AsemconnectVietnam - The results of a survey conducted by the Central Institute for Economic Management show that from 36 to 48.6 percent of Vietnamese companies have applied circular business models.

Major growth driver
Though a developing country, Vietnam is one of the nations with early access to green growth models. In 2012, the Vietnamese Government issued the National Green Growth Strategy for the 2011-2020 period, with a vision to 2050. Since then, the National Assembly has also promulgated, supplemented and amended a number of laws related to green growth.
In October 2021, the Prime Minister issued Decision 1658/QD-TTg approving the National Green Growth Strategy for the 2021-2030 period, with a vision to 2050, and Decision 687/QD-TTg approving the project on the development of a circular economy in Vietnam.
Since then, Vietnam has seen positive changes in production and consumption. New policies have encouraged not only power companies but also industrial and service businesses to invest in renewable energy production for their use and for sale to the national grid.
In 2022, enterprises nationwide were supported with about VND50 billion from the State Budget and dozens of billions of dong from localities to transform their production models based on green and circular approaches, making a foundation for Vietnamese businesses to shift their operation to meet the requirements in the new period.
Vietnam is amending and supplementing the legal framework for mobilizing green financial resources and for green production and investment. The country is accelerating energy transition to shift to a circular, low-carbon economy.
Shifting to a green economy is indispensable to help Vietnam successfully implement the Resolution of the 13th National Congress of the Vietnam Communist Party, the five-year Socioeconomic Development Plan for the 2021-2025 period, and the 10-year Socioeconomic Development Strategy for the 2021-2030 period.
Business responses
Businesses play a pioneer role in promoting green growth. Circular economic development helps businesses utilize used materials, thus saving the cost of waste treatment, minimizing the exploitation of natural resources, reducing exhaust emissions and solid waste discharge, and mitigating risks for businesses. Circular economic development also encourages investment in technological innovation to reduce production costs.
Vietnam has gradually formed circular business models for a group of companies or a single enterprise. The formation of the Packaging Recycling Organization Vietnam (Pro Vietnam) in 2019 marked the beginning of this new trend. Many members of Pro Vietnam have become role-models in shifting to circular businesses to optimize production efficiency, minimize exhaust emissions and protect the environment.
Nestlé Vietnam is an example. Design improvements aimed at using environmentally friendly materials instead of virgin plastic have helped the company reduce use of plastic bags by nearly 2,500 tonnes within two years, 2021 and 2022.
The PAN Group Joint Stock Company was one of the first businesses in Vietnam to build a set of sustainable development indices. Its products have been exported to more than 40 countries, including fastidious markets such as Japan, the EU and the US. The company has also attracted investment from major partners.
To make a successful shift to circular business models, experts said businesses should begin with changing product designs to eliminate waste and pollution, increase life-spans of products and materials, and regenerate natural ecosystems. A circular business model should be applied in five stages: improvement of product design to increase the possibility of recycling and reuse, production process that restricts or does not generate waste, responsible consumption, waste management, and turning of waste into valuable materials through reuse and recycling. Of these stages, design improvement plays an important role, helping reduce waste before products reach consumers.
Source: Ven.vn