For sustainable production and consumption

Twenty-four year old Hanoi office worker My An is something of an online shopping enthusiast. She once believed she had scored a major bargain by purchasing a shirt for just $8. After only three washes, however, the shirt was practically ruined, leaving her to reflect on a $35 shirt from five years ago that still looks great due to its higher quality. She now questions whether her shopping habits are actually mindful and sustainable.

Financial factors and the placing of trust in the right products are crucial in the process of sustainable consumption. Buying an expensive but durable product is indeed economically-beneficial compared to buying a cheap equivalent that wears out quickly. It is also more sustainable, as it reduces the need to dispose of fashion “waste”. Therefore, raising awareness among Vietnamese consumers about the importance of sustainable consumption has become a pressing matter.

Landscape for sustainable consumption

The escalating climate crisis has spurred global efforts to promote sustainable development, with sustainable production and consumption emerging as key areas of focus. These are also among the Sustainable Development Goals (SDGs) the United Nations announced and recommended that member states implement.

According to the Sustainable Consumption in APAC report from market researchers Rakuten Insight, around 61 per cent of Vietnamese respondents reported adopting sustainable practices when shopping in the last 12 months. Over half view purchasing sustainable or environmentally-friendly products as being very important. Around 1 per cent, meanwhile, don’t regard sustainability as important when making purchases.

In reality, sustainable consumption in Vietnam is still not widely prioritized and remains limited. Consumption habits in the country are influenced by customs, traditions, and economic capacity. Despite strong economic growth over the past ten years, many consumption habits, especially among the younger generation, have become a direct or indirect cause of resource depletion and environmental pollution, leading to ecological imbalances and unsustainable development. Ongoing activities focus mainly on raising public awareness and are often small in scale, unconnected, and limited in impact, directly benefiting only specific groups.

The Vietnamese Government has been working to introduce various solutions to address this issue. Resolution No. 01/NQ-CP on major tasks and solutions to realize the socio-economic development plan for 2024 identified sustainable efficiency as one of the key themes for implementation this year. Additionally, the Law on the Protection of Consumer Rights 2023, which took effect on July 1, 2024, introduces many regulations to create an important legal basis for sustainable production and consumption.

“For the first time, the Law on the Protection of Consumer Rights includes specific provisions on the concept of sustainable consumption, State policies, and the responsibilities of ministries, branches, People’s Committees at all levels, consumers, and especially businesses in promoting sustainable production and consumption,” said Mr. Le Trieu Dung, Chairman of the National Competition Commission at the Ministry of Industry and Trade (MoIT).

Sustainable production and consumption are crucial components in ensuring the effectiveness of sustainable development, he noted. “Sustainable production and consumption are not only a legal obligation, a trend, and an objective need, but also an opportunity for the business community and consumers to demonstrate their responsibility and contribute directly to Vietnam’s sustainable development,” he continued. “Consumers increasingly play a decisive role in the success of this endeavor.”

“Sustainable production and consumption are of particular importance and position in the process of sustainable development, both in Vietnam and globally,” according to Mr. Ta Dinh Thi, Vice Chairman of the National Assembly’s Committee for Science, Technology, and Environment. “Recognizing the significance of sustainable production and consumption, Vietnam has been committed to implementing the 2030 Agenda with 17 SDGs, including sustainable production and consumption, which was adopted by United Nations member states in September 2015 with a focus on 17 SDGs.

Promoting sustainable development

The government is promoting sustainable development across all production sectors to achieve the goal of transforming the growth model towards a greener economy and adopting a circular economy model. This involves the efficient and economical exploitation and use of natural resources and energy. Along with creating mechanisms and policies to support enterprises in implementing green and sustainable production, Vietnam needs to focus on raising awareness and encouraging consumer participation in sustainable consumption to achieve sustainable results.

The growing demand for sustainable products is driving businesses to rethink their operations and align with evolving consumer preferences. Governments play a crucial role in facilitating this transition by implementing policies that promote sustainable production and consumption.

Businesses themselves are becoming increasingly aware of this issue. Mr. Nguyen Anh Duc, Chairman of the Vietnam Retailers Association and CEO of Saigon Co.op, sees that consumers are becoming more focused on green products. This trend is evident in the 50-60 per cent rise in sales of eco-friendly products at Saigon Co.op’s 800 stores during June each year, coinciding with the annual launch of its Green Consumption campaign. Mr. Duc also mentioned that manufacturers are now prioritizing organic standards and consumer health. Over the past five years, around 30 per cent of supplier packaging has transitioned to greener, more eco-friendly alternatives.

Mr. David Payne, Program Management Specialist at the United Nations Development Program (UNDP) in Vietnam, commented that the MoIT has taken a range of actions to promote sustainable production and consumption, including changing consumer habits, which is a key step, and raising awareness about the circular economy. “From the perspective of the UNDP in Vietnam, we see that the policy and legal frameworks for sustainable production and consumption in Vietnam have developed strongly in recent years,” he said. “For example, Vietnam’s National Action Plan on Sustainable Consumption and Production is an important step forward in this area. We also welcome the amended Law on the Protection of Consumer Rights, which contributes to establishing a clear legal mechanism supporting sustainable production and consumption.” He added that surveys confirm an increase in the proportion of Vietnamese consumers who pay attention to the environment and prefer healthy products for their families. This is a key foundation for developing sustainable production and consumption in Vietnam.

Meanwhile, Mr. Bui Thanh Thuy, Vice Chairman and General Secretary of the Vietnam Consumer Protection Association, believes the primary purchasing factor is price, as Vietnamese consumers remain hesitant and lack trust in sustainable products. Average incomes in the country remain “moderate” and in some regions “modest”, making price an important issue. If businesses introduce products at reasonable prices, Vietnamese consumers will show more interest. “To produce green, sustainable products, enterprises must invest in equipment, facilities, machinery, and human resources, which are very costly, so the prices of these products can be quite high,” he explained. “Consumers still want products to be affordable.”

A second issue, Mr. Thuy went on, is consumption habits, which stem from awareness and practices. Not all consumers know which products are sustainable and which ones have less of an impact on the environment and human health. It is therefore necessary to make consumers aware that although a product may be more expensive, it protects their health and the environment. Additionally, some consumers, even when aware of sustainability, may lack the means to purchase such products. Mr. Thuy believes there are many challenges and difficulties in addressing this. Current investment policies in sustainability focus only on the production chain, not on consumers. “I think we need to consider reducing costs and taxes,” he said. “Credit funds need to study consumer habits, not just production and business establishments.”

The question now is over the need for more support from government agencies in jointly promoting sustainable production and consumption. Specifically, solutions related to mechanisms, policies, prioritizing and encouraging scientific research, and lowering prices for consumers are required. Additionally, green and clean production needs a long-term and stable source of capital. There is therefore a major great need for mechanisms and policies to help businesses access preferential capital.