Revised Law on Environmental Protection

• Vietnam is moving away from a linear economy and towards a circular economy that aims to achieve sustainable economic development.
• Vietnam’s revisions to the Law on Environmental Protection, (LEP), aim to strengthen the extended producer responsibility of importers and manufacturers through recycling.
• Despite the country’s growing efforts to embrace environmentally-friendly solutions, there is still much to do before it can transform fully into a circular economy.

Vietnam’s economy is based mainly on a linear economy. This means that it follows a traditional take-make-dispose approach to economic activity. This model maximizes the use of the collected raw materials during production, ultimately leading to the disposal of unusable material.

This causes a lot of unwanted and sometimes dangerous waste to be dumped in landfills. It also contributes to the scarcity or raw materials because of their irrational uses.

Currently, around 85 percent of Vietnam’s waste is buried in landfills without being treated. This has a huge negative impact on the environment.

Vietnam is gradually moving to a circular economy. The three-pillar circular economy system is based on the make-use/recycle model. This promotes waste reduction and lowers extraction of resources through recycling, reducing and reusing.

The circular economy concept treats plastics as valuable materials to be recycled and not as waste to be discarded. This is a very favorable way to promote sustainable growth as it gives Vietnam the opportunity to increase its recycling and other plastic circle efforts.

Vietnam’s situation regarding plastic and waste management

Vietnam is an industrial hub that is rapidly growing and has significant environmental issues. Vietnam produces approximately 25.5 million tons of waste annually. 75 percent of this waste ends up in landfills.

According to the World BankVietnam, which produces 280,000 tons of plastic waste per year, is one the top four countries that produce it. This situation has been exacerbated by the pandemic.

With increasing urbanization and a growing middle class, the demand and consumption of plastics has also increased rapidly in consumer packaging and construction.

Vietnam’s plastic industry accounted for 6.7 percent GDP in 2019. It contributed US$17.5billion to the country’s economy in 2019. A Vietnamese average consumes 41.3kg of plastics each year, which is equivalent to 7,600 plastic grocery shopping bags.

To address the crisis and to create a sustainable economy, government has developed long-term strategies and set ambitious recycling targets.

National action plans and strategies

Vietnam launched a national plan to manage marine plastic litter in response to growing marine pollution. It aims to reduce marine plastic debris by 75 percent by 2030. The country will strive to eliminate single-use and non-biodegradable plastic bags in all coastal tourism areas. All protected marine areas must be free from plastic litter.

The government has shown strong commitment to tackling climate change and sustainable development. Conference of the Parties(COP26) and its commitment to net-zero carbon emission by 2050.

Building a circular economy is more than just recycling, reusing and regenerating. It specifies a hierarchical transformation in distribution and consumption at the micro-level – production, businesses, consumers, mid-level – eco-industrial parks, and macro-level – city, region, country.

Vietnam is slowly climbing the ladder in its efforts to facilitate waste management and recycling at a micro level.

Provisions to The Law on Environmental Protection

The revised regulations will be in effect from January 2022. Law on Environmental Protection (LEP). 2020 came into effect. The law emphasizes the responsibilities that ministries and localities have to incorporate circular economy in development plans, planning strategies, and waste management plans.

The 2020 LEP introduces circular economy through fostering Extended Producer Responsibility (EPR).The policy emphasizes the responsibility of importers and producers to recycle packaging and products. Following this, Article 54 and Article 55 were published by the government. These articles outline requirements for collection, disposal, recycling, and reuse of plastic waste products.

EPR is an environmental policy approach in which a producer’s responsibility for a product is extended to the waste management stage. It was introduced in 2005 by the Law on Environmental Protection. However, there was no mandatory recycling limit for companies.

This led to their reluctance in facilitating EPR due to lack of specifications by the authorities. The revised LEP contains EPR provisions that allow EPR to be enforced.

The law states that domestic solid waste must be separated into recyclable or reusable solid wastes, food wastes, or other solid domestic wastes. Article 54 also states that producers and importers are responsible for collecting products and/or packaging with recycling value for recycling at the required rates.

This applies to both packaging and recyclable products, as well as waste treatment. Manufacturers have two options to comply with the law.

• You can arrange the recycling by yourself according to the rates and specifications.
• Contribute financially to Vietnam Environment Protection Fund(VEPF), to support the recycling and reuse of their waste.

Laptops, for instance, are products that have high recycling potential. As such, they must also be collected at a rate of 20 percent and according (X) specifications. If Producer A sells 3,000,000kgs of laptops on Vietnam’s market in a year under the brand A then producer A must collect and recycling 600,000.00 kg of used laptops.

Article 55 provides that individuals and organizations who produce and/or import packages containing toxic substances which are hardly recyclable or impede treatment and collection must pay financial contributions to support daily solid waste treatment activities.

According to regulations, cigarette producers as well as importers must pay VND 100 (US$0.0044), to the fund for each 20 cigarettes produced. This is due to the difficulty of collecting and treating cigarette tubes. Producers and importers are required to contribute to VEPF, as previously stated.

What does this mean for businesses?

To address plastic pollution, encourage plastic recycling at businesses and support key industries such tourism, shipping, or fisheries.

Businesses can also benefit from the circular economy’s four benefits, which include resources efficiency, environmental protection, economic development and social benefits.

Vietnam’s producers and manufacturers will now need to register recycling plans annually and report the results to the authorities in order to comply with the law. Ministry of Natural Resources and Environment. Companies with foreign investments and local companies are encouraged to create recycling plans and budgets for EPR to meet new requirements.

However, to transform the economy into a circular one, we need a regulatory framework that allows all sectors of the economy to use the model in all aspects of their production, from consumption to manufacturing.

Vietnam should improve its cooperation with business entities to speed up the process. It should also facilitate effective partnerships with the private sector, foster trust among businesses, and strengthen government-business relations. Vietnam can be a leader in sustainable economic development by promoting awareness and increasing government policies.