The domestic environmental industry still reveals a lot of limitations. Currently, it is capable to meet just two or three percent of the demand for urban wastewater treatment, 15 percent of solid waste treatment, and 14 percent of hazardous waste treatment. The recycling of waste in sectors such as oil, plastics, electricity, and electronics remains significantly underdeveloped.

The results of a survey carried out by the Vietnam Environmental Industry Association (VEIA) in 2015 showed that Vietnam had about 4,000 businesses operating in environmental fields such as collection, transport, and treatment of waste. However, most of these businesses remain small-sized with more than 52 percent having less than VND5 billion in chartered capital, and less than three percent having their capital exceeding VND500 billion.

Addressing a recent meeting held to review the implementation of the Environmental Industry Development Plan until 2015 with a vision towards 2030, Deputy Minister of Industry and Trade Cao Quoc Hung said the attraction of investment into this industry remained ineffective, and most businesses still lacked capital to invest in areas that required large amounts of capital.

Nguyen Huy Hoan, Deputy Director of the Science and Technology Department under the Ministry of Industry and Trade, attributed the situation to the lack of a market for environmental businesses to develop as well as the limited budget for research, application, and transfer of technologies, and weaknesses in human resource training.

Legal framework needed

To promote the environmental industry, VEIA proposed that the state create support mechanisms for environmental service businesses to seek loans from credit institutions, encourage the use of domestically manufactured environmental protection products, and provide financial assistance for environmental businesses to carry out trade promotion activities.

According to the Science and Technology Department, the Ministry of Industry and Trade in the 2010-2015 period approved and assigned 57 environmental research tasks with total state budget of VND134.3 billion. About VND64 billion has been raised from other sources to implement these tasks.

To make the domestic environmental industry capable of meeting the demand for environmental pollution treatment and sustainable use of energy by 2020, the Ministry of Industry and Trade has requested the prime minister to approve as soon as possible the Environmental Industry Development Plan until 2020 with a vision towards 2030 and issue a governmental decree regarding this issue in order to create a favorable legal framework for the environmental industry to develop.