New initiative to promote private sector-driven sustainable growth launched

Wednesday, 23/11/2022 16:13
(CPV) - On November 22, the United States Mission to Vietnam, through the U.S. Agency for International Development (USAID), and Vietnam’s Ministry of Planning and Investment (MPI), announced a new initiative to spur private sector-driven sustainable and inclusive growth across Vietnam.
Delegates launch the initiative. (Photo: CPV) 

The new initiative promotes socially-conscious business behavior, known as Environmental, Social, and Governance (ESG) standards. Investors use ESG standards to measure how a company protects the environment; manages its relationships with workers, customers, and the communities where it operates; and employs transparent and accountable corporate governance.

USAID Assistant Administrator for Asia Michael Schiffer and MPI Vice Minister Tran Quoc Phuong announced the ESG initiative at a USAID-supported business forum.

“USAID is pleased to launch this new initiative with the Ministry of Planning and Investment,” said USAID Assistant Administrator Schiffer, “which will help small businesses improve their competitiveness and innovation, overcome constraints, and chart a path for sustainable growth and job creation and to continue to contribute to Vietnam’s prosperity.” 

This first-ever ESG initiative for Vietnam targets small and growing businesses (SGBs). SGBs account for more than 90 percent of Vietnam’s private sector, employ more than 50 percent of the workforce, and contribute roughly 40 percent of GDP. As such, SGBs play a critical role in Vietnam’s socio-economic development and environmental sustainability. ESG is a recognition that business sustainability is multi-faceted, extending beyond environmental issues to people, resources, and systems. Businesses that invest in more energy efficient technology, create a good impact on communities, and consider input and feedback from people affected by the business achieve consistent growth and have stronger business models. 

USAID’s new ESG initiative will help SGBs adopt ESG standards. By 2025, the initiative will deliver ESG technical assistance packages to 300 businesses, of which 10 will receive additional assistance to pilot, implement or scale their innovative ESG business concepts. The effort supports Vietnam’s Green Growth Strategy 2021-2030, and the Prime Minister’s Decision 167 on supporting private enterprises in sustainable business.

The U.S. and Vietnam will celebrate the 10-year anniversary of their Comprehensive Partnership in 2023. This ESG initiative is yet another example of how the United States and Vietnam work strategically together to further sustainable, inclusive growth in Vietnam.

The new initiative is part of USAID’s USD36 million Improving Private Sector Competitiveness (IPSC) project. IPSC removes policy, market, and firm-level constraints on the growth of SGBs, including those owned by women and vulnerable populations. IPSC works with Vietnam to foster an innovative and dynamic private sector that can compete globally and expand economic opportunities domestically. 

In April 2022, USAID and MPI expanded their joint efforts to strengthen private sector competitiveness./.