Vietnam Climate Innovation Center: CIC · The CIC will be aligned with Vietnam‟s National...

Vietnam Climate Innovation

Center: CIC

A Business Plan for the financing and implementation of a CIC in

Vietnam.

Vietnam CIC Business Plan 2

Copyright

©2012 Information for Development Program (infoDev)/The World Bank

1818 H Street NW

Washington DC 20433

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To cite this publication:

Climate Innovation Center Business Plan: Vietnam. An infoDev publication, April 2012. Available

at: www.infoDev.org/climate

Cover photo:

Anthony Lambkin

http://www.infodev.org/climate


About infoDev

infoDev is a global partnership program in the Financial and Private Sector Development

Network of the World Bank Group. Its mission is to enable innovative entrepreneurship for

sustainable, inclusive growth and employment. infoDev manages a global network which

includes over 400 business incubators in more than 107 developing countries. This network has

assisted more than 25,000 companies and helped create close to 250,000 jobs worldwide.

infoDev‟s value-add is building global entrepreneurial and SME communities of practice, sharing

best practices and facilitating collaboration.

About AusAID

The Australian Agency for International Development (AusAID) is an Executive Agency within the

Foreign Affairs and Trade portfolio and reports to the Minister for Foreign Affairs.

AusAID supports developing countries in adapting to climate change, including the poor in least

developed states and small island developing states. It also assists developing countries with

high carbon emissions to pursue cleaner development.

About the Ministry for Foreign Affairs of Finland

In its development policy, Finland emphasizes the rule of law, democracy, human rights and

sustainable development. Poverty reduction and the achievement of the UN Millennium

Development Goals (MDGs), placing an emphasis on partner countries‟ needs and ownership,

are the first priorities of the development policy.

Finland builds on its strengths in the educational sector, health promotion, communications and

environmental technology, and good governance to promote education, decent work,

reducing youth unemployment and improving the status of women and children.


Contents

1.0 Executive Summary ................................................................................................ 6

1.1 Context ..................................................................................................................................................... 6

1.2 Barriers to Climate Innovation in Vietnam ......................................................................................... 7

1.3 Climate Innovation Center (CIC) ........................................................................................................ 7

1.4 CIC Programs ........................................................................................................................................... 8

1.5 Operational Plan ..................................................................................................................................... 9

1.6 Indicative Impact and Results ............................................................................................................ 10

1.7 Financial Plan ........................................................................................................................................ 10

2.0 Climate Innovation Centers ................................................................................. 11

2.1 infoDev Goals ........................................................................................................................................ 11

2.2 The Climate Innovation Challenge ................................................................................................... 11

2.3 Gaps in Existing Initiatives and Institutions ........................................................................................ 11

2.4 Incubators, Accelerators and Innovation Centers ........................................................................ 12

2.5 Climate Innovation Centers ............................................................................................................... 13

3.0 Climate Technology Market Landscape: Vietnam ........................................... 17

3.1 Defining Climate Technologies in the Vietnamese Context ........................................................ 17

3.2 Technology Prioritization ...................................................................................................................... 20

3.3 Stakeholder Analysis ............................................................................................................................. 34

4.0 Climate Innovation Analysis: Vietnam ................................................................ 48

4.1 Gaps along the Value Chain ............................................................................................................. 48

4.2 Technology Gaps ................................................................................................................................. 49

4.3 Company Gaps .................................................................................................................................... 50

4.4 Finance Gaps ........................................................................................................................................ 51

4.5 Market Gaps .......................................................................................................................................... 52

4.6 Policy Gaps ............................................................................................................................................ 53

5.0 Vietnam Climate Innovation Center Model ....................................................... 54

5.1 Program Tracks ...................................................................................................................................... 56

6.0 Operational Plan ................................................................................................... 62

6.1 Project Timeline ..................................................................................................................................... 62

6.2 Governance .......................................................................................................................................... 63

6.3 CIC Host Selection ................................................................................................................................ 63


6.4 Fund Manager ....................................................................................................................................... 65

6.5 infoDev .................................................................................................................................................... 70

6.6 Donors ..................................................................................................................................................... 71

6.7 Safeguards ............................................................................................................................................. 72

6.8 Other Issues to be Addressed during Implementation .................................................................. 73

6.9 Exit Strategy ............................................................................................................................................ 73

6.10 East Asia Regional Engagement ..................................................................................................... 74

6.11 Organizational Structure ................................................................................................................... 74

7.0 Financial Plan ........................................................................................................ 77

7.1 Budget for Years 1 to 5 ........................................................................................................................ 77

7.2 Sustainability .......................................................................................................................................... 79

7.3 Co-investment and leverage ............................................................................................................. 82

7.4 Fundraising Plan .................................................................................................................................... 83

7.5 Second round funding: Years 5+ ....................................................................................................... 85

7.6 Additional Funding ............................................................................................................................... 85

7.7 Global Network Participation: ............................................................................................................ 86

8.0 Indicative Impact and Results ............................................................................. 87

8.1 Highlights ................................................................................................................................................ 87

8.2 Spillover Effects ...................................................................................................................................... 87

8.3 Monitoring and Evaluation ................................................................................................................. 88

8.4 Indicative Results Framework ............................................................................................................. 89

9.0 Risks ........................................................................................................................ 92

10.0 Conclusion ........................................................................................................... 95

11.0 Stakeholder Support ........................................................................................... 96


1.0 Executive Summary

infoDev is establishing Climate

Innovation Centers (CICs) in a number of

developing countries. CICs provide a

country-driven approach to climate

change, thereby assisting countries in

achieving their green growth objectives.

Each Center provides early-stage

financing and other services to enable local enterprises to pro-actively and profitably develop

innovative climate technology solutions that meet local needs. This not only helps a country

address climate change challenges, but also creates economic development, job creation and

industrial competitiveness.

This business plan outlines a required investment of USD 17.95 million to establish a CIC in Vietnam

over a five-year period which includes implementation, launch and operations. The CIC will

deliver technology commercialization funding to up to 40 climate technology entrepreneurs

and equity investments to 25 companies, generating more than 3,500 direct and indirect jobs

after 5 years and over 13,000 long-term jobs. With investment returning a 12% IRR, the Center

aims to cover 71% of its yearly operating costs and 100% of yearly investment costs after 7 years.

The CIC will be aligned with Vietnam‟s National Strategy on Climate Change as well as the

Green Growth Strategy anticipated in 2012.

1.1 Context

Vietnam is characterized by the following challenges, which intersect directly with the global

climate change and green growth agendas. These issues underscore the critical need to

stimulate climate innovation and promote new local climate technology industries in Vietnam:

Vietnam is one of the world‟s most vulnerable countries to the effects of climate change with

its markedly rising sea levels and fluctuating rainfall, which include destructive typhoons.

The national economy remains dependent on agriculture, which provides a quarter of

export revenue and 70% of employment.

Vietnam is expected to become a net oil importer by 2015, given that its energy

consumption has tripled in the last decade.

Vietnam‟s economic development requires expansion of industrial activities. Vietnam needs

to boost its overall annual labor productivity growth by 40% (from 4.1% to 6.4%) in order to

sustain the government target of 7-8% annual growth by 2020.


1.2 Barriers to Climate Innovation in Vietnam

Over a 6-month process, infoDev engaged with over 200 local climate technology stakeholders

to evaluate five core areas and identify the major gaps hampering climate innovation in

Vietnam:

Technology: The main perceived barrier to the development of suitable climate

technologies in Vietnam is the lack of coordination between research and industry.

Secondary gaps concern the availability and quality of information, as well as the ability to

test technologies for commercial application.

Company: Prospective innovators view financial support as the most pressing need, followed

by human resource development.

Finance: Predominant gaps involve access to flexible, early-stage risk capital. Overall,

prospective investors in Vietnam would benefit from a greater understanding of how to

evaluate opportunities in the climate sector.

Market: There is a need for stronger demand generation and consumer confidence to

support climate innovation. In a developing country such as Vietnam, price is also a barrier

to mass market adoption.

Policy: Limited and uncoordinated policy in Vietnam inhibits the creation and adoption of

new technologies; additionally, more robust regulatory support is needed around access to

finance and quality standards.

1.3 Climate Innovation Center (CIC)

Over the course of 6 months, infoDev engaged with Vietnamese stakeholders from relevant

sectors and backgrounds. They represented R&D, universities, incubators, industry, government,

entrepreneurs, investors, NGOs and international institutions operating in Vietnam. This

multidisciplinary group gave a wealth of feedback and inputs which translated into the

outcomes of the business plan. The process also confirmed that Vietnam has the required

innovation capabilities to deliver the CIC‟s programs, would significantly benefit from hosting the

Center, and has the market size to attract adequate deal-flow and demand for the Center‟s

financing and services.

infoDev identified the most critical gaps in climate innovation across several areas: technology,

company, finance, markets and policy. Energy efficiency and sustainable agribusiness were

identified as priority technologies in which the Vietnam CIC should develop core competencies,

followed by technologies for adaptation, transportation technologies, and water management

and purification. Based on these, the mission and goals of the CIC were designed:


Vietnam CIC Mission

The Vietnam Climate Innovation Center will provide a targeted suite of early-stage financing, technology

commercialization, business development and capacity building services to Vietnamese private sector

innovators. The Center will work to incubate, commercialize and grow technology solutions that support

Vietnam's low-carbon development, resiliency and adaptation to climate change while creating jobs and

promoting domestic competitiveness.

Vietnam CIC Core Objectives

1. Providing catalytic seed-stage risk capital to local climate technology companies and assisting

companies to secure additional financing through investor match-making and facilitation of debt

financing.

2. Building a pipeline of high-impact climate solutions by supporting the localization, commercialization

and transfer of relevant technologies through access to innovation grants, industry partnerships and

facility providers.

3. Supporting the accelerated growth of climate ventures and entrepreneurial capacity by providing a

holistic set of business development services, mentoring and training programs.

4. Identifying and developing local and international market opportunities for new climate solutions

through providing key sectoral information, supporting policy transformation and creating linkages with

regional and international markets.

1.4 CIC Programs

The CIC‟s services and programs can be categorized as follows. It is important to note that

leveraging and coordinating existing institutions and initiatives in Vietnam will form a key

component of the CIC‟s approach to implementation and service delivery. Furthermore, the

programs and services offered by the CIC only address a subset of the needs identified by

private sector innovators during consultations. Navigating complex regulation, business-enabling

environments, market and political risks will be outside the scope of the Center. The below

programs were those identified through extensive stakeholder consultations and will be ramped

up over the life of the program based on demand and impact.

1.4.1 Access to Finance 1.4.2 Technology Commercialization

Providing risk capital through highly flexible

first-loss equity investments (USD 100K -

750K). This fills the gap between micro-loan

amounts and those offered by existing fund

managers.

Catalyzing investment syndication and

debt facilitation between CIC companies

and private financers, state development

banks, and the Vietnamese Diaspora to

build local investment capacity.

Offering proof-of-concept grants (USD 20-50k) that

enable local innovators to demonstrate and scale

their climate technologies and business models.

Promoting collaborative industry partnerships,

supported by a comprehensive technology

database (components, sourcing, certifications,

costs, user guides, and intellectual property).

Linking local innovators to facility providers for

prototyping, testing, production and other logistical

needs (e.g. office space, equipment).

1.4.3 Venture Acceleration 1.4.4 Market Development


Training individuals who are eligible for CIC

financing on basic business planning and

financial management, in addition to

offering a fund for out-sourcing other

advisory services.

Organizing seminars and university

partnerships to promote professional

development, business

administration/entrepreneurship, and

aware-ness of climate technology issues.

Networking SMEs with angel investors,

business mentors, and technical experts at

the national, regional and global levels.

Producing market studies, cases and analytical

reports on climate technology sectors and

opportunities at a local, regional and global level.

Encouraging dialogue between government and

the private sector to strengthen Vietnam‟s policy

framework around R&D, innovation, green growth,

taxation, and exports.

Supporting the growth and establishment of climate

sector business associations in Vietnam.

Networking Vietnam‟s climate innovators to their

regional and global counterparts by hosting an

annual CIC Forum and facilitating trade or

capacity-building relationships.

1.5 Operational Plan

Programs will be launched and operate over a five-year period. A preparatory implementation

phase of 6-9 months will be required for sourcing and selection of (i) a host institution and

consortia partners and (ii) a fund manager with the capabilities and capacity to deliver on the

CIC business plan. Additional institutional capacity building, expertise and oversight will be

provided by infoDev. The implementation and operation of the CIC will include the following key

elements:

1.5.1 Governance: The CIC will be housed in a local organization and supported by a

consortium of local and international partners. infoDev will manage and oversee

implementation including the provision of ongoing technical assistance, performance

evaluation and importantly, linking the Center with global level activities.

1.5.2 Fund Management: A fund manager will also be appointed to independently screen,

structure deals, make investments, provide relevant technical assistance, and secure additional

leverage from private sector co-investors.

1.5.3 Organizational Structure: The CIC management team will require the full-time equivalent of

19 individuals (in a combination of in-house and out-sourced roles) to oversee the center‟s daily

operations. In addition, an advisory committee of up to 7 members will support the CIC host

organization and facilitate linkages with external bodies.

1.5.4 Implementation Issues: After implementation partners for the CIC, further negotiation will

occur to determine matters such as (i) board membership and ownership, (ii) investment

structuring and mechanisms, (iv) staff sourcing, (v) intellectual property agreements, and (vi)

performance metrics.


1.5.5 Exit strategy: After year 5, the CIC will seek direct financing and in-kind contributions from

local stakeholders to supplement its investment revenues. The Government of Vietnam and the

private sector will assume primary funding responsibility for the CIC at this time.

1.6 Indicative Impact and Results

In carrying out its mission, the Center will measure performance against aggressive impact and

outcome targets. A comprehensive results framework will be designed during implementation to

establish a baseline and actively track outcomes. The CIC will support 65 climate technology

ventures, generating 3,500 direct and indirect jobs at a cost of approximately USD 5,000 per job

and close to 15,000 jobs within 10 years costing about USD 1,200 per job. The total economic

impact of these firms is projected at USD 150+ million beyond 10 years.

The accelerated growth of CIC-supported technologies will also deliver social, economic and

environmental impacts. These include carbon mitigation (1.3m tCO2), access to renewable or

more efficient sources of energy (190 MW installed capacity), access to water (391m kL) and

increased agricultural efficiency. Overall, the CIC will empower close to 1 million Vietnamese,

including women, youth, and the poor, to be less vulnerable to climate change.

1.7 Financial Plan

The USD 17.95 million budget for the establishment of the CIC over a five-year period will include

53% for financing, 31% for programs, and 15% for staff and central costs. The Center is expected

to cover at least 70% of its costs by the end of Year 7, including full replenishment of the annual

investment fund.

At this level of funding, investors will see concrete economic, environmental and social returns as

outlined above. Through private sector co-financing, more than 8 times leverage will be

achieved for each donor contribution. Further, investors will benefit from:

1. Exposure to an on-going pipeline of climate technology innovations.

2. Considerable knowledge generated and disseminated through the CIC‟s market

information, policy best-practice, analytical products and global benchmarking.

3. Access to a complete local network of CIC partners and stakeholders.

4. A primary point of contact for establishing international linkages that can facilitate

technology transfer, as well as trade and business-to-business opportunities in Vietnam.

These are the types of long-term impacts in Vietnam that a well-resourced and holistic institution

like the CIC can provide.


2.0 Climate Innovation Centers

Over an six-month period, infoDev assessed the feasibility of establishing a locally owned and

operated Climate Innovation Center (CIC) in Vietnam through an intensive stakeholder

engagement process. The process concluded in April 2012 with over 200 stakeholders from

varied backgrounds and experiences providing input into the conceptualization, design and

development of a CIC in Vietnam.

2.1 infoDev Goals

1. Assess the feasibility for establishing a CIC in Vietnam and develop a full business plan that

addresses market failures preventing domestic innovation in climate technologies.

2. Based on the business plan, mobilize investment to implement the CIC to execute the

Center‟s programs, services and financing via suitable in-country partner

institutions/consortia.

3. Network the Vietnam CIC regionally and internationally to promote technology

collaboration, business linkages and support local and international trade opportunities for

Vietnam‟s climate technology sector.

2.2 The Climate Innovation Challenge

New technologies are essential to reduce the long-term cost of climate change and achieve

Green Growth. Developing countries want to build their own capacity to innovate to (i) ensure

energy security and increased energy access, (ii) address climate change mitigation and

adaptation and (iii) create competitive domestic industries in clean tech for job creation and

other benefits.

However, barriers to innovation in climate sectors are especially high and even more

pronounced in developing countries. These barriers often include gaps in appropriate financing,

lagging technical and business capabilities, entrepreneurial and human capacity constraints

and uncertain regulatory environments. Moreover, many developing countries lack the public

and private sector bodies that support innovation, and as a result support for locally appropriate

climate innovation is often weak or absent.

2.3 Gaps in Existing Initiatives and Institutions

infoDev commissioned a report by Bloomberg New Energy Finance that surveyed and analyzed

hundreds of government, private and public-private initiatives that support climate and clean

energy innovation. These included centers of excellence, seed funds, technology accelerators,

business incubators, advisory centers and other programs. Of the 500 that were analyzed, 70


were mostly focused on climate technologies and only 25 dedicated all of their operations to

climate – a small number relative to the gravity of the challenges and immense market

opportunities.

The report found gaps in the existing institutions which prevented them from addressing the

broad range of barriers associated with climate innovation. Some focused only on financing or

business advisory while others concentrated efforts solely on technical development – few

advocated policy reform or standards. Only

a few institutions addressed most barriers

including China‟s Baoding New & High Tech

Industrial Development Zone, China, The

UK‟s Carbon Trust and Brazil‟s CIETEC at the

University of Sao Paulo. Geographic

coverage was also sporadic with a majority

of centers located in either in developed or

highly industrialized developing countries –

few were located in Africa.

2.4 Incubators, Accelerators and Innovation Centers

infoDev supports innovation in developing countries through facilitating a global network of over

400 business incubators. These incubators act as hubs to aggregate financing and shared

services to accelerate innovative companies, helping them overcome market barriers that are

particularly high in developing countries. Experience has shown that these centers dramatically

increase the survival rate of new enterprises with over 75% being operational after 3 years of

exiting the incubator.

As a policy tool, incubators are a highly effective form of public spending, resulting in lower long-

term employment costs when compared with infrastructure projects1. Incubation experience

also has shown that for every USD 1 of government subsidy, a Return on Investment (ROI) of USD

30 tax revenue can be generated in the long-term through corporate and income taxes from

the spun out companies2. With infoDev‟s business incubator network expanding to over 400

centers in more than 100 developing countries, supporting over 20,000 enterprises and creating

250,000 jobs, such programs form an important component of developing country economic

growth and employment strategies.

1 Grant Thorton Report on Incubation: Source: EDA 2 NBIA (National Business Incubation Association) data

Locations of institutions supporting climate innovation


2.5 Climate Innovation Centers

As multilateral, national and local solutions are being structured to address the issue of climate

technologies, infoDev‟s Climate Technology Program is rolling out Climate Innovation Centers

(CICs) in a number of countries in Africa, South East Asia and the Caribbean and assisting

developing countries achieve their green growth objectives. CICs support innovation by offering

a full suite of financing and capacity building services to technologists, entrepreneurs, and SMEs

that address challenges to starting and scaling their climate technology ventures. In addition to

incubating promising start-ups, CICs provide dedicated proof-of-concept and seed funds to

entrepreneurs to bridge local funding gaps.

In parallel to investments, CICs also provide business advisory and training services, market

intelligence products, access to product testing facilities, and government engagement on

policy. In this way, a Center acts as a national focal point, coordinating efforts in promoting the

growth of locally relevant climate sectors. CICs also provide a platform to create international

business-to-business linkages, enhance knowledge sharing and facilitate trade.

Brazil’s CIETEC

CIETEC, or Centro de Inovacao, Empreendedorismo e Tecnologia, is the largest incubator in

Latin America and one of the most successful in Brazil. Although it covers a range of sectors,

CIETEC‟s focus has shifted recently, and now hosts some 20 climate technology companies,

more than any other incubator in Latin America. With many renewable energy success

stories in its portfolio - including wind, hydro, solar hot water and fuel cells - CIETEC offers

valuable insights for the Climate Innovation Center in Vietnam.

Founded in 1998 with funding from government microfinance program SEBRAE, CIETEC is a

„full-service‟ incubator that provides assistance to companies at all stages of innovation -

from R&D through demonstration and deployment to diffusion and transfer. The center

provides incubatees with office space, laboratory use, and consultancy services at heavily

discounted prices. It also helps to arrange financing from public and private sources, and is

thinking about creating its own investment fund.

The CIETEC model is proving successful on a wide range of measures. In its first decade, the

number of companies under incubation has grown from 15 to 140. CIETEC also helps its

companies secure private sector equity investment – rising to USD5M in the past few years.

CIETEC‟s success rate is also impressive: while 75% of Brazilian start-ups fail within three years,

for CIETEC companies, that rate is just 30%. The center‟s work also represents value for

money: according to its 2008 annual report, for every USD 1 the government furnished

CIETEC companies, it received USD 3.40 in taxes. A total of 90 innovative companies have

already graduated from CIETEC, of which some 30 continue to be associated with the

center, achieving revenues of USD12M per year and creating thousands of jobs.


Services provided by Climate Innovation Centers

The Kenya Climate Innovation Center (CIC)

The Kenya Climate Innovation Center (CIC) will provide an integrated set of services,

activities and programs that leverage and expand existing innovation capacity and support

the accelerated scale and deployment of climate technology solutions. In the first five years,

the CIC is expected to create more than 70 sustainable climate technology businesses,

generating some 4,600 direct and indirect jobs. Over the next decade, it is estimated that

1.74m tCO2 will be mitigated from CIC supported technologies.


2.5.1 Complementarity with Ongoing and Future Programs

Each CIC is being designed and developed, leveraging the experiences and expertise of

hundreds of local stakeholders representing R&D, academia, entrepreneurs, NGOs, private

sectors and host government ministries such as water and energy, environment, commerce,

finance and science and technology. This is to ensure that existing local initiatives are

complemented and coordinated without duplication. It is also to secure local participation and

ownership that will increase the success of the CIC‟s implementation and operations. infoDev is

also coordinating efforts at the global level including existing and future programs designed to

support climate technology development and deployment. This includes ongoing efforts at the

UNFCCC, multilaterals such as The World Bank & IFC and bi-lateral organizations including

development partners and donors.

2.5.2 Stakeholder Engagement Process

The Center‟s business model and associated services are dependent on, and tailored to, the

local market. To identify market needs, opportunities and challenges from a local perspective,

infoDev developed a business plan via detailed analysis and an extensive in-country, multi-

stakeholder engagement process. Stakeholders were convened for a series of workshops, focus

groups, surveys, and interviews to explore the key barriers to climate technology

The Kenya CIC will become operational in July 2012. The host selection process included:

23 Expressions of Interest with 87 Organizations as Lead or Supporting Partners

Countries: Kenya (49 organizations), Germany, Denmark, UK, USA, Holland, Sweden,

Tanzania, Uganda, India, Belgium, South Africa, Finland, Switzerland, Austria

Organizations: Public and Private Universities, Research Institutes, Consultants, Nonprofits,

Tech Accelerators, Incubator Associations, Centers of Excellence, Industry Associations.

Strathmore University, PwC, GVEP and KIRDI have been selected for the implementation of

the CIC.

60% 11%

9%

8%

7% 5%

Kenya CIC funding breakdown -

USD 15.2m SME finance

Business advisory

Training,

education

Market

information

Government

advisory

Networking, trade

$0

$1

$2

$3

$4

$5

Year 1 Year 4 Year 7 Year 10 M

illio

ns

CIC Revenue Model

CIC Cost

Invesment

cost

Revenue


commercialization and assist in the development and design of appropriate solutions to

overcome barriers. This gaps-needs analysis formed the basis for the Vietnam CIC business

model.

The flow chart shows the process of the business plan development

September '11: Local stakeholder

identification

October '11: Sector mapping and

research

November'11: Workshop - Expert panels & working

groups

December '11: Quantitative analysis and

surveys

February '12: In-depth interviews

March '12: Development of

CIC business model

April '12: Focus group on model

design

May '12: Delivery of business plan


3.0 Climate Technology Market Landscape: Vietnam

3.1 Defining Climate Technologies in the Vietnamese Context

In the last quarter century, Vietnam has transformed itself from a war-torn country into one of

Asia‟s success stories, with annual per capita growth of 5.3% since 1986. China is the only Asian

economy to have grown faster than Vietnam since 2000.

According to UNDP forecasts, Vietnam is one of the five most vulnerable countries to climate

change. The country‟s unique attributes and rapid development are causing increased pressure

to implement a locally driven, globally responsive climate change strategy.

In the last 50 years, sea level in Vietnam has risen by 50 cm. Vietnam is a low-lying coastal

country whose food supply comes from two deltas: Mekong Delta in the south and Red River

delta in the north. If the sea level rises by 1 meter, 40% of the Mekong Delta and 11% of the

Red River Delta will be inundated. 20% of Ho Chi Minh City will be underwater, causing an

estimated loss of 10% of national GDP3.

Vietnam has 60% of its population working in agriculture and 20% of its export revenue

coming from agricultural products4. Agriculture, the livelihood of more than 63 million

Vietnamese, will be severely affected by the rise in temperature and changes in rainfall

patterns caused by climate change. From 1951-2000, the average annual temperature in

Vietnam increased by 0.5 - 0.7 OC5. Rainfall has showed a tendency to increase in the rainy

season and decrease in the dry season, leading to more floods and water scarcity. The rise in

temperature affects crops and increases the risk of crop diseases and pest plague. The

Mekong delta has already been affected by more frequent droughts and saline intrusion

caused by rising sea level and reduced river flow during dry season.

Vietnam already suffers 5 to 7 typhoons a year. Increasing frequency of extreme climate

events as a result of climate change will take a significant toll on the nation. From 2001-2010,

extreme climate events (typhoon, flood, landslide, drought, saline intrusion, etc.) have cost

the country 9,500 human lives and approximately 1.5% of GDP each year. 3

Energy consumption in Vietnam tripled in the last decade6. In the last five years, Vietnam has

started to import steam coal and oil products for its energy needs. Though oil is currently its

largest source of export revenue, Vietnam is expected to become a net importer by 2015 due

3 Vietnam National Strategy on Climate Change 4 http://www.fao.org/countries/55528/en/vnm/ 5 Vietnam's second national communication to the United Nations Framework Convention on Climate Change. 6 World Bank - Asia Sustainable and Alternative Energy Program – Vietnam Expanding Opportunities for Energy Efficiency

March 2010


to its rapidly rising energy demand. This growing reliance on imports worsens the country‟s

chronic trade deficit and is exacerbated by the global context of dwindling fossil fuel supply

and increasing energy cost. Meeting Vietnam‟s needs through alternative sources and/or

energy efficiency has become vital to sustain the country‟s growth and its competitiveness. In

addition, this would reduce emissions to mitigate climate change, generate cost savings, and

help to ensure affordable access for the poor.

Emission rate per capita in Vietnam, though relatively low compared to developed countries,

is rising rapidly as the country is on a rapid path of urbanization and transitioning to a more

manufacturing economy. Between 2020 and 2025, it is expected that 50% of the population

will be living in urban areas.7 The per capita emission rate has increased from 0.3 tons CO2e in

1990 to 1.2 tons CO2e in 2007. The total greenhouse gas emissions in Vietnam in 2000 were

150.9 million tons CO2e and reached an intensity of 4.48 tons of CO2e for every USD 1 million

of GDP. It is forecasted that total emissions will reach about 500 million tons CO2e by 2030.

Two of the main drivers behind Vietnam‟s recent success are its young and low-cost labor force

and the upgrading of skills from agriculture into manufacturing and services. However,

Vietnamese exports remain concentrated in low-value-added products compared to other

countries in the region. In a 2012 report on sustaining Vietnam‟s growth, McKinsey & Company

pointed out that Vietnam needs to boost its overall annual labor productivity growth by 40%

(from 4.1% to 6.4%) in order to sustain the government target of 7-8% annual growth by 2020.

Without this boost, Vietnam‟s 2020 GDP would be 30% lower than the target. The ability to adopt,

innovate, and master new technologies is critically needed for the nation‟s next phase of

growth.

Climate technology, in particular, would address the country‟s many overlapping challenges.

Local climate technology innovation would enable Vietnam to adapt to climate change,

mitigate emissions, meet energy needs, boost productivity, maintain competitiveness, reduce

the trade deficit and minimize dependence on fossil fuel imports.

Investing in climate technology will also help the country capture more benefits from carbon

markets and climate finance. As of June 2012, Vietnam has 283 registered clean development

mechanism (CDM) projects. Though only a few of these projects have received money from

selling Certified Emission Reductions (CER), Vietnam still ranks third in number of registered

projects after China and India. This shows the potential of emission reduction activities in the

country. Because Vietnam is not a Least Developed Country, its new CDM projects will not be

7 World Bank: Vietnam Urbanization Review Technical Assistance Report, November 2011


eligible for European markets after the end of 2012. However, there are new markets being

developed around the world, as well as new market mechanisms that would very likely enable

companies who invest in climate technology in Vietnam to sell carbon credits and participate in

carbon markets.

Climate-specific development finance is another promising sector. In 2009, the Climate

Technology Fund approved USD 250 million for Vietnam to co-finance energy efficiency,

renewable energy and mass transit projects by ADB, IBRD and the IFC. A number of

development partners are working with Vietnam‟s government to develop NAMAs (Nationally

Appropriate Mitigation Actions) for the country. These sector-wide emission reduction efforts

present a significant funding source and market for climate technology and carbon credits.

Vietnam has demonstrated that it recognizes this multi-faceted potential of climate

technologies. The country is developing a Green Growth Strategy that will be issued within 2012;

this is a coordinated effort by the central government and various ministries, spearheaded by

the Ministry of Planning and Investment. This strategy is emphasized as a key to the country‟s

sustainable growth and an important step to restructure the country„s economy. The most

recent draft of the strategy proposes that Vietnam decrease energy use per unit of GDP to 3%

per year (a 2.5% reduction) and reduce greenhouse gas emissions by 15% by 2020.8 The strategy

draft outlines actions to reform the policy and fiscal environment and to create investment

flows that reduce greenhouse gas emissions, thereby stimulating green growth as measured by

GDP and jobs. The strategy asserts that by 2050, “clean energy and clean

technology will be widely used in Vietnam”.

For Vietnam, innovating and restructuring toward a low-carbon economy is for the lives of its

citizen and also an obligation to the global community. In March 2012, the Vietnam National

Strategy on Climate Change was signed by the Prime Minister. This lays out priority projects to be

implemented from 2011-2015, plans for 2016-2025, as well as objectives for 2050 and a long-

range vision to 2100. One of the strategy‟s two overall targets is “to develop low-carbon

economy to protect and improve the quality of life of Vietnamese people, the security of the

nation and its sustainable development in the context of global climate change, and to

contribute actively with international community to protect earth's climate system”.

8 Base year: 2010.


3.2 Technology Prioritization

The Vietnam CIC must address the country‟s most pressing concerns, maximize impact, and use

its resources efficiently. To this end, it will focus primarily on two priority climate technology

sectors: energy efficiency and sustainable agribusiness.

Technology Prioritization Process Prioritized Sectors

1. Energy efficiency

2. Sustainable agribusiness

Other important sectors:

Technologies for

adaptation

Transportation

Water management and

purification

The process of prioritization involved three key components:

1. A long-list of almost 50 relevant climate sectors was identified in Vietnam, including key

priority areas for the government based on secondary research.

2. The infoDev team consulted local experts to evaluate these 50 sectors against 13 criteria

of market opportunity, business viability, and potential impact. See Table 3.2.6 for the

detailed evaluation criteria and Annex 2 for full analysis9.

3. Over 130 stakeholders ranked sectors most suitable for the CIC via a quantitative survey.

The weighted average of this process resulted in two focus areas for the Center including energy

efficiency and sustainable agribusiness. Other immediate areas of importance for Vietnam

included adaptation technologies, transportation and water management and purification.

Other areas such as hydro and wind were identified as “already on track”; these sectors were

either already attracting enough investment or were not seen as areas were the Vietnamese

SME sector could be competitive.

The in-depth consultations with climate sector experts and stakeholders have provided infoDev

with clear indicators on which sectors the CIC is most likely to create the greatest positive

impact in Vietnam‟s context. These impacts are measured along three dimensions: 1) economic

impact 2) greenhouse gas mitigation and climate resiliency impact and 3) social impact.

9 Adapted by infoDev: Nortech

Vietnam's Priorities Evaluation

Criteria Stakeholder Feedback


For emission impacts and economic impacts, the infoDev team cross-checked findings with the

Vietnam Second National Communication to the UNFCCC, a quantitative analysis of potential

emission savings and cost savings of different sectors. The CIC-identified sectors of priority

aligned well with the sectors identified in the national communication as having the most

emission reduction potential and lowest cost to mitigate.

The top two priority sectors identified by

stakeholders were energy efficiency and

sustainable agriculture. As shown in the

chart to the right, agriculture accounted

for the largest share (43%) of GHG

emissions in 2000. Energy compares at 35%

of GHG emissions for that year; however, it

has since overtaken agriculture and will increase faster in 2020 and 2030. Focusing on these

sectors would likely result in the largest impact in terms of emission savings.

Greenhouse gas emission by different sectors in Vietnam in 2000 (thousand tons)

Sector CO2 CH2 N2O CO2e Percentage

Energy 45,900.00 308.56 1.27 52,773.46 35

Industrial processes 10,005.72 0 0 10,005.72 6.6

Agriculture 0 2,383.75 48.49 65,090.65 43.1

LULUCF 11,860.19 140.33 0.96 15,104.72 10

Waste 0.00 331.48 3.11 7,925.18 5.3

Total 67,765.91 3,164.12 53.83 150,899.73 100.00

The Vietnamese national

communication also identified the

economic costs (or savings) of different

emission mitigation measures. It can be

seen that most of the negative cost

(profitable) measures are those of

energy efficiency (efficient public

lighting, electric motor, air conditioner)

or agriculture (switching feed for cattle)

or transportation (switching from

GHG emissions by sector in 2000 in CO2e

35%

7%

43%

10% 5% Energy

Industrial processes

Agriculture

LULUCF

Waste

GHG emission projections 2010-2030

-100

0

100

200

300

400

500

600

2010 2020 2030

Millio

n t

on

ne

s o

f C

O2e

Energy Agriculture LULUCF Total


traditional fuel to CNG and LPG for vehicle). Transportation is another identified sector of priority

for the Vietnam CIC.

Mitigation potential and cost of 27 options10

Option Mitigation Potential

(million tCO2e)

Mitigation Cost

(US$/tCO2e)

Replacing coal with LPG in household cooking 22.0 23.80

Wind Power replacing coal-fired thermal power 14.2 16.20

Switching from coal-fired to LNG thermal power 16.0 15.10

High-efficiency refrigerators 7.3 12.30

Biogas replacing cooking coal in mountain areas 5.2 9.70

Rice paddy field water drainage in South Central

Coast 4.1 7.00

Rice husk power replacing coal thermal power 6.9 6.60

Rice paddy field water drainage in the Red River delta 21.9 5.20

Biogas replacing cooking coal in lowlands 17.4 4.10

Planting short-rotation pulpwood forest 176.0 1.38

Protection and sustainable management of existing

production forest area 904.0 1.36

Planting short-rotation trees for lumber 296.0 0.81

Conservation of existing protection forests 1,153.0 0.77

Planting melaleuca forest on alkaline wetlands 25.0 0.59

Planting long-rotation large timber trees 271.0 0.55

Growing long-rotation non-timber-product forest 117.0 0.48

Reforestation of large timber forests in conjunction with

natural regeneration 80.0 0.38

High-efficiency air conditioner 9.9 -4.40

Innovative bricks / kilns 14.2 -5.10

Solar water-heating appliances 13.9 -6.20

Small-scale hydropower replacing coal thermal power 15.3 -7.20

Energy-saving compact fluorescent light bulbs 23.4 -8.20

MUB cattle feeds 7.9 -10.90

LPG-fuelled cabs 3.3 -11.00

10 Vietnam's second national communication to the United Nations Framework Convention on Climate Change.


Switching from DO to CNG in transportation 2.1 -14.10

Innovative coal stoves 25.3 -17.40

High-efficiency electric motors 15.5 -24.90

Identifying priority sectors is intended to help the CIC develop core expertise and to provide

guidelines for resource allocations over the life of the program. While the Center will primarily

target funding and support to energy efficiency and sustainable agriculture sectors, it will not

neglect other promising and high-impact companies operating in other areas. In the start-up

phase, it is particularly important the CIC remains receptive to a more diverse range of climate

tech solutions to ensure robust deal-flow and demonstrate quick success.

After cross-checking with official government quantitative analysis in the National

Communication to the UNFCCC, infoDev researched low carbon development policies in

Vietnam. The draft Green Growth Strategy, though not yet official, provides a good snapshot of

the country‟s preferences for low carbon development options. The three prongs of the strategy

are: (i) greening production (which includes industrial production and agriculture); (ii) reducing

greenhouse gas emissions, increasing low-carbon technologies (new and renewable energy),

and saving energy; and (iii) greening lifestyles and sustainable consumption. These are

reinforced by the CIC-selected priorities. Furthermore, the draft strategy identifies an immediate

action for the period 2011-2020 which is fully aligned with the CIC mission: to promote research

and development of appropriate green technologies and selective purchase of green

technology patents with anticipated broad applicability and high effectiveness in Vietnam.

The remainder of this section presents the scoring for each prioritized sector. in addition to

outlining key opportunities. The combined score is the average of the expert evaluation and

stakeholder surveys, while the matrix displays the aggregated results of the expert interviews.

Evaluation criteria for priority sectors

Code Evaluation Criteria Description

TR Technology Readiness Potential of the technologies to enter the market in the

near future

MD Market Demand Market pain-point, product subsidies, consumer

orientation, competing technologies, affordability etc.

AF Availability of Funding Near-term fund for R&D, commercialization and

expansion

RS Clear, Ready Stakeholders Stakeholders able to affect the likelihood of adoption of

a given technology


BM Business Model How viable is the business model today? Includes supply

chain, distribution, consumer access.

IR Leverage of Indigenous

Resources

Ability to utilize and/or leverage natural resources and

endowments

EC Entrepreneurial Capacity Existence or ability to develop/recruit talent to make the

technology companies successful

WF Workforce Current or potential workforce capabilities necessary to

commercialize and scale given technology

PO Policy Regulations, incentives and policies impacting a given

technology

EI Economic Impact Impact of a given technology on local economy

including the creation of jobs

GI GHG Impact Impact of a given technology on emission reduction

SI Social Impact Impact on rural areas, specific demographics (e.g.

Women) and base of the pyramid markets

AT Already on Track

MULTIPLIER: There is good traction in the market for these

technologies as barriers are low - therefore further

innovation or intervention is not required

3.2.2 Priority Technology 1: Energy Efficiency

TR MD AF RS BM IR EC WF PO EI GI SI AT

M M H M H L L L L M M L M

Main applications: Lighting, appliances (e.g. cook stoves), metering, HVAC, energy efficient

manufacturing, transmission and distribution, green ICT, building design and materials.

Opportunities in energy efficiency: During the nine-year period from 1998 to 2007, commercial

energy use in Vietnam grew at an average rate of 12.1% per year, while household energy use

grew at 10.7%. Both outpaced the country GDP growth of 7.3% per year. As such, the energy

intensity of Vietnam‟s economy grew from 387 kilograms of oil equivalent (kgoe) per US$1,000 of

GDP in 1998 to 573 kgoe per US$1,000 in 2007 (in constant 2000 prices).

(H) High (M) Medium (L) Low

Combined Score: 3.39/5.0


Vietnam‟s energy demand is expected to triple in the next decade. Satisfying this demand is a

daunting task since Vietnam has already been importing coal and oil for its energy needs in

recent years. According to a World Bank report on energy efficiency in Vietnam in 201011, if

Vietnam took further advantage energy efficient technologies, it could meet a significant

portion (20%-30%) of business as usual energy demand at about 25% of the cost for developing

additional energy supply.

The CIC is being established at an important time to help drive energy efficiency technology

and business opportunities in Vietnam. In 2006, the government put in place the first

comprehensive national program for energy efficiency (Vietnam‟s National Energy – Efficiency

Program or VNEEP) with the support of the Netherlands government, EU, SIDA and UNDP. The

2006-2010 phase of the program has done considerable work in research (notably, an energy

use survey of 500 large scale industrial enterprises), capacity building, awareness raising and

formulating the Law on Energy Conservation and Efficient Use.

The Law on Energy Conservation and Efficient Use was adopted by the 12th National Assembly

on June 17th 2010. The law requires intensive energy consumers (energy intensive enterprises,

public constructions, transportation establishments, groups that use government funds, e.g.

office buildings, road lighting, and public lighting) to conduct energy audits and prepare

specific action plans to increase energy efficiency. The plan must also cover implementation

management and compliance with reporting requirements. Residential entities and SMEs are

encouraged but not required to implement these practices.

The Law on Energy Conservation and Efficient Use also requires labeling products in terms of

energy efficiency to educate the market, encourage consumption of energy efficient products,

and gradually eliminate their energy intensive counterparts. This could be done on a voluntary

labeling of electronic appliances up to July 1st 2011, after which the labeling was made

mandatory. The deadline for industrial equipments (electric motors, small and medium-sized

boilers, three-phase transformers, etc) was January 1st 2012; for construction materials such as

insulation, glass, windows, roofing, sheeting materials, it will be on January 1st 2015.

These legal requirements signal an upcoming surge in market demand for energy efficiency

products and technologies in Vietnam, bolstered by escalating energy demand and costs.

Responding to this market development poses certain challenges due to the necessary level of

technical specialization and complexity. Vietnam will need not only reliable and affordable

11 World Bank - Asia Sustainable and Alternative Energy Program – Vietnam Expanding Opportunities for Energy Efficiency

March 2010


energy efficiency services and products, but also qualified energy auditors and energy service

companies (ESCOs). Considerable innovation and ingenuity will be needed to develop new

products/services for Vietnam or to introduce and customize existing products/services from the

international market. The CIC can provide effective technological support by leveraging its

expert network and its experience from other CICs in developing countries, such as India and

South Africa, which are moving ahead with energy efficiency efforts.

Energy efficiency presents good opportunities for the CIC to make a significant economic

impact. As mentioned in the table of emissions mitigation potential (page 23), most of these

technologies have a negative cost; that is, they can be profitable versus business as usual.

Among the five prioritized sectors, energy efficiency is considered the most private sector ready,

with a significant number of new companies, initiatives and innovators. In the course of

designing the Vietnam CIC, the infoDev team has met with multiple SMEs and entrepreneurs in

this sector: energy efficiency centers, private ESCO companies, Vietnam Green Building

Council, green architecture club, energy auditor, manufacturers and innovators of energy

efficient products (LED lighting, ventilation, building materials, industrial boilers, transmission,

telecommunication, etc.). The three common challenges faced by stakeholders in this sector

are a) difficulty in obtaining loans, or prohibitively high interest rates b) weak implementation of

government policy supporting their products12, and c) consumer hesitance to spend the upfront

cost for a new product that promises to save cost in the long run.

These issues can also be addressed by CIC service offerings. Difficulty in access to lending is

common to all climate technology sectors; Vietnam‟s commercial lending rate is extremely high,

reaching 18%-24% in the last two years as a result of government policy to contain inflation.

Access to loans is further complicated for climate technology businesses as banks are often

unfamiliar with their business models. The CIC can help with providing technical due diligence

training to banks, offering credit guarantees, or facilitating access to more favorable loans from

overseas. To strengthen the implementation and realization of government support policies, the

CIC can provide technical advisory to the corresponding ministries and agencies. To address

customer unfamiliarity and resistance to upfront cost, the CIC can initiate customer awareness

raising programs, subsidize technology pilots in test markets, or work with the government and

donors to establish end-user financing programs.

12 Example: Despite the general policy for favorable treatment for import of efficient lighting product components, the

custom import code does not yet have specific code for efficient lighting,. As a result, these components are still taxed

as normal lighting.


Energy efficiency is also a sector that has good potential to generate carbon credits for CDM or

future carbon markets, as more and more methodologies to calculate emission reduction for

energy efficiency projects are approved by the UNFCC CDM Executive board. The sector also

attracts attention from many of Vietnam‟s development partners; by June 2010, multilateral

development banks committed USD 40 million and the Climate Technology Fund committed

USD 50 million for industry energy efficiency in Vietnam13. This can engender support for CIC

investment efforts, particularly those targeted at the sector‟s chronic challenges of low

electricity price and fossil fuel subsidies.

The average electricity tariff was estimated to be USD .07/kWh in 2010, which is below the ASEAN

regional average of USD 0.10/kWh. To become financially sustainable, an estimated increase of

power tariffs above inflation by 15-30% of the current price will be needed. Low power tariffs act

as a disincentive for users to invest in more efficient energy technology. International Energy

Agency estimates that (indirect) fossil fuel consumption subsidies in Vietnam in 2007, 2008, 2009

and 2010 were USD 2.1, 3.56, 1.2 and 2.93 billion respectively, and were allocated especially to

electricity, i.e. fluctuating between about 1 and 4 percent of GDP in current USD. These

challenges are of macroeconomic nature and not within the capacity of CIC to tackle.

There are nevertheless signs of improvement, notably the country‟s road map to a more

competitive electricity market. Currently, the market is monopolized by the state company EVN;

the government has given EVN permission to gradually increase the electricity price. The CIC

can help its investee companies to prepare for entry into a more open market.

3.2.2 Priority Technology 2: Sustainable agribusiness

Main applications: new resilient crops and seeds, fertilizers and compost, water/energy efficient

machinery and equipment, water/energy efficient irrigation systems, climate friendly/energy

efficient food processing, bio-pesticides, waste management, waste-to-energy. livestock and

byproduct management, afforestation and sustainable land use practices.

13 Update on CTF investment plan for Vietnam, 2011


M H M M L L L L L H H L M



Opportunities in sustainable agriculture: 70% of the Vietnamese population works in agriculture

and 25% of its export revenue comes from agriculture; thus, the negative impacts of climate

change on agriculture will have a sizable and widespread impact on the country. By prioritizing

sustainable agriculture, the CIC will likely create significant impacts in terms of job creation,

reduced vulnerability, and improved livelihoods.

The Mekong delta, the food basket of the country, is ranked as one the three river deltas most

vulnerable to sea level rise (alongside Egypt‟s Nile and India‟s Ganges deltas). The Mekong delta

already suffers from saline intrusion making water unsuitable for agriculture and drinking at

certain times of the year. During high tide, saline intrusion can be found 200 km upstream. In one

extreme climate change scenario, it is estimated that as much as 40% of the Mekong delta

could be lost underwater.

Different scenarios project that the annual average temperature in Vietnam will increase 2-3OC

by 2100. In all scenarios, the evapotranspiration rate of crops will increase significantly, resulting

in a two- to threefold increase in agricultural water demand in 2100 compared to 2000. This will

be compounded by a projected decrease in dry season rainfall and increased saline intrusion

from rising sea levels. This triple change poses a serious risk of severe water shortage and

threatens Vietnam‟s food security.

The government has put in place programs oriented toward a more “climate smart” agriculture.

In 2008, the Ministry of Agriculture issued the Action Plan Framework for Adaptation to Climate

Chang in the Agriculture and Rural Development Sector Period 2008-2020. This framework set out

preliminary steps for research, communication awareness raising, strengthening international

support, allocating human resources and importantly, developing a policy system and integrate

climate change in all development programs for the sector. In March 2011, the Ministry

announced its “Action Plan on climate change response of agriculture and rural development

sector in the period 2011-2015 and vision to 2050” in which it outlines activities and expected

output for each sub sector (agriculture, forestry, fishery, water resource management, salt

production and rural development) to facilitate climate change adaptation and mitigation.

Each subsector has been tasked to develop further programs along these outlines.

In Vietnam, many of the technology subsectors in Sustainable Agriculture are managed and

operated by the state. These include crop breeding, fertilizers, and irrigation. New resilient

breeds are researched and introduced by state research institutes, though major international

crop research companies such as Monsanto or Croplife are also present in Vietnam. Fertilizer


manufacturing is invested and run by state companies, most notably the Vietnam Chemical

Corporation (VinaChem) and Petro Vietnam. Irrigation infrastructure is developed and

managed by the state, while irrigation schemes and schedules are managed by local

authorities. Promoting climate innovation in these subsectors means collaborating with state

research centers to introduce climate resilient products. More importantly, the Vietnam CIC can

facilitate the integration of SMEs along the supply chain of these subsectors (such as in logistics,

services, and after- sale). In these state-dominated subsectors, there remain some promising

niche segments for SMEs, such as organic fertilizers, compost, small scale drip irrigation, and site

specific fertilizer/nutrition management. Although there have been fertilizer/nutrition

management pilots between farmers and scientists in the North and the Mekong delta, current

fertilizing practice sill relies heavily on farmers‟ anecdotal experience. Companies providing

services in nutrient monitoring and site specific nutrient applications would benefit from this

current market gap.

Sustainable agriculture subsectors with a relatively more established presence of SMEs include

food processing, agro-forestry, organic vegetable, fair trade agricultural products, and livestock

waste management (biogas). During the infoDev team‟s discussion with a number of these

businesses, their challenges were revealed to be as follows: a) difficulties in getting certification

(either organic or fair trade certification) and internal quality control, due to the fragmented

supply base, b) lack of market information and technical training, and c) difficulties in access to

loans. The CIC can support these subsectors by providing technical training, facilitating

certification, and connecting them to international markets.

Since agriculture is one of the largest contributors of greenhouse gas emission in Vietnam, this

sector presents opportunities for the Vietnam CIC to achieve results in emission savings. In

November 2011, the Ministry of Agriculture and Rural Development approved the Ministry‟s

Proposal to Reduce Green House Gas Emission in Agricultural sector. The proposal lists mitigation

measures14 to be implemented throughout the sector and estimates CO2 savings from each

measure. The approval of this proposal means that the Ministry will allocate funding (including

international climate change finance) and other resources to implement these measures,

thereby stimulating demand for climate smart agribusiness. Working closely with the Ministry of

Agriculture and Rural Development will enable the Vietnam CIC to capitalize on this opportunity.

14 These measures include changing feed for 30% of livestock, providing 190,000 Molasses Urea Block as feed for dairy

cows, planting 2.6 million hectare of forest, increasing energy efficiency in irrigation, reducing emission in fishing fleet,

and switching household fuel from coal and wood to more sustainable fuels such as biomass and biogas


3.2.3 Other Technology Areas:

Technologies for adaptation


H M L M M M L M L H M H H

Main applications: Green houses/shade materials, Waste harvesting & storage, Irrigation &

distribution technologies, Afforestation products, Weather services (warning systems, insurance),

Disaster prevention, Biodiversity and agriculture, Health care, Integrated coastal management,

Transportation and construction.

Opportunities in Technologies for adaptation: Vietnam‟s government has indicated in the

National Strategy on Climate Change that adaptation should take precedence over mitigation

in the near future. Adaptation efforts of the country during this period will focus on the following:

a) monitoring and early warning system for disasters, b) improvement of disaster response and

recovery, and c) food security and water security for all regions. Vietnam experiences significant

losses every year to natural disasters, especially tropical typhoons and flooding. The country

knows the extreme costs of increasing frequency of extreme climate events. As such, Vietnam is

prepared to allocate significant budget to adaptation. The country has developed a major plan

to build sea dikes to protect against storm surge and erosion from rising sea levels, as well as

irrigation structures to prevent saline intrusion. Vietnam is actively seeking international support

for these massive infrastructure undertakings.

In the 2011 yearend review of the National Target Program in Response to Climate Change, the

National Steering Committee of the Program, headed by the Prime Minister, issued the following

instructions to relevant ministries: a) rapidly finish projects to prevent flooding in five vulnerable

cities (Ho Chi Minh, Hai Phong, Can Tho, Ca Mau and Vinh Long), b) finish the irrigation planning

for the Mekong Delta with financial and technical support from the Netherlands, c) develop

plans to relocate people from areas at extreme risk of sea level rise, and d) complete the Green

Growth Strategy of Vietnam. The CIC can support technology transfer in this area and help SMEs

to leverage private sector resource. For example, it can support SMEs in construction to build

expertise and experience as sub-contractors in large adaptation infrastructure projects. Water

resources planning, weather modeling, and crop/fishing insurance all require complex technical



or financial skills which the CIC can help provide to research institute and private consulting

companies.

Interviews with several enterprises and entrepreneurs involved in climate change adaptation,

particularly disaster response, revealed their most pressing challenge: the lack of real market

demand for adaptation products and services and thus the need to rely on government

purchasing. For example, one entrepreneur piloted a vehicle that can quickly clear paths of

forests to contain forest fires. He subsequently found out that there are few clients willing to

purchase his product, beyond a number of state national parks. He notes that institutions are

unwilling to set aside a budget for such new products, although some are likely to do so in the

event of a major forest fire. Another entrepreneur sells low cost mobile houses (similar to trailer

homes) for flooding adaptation. Demand for his products spikes after large flooding events, but

it this demand is primarily from the government and his company does not have the

manufacturing capacity to fulfill these orders at short notice. Many households in frequently

flooded areas cannot secure mortgage loans to purchase his products, because banks do not

consider his mobile houses as real estate property. For the above cases, the Vietnam CIC can

help with demonstrating these products to the right audiences (government and donor

institutions) and advocating for disaster readiness financing.

Transportation technologies


M H M M L L L L L H H L M

Main applications:, Alternate fuel and electric vehicles, bicycles and motorbikes (bio-

diesel/ethanol, batteries, energy efficiency, fuel cells), advanced materials, recycling/green

supply chain, public transportation, urban planning and related infrastructure.

Opportunities in transportation technologies: Vietnam‟s growth in transportation and its related

emissions are reflected in the steadily increasing number of registered vehicles - 15-25% a year

since the mid 1990s. Registered vehicles in Vietnam grew from 9 million in 2001 to 17 million in

2005, over 23 million in early 2008, and over 28 million in mid 2009.

As of 2007, transportation accounted for 25% of final energy consumption in Vietnam. Use of

transport fuel grew from 3.6 million ton of oil equivalent (toe) in 1998 to 7.9 million toe in 2007. A



little over half of fuel use was diesel oil, while gasoline accounted for about 39%, and jet fuel and

fuel oil combined accounted for about 7%.

Vietnam is a densely populated country with close to 90 million inhabitants. Congestion is

chronic in cities; gasoline prices increased by 30% in the last 3 years. According to the

Environmental Performance Index report in 2011 by Yale and Columbia University, Vietnam ranks

among the top ten countries with the most polluted air. The Vietnam Environmental

Administration estimated that 70% of air pollution in Vietnamese cities is caused by vehicle

exhausts.

Mass transit, alternative fuels and electric vehicles are needed in Vietnam to facilitate trade,

improve quality of life and alleviate pollution. Both Hanoi and Ho Chi Minh City, the two largest

cities, have a large and frequently running bus fleet. Both cities have planned for years to

develop underground transport, but these massive investment projects are yet to be initiated. As

part of a Nationally Appropriate Mitigation Action (NAMA) pilot for the transport sector, the

Japanese government is helping Ho Chi Minh City to reduce emissions from public transport by

retrofitting buses and modifying bus routes.

Petro Vietnam, the state petroleum company, has built 3 large cassava ethanol plants in the

north, south and center of the country, one of which has already begun operations. Petro

Vietnam started selling E5 gasoline (gasoline with 5% ethanol) in August 2010. Offtake has been

slow, with only 140 gas stations throughout the country offering E5 at present. Petro Vietnam is

asking for a government price subsidy to make E5 competitive with traditional gasoline. There is

also concern that the full-scale operation of the three power plants will cause a shortage of

cassava in the country, which will in turn drive up livestock feed price and cause other

environmental problems related to land use. Since late 2011, there have been many incidents of

spontaneous vehicle fires caused by low quality gasoline. This has further hindered consumer

adoption of E5 gasoline.

Though climate technologies in transportation are being gradually introduced in Vietnam, many

market and policy barriers remain. Opportunities being taken up by SMEs in transportation are

vehicle retrofit, environmental friendly vehicle components and parts, biodiesel from waste

vegetable or fish waste. The Vietnam CIC can liaise between the private sector and different

government departments, aggregating issues at the industry level and advocating for policy

changes to address the most important barriers. For example, one small business assembling

electric vehicles for city use currently can sell only to golf courses, resorts and airports because


there is no license for four wheel electric cars to be operated on public roads. The CIC can assist

with piloting, demonstrating, facilitating policy changes and implementing standardization to

accelerate the adoption of electric vehicles.

Water management and purification


L L L M M M L M L H L L L

Main applications: Waste Water Treatment, Potable water, Water Use Efficiency, Waste Water

Recycling, Desalination, Rain water harvesting, Efficient Irrigation.

Opportunities in water management and purification: In all water basins of Vietnam, the

projected impacts due to climate change are a) increased flow in wet season, resulting in

greater flooding risk, and b) decreased flow in dry season, increasing the frequency of drought

and severity of saline intrusion. Negative impacts from drought and saline intrusion already have

been observed in the drinking water supply, notably in the central highland and the Mekong

delta.

In the Mekong river delta, over 2,500,000 hectares will have over 1% salinity concentration by

2050. Increased flooding projected in the mid-21st century will inundate over 3,500,000

hectare, or nearly 90% of the Vietnamese Mekong delta.

In Dong Nai River Basin (home to Ho Chi Minh City and surrounding industrial provinces) the

water flow decreases significantly with the impact of rising sea level. It is estimated by the end

of the 21st century, up to 300,000 ha downstream will be flooded and saltwater

encroachment will come more than 10 km inland. These impacts will profoundly affect the

economic engine of the country - Ho Chi Minh City and surrounding provinces.

In Red-Thai Binh River Delta in the north, saltwater intrusion into land ranges from 3 to 9 km by

2100. Upstream floods will be more severe. The flood peak of 1% chance will increases to 8% -

10% chance in 2050 and possibly up to 11% - 25% chance by 2100. This greatly affects the

safety of all upstream reservoir systems and nearly 2700 km of dike system protecting the

whole delta.

Thu Bon and Ba Rivers in the centre are already under strong pressure from water exploitation

and growing density of hydroelectric power plants. With the onset of climate change,

conflicts between water users grows more intense and water shortage downstream will occur



more frequently in the dry season. Salinity intrusion is threatening downstream plains with

deeper saltwater encroachment (about 3 km from the sea in Ba river catchment and possibly

up to 8 km in some branches of Thu Bon River in 2100).

Given these threats to water resources across multiple regions of Vietnam, there is an urgent

need for technologies and innovation in water management and water purification to meet

irrigation and drinking demands. Though irrigation is still much a state-managed operation,

domestic water supply has been picked up by the private sector. In recent years, there has

been much privatization of state water companies. Some private companies have invested in

building brand new water supply systems for rural towns. In the Mekong delta, there are a good

number of village-scale water supply systems built and operated by local communities, or built

by the government and operated by the community. Technologies and innovative business

models are still needed for these private/community water supply systems in order for them

provide better quality water, to become more efficient and affordable, and to serve more of

the rural poor.

As salinization renders more surface and groundwater undrinkable, many rural households are

paying for potable drinking water at price about 10-15 US cents per liter. Potable drinking water

is made available through a large number of small businesses in water purification and logistics.

In this fragmented market, opportunities exist for ingenious solutions for on-site and pro-poor

water purification and desalinization.

Water management and purification do not have obvious emission reduction benefits, yet they

are significant for climate adaptation and development. Choosing this sector is a way for the

CIC to strike a balance between mitigation and adaptation, given the importance of

adaptation to a climate-vulnerable country like Vietnam.

3.3 Stakeholder Analysis

Through its stakeholder engagement process, infoDev conducted a landscape analysis of the

climate innovation stakeholders in Vietnam across the climate innovation value chain and in the

five priority technologies. We found a significant number of institutions already working on these

sectors. The CIC will engage collaboratively and take advantage of existing efforts, knowledge

and synergies, rather than to offset or compete with existing activities. The following section

outlines in detail the current climate technology stakeholder landscape in Vietnam, including:


R&D

Government

Universities

Business Incubation

Industry – Large

Industry – Small

NGOs

International Inst.

Financiers

3.3.1 Sector Mapping Matrix

The table below presents a sample of institutions operating in prioritized sectors in Vietnam:

Energy Efficiency Sustainable

Agribusiness

Technologies

Adaptation

Transportation

Technologies

Water

Management and

Purification

R&D

Institute VNCPC, CSD, VESDI, ICARGC, MIT

GOI/Policy MONRE, DWRM, NISTPASS, MOST,CIEM, VCCI, TBC, MOF

Universities HUSTECH, CRES-VNU

Incubators HCMUT-TBI, SHBI, CTBI-NLU

Industry -

SME

Redsun Energy

Solar Serve

Bio-fuels and

Petrochemical of

the South of VN

Hoang Huynh Corp

VECO Vietnam

SITTO Vietnam Vinh Thanh Ltd Pte. Wow Car

BIWASE

Ha Long Waste

Treatment

Quoc Minh E.C.M

Industry –

Large Philips, Schneider

Crop Life,

Monsanto

General

Electric

NGO PanNature, VESDEC, VUSTA, HBA, Vietnet-ICT, Vacne, Habitat for Humanity Vietnam, VNGO&CC, MCD, Green Ha

Noi, AFEO.

Consulting BK-CONTECH, Gratia Environment, TECOS, ENTEC, GEC Group, GLT Corp.

Internation

al

World Bank, GIZ, Embassy of Finland, SPIN, Innovative Partnership Programme, William J. Clinton Foundation, FVG

Group, Royal Norwegian Embassy, UNIDO, UNDP, SNV, Embassy of Australia, AusAID, DFID

Financiers Indochina Capital Mekong Renewable Resources Fund, Dragon Capital Clean Development Fund, IFC Energy

Efficienty Credit Line, Clean Development Fund – Green Credit Trust Fund

3.2.6 Technology vs. Business Model Innovation: Importance for Vietnam

It is important to note that while the Vietnam CIC‟s mission is to support the commercialization

and scale of emerging technologies; much of the „innovation‟ opportunity in Vietnam will be a

result of new business models. This will involve addressing non-technical related barriers to

deployment of existing and adapted technologies. Such interventions could include innovation

in distribution models, marketing and business development, cost structures, consumer financing

and production processes. With a stronger focus on financing and support to business model

innovation and the localization of existing technologies, the CIC can have a greater impact on

rapidly deploying new products and services that will address the challenges faced by

the under-served rural and low income households in Vietnam.

Source: Nortec, Adapted by infoDev Vietnam CIC Business Plan

36

3.3.2 Stakeholder Mapping Matrix

The below graphic illustrates ongoing activities of various stakeholders mapped to the innovation value chain. Gaps highlight areas of

CIC focus. Overlap is indicative of potential partnerships and collaboration.

Stakeholder

R&D

R&D on policies and regulat ions

Provide equipment

Microfinance

R & D on product/service Launching

Generate IP Marketing research DD & SS

Identify sources of finance

Policy research

Issue IPR

Technology Company Finance Market PolicyGenerate IP

Government

Minitry of Natural Resources and Environment Finance (

MONRE), Ministry of Agriculture and Rural Development

(MARD), , Ministry of Finance (MoF), Minostry of Education and

Traninning (MoET),National Target Programme response to

Climate change.,

Conduct and support R & D Provide facilit ies like laboratories and libraries

Awareness creation/promotion of environmental products/services

Loan, Financing projects , Coordinate international funds

R& D on policy , sector policy development, implementation and control

Industry

Bach Khoa Solar, Red Sun Energy ,Solar Material

Incorporated,Trung Nam Group,RCEE,Brilliant Chip, Hoang

Huynh Corporation,REE Corporation,VNEEC,PHILIPS,Holcim

,Grassroof ,EBLOCK - ,Green-Consult Asia,Viet Vmicro,

Enerteam Vietnam,Biofuel and Petrochemical Joint stock

company, Earthwise HVAC,Gyproc Drywall System,,,Systech

Co.,Ltd,ECC HCMCDantherm Filtration Co.,Ltd.,,Comin Asia

Vietnam Contracting Serv ice Power Trading,Kim Dinh Green

Energy JSC,Dong Xanh Joint Stock Company, Solar Server,

Pilot production, test ing and demonstrat ion, new technologies Integrate new technologies, manufacture / for production expansion

Identification of target market , marketing channel development, reaching target and expanding market Advert ising, Product promotion

Acquire finance and maintain balance sheet Acquire addit ional finance

Develop interest on policies that affects the sector Influence policy and regulat ion, advocacy

Company formation Expansion, Human resource development, production efficiency

Universities & Academia

University of Agriculture and Forrestry,Technology Teacher

College,Institute of Energy, MOIT,Institute of Water Resources

and Planning (MONRE),Institute of Strategy and Policy on

Natural Resources and Environment (MONRE),Research

Center for Energy and Environment,Research Center for Forest

Ecology and Environment,

Provide some facilit ies

Workforce development

R & D

R & D on policies

International Institutions

World Bank, ADB, IFC, DFID, AusAID, Embassy of Denmark,

CIDA, GIZ, Netherlands Development Organization, SDC,

SECO, Spanish Agency of Int‟l. Cooperative for Development,

EDCF, Kfw

Funding - Grants

Funding - Loans

R&D on policy and regulat ion regarding the financial sector Financial sector development

Vietnam Environment Protection Fund,Dragon Capital Clean

Development Fund,Indochina Capital, Vina Capital Green

Credit Trust Fund, IFC, Vietnam Development Bank, VietinBank,

Techcombank, Sacombank,

Development of the financial market

Equity finance, Debit financing, Venture capital

Fund advisory services

Financing projects

Business services

Investment advisory

Financial Institutions

WWF Vietnam, Oxfam Great Britain, SNV, Care International,

IUCN, ActionAid Vietnam. 350, SRD, GRET,RECOFTC , Live and

Learn, East Meet West, Clinton Foundation,AMDI, PanNature,

Provide technical assistance

Provide financial assistance

Policy Advice

Promotion of clean energy: Awareness creation

Capacity building: BDS

Incubation Centers

IBK Holdings: Hanoi University of Technology,HCM City

Unveristy of Technology, Business Incubator,,Topica Education

Group,University of Agriculture and Forestry (HCM),Hoalac Hi-

Tech Park,Hanoi Hi-Tech Business incubator,NANO

TECHNOLOGY LABORATORY - HCM high tech

park,Semiconductor laboratory Vietnam National University –

HCMC ,Institute of Applied Technology,School of Science and

Provide working space & consultancy

Provide networking

Business software consultancy , Entrepreneurship & Business t raining

NGOs

Commercialization Stages

Basic and Applied Research Development and Demonstration Scale-up Commercial

CIC Focus


37

3.3.3 Leveraging existing initiatives

Government of Vietnam (GoV)

The following table outlines previously mentioned initiatives and other relevant activities in

summary form:

Initiatives Description Agency in

charge

Green Growth Strategy (in

development)

The Strategy draft outlines actions for policy and fiscal

reforms, for creating investment flows to

reduce greenhouse gas emissions, for increasing

green GDP and creating green jobs. It is to be signed by

the Prime Minister and issued in 2012

Ministry of Planning

and Investment

National Target Program

to Respond to Climate

Change

Five year program covering 2009-2014; to assess climate

change impacts on sectors and regions in specific periods

and to develop feasible action plans to effectively

respond to climate change in the short term and long

term.

It will be governed by a National Steering Committee

chaired by Prime Minister and comprised by Ministers of

five ministries, with MONRE as the focal point.

Ministry of

Environment and

Resources

(MONRE)

Vietnam National Strategy

on Climate Change

Announced in March 2013, with six major parts: climate

change challenges and opportunities for Vietnam;

strategic viewpoint; vision to the year 2100; goals by 2050;

strategic tasks and implementation during 2011-2015,

programs will be prioritized, including programs on water

resource management and response to climate change

implemented in the Mekong river delta and the Red river

delta, program to respond to climate change in Vietnam's

big urban areas, and others.

Ministry of

Environment and

Resources

(MONRE)

Vietnam’s National Energy

– Efficiency Program

VNEEP

First phase 2006-2010: research, survey, capacity building,

awareness raising, formulating the Law on Energy

Conservation and Efficient Use.

Second phase: 2010-2015 – further implement phase 1

components, while promoting energy efficiency activities

in the manufacturing, trading and activities of society as a

whole.

Overall program target 2011-2015: reducing 5-8% of the

total energy consumption of the country by 2015

Ministry of Industry

and Trade

Law on Energy

Conservation and Efficient

Use

Issued July 2010 - requires intensive energy consumers to

conduct energy audits and prepare specific action plan

to increase energy efficiency and to report to authorities-

also requires labeling products in terms of energy

efficiency

Ministry of Industry

and Trade

Promoting Energy

Conservation in Small and

Medium Scale Enterprises

(PECSME)

Program finished in 2011

Targets its activities in SMEs in five industrial sectors: Brick

manufacturing, Ceramic and Pottery, Textile and

Garment Paper and paper pulp, Food processing

Co-financed by UNDP/GEF and some Ministries, Sectors

and Agencies.

Ministry of Science

and Technology

(MOST)


38

Action Plan Framework for

Adaptation to Climate

Change in the Agriculture

and Rural Development

Sector Period 2008-2020

Sets out preparatory steps e.g. research, communication

awareness raising, strengthening international support,

allocating human resources and importantly, developing

a policy system and integrating climate change in all

development programs for the sector

Ministry of

Agriculture and

Rural

Development

Action Plan on climate

change response of

agriculture and rural

development sector in the

period 2011-2015 and

vision to 2050

Outlines activities and expected output for each sub

sector (agriculture, forestry, fishery, water resource

management, salt production and rural development) to

adapt and mitigate climate change. Each subsector will

develop further programs along these outlines.

Ministry of

Agriculture and

Rural

Development

Proposal to Reduce Green

House Gas Emissions for

the Agricultural sector

Issued in 2012, lists mitigation measures to be implemented

throughout the sector and estimated CO2 savings from

each measure

Ministry of

Agriculture & Rural

Development

National Strategy for

Natural Disaster

Prevention, Response and

Mitigation to

2012

Issued in 2007; outlines Vietnam‟s approach for disaster

mitigation and management, particularly focusing on

floods, storms and drought.

To date, all 63 provinces have developed their action

plans to implement the Strategy. Most Ministries have

developed action plans for the mainstreaming of disaster

risk reduction in their sectors. In the past two years, some

activities have been implemented in the provinces or by

sectors (e.g. dike construction, relocation, embankments,

training, awareness-raising, risk mapping, etc.).

Ministry of

Agriculture and

Rural development

Pilot Program on

Agriculture Insurance for

the period of 2011-2013

Issued in March 2011, aims to support farmers to actively

recover and compensate for financial losses caused by

natural disasters and diseases, will be piloted for crops,

livestock and aquaculture products in 21 selected

provinces; targeting poor, pro-poor farmers and farmers

with different supports for insurance fee

Ministry of

Agriculture and

Rural development

National Platform for

Disaster Risk Reduction

and Climate Change

Adaptation in

Vietnam (in development)

The Platform will be a national mechanism that will

promote better coordination and implementation of

disaster risk reduction and climate change adaptation

actions. It aims to support the implementation of relevant

policies and strategies, provide a solid basis for action at

the national level and be guided by evidence-based

activities at the local level

Ministry of

Agriculture and

Rural development

And Ministry of

Environment and

Resources

National REDD+ Program

(in development)

Expected to be presented to the Prime Minister for

consideration of promulgation as a Decree. This would

allow Vietnam to formally engage in an international

REDD+ mechanism if/when it is implemented under the

UNFCCC.

Ministry of

Agriculture and

Rural development

Agency for SME

Development (ASMED)

Under the Ministry of Planning and Investment, ASMED is

the central government agency that is responsible for

coordinating policy formulation and policy

implementation for the development of SMEs in Vietnam.


and Investment

SME Development

Promotion Council

Advises the Prime Minister on mechanisms and policies to

encourage development of SME. Chaired by the Minister

of Planning and Investment with representatives of

different ministries and major cities.


and Investment


39

National Agency for

Technology

Entrepreneurship and

Commercialization

Development

Newly established under Ministry of Science and

Technology, promotes the technology market and

supporting the establishment and development of

science and technology enterprises.

The Ministry of

Science and

Technology

Vietnam Chamber of

Commerce and Industry

Established in 2001, represent business enterprises,

promote business trading and networking of enterprises

Stand alone

organization

This list demonstrates that the government of Vietnam has proactively put in place a number of

policy frameworks (strategies, action plans, national programs) related to climate change, with

a number of other strategies and programs are in development. Under these policy frameworks,

more specific action plans, projects, and initiatives will be implemented. The Vietnam CIC will

track these policy developments and work with closely with the government to:

Bring the private sector to policy makers‟ attention – raising awareness among policy makers

about the potential of private sector in tackling climate change, and any private sector

impact of proposed policies

Create forums, dialogues using the CIC resources for the private sectors to participate and

provide feed backs into policy making process, feedback into the implementation of policies,

programs, initiatives.

Advocate for policies, programs to support climate innovation, commercialization, and

climate technology market

Utilize/channel resources from the above programs to create business opportunities, create

market demand for climate enterprises, to prime/facilitate private sector participation and

climate technology innovation

Leverage private sector funding to sustain and multiply these efforts‟ impact.

In addition to climate change initiatives, Vietnam government has created several mechanisms

and organizations to support the development of SMEs, which are also listed in the table above.

These organizations are highly relevant to the CIC‟s work in Vietnam, especially the newly

created National Agency for Technology Entrepreneurship and Commercialization

Development. The CIC will work to make sure that the benefits, resources, and support available

from these government entities are captured by climate technology entrepreneurs.

R&D Institutes and Universities

Listed in the following table are a number of research institutes and universities that are active in

climate change research. Large organizations include Vietnam Academy of Science and


40

Technology (VAST) and major universities in Hanoi and Ho Chi Minh cities. Major universities

typically also have their own subsidiary institutes, which are included in the list.

Institute / University Location

Vietnam Academy of Science and Technology (VAST) Hanoi

Vietnam National University, Hanoi Hanoi

Vietnam National University, Ho Chi Minh City HCMC

Hanoi University of Science and Technology Hanoi

Ho Chi Minh city University of Science and Technology HCMC

University of Agriculture and Forestry, Hanoi Hanoi

University of Agriculture and Forestry, Ho Chi Minh city HCMC

Can Tho University Can Tho

Vietnam Institute of Meteorology, Hydrology and Environment- (IMHEN), under MONRE Hanoi

Institute of Strategy and Policy on Natural Resources and Environment (ISPONRE) under MONRE Hanoi

Institute of Energy, under MOIT Hanoi

Institute of Water Resources and Planning (under MONRE) Hanoi

Chemical and Industrial Safety Technology Institute (under MOIT) Hanoi

National Institute for Science and Technology Policy and Strategy Studies (NISTPASS) Hanoi

Institute of Environmental Technology, under Vietnam Academy of Science and Technology -

VAST

Hanoi

Institute of Biotechnology, under VAST Hanoi

Institute of Ecology and Biological Resources, under VAST Hanoi

Institute of Energy Science (IES), under VAST Hanoi

Environment and Sustainable Development Institute Hanoi

Institute for Environmental Science and Technology, Hanoi University of Science and Technology Hanoi

Centre for Environmental Engineering of Towns and Industrial Areas, National University of Civil

Engineering

Hanoi

Vietnam Academy for Water Resources, under MARD Hanoi

Institute of Oceanography, under VAST Nha Trang

Ecological Economy Institute Hanoi

Forest Inventory and Planning Institute, under MARD Hanoi

Centre for Natural Resources and Environmental Studies (CRES) Hanoi

Forest Science Institute of Vietnam, under MARD Hanoi

Institute of Resources, Environment and Biotechnology (IREB), under Hue University Hue

Institute for Environmental Science and Development (VESDEC) Hanoi

Institute of Environment and Resources , Vietnam National University, Ho Chi Minh City HCMC

Institute of Environment and Resources, HMC Department of Science and Technology HMC

http://www.vast.ac.vn/index.php?option=com_content&view=article&id=382%3Avcnmt&catid=42%3Acac-vin-nghien-cu&Itemid=103&lang=en

http://www.vast.ac.vn/index.php?option=com_content&view=article&id=382%3Avcnmt&catid=42%3Acac-vin-nghien-cu&Itemid=103&lang=en

http://www.vast.ac.vn/index.php?option=com_content&view=article&id=379%3Avcnsh&catid=42%3Acac-vin-nghien-cu&Itemid=103&lang=en

http://cres.vnu.edu.vn/cres/vn/?mnu=coop&domain=domestic


41

Some institutions are more focused on policy research, such as Institute of Strategy and Policy on

Natural Resources and Environment (ISPONRE) under MONRE that conducts research and

advises the government on policies related to resources and environment management.

Another example is the Institute of Meteorology, Hydrology and Environment- (IMHEN) - the focal

point for research on climate change scenarios and mitigation options – or Institute of Energy

research and advises the government on energy policy. The CIC will need to work with these

institutions if it is to participate in policy formulation. The CIC can present a voice of the climate

technology sector to these think tanks, or provide data and information to these think tanks, in

order integrate the need and opinion of the climate sector early in the policy making process.

Other institutions are more toward applied sciences and technologies such as Institute for

Environmental Science and Technology under Hanoi University of Science and Technology,

Institute of Environmental Technology, Institute of Energy Science, Institute of Biotechnology

under VAST. These institutes are where the CIC can leverage existing infrastructure, labs and

equipments as well as expertise for climate entrepreneurs.

One major concern raised by the CIC stakeholders is that climate R&D in Vietnam is not

practical and not well suited to the commercial world. This is a challenge for the Vietnam CIC to

address and prioritize following its establishment.

NGOs other Civil Society Partnerships

International and local NGOs working in climate change in Vietnam have come together to

form a Climate Change Working Group for information sharing, capacity building and

coordination among NGOs in Vietnam and between NGOs and government in relation to

climate change responses. This working group meets once a month for information exchange,

coordination and prepare feedback/responses to government and donor initiatives.

Climate NGOs in Vietnam have been the pioneers in awareness raising and community based

climate change efforts. The CIC can collaborate with these NGOs on policy advisory, or more

importantly, on promoting small businesses to engage in and be beneficiaries of these NGO‟s

projects, such as community based projects that are also market led or projects that pilot

business models at village level.

Other infoDev activities in Vietnam

Vietnam is the focal point of infoDev‟s mobile innovation agenda in East Asia, with a mobile

applications lab (mLab) in Ho Chi Minh City and a mobile social networking hub (mHub) in


42

Hanoi. The SHTP consortium is collaborating to host the mLab, with consortium partners including

Saigon Hi-Tech Park, Vietnam National University, FPT University, and Elcom Ltd. For the mHub,

CRC Topica will support preexisting or establish new social networking hubs and complementary

online communication channels to foster collaboration among developers, entrepreneurs,

mentors, partners, investors and other technologists working in the mobile field. The mHub will

provide vital support for the creation of content for a mobile applications community of

practice, along with other mentoring and concept incubation activities.

Under its Creating Sustainable Businesses in the Knowledge Economy program, infoDev is

developing a pilot to test virtual incubation in Vietnam as a tool for reaching growth oriented

entrepreneurs outside the major cities. Important objectives of the pilot are to assess the impact

and cost‐effectiveness of virtual incubation and, by way of a strong Monitoring & Evaluation

(M&E) component, to derive the necessary lessons for potential future potential future scaling‐up

in Vietnam and/or replication in other countries.

infoDev and Emerging Markets Consulting (EMC) inaugurated the Mekong Women’s

Entrepreneurship Challenge (MWEC) on International Women's Day, March 8, 2012. The

challenge tackles problems that women in developing countries identify as major impediments

to female-led firms, namely: lack of relevant business information and knowledge, lack of

supportive networks, and lack of self-confidence, in addition to cultural barriers. The MWEC

primarily targets later-stage women-led enterprises with growth potential.

The goal of the program is to facilitate the expansion of women-owned businesses. For this

purpose, MWEC provides qualified women the necessary tools to improve and grow their

businesses, including financing, one on one support, peer-based learning, training workshops

and seminars. The program focuses on highly motivated women who are small business owners

or managers eager to expand their businesses.

International Aid Agencies and Multilaterals

The following table lists a selection on-going or in pipeline programs /initiatives from donors

relevant to the Vietnam CIC. In recent years, international development partners of Vietnam

have approved significant amount of support specifically for climate change or for climate

change technology subsectors such as energy efficiency or disaster management. Many of

these programs/initiatives have a component to support private sector, which represent

important opportunities for the CIC in Vietnam.


43

Agency / Program Description Multiple donors (JICA, AfD,

CIDA, DANIDA, WB)

Support Program to Respond

to Climate Change in Vietnam

(SP-RCC)

Growing as a national financing mechanism for coordinated donor

climate change investment in Vietnam with over USD 300 million

committed to date. SPRCC support the implementation of climate

change related policies and strategies based on the “National Target

Program to Respond to Climate Change (NTP-RCC)”

World Bank Vietnam Climate

Change Development Policy

Operations are structured around four pillars

Climate-resilient development: Improving the resilience of

water resources

Lower carbon intensity: Exploiting Vietnam‟s energy

efficiency potential

Strengthening capacity and preparedness to formulate,

prioritize and implement climate change policies

Strengthening the financing framework to support climate

change action

World Bank- Clean Production

& Energy Efficiency

Strengthen the capacity of Vietnam government and other key

stakeholders for the effective delivery of the national energy

efficiency program in key industrial sectors

World Bank Vietnam

Renewable Energy

Development Project

Credit support through commercial banks to hydropower projects

under 30 MW; technical assistance to banks and project developers;

support the development of renewable energy regulatory

infrastructure

World Bank Urban water

supply and wastewater

Increase access to sustainable water services and environmental

sanitation in selected urban areas in project provinces. One

component to support Ministry of Planning and Investment (MPI) to

develop policies on applying wastewater tariffs and on promoting

the role of the private sector.

World Bank Natural Disaster

Risk Management Project

Support post-disaster reconstruction financing; reduce a financing

gap in public resources available to fund post-disaster reconstruction

costs

ADB - Support for the National

Target Program on Climate

Change with a Focus on

Energy and Transport

Support MOIT, MOT, and the People's Committees of Thanh Hoa

province, HCMC and Da Nang in developing and/or instituting action

plans for effective implementation of the government's National

Target Program on climate change.

ADB Energy Efficiency

Improvement Program

Pipeline project: Support Ministry of Finance, Ministry of Industry and

Trade and manufacturing establishments for energy efficiency

IFC Vietnam Energy Efficiency

and Cleaner Production

Financing Program

Works with selected banks to build their sustainable energy portfolios

and tailored financing products, provides energy efficiency credit

lines to banks, supports enterprises with knowledge, tools, financing,

and training to unlock sustainable energy‟s cost saving potential.

AusAID Community-based

disaster risk management

(CBDRM) – in development

supports the roll-out of community-based activities for disaster risk

management in around 63 communes across two provinces in

Vietnam‟s Mekong Delta region

AusAID Strengthening

Vietnam’s household energy

standards and labelling – in

development

Australia‟s Department of Climate Change and Energy Efficiency

(DCCEE) is currently exploring a possible partnership with Vietnam‟s

Ministry of Industry and Trade (MOIT) to strengthen Vietnam‟s

household lighting and appliance labeling standards for improved

energy efficiency.

DIFD - trilateral partnership on

climate change between

Enhances the Government‟s technical expertise and coordination

capacity, mainstream climate resilience (in World Bank/ Government

http://ntprcc.gov.vn/index.php?option=com_content&view=article&id=181%3Ajica-2010-chng-trinh-h-tr-ng-pho-bin-i-khi-hu-ti-vit-nam&catid=60%3Asprcc-la-gi&Itemid=120&lang=en

http://ntprcc.gov.vn/index.php?option=com_content&view=article&id=181%3Ajica-2010-chng-trinh-h-tr-ng-pho-bin-i-khi-hu-ti-vit-nam&catid=60%3Asprcc-la-gi&Itemid=120&lang=en


44

Government and World Bank projects) and develop a low-carbon strategy.

DFID work plan 2011-2016

Climate Change pillar

Ensures 10 million rural poor people benefit from enhanced climate

resilience in rural development and natural resource management

by 2016

DANIDA – Business Partnership

Programme (DBP)

supports commercial ideas and projects originating from Vietnamese

and Danish enterprises, with a focus on green growth, within

prioritized sectors such as renewable energy and waste

management

Denmark – Climate change

initiatives

supports the Vietnamese National Target Programme to Respond to

Climate Change from 2009 to 2015, supports Vietnam's efforts to

combat global warming and improve energy efficiency

As the Vietnam CIC is also a multi-donor initiative, it will be in a good position to interface

between the donor community and SMEs/entrepreneurs. The Vietnam CIC is anticipated to

complement donor initiatives in the following manner:

Help SMEs/entrepreneurs to tap into the resources offered by donor projects. In many cases

this means helping them to overcome the final hurdles to be qualified as beneficiaries of

donor funding.

Provide data/information on gaps, needs, challenges and opportunities from the climate

technology sectors to the donor community – this will provide feedback and insights to

donors who are formulating their pipeline projects or reviewing the ongoing implementation

of existing projects.

Matching donor‟s funding with existing private sector initiatives

Financiers

The most important financiers for climate technology sectors are banks and technology funds.

Vietnam Development Bank and Vietnam Bank for Social Policies are the two banks that give

favorable loans for projects which help reduce poverty, build rural infrastructure, loans for export

financing, for projects that protect the environment. The Bank of Agricultural and Rural

Development is another major player that lends to agricultural sector and rural development

projects. Some development assistance lending is implemented through these banks. A number

of projects in CIC sectors can seek loans from these banks (such as agro business and

hydropower). However, the majority of climate technology businesses still need to seek loans

from commercial banks.

The most common challenges of accessing bank loans, as reported by stakeholders, are

prohibitively high interest rates and banks‟ unfamiliarity with climate business models. The

situation is worsened by government policies which have restricted credit growth in the last two


45

years, making banks more hesitant to accept new borrowers and prone to focus on existing long

term and large clients. The Vietnam CIC can support commercial banks and development

banks by providing due diligence, technical training, and credit guarantees, or by consulting

with them to create innovative financing services.

Fortunately for climate technology businesses, several commercial banks have been given

credit lines for energy efficiency or clean technology projects in recent years. Techcombank,

Sacombank and VPbanks have received credit line for energy efficiency from the IFC.

Techcombank, VIB, and ACB have received credit guarantees from the Vietnam Green Credit

Trust Fund (supported by the Swiss government), which will be partially earmarked for loans to

SMES for cleaner production projects.

Besides banks, some private equity funds have been established in Vietnam that invest in clean

technology:

Dragon Capital Clean Development Fund - US$45m to invest in projects in the Mekong River

Region that have positive impact on the environment and contribute to sustainable

development.

IDG Ventures Vietnam - technology venture capital fund, currently has $100 million under

management, with investments in over 40 companies in the technology, media,

telecommunications, and consumer sectors

VinaCapital - invests in early and growth-stage technology businesses, focusing investment in

four sectors: Internet, telecommunications, media and clean energy

Indochina Capital - Mekong Renewable Resources Fund (MRRF) - targeting to raise US$150

million to invest in projects and companies focused on renewable energy generation, energy

efficiency, environmental infrastructure and natural resources preservation in Vietnam,

Cambodia, and Laos.

The infoDev team has met with all four of the above investors and found good synergies for the

future of the Vietnam CIC. These funds can provide follow-up financing or private sector co-

investment into the CIC‟s technology businesses. The Vietnam CIC can present deal flows to

these funds and vice versa. Potential partnership has been discussed where these funds can

pass on the investment candidates that are almost ready for their investments for Vietnam CIC

convertible loans/grants that address the last remaining gaps. Provided that the conditions are

met, the commercial funds can commit to supporting the companies for their next level of

financing.


46

3.3.4 Private sector companies seeking support:

The following table describes a representative subset of Vietnamese companies interviewed by

infoDev who are seeking the various kinds of support and financing that the CIC will provide.

They furnished detailed information on the constraints they were facing and their required needs

to overcome these challenges. These companies highlight the demand for the Center‟s services

in Vietnam and will form part of a ready pipeline of investable projects that the CIC can initially

support. Names of the companies have been removed for confidentiality.

Sector Product Founded Needs

1 Wind power Wind farm developer

2008 Advocacy assistance for feed-

in tariff policy

Matchmaking with sources of

equity and debt

Insight/input into government

wind power planning

2 Sustainable

Agribusiness

Organic vegetables 2009 Financial assistance/access

Land acquisition assistance

Technical support

Brand development

3 Energy Efficiency Energy saving microchip 2006 Domestic market development

Financial assistance/access

4 Building and Materials Autoclaved aerated

Concrete

2007 Market development

Sales and business

development assistance

5 Solar Energy Manufacture solar

panels

2006 Internationalization of sales

Technical due diligence support

for financing banks

Talent pool of skilled engineers

6 Building and Materials PET recycling

2001 Finance to move up the supply

chain (produce plastic fibers

from plastic chips)

7 Biomass Rice husk biomass fuel

for export

2009 Machinery to diversify products

Access to finance to enable

scaling up of operations

8 Energy Efficiency Energy Service,

Energy Auditing

2009 Financial resources.

Advisory/ capacity building on

business skills

9 Transportation Electric car 2009 Market development

Policy support e.g. road

certification

Finance to scale up production

10 Biofuels Jatropha farming,

Jatropha biomass

2007 Access to land to scale up

farming capacity/production


47

processing to oil Productivity improvement

11 Building and Materials Glucosamine from

recycling shrimp skins

2007 Supply chain development

12 Solar energy Solar cook stoves and

Water heater

2007 Sales and distribution assistance

Machineries for mass

production

13 Biofuels Industrial steam services

from biomass

2010 Financial assistance to support

company expansion

Marketing and sales support

14 Wind energy Wind farm developer

2004 Financing for wind farm

extension

Government price support

15 Sustainable

Agribusiness

Sustainable bamboo

flooring

2006 Supply chain development

International market

development

16 Adaptation Tech Mobile houses for flood

prone areas

2008 Consumer loan

Government disaster readiness

programs

17 Biofuels Fish oil to biodiesel 2008 Reliable input

Finance to scale up

18 Hydro power Developer of small scale

run of river hydro power

plants

2008 Matchmaking with sources of

equity and debt at reasonable

cost

19 Water management

and purification

Developer of small town

scale water supply

systems

2007 Financial management

Equity investment

20 Biofuels Power generation from

rice husk

2008 Pricing support

Financing for equipment


48

4.0 Climate Innovation Analysis: Vietnam

4.1 Gaps along the Value Chain

Countries must progress through five core areas15 in order to successfully develop and deploy

local innovation:

Technology: Supporting

technology creation and

adaptation.

Company: Building a

pipeline of human capital

and sustainable ventures.

Finance: Ensuring access

to flexible risk capital.

Market: Creating new and

expanding local and

global markets.

Policy: Informing, linking and transforming innovative policy mechanisms.

Over a 6-month process, infoDev engaged with over 200 local climate technology stakeholders

to identify the gaps in each core area that hinder climate innovation in Vietnam. 120

participants at the „CIC Model

Design Workshop‟ working groups

identified the relevant gaps in each

area and proposed solutions to

these challenges. To quantify the

results from the workshop, 130

respondents completed an online survey which was accessible in both English and Vietnamese.

These activities were further supplemented by in-depth interviews and focus groups.

Survey respondents were given a set of gaps hindering Vietnam‟s progress in each innovation

core area.16 Each set of gaps suggested interventions needed in Vietnam, which in turn

informed the design of CIC activities, programs and services.

15 Adapted by infoDev: Carbon Trust 16 The tables in Sections 4.2-4.6 rank these gaps by the total percentage of respondents who answered “Agree” and

“Strongly Agree”. For more detailed survey results, see Annex 3

Gaps Needs Solutions

Programs and services of the CIC are formulated as solutions to stakeholder’s needs.

Five core areas of innovation development where gaps were identified


49

4.2 Technology Gaps

The largest perceived barrier to the development of suitable climate technologies in Vietnam is

the lack of coordination between research and industry. 84% of survey respondents affirmed this,

with about half indicated strong agreement. Secondary gaps concern the availability and

quality of information, as well as the ability to test technologies for commercial application.

Technology : Supporting local and adapted technology innovation

Gaps % Agree Needs

Lack of linkages between Vietnamese

universities and industry. Researchers do not

follow business needs and trends

84% Incentives that tie academic pursuits to

current market developments

Information on climate technologies is

unavailable/unreliable. Businesses have low

understanding of the sector in Vietnam

77%

Access to knowledge databases and best

practice

Original Vietnam-specific research

Greater public awareness/interest Lack of funding for technologists to test

products at industrial scale 77% Appropriate testing environment and facilities

Research in Vietnam remains stuck at the

laboratory scale and not suitable for industry

transfer

67%

Support from government, private sector, and

international community to enable

commercialization

Clean technology components and

equipment are expensive in Vietnam making

final products uneconomical

60%

Market linkages to cost-effective regional or

international suppliers

Tariff reductions for clean tech sector

Difficulty in importing material (custom

clearance, product database outdated,

material confiscated)

47%

Platform or venue to address industry level

concerns with government and regulatory

bodies

Case Study: Technology Gap

Systech Eco - City: Founded 2009

Systech Eco is an energy audit and energy service (ESCO) company, one of the first of its

kind in Vietnam. Systech Eco offers energy saving services for industrial and commercial

clients. The company invests in energy saving equipments for clients and clients pay pack

monthly with cost lower than they would have not using Systech Eco equipments. Systech

Eco is looking into waste heat recovery technology for potential clients in cement and steel

manufacturing. They have difficulty finding technology suppliers, the few suppliers they found

required expensive deposit and guarantee for technology transfer and acquisition that were

costly prohibitive for Systech Eco.


50

4.3 Company Gaps

Holistic support is required to grow and sustain activity in the Vietnamese climate technology

sector. Prospective innovators view financial support as the most pressing need, followed by

human resource development. Gaps in the policy environment and business advisory are also

contributing factors, in addition to the market information identified in the previous section.

Company: Building workforce capacity and a pipeline of sustainable new ventures

Gaps % Agree Needs

Lack of financial support to entrepreneurs to

make ideas into marketable products and

services

88%

Targeted finance instruments and investor

networks

Business plan development assistance

Difficulty in finding and hiring adequate talent

and human resources for climate technology

sectors

78%

Workforce capacity building and skills

enhancement

Ability to attract international talent pool

Inconsistent policy to support new business

creation and growth 76%

Analysis of policy trends and outreach to

government on priority issues

Limited availability of advice and expertise on

business development, accessing financing

and intellectual property rights laws

76%

Business advisory services

Mentorship networks and relationships

Guidance on legal frameworks governing

commerce and research

Limited access to information on technologies

and technology markets 71%

Knowledge and information sharing at par

with global best practice

Resistance to innovation and

entrepreneurship. Culture of creativity and

risk-taking is still evolving

62%

Stronger connections and expansion of the

innovation ecosystem (academic, business,

government, social sector)

Case Study: Company Gap

Solar Serve – Danang City: Founded 2007

Solar Serve manufactures solar cook stoves and solar water heaters targeting low income

rural customers. Each cook stove is priced at 1.8 million Vietnam Dong (around 90 USD), or 2

million Vietnam Dong (100 USD) if transported to a distant customer. The company is

producing the cook stoves and water heaters manually. It lacks finance to acquire

machineries or at least get access to machineries to mass produce components and scale

up its production. Manufacturing with machineries will help reduce price of its cook stoves up

to 40%, making these products even more affordable to the poor.


51

4.4 Finance Gaps

Stakeholder feedback strongly suggests that the one of the predominant gaps involves access

to flexible, early-stage risk capital. More than 50% of the 87% who pointed to prohibitively high

interest rates on small business loans as a barrier indicated strong agreement. In addition, 88%

agreed that overseas funding is difficult to access from Vietnam. Overall, prospective investors in

Vietnam would benefit from a greater understanding of how to evaluate opportunities in the

climate sector.

43% of stakeholder survey respondents agreed that the largest funding gap is faced by

businesses requesting between USD 1-3 million, followed closely by USD 250,000-750,000 (38%).

Finance : Ensuring access to flexible risk capital

Gaps % Agree Needs

Difficulty in accessing regional and

international sources of funding 88%

Enhanced ability to compete for global

green growth financing

Prohibitively high interest rates on small

business loans 87%

Facilitation of bank financing through

providing appropriate guarantees

Financial institutions lack technical expertise

and knowledge for evaluating climate

technology projects

80%

Advise financing sector on appropriate

techniques

Offer flexible start-up financing

Limited risk appetite for the financing of early-

stage technology ventures 74%

Investment funds that target higher-risk

profile companies

Lack of evidence for financial viability for

climate technology projects 66%

Case studies profiling successful investments

in other countries

Case Study: Finance Gap

Vinh Thanh Mobile Housing – Ho Chi Minh city: Founded 2008

The company founder makes mobile houses (trailer homes) for low income customers in

frequently flooded or disaster hit areas. Many customers wanted to buy his houses in

preparation for flood but could not get mortgage loans because banks do not see his

mobile houses as permanent real estate property. Currently the company can only sell to the

customers who can afford to pay the whole house. The company founder hopes to have

special credit programs to support his customers.


52

4.5 Market Gaps

Stakeholders emphasized the need for stronger demand generation to support climate

technology innovation. Among the market-related constraints presented in the survey,

consumer confidence received both the highest response rate (78%) and agreement rate (85%).

In order to successfully induce trial and switching, there is a need for businesses and consumers

to understand the value proposition behind different climate technologies. In a developing

country such as Vietnam, price is also a barrier to mass market adoption.

Markets : Creating new and expanding local and global market opportunities

Gaps % Agree Needs

Lack of trust on new products. Consumers are

cautious trying new technologies, especially

those produced by small companies

85% Information on and promotion of climate

technology sector market advancements

Support of opinion leaders and influencers

Businesses incur high switching costs to use

more efficient technologies

84% Raise awareness about new technology

benefits (profit, CSR/sustainability, etc.)

Access to commercialization grants to pilot

new technologies

Consumers stick to habits and usually follow

mass-market buying behaviors and trends

81% Communication about growing adoption of

clean technologies in overseas and nearby

countries

The price of climate technologies is too high

especially for low-income users

81% Provide support for inclusive innovation

technologies and approaches

Challenges in linking entrepreneurs to global

markets

74% Facilitate supply chain linkages and import-

export relationships

Case Study: Market Gap

ASEM LED – Ho Chi Minh city:

ASEM LED is a LED lighting manufacturer. The company is having difficulty marketing its

products to mass consumers. There have been good awareness raising programs in Vietnam

on efficient lighting, but all focused on compact florescent lamps, thus not many consumers

are aware that LED lights are even more energy efficient than compact florescent. As a

result, the company is targeting commercial clients who are financially well. It hopes to get

support in winning more mass customer‟s trust and acceptance to its LED products which

have higher cost but longer life.


53

4.6 Policy Gaps

The stakeholder feedback reveals that limited and uncoordinated policy in Vietnam inhibits the

creation and adoption of new technologies. Government should engage with climate industry

practitioners and the international community in order to develop a policy framework favorable

to innovation. In relation to findings from the other core areas, regulatory support is needed

regarding access to finance and quality standards.

Policy : Informing, linking and transforming innovative policy mechanisms

Gaps % Agree Needs

Limited coordination across ministries within

the government on climate technologies.

Difficult for entrepreneurs to navigate

87% Advocacy on behalf of industry-level issues

Focal point to help coordinate policy issues

within different ministries

Lack of knowledge of different climate

technology sectors

87% Provide a channel for dialogue between

innovators, SMEs and government

Lack of government incentives for private

sectors to adopt and deploy climate

technologies (e.g. feed-in-tariffs)

84% Demonstrate effectiveness of effective policy

approaches to green growth from other

countries

Taxation policies and incentives do not favor

new climate technology industries

80% Facilitate dialogue on taxation issues with

Ministry of Finance.

Consumers and enterprises have limited

interest and understanding of environmental

policy

67% Outreach, awareness and information on

positive impacts of conducive environmental

policy

Case Study: Policy Gap

Trung Nam Group – Ho Chi Minh city : Founded 2006

Trung Nam Group started as real estate developer and recently expanded into developing

renewable energy. The company created 3 members companies to develop 3 hydro power

projects and one wind power project. Trung Nam‟s Dong Nai 2 hydro power project is near

operation and is the largest hydro power invested by a private company in Vietnam. Trung

Nam has been having difficulty with its wind project due to the lengthy and uncertain

national and provincial wind power planning. The planning issue has been solved, however

Trung Nam is now facing the fact that even with tariff support, tariff for wind power set by the

government is not enough to make its project feasible given the price and exchange rate

escalation in recent years.


54

5.0 Vietnam Climate Innovation Center Model

Stakeholders have custom-designed the CIC model to respond to the numerous gaps illustrated

in Section 4. The model will address the majority of the needs of each priority sector through the

following initiatives:

1. Providing catalytic seed-stage risk capital to local climate technology companies and

assisting companies to secure additional financing through investor match-making and

facilitation of debt financing.

2. Building a pipeline of high-impact climate solutions by supporting the localization,

commercialization and transfer of relevant technologies through access to innovation

grants, industry partnerships and facility providers.

3. Supporting the accelerated growth of climate ventures and entrepreneurial capacity

through providing a holistic set of business development services, mentoring and training

programs.

4. Identifying and developing local and international market opportunities for new climate

solutions through providing key sectoral information, supporting policy transformation and

creating linkages with regional and international markets.

The Vietnam CIC model has been developed with the above objectives based on an extensive

gap analysis in consultation with local stakeholders and beneficiaries. The vision for the Center is

to provide a holistic range of programs and service that ensure local challenges to climate

innovation are addressed, while also coordinating and leveraging related activities in Vietnam.

Based on these objectives, 4 main pillars have been designed as the major programs of the

Vietnam CIC model. Each pillar supports a number of programs and services that are outlined in

the diagram below. While there are numerous service offerings that have been included in the

model, it is important to realize that these programs will remain targeted to the Center‟s core

objectives and positioning. There are also a number of functions that the CIC will not offer

outside of its scope, scale and sectoral focus. The Vietnam Center will therefore be a catalytic

program designed to produce medium-term impact, and contribute to longer-term market

transformation.


55

CIC Model: Vietnam


56

5.1 Program Tracks

The following section provides further detail of each program within the Vietnam CIC model.

These four „pillars‟ outline the specific activities, their functions and what needs they address as

identified in chapter 4 of the business plan.

5.1.1 Finance

Finance

Program Activity Needs Addressed

Investments

First-loss Seed Equity ($150K -750K): Seed financing

to address the financing gap for start-up and

growth-oriented companies. Funding is available as

a first-loss instrument to incentivize co-investment.

The fund should invest in businesses that address

climate change challenges either through

mitigation or adaptation to changing climate

conditions. This would include but not be limited to

prioritized sectors. Investments will be placed via a

local fund manager in partnership with the CIC.

Targeted finance

instruments and investor

networks

Offer flexible start-up

financing

Investment funds that target

higher-risk profile companies

Facilitation of bank

financing through providing

appropriate guarantees

Access to commercialization

grants to pilot new

technologies

Investment

Syndication

The CIC will facilitate additional sources of both

debt and equity financing for co-investment and

follow-on investment in portfolio companies. This will

be achieved through:

Investor match-making: Establish and grow local

investor networks including relationships with high-

net-worth individuals, angel investors and existing

fund providers to secure co-investment and follow-

on financing rounds.

Debt facilitation: Build relationships with banks

including institutions with IFC credit lines to facilitate

debt financing for working capital.

Targeted finance


networks

Offer flexible start-up

financing

Stronger connections and

expansion of the innovation

ecosystem (academic,

business, government, social

sector)

Enhanced ability to

compete for global green

growth financing

Advise financing sector on

appropriate techniques


57

5.1.2. Technology Commercialization

Technology Commercialization


Innovation

Fund

Proof of Concept (US$ 20K -50K): – Funding for

researchers, entrepreneurs and/or new projects

within existing organizations, to assist the

localization, commercialization and transfer of

technologies for local markets. Funding in

grants delivered upon achievement of

milestones. Uses include prototype

development, product design, demonstration

and field testing, measurement, market

research, company formation.

Incentives that tie academic

pursuits to current market

developments

Targeted finance


networks





sector)

Investment funds that target

higher-risk profile companies

Facilitation of bank

financing through providing

appropriate guarantees

Access to commercialization

grants to pilot new

technologies

Provide support for inclusive

innovation technologies and

approaches

Technology

Collaboration

Technology/IP Database: The CIC will provide

access to information on sourcing climate

technology products and components

including local intellectual property information

Industry partnerships: Technology collaboration

programs will include the facilitation of R&D,

technology development and joint ventures

with Vietnamese industry including utilities.

Partnerships will enable CIC companies and

affiliates to conduct joint product development

of technologies, facilitate market need

Access to knowledge

databases and best

practice

Original Vietnam-specific

research

Appropriate testing

environment and facilities

Support from government,

private sector, and

international community to

enable commercialization


58

identification and allow access to industry

knowledge and know-how.

Market linkages to cost-

effective regional or






sector)

Raise awareness about new

technology benefits (profit,

CSR/sustainability, etc.)

Facilities

Facility Provider Agreements: The CIC will

partner with existing facility providers to provide

access to:

Equipment for testing and prototyping.

Industry facilities for first-run production and

small-scale manufacturing.

Appropriate testing


5.1.3 Venture Acceleration

Venture Acceleration


Business

Development

Services

Advisory Services Fund: The CIC will house a

fund for access to out-sourced specialized

advisory services such as business planning,

investment preparation, product design,

engineering support, legal, HR and IPR

assistance. While the CIC will provide basic

business planning advice for interested

companies, funds will only be available to

companies eligible for CIC financing. As part of

investment due-diligence, entrepreneurs eligible

for CIC financing will be offered access to funds

for financial planning services to ensure

companies are investment-ready. The CIC‟s due

diligence services will be also offered to

companies seeking investment from other

Appropriate testing



private sector, and



Business plan development

assistance

Workforce capacity building

and skills enhancement

Ability to attract international

talent pool

Guidance on legal

frameworks governing



59

sources of financing.

Diaspora-Mentor Network: The Center will

establish a broad network of serial

entrepreneurs, technical advisors and

professional service firms (accounting, legal,

marketing) that are locally based. A mentor

program will be established to ensure each CIC

invested company is assigned a mentor for the

duration of the funding cycle at both grant and

equity stages, as applicable. The advisory

service fund will be used in combination with the

mentor network to modestly compensate

mentors for their involvement in the program.

Virtual Incubation: CIC supported companies

will be provided the physical space, services

and infrastructure needed via partnerships with

Vietnamese incubators, science parks, labs,

universities and industry facilities.

Business advisory services

Mentorship networks and

relationships





sector)

Education &

Training

University Partnerships: The CIC will build

partnerships with various universities in Vietnam

to:

Fund specific courses and workshops on

climate tech entrepreneurship for students

Be a focal-point for university-industry

partnerships

Advertise project opportunities

Facilitate access labs and equipment

Seminar Series: General business training

seminars targeted at individuals and university

students interested in starting or growing a

technology-based business. Seminar series will

include guest speakers and cover a range of

business and technical issues relevant to climate

technology. The Centre will also hold training

programs for women on management, finance,

negotiation, business leadership and handling

harassment.

Incentives that tie academic

pursuits to current market

developments

Greater public

awareness/interest


private sector, and



Workforce capacity building

and skills enhancement

Enhanced ability to

compete for global green

growth financing

Information on and

promotion of climate

technology sector market

advancements


60

5.1.4. Market Development

Market Development


Market Analytics

Market and Sector Trend Reports: The

Center will research and produce original

analytical products including reports on

various climate tech sectors and detailed

information and data on local and regional

market trends and opportunities. The

Center will also deliver periodic reports with

data and lessons learned from CIC

beneficiaries to share knowledge and

experiences with the broader network.


research

Greater public

awareness/interest

Knowledge and information

sharing at par with global

best practice

Information on and

promotion of climate

technology sector market

advancements

Policy Advisory

Association support and advocacy: To

promote industry collaboration within a

number of sector verticals, the CIC will

provide financial support to build the

capacity of existing business associations

and/or create new associations where

necessary. These will be coordinated by

the Center and form part of the CIC‟s

industry network, The CIC will also provide

awareness raising and communication on

the CIC and incubation activities in

Vietnam more generally to further

knowledge and public understanding.

Policy advisory board: The CIC will form an

advisory board of relevant public and

private sector stakeholders and host

regular roundtables on pertinent policy

implications for issues including innovation,

R&D, intellectual property rights, private

sector development, taxation,

environmental, and export policy. The

policy advisory board will aggregate the

issues of CIC invested companies and


private sector, and



Greater public

awareness/interest

Access to knowledge

databases and best practice


research

Market linkages to cost-

effective regional or


Tariff reductions for clean

tech sector

Platform or venue to address

industry level concerns with

government and regulatory

bodies

Guidance on legal

frameworks governing


Support of opinion leaders


61

affiliates and aim to influence positive

policy reform through direct dialogue with

Vietnamese ministries. The advisory board

will also promote coordination between

various ministries.

Expert Fellowship: The Center will host a 6-

month rotating international or regional

fellowship position. The policy fellow will be

tasked with organizing roundtable events

and producing analytical products

highlighting global best practice on policy

and regulation on topics related to climate,

energy, private sector and innovation.

and influencers

Advocacy on behalf of

industry-level issues

Focal point to help

coordinate policy issues

within different ministries

Provide a channel for

dialogue between

innovators, SMEs and

government, e.g. dialogue

on taxation issues with

Ministry of Finance.

Regional

Networking

Regional CIC Forum: Vietnam will host an

annual event on climate innovation to

bring together relevant stakeholders from

the country and region.

Company Internationalization: The CIC will

form linkages with regional and

international organizations and initiatives to

promote global technology development,

joint venture and trade opportunities with

Vietnamese firms. The Center will also be

linked to CICs in other countries including

India, Kenya and South Africa to assist

companies in accessing foreign markets.

Knowledge and information

sharing at par with global

best practice

Case studies profiling

successful investments in

other countries

Outreach, awareness and

information on positive

impacts of conducive

environmental policy

Demonstrate effectiveness of

effective policy approaches

to green growth from other

countries

Enhanced ability to compete

for global green growth

financing

Communication about

growing adoption of clean

technologies in overseas and

nearby countries

Facilitate supply chain

linkages and import-export

relationships


62

6.0 Operational Plan

6.1 Project Timeline

6.1.1 Implementation phase: 9 Months

The diagram below shows the staged roll-out plan for the Vietnam CIC based on infoDev‟s

implementation experience with the Kenya CIC, Mobile Application Labs and other enterprise

acceleration and incubation programs. The first year of implementation activities will be a

critical time of securing requisite funding, identifying and contracting partner institutions,

establishing the Center‟s structure and making key hires. The majority of the CIC programs will

begin with the opening of the CIC in the fourth quarter of 2012 and scale-up over the first years

of CIC operations, as described in the 5-year budget projections.

6.1.2 Five-year operational timeline

It is anticipated that the CIC‟s services will operate on predominantly annual cycles from years

one through five, although this may require adjustments based on initial institutional capacity

constraints and hiring of staff. In order to maximize the value of revenue streams of CIC

supported ventures and to generate „quick wins‟, the finance programs will be front-loaded in

Years 1-3. Other programs will be phased and prioritized according to their importance. Based


63

on the stakeholder survey, each activity line was ranked according to priority. These have been

identified in the operational summary timeline below. To avoid capacity constraints, the CIC‟s

host should allocate resources and concentrate hiring efforts specifically for those services

considered „integral‟ to the Center‟s operations. Those that are „high priority‟ should follow with

„ideal‟ activities being implemented once all other programs are successfully in place. This will

avoid overreach and ensure efficient ramp-up of the CIC over time.

6.2 Governance

The Climate Innovation Center will be housed in a local organization selected through a

competitive bidding process. The governance of the CIC will be fully defined at the time of

negotiation with the host organization and partners in adherence with local regulations. The

selected organization and associated consortium partners will be responsible for all aspects of

the CIC establishment and operations including securing appropriate facilities, identifying a

world-class management team, providing the services and programs described in the business

plan, and ensuring effective monitoring and evaluation (M&E) of programs. The host will report

to infoDev and the infoDev Climate Innovation Steering Committee to ensure effective and

successful execution of the program in accordance with required fiduciary and financial

management practices.

6.3 CIC Host Selection

The Center‟s host and consortium will be identified via a request for proposal (RFP) process. The

lead partner must be Vietnamese; therefore, local legal registration may be needed. Applicants

will be encouraged to consider partnerships with other organizations, inside and outside

Vietnam in order to best provide the range of capabilities necessary to establish and operate

the CIC. Short-listed organizations or consortia will be required to provide full technical proposals

indicating that they are qualified to perform the services outlined in this business plan.


64

Important evaluation criteria for consortia partners will include:

Capabilities to build and manage complex organizations, including strong internal

governance frameworks and a track record of fiduciary responsibility and accountability.

Proven ability to attract and build a strong team of individuals including a senior

management team for project implementation.

Understanding of the needs of climate technology SMEs in Vietnam or similar contexts,

including experience evaluating climate technologies and incubating early-stage

businesses.

Strong local and international links with potential partners including climate technology firms,

investors, technical and business experts, policy experts, and leading research and

development organizations.

Ability to leverage existing and additional sources of funding, both cash and in-kind, such as

space, equipment, and staff.

Ability to implement and maintain procurement and financial management processes and

a comprehensive M&E strategy.

Physical presence, including relevant experience, partners and networks in both Hanoi and

Ho Chi Minh City with the ability to engage rural and regional areas.

6.3.1 Sample of possible CIC host organizations in Vietnam17:

Institution/Organization Type Partners/Funders

TOPICA Founder Institute Business incubator Private

John Von Neumann Institute Education Vietnam National University,

HCMC

Dragon Capital Clean Development Fund Equity fund Private

Indochina Capital Infrastructure Fund Equity fund Private

BK Holdings Semi private Company under Hanoi University

of Science and Technology

Saigon Hi-Tech Business Incubator (SHBI)

at Saigon Hi-Tech Park (SHTP)

Incubator - Government Government Saigon Hi-Tech Park

is under the management of

People‟s Committee of HCMC

17 Note selection will be made via competitive bidding process following World Bank Group procurement guidelines.

Above list is informational only and is in no way indicative of selection.


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6.4 Fund Manager

In addition to the CIC host, a separate contract for the investment funds will be established with

a suitable fund manager via a competitive selection process. It is expected that the CIC

investment fund will be framed on the key principles outlined below. The framework for this fund

may evolve and may be determined in discussion and negotiation with the selected investment

fund manager. More details of the fund will be outlined in the Request for Expressions of Interest

for hosting the CIC‟s funds.

Fund manager will place investments alongside CIC host activities

6.4.1 Investment philosophy and approach

The fund should aim to address the financing gap for start-up and early stage business

models and growth-oriented SMEs.

The investment fund should be managed as a „seed investment fund‟ addressing the

financing gap below the radar of the current set of impact and private equity investors in

Vietnam.

The fund manager should expect to take a hands-on approach to support investee

companies, working closely with senior management to advance each company‟s viability

and commercial success.


66

6.4.2 Investment targets

The fund should invest in businesses that address

climate change challenges either through mitigation

(reduction of GHG emissions) or adaptation to

changing local climate conditions. This would include

prioritized areas of energy efficiency and sustainable

agribusiness. While the fund will be required to focus

on investments in these areas, it will not be limited in

its ability to invest in promising opportunities in other

climate related sectors. In addition, there will be no

preferred investment based on demographic criteria

(e.g. women-owned businesses), however the CIC will

track gender involvement in investments and

coordinate this with gender outreach activities.

Portfolio companies would generally have a

proprietary advantage such as a unique technology

development approach, intellectual property position

or a difficult-to-replicate business model. Financing would be tied to achievement of agreed

technology, financing or business development milestones to mitigate investment risk.

The Fund would typically take minority positions, with typical consent and governance rights,

including Board representation. It is anticipated that the Fund would play a strong role in

developing good corporate governance practices in its portfolio companies.

6.4.3 Financing mechanisms

The investment size in each company will be between USD 150,000 to USD 750,000 based the

company‟s funding requirements and appropriate due diligence. The fund will target early-

stage companies with a clearly articulated business plan, in which the fund serves as a

critical enabler of company growth. Generally, the fund is expected to invest in self-

liquidating preferred equity or convertible debt instruments depending on existing

regulations in Vietnam. Convertible debt may not be feasible within current financial

regulations and therefore this will be established in negotiations with the selected fund

manager.

Investment criteria: The CIC‟s

investment term-sheets will be

developed by the CIC‟s fund

manager. The broad metrics upon

which CIC will invest include:

Level of Innovativeness

Technology priority for country

Management experience

Competitive advantage

Market & growth potential

Uniqueness of business model

Quantifiable environmental

benefits

Impact on gender and social

inclusion


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6.4.4 Leverage

The fund manager will be required to leverage the capital committed from the CIC

investment fund by attracting additional investment capital from other investors. It is

envisioned that fund will leverage up to twice the investment amount directly through

private, commercial co-investors, IFIs, philanthropic organizations and angel groups. The CIC

host will work to build a Diaspora network that will be invited to participate in funding

opportunities. Similarly, infoDev will continue to engage policy makers, local banks and the

IFC for potential partnerships on debt co-financing or credit-lines for CIC beneficiaries.

6.4.5 Fund structure:

The fund manager would require local legal registration in Vietnam, however funding maybe

housed in a more politically and financially efficient jurisdiction in South East Asia (e.g.

Singapore), that is governed and managed in line with best practice.

Fund manager fees will come from the CIC grant to the fund manager. Based on the Kenya

CIC lessons, fees will include (i) management fees, likely higher than the usual 2% to

compensate for the additional costs associated with smaller, earlier stage investments, and

(ii) profits from investments, with details such as first-loss provisions and the waterfall of returns

to be determined in negotiation with the fund manager (see below graphic).

infoDev will aim to coordinate the fund with existing investment initiatives including donor

programs such as Finnfund, Vietnam-Finland Innovation Partnership Programme (IPP), and

the recently announced AusAID-World Bank investment and advisory program18. To

supplement locally available investment expertise, an established fund manager from

outside Vietnam may be required to assist with investment management. In this case, the

fund manager would be expected to place at least investment officer level staff to oversee

and implement operations in Vietnam.

6.4.6 Foreign Exchange

Vietnam‟s ordinance on Foreign Exchange Control stipulates that investment capital in

foreign currency must be remitted via foreign currency accounts established at an

authorized credit institution. These funds must then be converted into Vietnamese dong for

the implementation of the investment. Accordingly the CIC, through its investment fund, will

18 AusAID to fund WB program to effectively develop Vietnam, March 2012.

http://www.thanhniennews.com/2010/pages/20120311-wb-to-use-ausaid-fund-for-vietnam-effective-development.aspx


68

set aside funds in foreign currency for equity investments for firms, with a provision for

exchange rate fluctuations.

In addition, the CIC will liaise with the State Bank of Vietnam and facilitate foreign currency

borrowing for firms whose outputs are export oriented. Foreign exchange issues will be

discussed with potential fund managers during implementation.

6.4.7 Local presence and relevant experience:

The fund manager should demonstrate local presence and an understanding of the

Vietnamese context, market opportunities, and challenges.

The fund manager should demonstrate substantial in-country networks to ensure effective

deal sourcing. Additional regional networks (e.g. East and Southeast Asia) are desirable.

The fund manager should demonstrate relevant experience and track record in fund

management and impact investing and a strong interest in clean-tech/renewable energy.

At the proposal stage, the bidding firm will be required to present the specific profile and

experience of the senior management team including the profile of the key senior

investment officer(s) who would drive and be accountable for the fund.

6.4.8 Returns, expectations and exit value:

In negotiation with infoDev, the fund manager will set a target return of up to 5% to both

investors in the fund and co-investors based on exit mechanisms and timelines, with a 20%

carried interest for the fund manager. It is anticipated that the fund will be in operation 5 to 8

years from final closing subject to two one-year extensions with the consent of investors.

Financial returns and exits including profit-sharing royalties, repayments, buybacks,

acquisitions or public sale should be reinvested in the fund prior to allocating returns to

investors, co-investors and partners. Once the CIC‟s fund has been replenished, if possible,

returns should be allocated to the CIC host to ensure continued sustainability of the Center.

The fund manager will define, in partnership with infoDev, supplementary targets and

indicators to advance the CIC‟s overarching objectives within the context of Vietnamese

capital market limitations. The CIC will collaborate closely with other funds, programs and

development initiatives aimed at developing capital markets in Vietnam in order to facilitate

successful exits.


69

CICs Fund’s waterfall reflow provides 50% cushion to reduce financial risk to co-investors

6.4.9 Link to the CIC host:

While the CIC investment fund would be managed and governed independently from the

CIC host, the two components are complementary and the investment fund must be linked

to the CIC‟s other services, programs and grant activities, while still maintaining

independence in funding decisions. Ways to ensure this link will be developed by infoDev in

conjunction with the managers of the CIC and investment fund.

One of a number of proposed linkages will be the establishment of the CIC host as a limited

partner (LP) in the fund. After the first few years of operation, the CIC should be registered as

its own legal entity, whereupon the LP shares would then be transferred to the CIC. The fund

would likely have a 5 year investment period and a 7 to 8 year term. The fund manager will

distribute profits to LPs according to the waterfall agreed in negotiations.

To allow flexibility for the fund manager, technical assistance and other mentoring services

provided by the CIC will not be a mandatory condition for receiving financing. The CIC will

refer appropriate clients to the fund manager and vice versa, however both can support

businesses that do not interact with the other.


70

6.4.10 CIC investment pipeline:

infoDev has assessed market demand for the CIC‟s services and financings via extensive

identification and consultation with potential private sector beneficiaries. These have been

presented in chapter 3.

To actively encourage the demand for the CIC fund‟s investment products, a dedicated

„Innovation Fund‟ proof-of-concept (PoC) grant facility will be managed by the CIC host.

The ticket size for the PoC funds ranges from USD 25,000 to USD 50,000 and will primarily fund

technology development and company formation in order to build a robust pipeline for the

CIC‟s equity investments. The equity investments will aim to invest in the most promising PoC

grant recipients, but will not be limited to investing in these companies only. Coordination

between the CIC host and the fund is mentioned above and will be further clarified in grant

agreements with implementing partners.

Significant outreach and promotional activities will be required in the first years to build

awareness and encourage funding application The Center is also staffed with a number of

Partnership Development Managers who will be working closely with affiliates to identify and

source potential deal-flow for the CIC‟s fund. infoDev will also ensure that the CIC fund host

has strong networks in Vietnam. In addition to this, a finders or promoters fee may also be

negotiated with the fund‟s host firm.

6.5 infoDev

The World Bank‟s infoDev will act as a trustee and implementation partner for the CIC. Financing

for the CIC will be housed within a dedicated Climate Innovation Multi-Donor Trust Fund (CITF)

which will have the fiduciary oversight of the World Bank. Implementation oversight, project

management and monitoring and evaluation will be executed by infoDev‟s CIC Program

Implementation Team to ensure timely and successful program delivery.

The project will be executed via contractual grant agreements between Dev and the CIC host

institution and partners. infoDev will act as the administrator of the grant agreements and

competitively source recipients based on their ability and capacity to deliver the CIC‟s services

and programs as outlined in the business plan. Multiple grant agreements may be issued with

various partners based on their capability of delivering a specific service.

The CIC host institution will also be tasked with sub-contracting specific services as appropriate.

These services will include the capacity building components of the CIC including training,

advisory services, market information, and policy support to the government. This will allow the


71

CIC‟s services to be delivered by the most appropriate organizations, leverage existing

expertise, networks and overheads while reducing duplication of existing activities.

Grant agreements will also be phased over two periods: a launch phase in years 1 to 2 and

scale-up phase in years 3 to 5. This will allow infoDev and donors to maintain flexibility over

contingencies including modifications to recipient executed activities.

Grant agreements will outline the following contractual arrangements with grant recipients:

Project deliverables Eligible expenditures

Monitoring, reporting and evaluation Withdrawal conditions

Financial Management Intellectual property rights/licenses

Procurement

infoDev will coordinate all activities with local World Bank and International Finance Corporation

(IFC) colleagues, to leverage existing in-country knowledge and expertise and link with

complementary WBG projects and investments where appropriate. This governance is illustrated

in the below diagram.

6.6 Donors

Donors to the Vietnam CIC will form part of infoDev‟s Climate Technology Program Steering

Committee (SC). The SC will meet at least once a year and will be responsible for: (i) providing

overall strategic direction to the Program; (ii) endorsing the annual work plan and budget for

CTP; and (iii) periodically reviewing overall progress of activities conducted under the Program

and provide guidance to individual country CIC‟s. Decisions of the SC will be communicated to

infoDev in writing. The Steering Committee will be chaired by the World Bank‟s Financial &

Private Sector Development Vice President, or its designee.


72

Governance structure of Climate Innovation Center

6.7 Safeguards

As the implementation agency, infoDev strictly follows World Bank procurement guidelines and

procedures. In addition, the CIC host and fund will also be subject to World Bank procurement

guidelines. They will be required to display financial management and procurement capacity

through the presentation of a „procurement plan‟ prior to receiving implementation funding by

infoDev. Part of this process will include a safeguard assessment of the CIC host. Furthermore,

safeguards will also be assessed at the CIC level for major programs and funding decisions that

are higher than a pre-identified threshold (for example, any construction/renovations above

$50,000 or investment decisions above $100,000) . Safeguard triggers will include:

Natural habitats

Forests

Pest management

Physical cultural resources

Indigenous peoples

Involuntary resettlement

Safety of dams

International waterways

Disputed areas

Child labor


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6.8 Other Issues to be Addressed During Implementation

Outstanding governance questions including board membership, management structures

and ownership of the CIC which will be addressed in detail when founding donors and hosts

are identified.

Investment governance and structuring including design of fund structure, potential

leverage amounts, term-sheets, management fees, and coordination with CIC host.

Staffing review including reassessment of in-house versus outsourced staffing requirements for

each business line based on host‟s existing capacity.

Technology priorities including understanding which sectors have the greatest demand for

the CICs services and how the Center‟s technology specializations and expertise will evolve

over the first years of operations.

Intellectual property rights including addressing ownership issues amongst the Center,

affiliates, partners and investees.

Performance metrics including the priority impacts and objectives the CIC will measure over

the first phases.

6.9 Exit Strategy

6.9.1 CIC Host

While donor money will be necessary to seed the CIC over the first five years, it is expected that

the director and management team will raise additional contributions (both cash and in-kind)

from local stakeholders for continued operations beyond the first five years. The objective of

initial donor funding is to establish the CIC, generate successes and demonstrate the program‟s

value for local public and private sector support in the longer term. Donors are expected to exit

as major funders of the CIC after the first five years, with investment income and operational

revenue, subsidizing a majority of the ongoing cost of the program. Further support to

supplement the entire costs of the CIC will be sought from both the Government of Vietnam.

Other funding sources from international climate finance, philanthropy and corporate

sponsorships will also be considered to ensure the sustainability of the program after 5 years.

6.9.2 CIC Fund

Distributions allocated from the fund‟s liquidation will either be transferred to the CIC host for

budgetary support or reinvested in the fund on a revolving basis. The fund will operate for a

period of five to eight years depending on the success of the investments. The sunset clause for

the fund will be negotiation upon selection of an appropriate fund manager.


74

6.10 East Asia Regional Engagement

The Vietnam CIC will be a member of infoDev‟s CIC network, which will allow the Vietnam

Innovation Center to be connected to climate technology markets in the region. Through the

Climate Technology Program activities, infoDev will help facilitate access to markets, build

capacity and promote south - south knowledge transfer and trade. The Vietnam CIC will also be

linked with CICs in Kenya, Ethiopia, South Africa and India to assist entrepreneurs in accessing

foreign markets and expertise. These linkages will also allow the Vietnam Center to benefit from

knowledge generated from the implementation of CICs in other countries.

6.11 Organizational Structure

In addition to the above governance arrangements, the CIC will have its own internal

organizational structure which will comprise of an advisory committee, a management team

and key staff.

6.11.1 Advisory Committee (AC)

An Advisory Committee will advise the CIC host on technical elements related to planning,

strategy and business development. It will include up to 7 members, to be composed of relevant

private sector and government representation and will be nominated by the CIC in

collaboration with infoDev and founding partners. To ensure involvement of the Vietnamese

Government including alignment with relevant policy strategies, the AC will reserve 3 of the 7

committee memberships for representatives of different government ministries.

These memberships, which will be provided on a two-year rotating basis, will assist in forming

linkages with various public and private partners to help achieve its mandate. The AC will also

ensure appropriate coordination is made with existing initiatives of AusAID and the Foreign

Ministry of Finland. The CIC will consult infoDev and funding partners on changes in the

committee‟s structure over the duration of the program. The AC, once established, will set up

separate bodies that, over time, may be grouped into specialties based on technology sectors.

For example, the CIC may have an advisory sub-committee on „transportation technologies‟.

6.11.2 Management Team

In accordance with the organizational design, program budgets will be managed by a

management team led by the CIC Manager. The Manager will be responsible for the day-to-

day operations of the Center, including oversight of programs, reporting to infoDev, the host and

advisory committee, developing relationships, setting strategic objectives and fund-raising. The

Manager will be supported directly by a Procurement and Financial Management Specialist to

ensure appropriate fiduciary duties are enacted and procurement guidelines followed. The CIC


75

Manager will also be supported by a Marketing and Communications Officer that will lead the

promotion, branding and publicity of the Center‟s programs and services.

6.11.3 CIC Staff

Other roles within the CIC include Case Manager/s who will manage the budgets for the POC

investments, mentoring and other advisory service offerings as these activities are closely

related. The Project Managers will manage the budgets for the various Access to Policy and

Information activities, while the Partnership Development Managers will be responsible for the

brokering and facilitating of local, regional and international relationships. An International

Fellowship will be established to bring in a series of experts to manage the policy advisory and

other related analytical products while an Energy/Environment Specialist will be on hand to

oversee technical expertise requirements. Analysts and administrative staff will be responsible for

supporting the above functions.

6.11.4 Fund Management

In addition to the CIC staff, An Investment Officer will be part of the selected Fund Manager‟s

team and will be responsible for overseeing investment activities including scouting, due-

diligence, selection and advisory of investees. These activities will be coordinated closely with

the CIC host and affiliates. In this way, the CIC‟s advisory, technical assistance and mentoring

programs can support investees as needed. The Fund will however be operated independently

to ensure no conflicts of interest arise and that investment decisions are made impartially. One

mechanism to ensure coordination without conflict is for the CIC to act as a Limited Partner (LP)

in the fund.

Proposed organizational structure of CIC


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6.11.5 Staffing requirements

The illustration below outlines the staff requirements for the CIC, totaling the equivalent of 19 full

time employees (FTE) per year. The CIC may choose to outsource many of these roles through

contracts with service providers or through partnership arrangements with consortia members.

Some of these positions and roles may also form part of the World Bank‟s implementation team

for the Center based on the host organizations‟ capacity and capabilities. Salary assumptions

for the different roles can be found in Annex 4.

Role Description FTE per year

CIC Manager

Manager of center who reports to a board and

oversees investments, enterprise development,

budgets and fundraising for center (1)

Case Manager

Oversees proof of concept phase and supports

technologists, entrepreneurs and enterprises in

accessing technical assistance and mentorship (2)

Investment Officer19

Part of fund management team. Scouts, screens,

selects and advises investment and co-investment

opportunities. (1)

Project Manager Supports and oversees a range of programmatic

operations of the CIC (2)

Partnership

Development

Manager

Makes links between strategic national and

international partners, builds network of mentors and

develops regional programs (3)

Analyst Tasked with conducting research for center's market

information programs (4)

Fellow

Experts and thought leaders affiliated or on

assignment with center tasked with preparing reports,

articles and policy advisory (1)

Marketing and

Communications

Officer

Coordinates branding, marketing, communications

and outreach for center (1)

Financial

Mgt/Procurement

Responsible for Center's procurement and financial

management obligations to meet World Bank group

procedures and guidelines (1)

Energy/Environment

Specialist

Supports all projects and is a source of technical

expertise in energy and environment sectors. (1)

Administrative

Support Responsible for the Center's administrative tasks

(2)

19 The cost of the investment officer approximately constitutes the anticipated management fee of the fund (3-5%). This

may not be the only staff member that the fund employs as they will be required to leverage other funding sources

which would support the costs of further investment staff.


77

7.0 Financial Plan

7.1 Budget for Years 1 to 5

The included graphics illustrate the budget allocation for the CIC‟s first five years of operations

totaling USD 17.95 million which includes the preparation, implementation, launch and operation

of the CIC over the first five years. This amount also includes linking the CIC with infoDev‟s global

program activities and network. The first

year of the CIC‟s implementation will

primarily be dedicated to establishing

institutional capacity, including

establishment of the management team

and the launch of major programs. The

subsequent years will scale the CIC‟s

investment, mentoring, regional and

other capacity building programs.

The majority of the Center‟s funding will

be allocated towards investments,

which total USD 9.3 million including

staff related costs. Core staff and

central costs is the second largest

allocation at just under USD 2 million.

The CIC‟s overall staffing including

programmatic staff represents USD4.6m

or 23% of the budget; however, some

of these roles are envisioned to be

outsourced.

The Innovation Fund is another significant budget item at approximately USD 1.8 million. This will

provide proof-of-concept grants to deserving climate technology innovators, thereby

contributing to the CIC‟s future investment pipeline. Approximately USD 1 million will be

budgeted for the Vietnam CIC‟s participation in infoDev‟s global network, most notably to the

CICs in other countries.

53%

12% 5%

3%

4%

2% 15%

6%

USD 17.95m Vietnam CIC budget

breakdown

Investments

Tech Commercialization

Venture Acceleration

Market Analytics

Policy support

Regional programs

Core staff & overheads

Global Network Participation

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

Year

1

Year

2

Year

3

Year

4

Year

5

Vietnam CIC Budget Breakdown

Investments

Core staff &

overheads Tech

Commercialization Global Network

Participation Venture

Acceleration Policy support

Regional programs

Market Analytics


78

7.1.1 Vietnam CIC Aggregated Budget in USD „000s

The table below breaks down the CIC budget for Years 1-5; discrepancies in the total are due to rounding. A more detailed budget

is available in Annex 5.

ACTIVITY

Year 1 Year 2 Year 3 Year 4 Year 5

TOTAL STAFF

PROG

RAM TOTAL STAFF

PROG

RAM TOTAL STAFF

PROG

RAM TOTAL STAFF

PROG

RAM TOTAL STAFF

PROG

RAM TOTAL

Investments 100 2,200 2,300 100 2,800 2,900 100 3,800 3,900 100 - 100 100 - 100 9,300

Investment

Syndication 35 8 43 35 8 43 35 8 43 35 8 43 35 8 43 215

Innovation Fund 50 240 290 50 325 375 50 320 370 50 335 385 50 335 385 1,805

Tech

Collaboration 20 15 35 20 15 35 20 11 31 20 6 26 20 6 26 153

Facilities 10 14 24 10 14 24 10 14 24 10 8 18 10 - 10 99

Business devel-

opment services 76 96 173 76 96 173 76 106 183 76 59 135 76 9 85 749

Education and

Training 28 14 42 28 14 42 28 14 42 28 14 42 28 14 42 211

Market Analytics 20 90 110 20 90 110 20 90 110 20 90 110 20 90 110 550

Policy advisory

100

42

142

100

42

142

100

42

142

100

42

142

100

42

142

710

Regional

Networks 35 30 65 35 30 65 35 30 65 35 30 65 35 30 65 325

Core Staff 330 64 394 330 64 394 330 64 394 330 64 394 330 64 394 1,968

Monitoring /

Evaluation 20 50 70 20 50 70 20 50 70 20 50 70 20 50 70 265

Travel / other

expenses - 30 30 - 30 30 - 30 30 - 30 30 - 30 30 150

Overheads

(Office facilities) - 72 72 - 72 72 - 72 72 - 72 72 - 72 72 360

Subtotal 825 2,944 3,769 825 3,584 4,409 825 4,610 5,435 825 767 1,592 825 729 1,553 16,859

Global Network

Participation 118 100 218 118 100 218 118 100 218 118 100 218 118 100 218 1,094

Total 17,953

*Project implementation and management costs are included in the above budget


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7.2 Sustainability

The CIC will work for partial self sustainability, largely through its investment activities, which are

anticipated to cover 71% of the CIC‟s operating costs and replenish the CIC‟s annual investment

activities each year by year 7. The Center can aim to reach a higher level of sustainability by

introducing other revenue streams, once a strong value proposition has been achieved in the

early years. It is, however, envisioned that the Innovation Center will never be fully sustainable

and will require continued public subsidy given its inherently higher risk versus established private

sector initiatives. The detailed assumptions driving this revenue are shared in Annex 6.

Years

Sustainability 4 5 6 7 8 9 10

CIC Total 0% 47% 47% 71% 71% 73% 73%

Investments Only 0% 67% 67% 101% 101% 104% 104%

Sustainability of CIC over time

8.2.1 Investment fund:

Valuations of CIC invested companies were estimated based off investment levels of seed

funding over both 5 and 10 years as outlined in the below schedules and detailed in Annex 7.

Investment Average $ Ownership

held by CIC yr 1 2 3 4 Total $

PoC 30.500 Nil-grants 9 11 10 10 $1,220,000

Seed

Investments 352.000 30% 8 8 9 0 $8,800,000

Given the CIC is has been designed as a long-term capacity building initiative, it will realize

much of its impact after the first 5 years. Therefore it is more realistic to calculate results using an

investment schedule of 10 years which takes into account (i) continued investment in the CIC

and (ii) investment returns that the CIC will use to replenish its own fund. Therefore investment

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

4 5 6 7 8 9 10

CIC Budget

Investment Budget

Investment Revenue


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returns and impact have been calculated on continued investment in the CIC beyond its first 5

years of operations under a budget scenario of USD17.95 million.

It takes time to realize investments in early stage companies, therefore 5 to 8 years will be

required to achieve exits from investments made in the first 3 years, largely by trade sale or

shareholder buy-back. Proof of concept investments would not generate revenue directly

(however may be linked to a royalty mechanism for the CIC – See „7.2.2 Other revenue

potential‟), however would help generate quality deal flow for future CIC investments. Using

conservative assumptions, verified in the local context, returns would start to flow back to the

CIC starting from the 5th year based on the below assumptions.

Key Investment Revenue Assumptions:

Type of Investment Average

Investment Probability

Years to

exit/repayment

Exit multiple

(Equity only)

POC Grants (no estimated

revenue generation, however

royalties possible)

$30,500 N/A

Seed investments $352,000

- -

Company fails or produces no

realizable value 50% - * -

Company has low growth

20% 5 1.5

Company has modest growth

15% 6 2

Company has medium growth

10% 6 3

Company has high to very high

growth 5% 8 7

* No realistic exit given the unlikelihood of management buy outs. If equity is converted to debt, additional

revenue can be achieved through interest earned.

It is conservatively estimated that about 50% of the CIC‟s investments will fail or produce no

realizable value. The remaining investments will include low-growth enterprises at 20% of the

portfolio, modest growth at 15%, medium growth at 10% and high to very-high growth at 5%.

These probabilities have been used in combination with assumptions on various exit multiples

over a 6 to 9 year period. The investment returns from the CIC‟s fund will likely take many years

to generate revenues given the high-risk and higher capital requirements of climate tech

companies. Assuming continued investment in the CIC‟s fund, investment returns are predicted

to grow from USD 800 thousand in year 5 to USD 3.8 million in year 7. This delivers an expected


81

investment rate of return (IRR) of 3% on the CIC‟s portion of the funding, taking into account the

first loss provisions in the fund‟s structure.

Amounts In USD

Years

4 5 6 7 8 9

Yearly

Investment

Returns

_ $844,800 $2,534,400 $3,625,600 $2,886,400 $1,108,800

Cumulative

investment

returns

- $844,800 $3,379,200 $7,004,800 $9,891,200 $11,000,000

With USD 6.3 million of continued support to the CIC to continue investments in years 4-6, the

projected returns from investments would allow the fund to become self-sustaining. After year 7,

these returns can either be re-invested into CIC companies or invested in the CIC host to cover

operating costs of non-investment services. The governance arrangement between the fund

and the CIC host would need to be designed to facilitate such funding flows (See chapter 7)

including establishing the CIC host as a limited partner (LP) in the CIC‟s fund.

The revenue model strategy has two distinct benefits for the CIC and companies it assists.

1. The ambitions of both are aligned, sharing the common objective of building a significant

business. Actions that benefit the company also maximize the return to the CIC.

2. Importantly, the success-sharing model builds a sustainable future for the CIC, with a model

that is scalable and replicable. Returns from company success can not only be used for

reinvestment, but also incentives to management, investment officers and mentors who are

providing critical advisory support.

7.2.2 Other revenue potential:

infoDev has investigated other potential revenue sources, which may be developed over time.

These revenue streams will be evaluated and developed in years 3 to 5, once a strong value

proposition has been achieved. It is projected that via the below revenue mechanisms, the CIC

can aim to cover a portion of the remaining 29% of the budget at year 8. It is assumed that

management would periodically revisit the business model of the center to identify sources of

funding where appropriate without compromising the objectives of the program. Such sources

of revenue could include:

Royalties: A royalty arrangement will likely be implemented as part of the proof of concept

grants. If the company is successful and launches the product or services, the CIC would be

entitled to up to 7% of annual revenue over a two to three year period.


82

Advisory services: A significant portion of the funding for mentoring and investment advisory

could be paid back by beneficiaries over time. This has not been calculated in the current

revenue model for the Center however it can be assumed that all monies repaid to the fund

will be disbursed for additional advisory service support, even within the first 5 years.

Carbon credits: The CIC and its beneficiaries will ideally apply for available carbon credits as

a potential revenue source. The policy advisory and market information services of the

Center should aim to identify such sources of funding.

Promoter’s fee: By brokering finance as a service, the CIC can generate revenue as

percentage of the finance secured. This may be taken in cash or re-invested in the

investee‟s business. The revenue potential for such a service should be explored in the future

when demand for the CIC‟s investments increases. This would not apply to investments

made by the CIC‟s fund.

Facilities leasing: The CIC will explore the adoption of a pay-per-use model to generate

income from the Center‟s agreements with facility providers.

Sponsorship: The CIC will recruit corporate sponsors that will attract private sector

participation. Industry and the private sector will benefit from this affiliation by gaining,

among others, access to SME activity, technology and market research.

Tailored training: In later years, the CIC may be able to monetize its market and technical

knowledge. The capacity building team will develop training models that can be provided

to industry at a fixed fee. Charging for training will be explored in years 3-5.

Consulting work: The center may in time, leverage in-house talent and resources to provide

consulting services to third parties for a fee. Lessons learnt, relationships built and expertise

accumulated by the CIC‟s work would provide a wealth of information for private sector,

government and development partners.

7.3 Co-investment and leverage

Leverage for all investments will be sought from affiliated investors contributing at the fund level

as described in chapter 6. Leverage may also be sought at the company level where co-

investors will be identified to invest alongside the CIC‟s fund. Leverage may also be achieved

through follow-on investments in CIC companies. It is expected that this will amount to


83

approximately 3 times the Center‟s total investment, or over 8 times each donor contribution20.

Overall leverage on donor contributions is discussed in chapter 9.

7.4 Fundraising Plan

For the CIC‟s operations in Years 1-5, infoDev is raising a cumulative USD 17.95 million. infoDev

intends to secure commitments for at least half of the required capital in advance of launching

the CIC. Securing this funding is important to ensure that the CIC remains adequately resourced

throughout its implementation period. infoDev is targeting investors with an aligned mission to

the CIC. The ideal investor base would consist of donors, foundations and potentially corporate

sponsors. Discussions with the Government of Vietnam on contributions to the CIC are ongoing.

This may be in the form of direct funding support to the CIC host organization or an in-kind

allocation such as access to land and industrial parks. However it should be noted that funding

solicited from the Government of Vietnam may compromise the ability to house the CIC in a

non-governmental organization. This is a critical implementation issue that will be revisited when

considering funding options.

Investment in the Vietnam CIC presents a clear value proposition to prospective investors:

Pipeline: CIC donors will be exposed to an on-going stream of climate technology ventures

that are screened through the finance and advisory services activities of the CIC. While the

investment fund will use its own criteria to select beneficiaries, the CIC founders will have the

opportunity to learn from and potentially collaborate with any enterprises that benefit from

the Center‟s services.

Knowledge: CIC donors gain considerable knowledge from their association with the Center.

In addition to published research and market analysis, investors will have access to in-depth

R&D and technical activity, as well as cutting-edge information on Vietnam‟s green

economy and business activity.

Partners: CIC donors gain access to the complete network of CIC partners and stakeholders

from R&D facilities and universities to industry and government. These relationships will be

strategically valuable to any investor with programs related to, among others, climate

change, clean technology, green growth and private sector development.

Measured outcomes and impact: CIC donors will benefit from transparency concerning the

outcomes of the Center‟s activities. In addition to providing funders with regular

20 Assuming that there will be three donors equally covering the CIC budget of USD17.9 million, or approximately USD6

million each.


84

performance reports, the CIC will provide synthesized data and evidence on economic and

social returns to the investors‟ contributions.

Development goals: In addition to directly measureable impact, CIC funders will be

responsible for facilitating real transformation in Vietnam‟s green economy. It is expected

that these impacts will be in alignment with donors‟ core mission of promoting sustainable

green growth in Vietnam.

7.4.1 Current Support

Various stakeholders have demonstrated enthusiasm and support for the CIC both in the form o

funding and in-kind contributions.

International agencies and donors, such as AusAID and the Government of Finland, in addition

to the United Kingdom, Denmark, Norway, have expressed interest in direct funding support as

well as facilitating global interactions with potential international partners.

The private sector including Diaspora has played a leading role in the conceptual design and

development of the CIC by providing its valuable time and expertise. The CIC will stand to

benefit greatly from the commitment and ingenuity of the Vietnamese private sector both as

supporters and beneficiaries. In addition, financial institutions such as Dragon Capital Clean

Development Fund and Mekong Renewable Resources Fund have shown interest to collaborate

on financing bankable projects.

Government agencies like the Ministry of Natural Resources and Environment (through its

International Cooperation Department) and Ministry of Science and Technology (MOST) are

willing in principle to provide funding for the CIC and advocate for the program within other

ministries. In addition, the Ministry of Finance, National Institute for Science and Technology

Policy and Strategy Studies (NISTPASS), Ministry of Planning and Investment and National Target

Program to Respond to Climate Change, among others, have shown support for the Center.

Throughout the CIC‟s implementation phase, in-kind partnerships with the Government of

Vietnam will be pursued to facilitate access to high-tech industrial zones for CIC companies

requiring preferential tax treatment, land and facilities and access to international talent.

Academic and research institutes such as Ha Noi University of Science and Technology

(HUSTECH), Nonglam University (CTBI-NLU), and Vietnam National Cleaner Production Center

(VNCPC) have all voiced their support to the CIC. Institutions like these are willing to work with

the CIC in providing technical and material support such as coordinating training and use of

their equipment and facilities.


85

7.5 Second round funding: Years 5+

The Vietnam CIC‟s second round of funding will depend on institutional performance and results

generated in Years 1-5. Assuming that the CIC meets or exceeds performance expectations,

infoDev is projecting an additional capital requirement of approximately USD 9 million in a

business-as-usual scenario from years 6 through 10. This funding assumes continued operating

cost of the CIC fund at years 4 & 5 at USD 3.8 million per year and continued overall support for

the CIC (host and fund) at USD 5.4 million per year from years 6-10. This amount totals

approximately USD 34.8 million over 7 years; however with projected returns from investments,

the overall capital requirements would be significantly less at USD 14 million. Realistically, the CIC

will go through a rigorous reassessment in Years 4-5 to refine the strategy to understand future

funding requirements.

Amounts (In USD ‘000)

Years

Total 4 5 6 7 8 9 10

CIC budget years 5+ $3,800 $3,800 $5.435 $5.435 $5.435 $5.435 $5.435 $34.775

Investment Revenue $0 $2,534 $2,534 $3,837 $3,837 $3.960 $3,960 $20,662

Additional funding

required $3,800 $1,266 $2,901 $1,598 $1,598 $1,475 $1,475 $14,113

7.6 Additional Funding

Pending any additional funding for the CIC, beyond current projected requirements, the Center

would increase in both scale (size of current programs) and scope (additional programs).

Additional programs to be considered include:

Strategic Applied R&D Funding: The CIC could make grants available up to USD 2m for

international collaborative research projects to solve highly specific technical barriers to

technologies that have a wide-reaching impact for the Vietnamese people.

Demonstration Project Funding: The CIC may provide larger-scale financing than currently

offered to assist in the financing of demonstration projects and field tests. Such activities

would involve highly innovative technologies that require large capital injections to prove a

concept at a large scale and are often highly risky.

Workforce Capacity Building: The center could look to expand its current capacity building

courses to sponsor and fund larger workforce development activities within Vietnamese

universities.


86

Physical Facilities: The CIC would build its own facilities and open the use of such facilities to

the wider community based on a „membership model‟. Such a facility would house a range

of prototyping and manufacturing equipment, including office and networking space.

Expansion of regional programs: The CIC would build regional satellite offices in other

Vietnamese provinces to better deliver programs and services to beneficiaries in remote and

rural areas.

7.7 Global Network Participation:

In addition to country level activities, the Vietnam CIC will also participate and benefit from

infoDev‟s Global Climate Technology Program. The CTP focuses on a number of global activities

to coordinate national CICs, drive learning for developing country innovation in climate

technologies, and collaborate with related initiatives. These programs include: (i) CIC Design &

Oversight, (ii) Global Financing, (iii) Learning and Analysis, (iv) Global Networking and

Collaboration, and (v) Monitoring and Evaluation. These five global programs will serve the

needs of Vietnamese climate innovators in developing countries by helping them access the

latest technologies, information, financing and expertise to participate in growing international

climate sector opportunities.

While the global CTP activities will be operated by the infoDev‟s Washington DC-based expert

team, country CIC‟s will be implemented through the local World Bank offices. This will ensure

that World Bank and IFC knowledge, systems and funding can be leveraged at the country

level.


87

8.0 Indicative Impact and Results

The CIC‟s economic, environmental, and social impacts will be determined by the technologies

the center supports. These have been estimated using a comprehensive model based on the

CIC‟s budget breakdown and investment rationale, which generates targets for the CIC

program goals and maps them to dimensions of the results chain: inputs, outputs, outcomes and

impacts. Inputs and outputs are shared across the whole CIC, while outcomes and impacts are

categorized accordingly. Due to the differing needs of climate technology innovators in

Vietnam, several technology-related outcomes and impacts are presented as ranges. The

center will aim to support innovations across this spectrum of risk and sophistication, depending

on market opportunity and deal flow.21

The principal input to the CIC is the total USD 17.95 million 5-year program cost. The model

assumes that this will be shared equally by three donors, resulting in a USD 6 million (33%)

contribution and a 3x value for money multiple per donor at the project level. Additional private

sector leverage will sort over the five-year period; the CIC is expected to attract up to USD 1.2

million in proof-of-concept grant matching, USD 17.6 million in equity investment co-finance and

USD 20.7 million in follow-on investments and later-stage funding. Ten year outputs, outcomes

and impacts have been calculated based on a „business as usual‟ scenario to take into

consideration the anticipated continued operation of the CIC beyond 5 years.

8.1 Highlights

After 5 years, the revenues of 65 CIC-assisted companies will generate the equivalent of USD 40

million in economic impact and help close to 1 million Vietnamese increase their resiliency to

climate change. This corresponds to 2.2x leverage on the 5-year budget, 26% economic rate of

return, and a cost of $5,079 per job generated. After the tenth year, with continued financial

support, the CIC‟s economic impact will have grown to over $151 million. This will deliver 8.5x

economic leverage on the 5-year budget, generate 60% economic rate of return, and reduce

cost per job to $1,220. The price of CO2 mitigated will be as low as $14/ton, which compares

favorably against the planned price of USD 25 for the Australian carbon market22. The Center‟s

equity investments will yield an estimated conservative 3% internal rate of return.

8.2 Spillover Effects

In addition to the measurable parameters outlined in the results framework, the CIC programs

and activities will produce numerous beneficial spillover effects to the Vietnamese economy. It is

21 More in-depth calculations are shown in Annex 8. 22 http://www.eastasiaforum.org/2011/07/12/australia-s-carbon-price/


88

envisioned that the CIC‟s example will encourage increased innovative activity in universities

and communities. This can lead to higher commercialization rates of domestic R&D, better

access to the infrastructure necessary for technology development, and increased workforce

capacity of business and technical skills.

The direct and indirect creation of higher-paying, sustainable jobs by CIC-supported companies

will boost economic output in surrounding communities and provide more Vietnamese citizens

with access to innovative products and services. This more active market will be further

accelerated by the wider availability of information, which includes new products launched,

companies created, industrial activity and export and trade. In parallel, the CIC will facilitate the

creation of new investor networks, enabling Vietnam to capitalize on increased investment

opportunities and access to follow-on funding.

Via its coordination, networking and outreach efforts, the CIC will endeavor to increase local

and regional R&D cooperation and strengthen industry linkages. This will ensure greater transfer

of knowledge, know-how and experience among Vietnamese climate technology companies,

in addition to their increased internationalization and competitiveness. Mentor and advisor

activities provided by the CIC will also boost entrepreneurial opportunity and the success rates

of invested companies. Marketing and outreach for CIC technologies will also increase

awareness of the industry. This will in turn encourage favorable policy in support of innovation,

entrepreneurship and the accelerated scale-up of new technologies.

8.3 Monitoring and Evaluation

The CIC will budget USD 265,000 per year for rigorous monitoring and evaluation of the both

direct and spill-over effects that the center‟s programs and services are having on beneficiaries

and surrounding communities. M&E will be achieved through the following means of verification:

Internal databases and data collection

Vietnam CIC annual reports

Focus groups and stakeholder follow-up

Surveys and other quantitative

measurements where possible.

infoDev CIC M&E Framework

Customer satisfaction surveys

Government interviews

Website usage statistics

Annual investor focus groups and

interviews

The full set of results indicators will be developed in accordance with donor requirements. This

will form a comprehensive results framework which will be used to monitor the CIC‟s

performance on a quarterly basis.


89

8.4 Indicative Results Framework

Inputs Investments $9,515,000 53%

Programs $5,595,425 31%

Core Staff & Central Costs $2,742,500 15%

Total $17,852,925 100%

Value for Money Amount Multiple Notes

CIC Investment Leverage

a. Proof of concept Matching $1,220,000 1.0 Based on $1.2m PoC Grants budget

b. Equity co-finance $17,600,000 2.0 Based on $8.8m Equity Investments budget

c. Follow-on investments $20,662,400 2.4 Based on $8.8m Equity Investments budget

Total project leverage

a. Per donor Investment $17,852,925 3.0 Based on $6m equal share of each donor

b. Economic Impact – 5 years $40,037,905 2.2 Based on $17.95 m CIC budget

c. Economic Impact – 10 years $151,110,667 8.5 Based on $17.95 m CIC budget

5 Years 10 Years

Economic Rate of Return 26% 60%

IRR on investment portion 3%

Cost per Job $5,079 $1,220

Carbon price ($/ton) $14 - 43

Goals Year 5 Year 10

Outputs Outcomes Impacts Outputs Outcomes Impacts

Economic

Supporting the

accelerated

growth of climate

ventures and

Provide business

advisory services and

financing to 65

Vietnamese

companies.

The equity in-

vestments will yield

19 sustainable

enterprises. Of these,

6 will experience low

growth, 9 will exhibit

Total economic

impact (cumulative

revenues) will be $40

million.

Creation of new

Provide business

advisory services and

financing to 188

Vietnamese

companies.

The equity in-

vestments will yield

66 sustainable

enterprises. Of these,

22 will experience

low growth, 31 will

Total economic

impact (cumulative

revenues) will be $151

million.

Creation of new


90

entrepreneurial

capacity by

providing a holistic

set of financing,

business

development

services, mentoring

and training

programs.

o 40 will receive

proof-of-concept

grants1 for technol-

ogy commer-

cialization through

the CIC‟s Innova-

tion Fund

o 25 will receive

equity investments2

to use as catalytic

early stage risk

capital.

Vietnamese climate

tech innovators will

have access to a

network of 50

mentors.

Finalize 5 facility

provider agreements

at the rate of 1 per

year, ensuring access

to facilities and tech-

nical assistance for its

supported

companies.

Produce 4 Market

summaries, 2 Trend

reports, and 1 Annual

report per year for a

five-year total of 35

analytical reports.

Facilitate 20

partnerships with

industry and the

private sector, 10 of

modest to medium

growth, and 4 will

have high to very

high growth.

Higher commer-

cialization rates of

domestic R&D

investor networks -

increased investment

opportunities, success

rates, and access to

follow-on funding

Creation of higher

paying sustainable

jobs which increase

economic output

Internationalization of

Vietnamese climate

tech companies

o 100 will receive

proof-of-concept

grants for technol-

ogy commerciali-

zation through the

CIC‟s Innovation

Fund

o 88 will receive

equity investments

to use as catalytic

early stage risk

capital.

Vietnamese climate

tech innovators will

have access to a

network of 100

mentors.

Finalize 10 facility

provider agreements

at the rate of 1 per

year, ensuring access

to facilities and tech-

nical assistance for its

supported

companies.

Produce 4 Market

summaries, 2 Trend

reports, and 1 Annual

report per year for a

ten-year total of 70

analytical reports.

Facilitate 40

partnerships with

industry and the

private sector, 20 of

exhibit modest to

medium growth,

and 13 will have

high to very high

growth.

Higher commer-

cialization rates of

domestic R&D

Carbon price per

donor contribution

will have a $43/ton

threshold and a best

case price of

$14/ton

investor networks -

increased investment

opportunities, success

rates, and access to

follow-on funding

Creation of higher

paying sustainable

jobs which increase

economic output

Internationalization of

Vietnamese climate

tech companies

Environmental

Building a pipeline

of high-impact

climate solutions

by supporting the

localization,

commercialization

and transfer of

relevant

technologies

through access to

innovation grants,

industry

partnerships and

facility providers.

CIC firms generate

74-222m kWh3 (17-

51 MW installed

capacity4) from

cleaner and/or

renewable energy

sources, improve

water access by 34-

103m kL5, reduce or

avoid the equivalent

of 113-340k tons6 of

CO2, and protect/

avoid the loss of 1.6-

5.3k hectares of

forest7

87k-260k people will

be less vulnerable to

climate change.

o 8-24k provided

with power from

cleaner and/or

renewable energy

sources 8

o 36-108k given

better water

supply9

o 11-34k with access

to cheaper/ better

quality food10

o 2-5k smallholder

farmers with

increased yield11

Innovation and

entrepreneurship

CIC firms generate

280-840m kWh (64-

192 MW installed

capacity) from

cleaner and/or

renewable energy

sources, improve

water access by

130-391m kL, reduce

or avoid the

equivalent of 425k-

1.3m tons of CO2,

and protect/ avoid

the loss of 6.5-20.2k

hectares of forest

325k-985k people will

be less vulnerable to

climate change.

o 30-90k provided

with power from

cleaner and/or

renewable energy

sources

o 135-410k given

better water

supply

o 40-130k with

access to

cheaper/ better

quality food

o 7-20k smallholder

farmers with

increased yield

Innovation and


91

which should be with

regional and/or

international partners.

Organize the

following events:

o 60 business

seminars on

various topics

relevant to climate

tech SMEs

o 5 international

events (1 per year)

centering on the

CIC Innovator

Awards. Each

event should be

attended by 20

international and

150 Vietnamese

participants.

contributes to

Vietnam's climate

resilient growth and

development

which should be with

regional and/or

international partners.

Organize the

following events:

o 120 business

seminars on

various topics

relevant to climate

tech SMEs

o 10 international

events (1 per year)

centering on the

CIC Innovator

Awards. Each

event should be

attended by 20

international and

150 Vietnamese

participants.

entrepreneurship

contributes to

Vietnam's climate

resilient growth and

development

Social

Improving

Vietnamese

livelihoods through

climate innovation

and fostering a

culture /

environment

supportive to the

industry‟s long-term

growth and

competitiveness.

Create 3.5k jobs

(703 direct and 2.8k

indirect)12, including

1.7k for women13

and 637 for youth14.

Increased inno-

vative activity in

universities and

communities

Increased transfer of

knowledge, know-

how and experience

Increased work-force

capacity of business

skills, knowledge and

know-how

Strengthened legal/

organizational

environment

Create up to 15k

jobs (3k direct and

12k indirect),

including 7k for

women and 2.7k for

youth.

Increased innovative

activity in universities

and communities

Increased transfer of

knowledge, know-

how and experience

Increased work-force

capacity of business

skills, knowledge and

know-how

Strengthened legal/

organizational

environment

Notes and

Assumptions

1 Each direct investment will create 10 jobs plus additional employment in each subsequent year depending on its projected level of growth.

2 Each proof of concept grant will create 3 jobs in the year that it is disbursed

3 Using $0.27/kWh as average cost of wind and solar energy in Vietnam (South Asia Regional Initiative for Energy)

4 Conversion assumes daily energy production at 50% capacity factor.

5 $0.29 average cost per kL of water (Vietnam Ministry of Finance)

6 Based on biomass CO2 emissions at 1.22 kg/kWh. Includes +25% from water and agricultural products that also mitigate CO2

7 Based on hectare of forest required to offset carbon by 2.6 tons per year (http://www.coloradotrees.org/benefits.htm)

8 Based on 918 kWh per capita energy use in Vietnam (Harvard Kennedy School)

9 96 kL water usage per person per year (FAO)

10 $888 food expenditure per household (Vietnam GSO) and 3.8 people per household in Vietnam (World Bank)

11 $4,700/ha cost for sprinkler irrigation (FAO)

12 Indirect jobs are created at 4 times the rate of direct jobs. (Source: comparative data of high-growth technology sectors in other countries)

13 Women represent 49% of employment in Vietnam (ILO)

14 Youth aged 20-29 represent 18% of employment in Vietnam (ILO)


92

9.0 Risks

Along with expected successes, there are a range of risks associated with establishing an

innovative program such as a CIC in Vietnam; in terms of (i) Operational Risks, (ii) Market

Environment Risks and (iii) Implementing Agency Risks. The stakeholder outreach conducted

provides an indication of the major risks that will be encountered and potential management

strategies. However, a key role of the Center‟s advisory committee and management team will

be to examine, evaluate and manage risks over time. Included below is an overview of the key

risks identified and their associated rating, description and mitigation strategy:

Risk Category Risk

Rating Risk Description Proposed Mitigation Measure

1. CIC Operational Risks

1.1 Stakeholder support L

Stakeholders including

beneficiaries, partners,

government and

private sector that

were involved in design

process are not

supportive of the CIC‟s

implementation.

Locally based infoDev staff will

maintain relationships with key

stakeholders throughout

implementation period

Center will be staffed with

„partnership development‟ manager

Board will include seats for key

stakeholders

infoDev will monitor implementation

to ensure stakeholders‟ design is

followed

1.2 Host institution/

implementation

partners

M

There is a risk that

potential host

institutions/

implementation

partners for the CIC do

not have the

adequate capacity,

skills and resources to

successfully bid and

host the center.

Throughout the design phase, infoDev

has assessed the capacity of existing

institutions and identified such risks

Grant agreement/s will encourage

consortia and partnerships to

strengthen bids

The project implementation team will

provide ongoing support and

technical assistance throughout the

implementation phase.

1.3 Management team

and staff M

There are risks

associated with the

unavailability or lack of

talent to manage the

center

Other risks include the

selection of a manager

and/or staff who are

ineffective at delivering

the CIC‟s expected

results

Salaries of CIC management have

been calculated at competitive

market rates to attract required talent

Identification of management and

staff will follow WBG procurement

guidelines and competitive selection

procedures

Local advisory committee will oversee

performance of management and

staff and set required metrics to

monitor management results.


93

1.4 Performance M-H

CIC does not achieve

adequate

performance results as

agreed in the grant

agreement

Investments do not

generate required

returns to achieve CIC

sustainability objectives

infoDev and the CIC board will

monitor the results of the Center to

ensure grant agreement milestones

are being met. This will be achieved

through the establishment of a

thorough M&E framework.

In coordination with donors, infoDev

will retain the flexibility of reallocating

budgets based on the performance

of specific budget items of the CIC.

Grant agreements will be canceled

and reissued if milestones in the M&E

framework are not achieved.

The Center‟s first 5 years of funding

are not contingent upon returns on

investment. Expectations for ROI are

long-term and will be monitored

regularly to adjust CIC‟s future

funding requirements.

2. Market Environment

Risks

2.1 Country L

Political support for the

CIC weakens and/or

political opposition to

the CIC

Introduction of

perverse subsidies

and/or decrease of

conducive policies to

support climate

technologies

CIC has been designed in close

coordination with Vietnamese

government including multiple

ministries

Center is not contingent on

government funding

Government has minority role on CIC

board

CIC is aligned with Vietnam National

Strategy on Climate Change

CIC investments will not be made

based on speculative or short-term

policy measures.

CIC‟s policy advisory business line will

conduct outreach to government

decision makers to ensure such risks

are fully considered.

2.2 Market demand L

Poor demand for CIC‟s

services

Lack of quality deal-

flow for center‟s

investments

Assessment of market demand has

been incorporated into the design

phase by interviewing and analyzing

potential CIC beneficiaries

Center continually adapts to market

gaps and reallocates budgets as

necessary

Emphasis on customer feedback,

quality control and M&E.

2.3 Competition L

Overlap with other

initiatives.

Other

Close coordination with existing

initiatives and focus on center

visibility.


94

donor/development

program/company

plans to implement a

CIC.

Demonstrable support from

stakeholders and local government

to ensure CIC is aligned with national

goals

3. Implementing Agency

Risks

3.1 CIC financing/donor

support L

Risks that full initial

financing for center‟s

implementation in first 5

years is not secured.

Budget outlined in

business plan is

insufficient to execute

current model.

Additional risk of

financing beyond year

5 not being secured.

More than 50% of budget current

secured and ongoing discussions with

a number of donors & investors.

Project still viable at lower levels

although not ideal. Various scenarios

have been planned and accounted

for.

Financial sustainability as an explicit

aim of the Center post year 5 with a

clear focus on revenue generation.

Close monitoring by infoDev of

financing decisions including flexibility

in reallocating program budgets as

needed.

3.2 Capacity &

Governance

L

Risk that the infoDev‟s

project implementation

team lacks adequate

staffing, processes

and/or systems

sufficient to allow for

successful

achievement of the

results envisaged by

the project.

As part of project preparation,

infoDev will ensure that the staffing

arrangements and project

management procedures are

adequate to implement the CIC.

Through review of relevant financial

management capacity of the

host/implementing partners,

necessary training will be provided to

equip infoDev‟s project

implementation team with the

required skills to ensure sufficient

financial management and

procurement capacity of the CIC.

3.3 Fraud & Corruption

L

Grants provided to

implementing partners

and host institution/s

will be mismanaged.

Host institution/s and implementing

partners will adhere to World Bank

Procurement Guidelines. Financial

management and technical progress

will be routinely supervised during

implementation.


95

10.0 Conclusion

The global transition to low-carbon growth holds tremendous economic opportunities for

Vietnam. The country‟s thriving private sector, young labor force, and abundant natural

resources present an exciting opportunity to locally develop technologies and business models

addressing climate change. However, clear gaps in institutional support, market readiness, and

financing hinder the growth of the Vietnamese climate innovation ecosystem.

The establishment of the Climate Innovation Center in Vietnam will be a targeted yet holistic

mechanism to overcome these gaps and accelerate the domestic development, deployment

and transfer of climate technology solutions. The CIC‟s service and programmatic offerings will

include: access to finance, technology commercialization support, venture acceleration

services and market development assistance. In addition to stimulating innovation and market

linkages within Vietnam, the CIC will be able to deliver regional and international collaboration,

knowledge exchange, and value chain partnerships through infoDev‟s global Climate

Technology Program.

The projected cost to implement, launch and operate a CIC as designed by Vietnamese

stakeholders is USD 17.95 million over a five year period, of which 52% will be for financing, 33%

for programs, and 15% for staff and central costs. Donor funding will be initially required for the

Center; however, it is anticipated that the CIC investment activities will cover more than 70% of

operating costs each year by year 7. In addition, the Center will aim to reach a higher level of

sustainability by introducing other revenue streams once a strong value proposition has been

achieved in the initial years.

The stakeholder engagement process has already built a strong coalition of partners and

identified a pipeline of potential investees that will allow the CIC to hit the ground running and

produce tangible impacts over the first five years. Pending the success and outcomes of the

CIC‟s programs, the direction, scope and scale of the Center (and business plan) will evolve

over time with guidance from infoDev, a strong management team and advisory committee.

The timing is right to capitalize on local and global market momentum by establishing the CIC in

Vietnam. The CIC will serve as a catalyst for long-term transformative impact in Vietnam‟s

climate technology sectors, thereby helping to develop new industries, create jobs and

produce products and services that equip the country and its people to prevail over the

challenges of climate change.


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11.0 Stakeholder Support

infoDev would like to acknowledge the following stakeholders for their guidance, support and

input through the conceptualization and development of this business plan for a Climate

Innovation Center (CIC) in Vietnam:

ORGANIZATION NAME CONTACT PERSON LOCATION

PRIVATE SECTOR/FINANCIAL INSTITUTIONS

Ha Long Waste Treatment JSC Vu Quynh Quang Ninh

Systec ECO Luu Thi Viet Hang Hai Phong

Systec ECO Vu Ngoc Tuyen Hai Phong

Entec AG Hoang My Linh Ha Noi

TECOS Le Khac Minh Tam HCM

Entec AG Vu Thoa Ha Noi

Systech Co.,Ltd Kieu Tuan Kien Ha Noi

Mekong Renewable Resources Fund, Indochina Capital Nguyen Dang Anh Thi Ho Chi Minh

Solar Serve Nguyen Tan Bich Da Nang

Bach Khoa Consultancy and Technology Transfer Kieu Van Hai Ha Noi

Bach Khoa Consultancy and Technology Transfer Hoang Van Thu Ha Noi

Bach Khoa Consultancy and Technology Transfer Hoang Sinh Truong Ha Noi

Bach Khoa Consultancy and Technology Transfer Nguyen Trung Dung Ha Noi

Genova Fashion Duong Linh Ha Noi

Entec ESCO Vietnam Vu Thi Kim Thoa Ha Noi

Green Apple Hoi An Hans van der Broek Hoi An

Green Apple Hoi An Tran Linh Hoi An

Indochina Capital Hai Hoang Ha Noi

Indochina Capital Nguyen Thi Ha Noi

Bitexco Bui Thi Nguyen Thao Binh Duong

BIWASE Lam Minh Ky Binh Duong

BIWASE Duong Hoang Son Binh Duong

Net-com Vietnam Mai Duy QUang Ha Noi

Ho Chi Minh Metal JSC Nguyen Phong HCM

C3 Vietnam Consultant and Communication Ltd Pte Dinh Thi Thu Huyen Ha Noi

C3 Vietnam Consultant and Communication Ltd Pte Wellard Jeremy Ha Noi

Phu Vinh Bamboo and Rattan Training Center Le Truong Son Ha noi

COMPETIS Vu Huong Tra Ha noi

COMPETIS Hoang Anh Tuan Ha Noi

Freelance Dao Thu Hien HCM

Red Sun Energy JSC Huynh Kim Tuoc HCM

Bio-fuels and Petrochemical of the South of VN JSC Nguyen Le Hieu Lang HCM

Passion Zone Pham Ngoc Thang Ha Noi

Aerogie Plus. Solutions VN Le Simon Vietnam

Hoang Huynh Corp. Le Hoang Huynh HCM

Taknet Systems Pte Ltd Cao Thai Hung HCM


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GreenHiTek Co. Ltd. Nguyen Khanh HCM

Konia Company Limited Phung Khoi HCM

MEET-BIS Vietnam Do Van Anh Ha Noi

Global Energy Company (GEC Group) Tran Ngoc Uynh HCM

TNT Media JSC Duong Hong HCM

ASEAN Consultant, Management and Development

Co.Ltd Tran Huong Ha Noi


Co.Ltd Nguyen Khoa Ha Noi


Co.Ltd Dao Tung Ha Noi

Thu Duc Electronic JSC – ASEM LED Duong Minh Thu Duc

ASIA PETROLEUM ENERGY CORPORATION Dang Quoc Toan HCM

TRU-E Truong Tri Ha Noi

TRU-E Dang Hanh Ha Noi

TRU-E Nguyen Toan Ha Noi

Global Electrical Technology Corp. - GLT Corp. Nguyen Thi Lien Chi HCM

Quoc Minh E.C.M Quoc Minh HCM

Vinh Thanh Ltd Pte. Ho Van Tho HCM

Trung Nam Group Dinh Cong Chuan Ha Noi, HCM

SITTO Vietnam Co.,Ltd Theerapong Dong Nai

Wow Car Tuan Ly Randy HCM

Vietnam Semiconductor Manufacturing JSC Vo Huu tai HCM

ECOLIFE Ecological Services Company Ho Thu

DHVP Research & Consultancy Tran Tri Dung

Economic and Environment Online Magazine Vu Huong Ha Noi

Advance Communication Company Ha Le Phuong Linh Ha Noi

Nhan Dan Online News Le Nu Hang Nguyen Ha Noi

Gratia Environment Pham Phuong Linh HCM

RCEE NIRAS JSC Phan Minh Thao Ha Noi

FED Software Join stock Company Nguyen Van Huy Ha Noi, HCM

Anh Minh Chau Trading & Service Co., LTD Bui Phuong Thao HCM

Dragon Capital Group Limited Gavin Smith HCM

VinhThanh Ltd Pte. Ho Van Tho HCM

Electrical engineering technology global stock company Huynh Minh Hai HCM

Enerteam Huynh Thi Minh Trang HCM

Vietnam minerals resources power and emvironment

corporation Le Tuan Anh Ha Noi

Nguyen Chi Trading Co., Ltd Nguyen Chi Hung HCM

International Projects Nguyen Hoang Tu Ha Noi

SUNMARK Production Co. Ltd. Nguyen Hong Khuc Ha Noi

Minh Phat Boiler Company Nguyen Quang Ngoc HCM

Phu An Phat trading, service and produvtion Co., LTD. Nguyen QuocKhanh HCM

QuangTrung Software city development company LTD.

Nguyen Thi Phuong

Dong HCM


98

The SHcons Co., Ltd Nguyen TrongHao HCM

Operations Officer – Sustainable Energy Finance Romel M. Carlos HCM

NGOs

PanNature To Bich Ngoc Ha Noi

Actions for Environment Organization (AFEO) Doan Viet Tien Ha Noi

Northwest Cooperation Development Center Dinh Thi Huyen

Development Initiative for Community and Environment

Center (C&E) Tran Hoan Ha Noi

Institute for Environmental Science and Development

(VESDEC) Nguyen Hong Vu HCM

VNGO&CC Vu Van Trieu Ha Noi

VUSTA Nguyen Manh Don Ha Noi

The Center for People and Forest (RECOFTC) James Bampton Ha Noi

Hanoi Business Association – HBA Le Thi Van Ha Noi

Hanoi Business Association – HBA Nguyen Hong Kien Ha Noi

Vietnet-ICT Ngo Minh Trang Ha noi

Vietnet-ICT Pham Hoang Ngan Ha Noi

Association of Vietnam Retailers Tieu Quang Khanh Ha Noi

Association of Vietnam Retailers Nguyen Thi Cam Tu Ha Noi

Vietnam Association for Conservation of Nature and

Environment (Vacne) Nguyen Gia De Ha Noi

Vietnam Association for Conservation of Nature and

Environment(Vacne) Pham Khanh Toan Ha Noi

Habitat for Humanity Vietnam Tang Phuong Ha Noi

HMC Nguyen Phong Ha Noi

Green Ha Noi

Ha Noi

Centre for Marine life Conservation and Community

Development (MCD) Nguyen Thu Trang Ha Noi

GOVERNMENT

MONRE Pham Vinh Phong Ha Noi

MONRE Tran Hong Ha Ha Noi

Health Center for working Environment – Ministry of

Industry and Trade Nguyen Viet Dong Ha Noi

International Cooperation Department, Ministry of Natural

Resources and Environment Tran Thi Minh Ha Ha Noi

National Centre for Hydro – Meteorological Forecasting –

Ministry of Natural Resources and Environment (NCHMF) Nguyen Quoc TRinh Ha Noi

Ministry of Finance Vu Thi Luyen Ha Noi

Tax Policy Department, Ministry of Finance (MOF) Ngo Huu Loi Ha Noi

Department of Water Resources Management (DWRM) Le Thi Kim Oanh

Ha Noi Trinh Thu Van

National Institute for Science and Technology Policy and

Strategy Studies (NISTPASS) Dang Lan Huong Ha Noi

SME Promotion Center – VCCI Le Thi Hai Yen Ha Noi

Vietnam Chamber of Commerce and Industry, Branch in

Can Tho – VCCI Tran Thi Phuc Duyen Can Tho


99

Ministry of Science and Technology (MOST) Nguyen Thuy Hien Ha Noi

Ministry of Science and Technology (MOST) Pham Hong Quat Ha Noi

Ministry of Science and Technology (MOST) Nguyen Hong Nhat Ha Noi

High Tech Department, Ministry of Science and

Technology Do Van Loc Ha Noi

CIEM – the Ministry of Planning and Investment Nguyen Manh Hai Ha Noi

Vietnam General Confederation Labor – Legislation

Department Nguyen Trong Nghia Ha Noi

National Target Program to Respond to Climate Change Pham Vinh Phong Ha Noi

National Target Program to Respond to Climate Change Phan Thanh Trung Ha Noi

Kien Giang Industry and Trade Department Lam Thanh Hung KienGiang

RESEARCH INSTITUTIONS/EXPERTS

Management training Institute (MIT) Nguyen Thi Kha Ha Noi

Management training Institute(MIT) Dinh Thi Phuong Loan Ha Noi

Management training Institute(MIT) Hoang Van Thu Ha Noi

Management training Institute(MIT) Khuong Nguyen Ha Noi

Management training Institute(MIT) Tran Cong Yen Ha Noi

Management training Institute(MIT) Le Vu Toan Ha Noi

Management training Institute(MIT) Hoang Thu Hien Ha Noi

Management training Institute(MIT) Vu Van Khiem Ha Noi

Management training Institute(MIT) Nguyen Tuan Hung Ha Noi

Management training Institute(MIT) Vu Ngoc Hai Ha Noi

Institute of Energy and Environment Pham Khanh Toan Ha Noi

Vietnam Environment and Sustainable Development

Institute (VESDI) Nguyen Duc Tung Ha Noi

Research & Communication Centre for Sustainable

Development (CSD) Nguyen Thanh Tuyen Ha Noi

Saigon Hi-tech business incubator (SHBI) Tran Tuan Anh HCM

Research & Communication Centre for Sustainable

Development (csd) Nguyen Diem Anh Ha Noi

Climate Change Resilience Centre Vu Trung Kien

Climate Change Resilience Centre Nguyen Ngoc Quynh

Vietnamese- Germany University Vo Viet Cuong HCM

Union of Science and Technology of Dong Thap Nguyen Van Dung Dong Thap

Department of Science and Technology of Ba Ria - Vung

Tau Nguyen Van Anh Vung Tau

Vietnam Commercial University Nguyen Nguyet Nga

Nguyen Tat Thanh University Vu Ngoc Hai HCM

Technology Business Incubator-Ho Chi Minh City University

of Technology (HCMUT-TBI) Mai Thanh Phong HCM

Institute for Defense International Relations Ngo Xuan Truong

Institute for Defense International Relations Le Trang

Center for Development of Community Imitative and

Environment Tran Kim Hoan Ha Noi

Center for Environmental Research and Community

Development Tran Xuan Phong Ha Noi


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Nacentec - National Center for Technological Progress

Center

Nguyen Thi Huong

Quynh Ha Noi

Vietnam University of Commerce Dang Thi Dieu Thuy Ha Noi

Vietnam University of Commerce Nguyen Nga Ha Noi

NIICS Khanh Duong Ha Noi

EME Taravilla Eva Cambodia

Vietnam Cleaner Production Centre (VNCPC) Ta Huong Thu Ha Noi

TOPICA Education Group Pham Tuan Ha Noi

TOPICA Education Group Cao Cong Minh Ha Noi

TOPICA Education Group Tran Cong Ha Noi

TOPICA Education Group Dang My Chau HCM

TOPICA Education Group Tran Manh Cong Ha Noi

Institute for Defense International Relations Ngo Xuan Truong Ha Noi

Hanoi National University of Education Tran Duc Tuan Ha Noi

International Center for Advanced Research on Global

Change (ICARGC) Luong Huong Ha Noi

Ha Noi National University Nguyen Tuyet Ha Noi

Ha Noi National University Phan Quoc Nguyen Ha Noi

Centre for Natural Resources and Environmental Studies –

Hanoi National University ( CRES-VNU) Hoang Van Thang Ha noi

Technology business Incubator, Nonglam University (CTBI-

NLU) Nguyen Tien Thanh HCM

Technology business Incubator, Nonglam University (CTBI-

NLU) Bui Van Mien HCM

Ha Noi University of Science and Technology (HUSTECH) Nguyen Bich Huyen Ha Noi

Ha Noi University of Science and Technology (HUSTECH) Tran Van Binh Ha Noi

Ha Noi University of Science and Technology (HUSTECH) Nguyen Tien Dong Ha Noi

Jon Von Neumann Institute Duong Nguyen Vu HCM

INTERNATIONAL

The World Bank Group Ari Huhtala Washington D.C.

The World Bank Group Nguyen Le Thu Ha Noi

The World Bank Group Dihn Thuy Quyen Ha Noi

IFC Vu Tuong Anh HCM

DFID Alan Duncan Ha Noi

DFID Nguyen Van Kien Ha Noi

Innovation Partnership Programme Chu Van Thang Ha Noi

Innovation Partnership Programme Kokko Hannu Ha Noi

Innovation Partnership Programme Tuomas Pollari Ha Noi

Embassy of Denmark Tran Hong Viet Ha Noi

Embassy of Finland Sykko Janne Ha Noi

Embassy of Finland Mac Le Thu Hong Ha Noi

Embassy of Finland Giang Thi Thanh Mai Ha Noi

William J. Clinton Foundation Benny Tran HCM

GIZ Wasielke Angelika Ha Noi

The IDL Group Vu Phuong Ha Noi


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IUCN Vietnam Nguyen Thuy Anh Ha Noi

JICA Truong Thi Quynh Trang HCM

Swedish CENTEC Vietnam Nguyen Viet Hung Ha Noi

Swedish CENTEC Vietnam Nguyen Duc Vinh Ha Noi

Royal Norwegian Embassy Vu Minh Duc Ha Noi

SAVVi Investors Forum Christopher Zobrist HCM

Sustainable Product Innovation Project (SPIN) Ho Thi Thanh Huong Ha Noi

Sustainable Product Innovation Project (SPIN) Nguyen Hong Long Ha Noi

Sustainable Product Innovation Project (SPIN) Vu Chi Cong Ha Noi

Sustainable Product Innovation Project (SPIN) Ta Huong Thu Ha Noi

Fidelity Ventures Group (FVG Group) Ho Phuong Ha Noi

Fidelity Ventures Group (FVG Group) Nguyen Thanh Son Ha Noi

Technology Development Board Mittal Harkesh Delhi

UNIDO – United Industrial Development Organization Lalique Marine Ha Noi

UNIDO – United Industrial Development Organization Yves Januel Ha Noi

UNDP Johan Kieft Ha Noi

UNDP Koos Neefjes HCM

UNDP Daniel Buckley New York

SNV Netherlands Development Organization Dagmar Zwebe Ha Noi

37%

10%

10%

23%

20%

Background of Vietnam CIC Stakeholders

Private Sector/ Financial Institutions

NGOs

Government

Research Institutions/Experts

International


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©2012 Information for Development Program (infoDev)/The World Bank |1818 H Street

NW |Washington DC 20433 | Internet: www.infoDev.org | Email: [email protected]

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