Environment Policies in Vietnam

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Chapter9

DevelopmentofEnvironmentalPolicyinVietnam9.1IntroductionAfter the countrys reunification in 1975, Vietnam was governed as a centrally planned

(command) economy in which environmental issues were almost totally ignored. In 1986,

Vietnam started a new economic strategy, the so-called economic reform policy (Doi Moi

policy). It has changed the Vietnamese economic system from a purely command economy to

a market-oriented economy. Vietnam has welcomed all types of economic organization such

as state-owned business enterprises, private enterprises, and foreign direct investments. Since

then, the economy has been developing rapidly and the urban population has risen quickly.

Parallel with industrial and urban development, environmental degradation increasingly

became a problem and environmental policy appeared on the political agenda. The first

environmental protection laws were enacted in 1993 and went into effect in 1994.

This chapter will discuss the development of environmental policy in Vietnam in general

and go more deeply into policies to control air pollution of both stationary and mobile

sources. Section 2 will give an overview of industrial development in Vietnam in order to

have a picture of how technology has developed in Vietnam. Section 3 describes the

environmental pollution situation in Vietnam. Section 4 describes the public bodies on the

national and local levels which plan and implement environmental regulations. Section 5 and

6 will discuss the development of environmental legislation from the moment the

environmental issues started to become a political concern to the present time. The sectionswill focus on the major characteristics of environmental legislation, its implementation in

practice and national planning for the next 5 to 10 years. The major components of the

national policy approach are presented and assessed: in section 5 and 6, there is a discussion

of the instruments that should reduce air pollution from stationary sources (section 5) and

from mobile sources (section 6). In section 7 air pollution control policy on the regional and

local levels is discussed, using HoChiMinh City as an example. Finally, the summary and

conclusion of the chapter is presented in section 8.

9.2Industrial

Development

in

Vietnam

The development of industry in Vietnam can be divided into five periods, separated by

important historical events.

The first period runs from the beginning of industrialization to 1954. Before 1945

domestic industry developed on a small scale, and depended on colonial power. Between

1945 and 1954, these small industries developed further, not only to provide goods for the

population but also to support the resistance against the French, as was the case with the

defense industry (Hanoi Architectural Institute, 1995).


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The second period from 1955 to 1975 covers the time the country was divided into two

regions the North and the South with different political and economic regimes. North

Vietnam adhered to Socialism in which industrial policy was strongly based on the Soviet

model of a centrally planned economy. Heavy industry was given a high priority and all

production facilities in this sector were owned by the state. The quantitative output targets of

state-owned enterprises were fixed by the state planning authorities. The first Five Year Plan

(19611965) assigned priority to heavy industry, particularly to steel and engineering while

neglecting foreign trade and light industry. Industrial zones were developed in some

provinces and some factories were established very close to big cities like Hanoi and

Haiphong. The facilities in these factories were not up to international standards but still

better than the ones developed in the period before 1955 because the technology in this period

was not only inherited from the French colonizers but also imported from other centrally

planned economies like Russia, Central Europe, and China. Industrial areas were often

established or expanded without specific planning or a long-term view. One of the main

features of the centrally planned economy was highly bureaucratic administration and

management which presented a barrier to further economic growth of the North. This resulted

in economic stagnation and regression at the end of this period (Phung Thuy Phuong, 2002).

In the South, industry developed under the capitalist regime with a more decentralized and

market-oriented strategy. In contrast with the heavy industrial orientation in the North, light

industry dominated, with a share of 90 percent in the South and it depended strongly on

foreign support. Most technologies were imported from the United States and Europe.

Industrial zones were established mainly near big cities such as Saigon, Bien Hoa, Da Nang,

Nha Trang, Can Tho. In addition, some industrial clusters, with factories located together,

developed without planning within residential areas in the Thu Duc district and Tan Binh

district of (former) Saigon. The industries played a significant role in the development of the

economy of the South (Hanoi Architectural Institute, 1995; Ministry of Construction, 1998).Even though the political regime and features of industries differed between the North and

the South, there was one thing in common: industries developed without consideration to the

environment. There was no pollution control policy and consequently pollution treatment

facilities did not exist.

The third period runs from 1976 to 1985. In 1975, the North and the South were united under

a Socialist regime with the Communist Party in power. The Second Five Year Plan, also

referred to as the First National Plan, started in 1976 in order to extend the central planning

approach to the South. Heavy industry was the first priority in the First National Plan and it

expanded to become the main sector in the whole country. There were no private firms, only

state-owned enterprises in both the north and the south of the country. The achievements ofthe heavy industry policy were very far below the First National Plans target: an annual

average growth rate of only 0.6 percent of heavy industrial output compared with the targeted

annual 16 to 18 percent increase during the plan period (Reinhardt, 1993). In other sectors

there were also problems: 1979 and 1980 were years of crisis because of severe shortages of

food, basic consumer, and intermediate goods. State-owned enterprises overall in the country

experienced difficulties, such as the lack of energy and raw materials, inadequate

infrastructure, obsolete equipment, and out-of-date technology (Ministry of Construction,

1998). Reacting to the crisis, the government undertook an overall review of its industrial


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policy. The Second National Plan (19811985) was issued, in which industrial policy shifted

from heavy to light industries; the need to promote an export-oriented manufacturing capacity

was also recognized by the government (Reinhardt, 1993). Environmental policy was not on

the political agenda yet in these years.

The fourth period covers 1986 to 1990. Learning from the experiences of period 3, an

additional economic reform policy, the so-called Doi Moi, started in 1986. It changed the

centrally planned economy to a market-oriented economy: private firms and foreign

investments were allowed in addition to the state-owned enterprises, except for the key

industrial sectors such as coal, electricity, steel, chemicals, fertilizers, transport and

communication. And in several light consumer goods, the government still maintained direct

control (Reinhardt, 1993). For state-owned enterprises, government control was reduced by

giving enterprises the freedom to recruit workers, set wages, purchase raw materials, attract

capital through borrowing and investment, and sell their own products. Privatization and

private firms were promoted. Next to that, the recognition that foreign direct investment could

play a significant role in Vietnams industrialization was one of the main elements of the

reform policy. The new Law on Foreign Investment became valid in January 1988. However,the economic reform policy was implemented without any external financial assistance from

industrialized capitalist countries or from multinational institutions like the International

Monetary Fund, the World Bank, or the Asian Development Bank. The legislative and

institutional frameworks were not adequate to serve the economic reform policy. There was

much trial and error during its implementation, leading to poor results during this period

(Phung Thuy Phuong, 2002).

The fifth and most recent period from 1991 to the present, has seen a rapid development of

the industrial sector in Vietnam. Privatization of state-owned enterprises continued. Firms

operating at a loss were either shut down or transferred to another form of ownership. Private,joint-venture, and foreign direct investment companies exist beside state-owned enterprises,

but essential industrial sectors are still wholly owned by the government. Industry has been

growing quickly. The industrial sector accounted for 25% of Gross National Product (GNP)

in 1996, and according to the projections of the Ministry of Planning and Investment, it will

account for 35% in 2010 (Mol and Frijns, 1997). Light industries such as food processing,

textiles and footwear dominate industrial development. Next to that, industries in the oil, gas,

steel, and chemicals sectors have been growing over 20% each year and are expected to

become an even larger percentage of GDP in the years to come. However, most of existing

manufacturers in both light and heavy industry still have to operate with old equipment,

outdated machinery and technology. The rate of equipment replacement is only 7% per

annum, which is only half of the minimum rate in more developed countries (HanoiArchitectural Institute, 1995). Rapid industrialization, which increases the number of factories

and total volume of industrial output and the intensity of traffic and transport, has increasingly

negative environmental effects if pollution remains uncontrolled. Therefore, environmental

policy was seriously considered for the first time in 1993 with the result that the

Environmental Protection Law was enacted in 1994.

Thus, since the Doi Moi period different types of firms exist in Vietnam: state-owned

enterprises (SOEs) (which are owned and operated by either the central government or by


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governments on a provincial, district, or local level), joint state-private firms, cooperatives,

privately-owned firms, individual household businesses, foreign investment firms with 100

percent foreign capital, and joint-venture companies. Looking at the scale of operation, two

kinds of industries can be distinguished: large-scale industries and small/medium-scale

industries (SMIs). In Vietnam, 90 percent of all industries are SMIs. The environmental

policy is meant to be applied equally to all different types offirms. Although the current

national policy encourages the privatization of state-owned enterprises, the process of

privatization has been slow and very selective; basic industries still belong to the state, with

prices for products fixed by the state rather than through the market. The state still holds a

strong position in economic and societal development. It plays a leading role in planning and

prioritizing economic development in the process of industrialization. The state subsidizes the

energy inputs for SOEs such as electric power, fuel as well as other inputs and also subsidizes

their losses (if any). In addition, all SOEs have very old equipment and outdated technology.

These factors create one of the biggest bottlenecks in enforcement of environmental pollution

control policies on SOEs.

In contrast, foreign and joint-venture companies in Vietnam, especially foreign companies

from OECD states, have more advanced technology compared to domestic firms and they donot hesitate to comply with national environmental regulations because of their competition

on the global market and also because they do take care of their public image (Phung Thuy

Phuong, 2002). Some of them also help to raise environmental awareness by funding

activities, like the support for Green Day and the phase-out of lead. Unilever in Vietnam has

invested VND 2.5 billion in environmental protection for its Hanoi site. The Ford Visiting

Engineer and Scientist Program, which supports the training of engineers and scientists on

safety, environmental regulations, etc. was implemented with the help of some foreign

companies.

9.3AirpollutioninVietnamAir pollution is generated by stationary sources and mobile sources. They will be surveyed in

subsection 3.1 and 3.2. The air quality that results is presented in 3.3. Reliable data on air

pollution are of a rather recent date and reflect the situation around the year 2000, about five

years after the formal start of environmental policy in air pollution in 1994.

9.3.1IndustrialPollutionControlTechnologyOld industrial plants, built before the 1994 Law on Environmental Protection was in place,

are often of a medium and small size, with old production technologies. Only a few facilities

have filters and most of the old factories have not installed any equipment for treating

pollution. Due to expanding urbanization and growth of urban centers most of these old

factories are located within urban areas. For example, HoChiMinh city (HCMC) has about

700 factories, of which 500 are located within city limits. The capital city Hanoi has 300

factories, including 200 factories located within city limits (UNEP, 2001).

Plants which were built after 1994 (the so-called new industries) are mainly located in 66

industrial zones. According to the Law on Environmental Protection, an Environmental

Impact Assessment must be approved by authorities before the construction of a project can

start in order to ensure that the new plant meets the emission standards set by law. However,


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in reality, many new enterprises with a potentially high pollution load have not installed

technology for controlling air pollution, or have not applied the proper technology to control

air pollution (e.g. the electricity firms and cement factories), or they have very out-of-date

equipment (Saigon cement factory). Yet the capital investment required for installing

equipment to control air pollution is low because technology requirements are modest

(UNEP, 2001).

Besides the emissions from industries, a lot of pollutants are discharged into the air by

construction activities. In Vietnam, many construction activities, such as new construction,

rehabilitation, repair, up-grading of ancient monuments, houses, roads, bridges are

undertaken, in particular in the urban centers. Activities such as digging up soil, dumping

soil, demolition of old buildings, spillage of building materials during transportation, etc.

generate serious dust pollution. Measured results show that 60 to 70 percent of the dust

volume in urban air is powdered soil and stone whirling from the surface of land and roads

and originating from transportation and construction activities (UNEP, 2001). According to

the Law, the Ministry of Construction is responsible for setting and enforcing the standards

for all construction activities; environmental standards are part of that task. The National

Institute for Urban and Industrial Projects has authority to stop operations where very severepollution occurs. In practice, it seems that the Ministry of Construction and its provincial

units ignore doing their tasks. No construction that causes serious air pollution has been

required to stop until 2003.

9.3.2TransportThe industrialization of Vietnam has caused major changes, not only in industry but also in

population. Urban population has increased very quickly. In recent years, the urban

population has been growing at around 3 per cent per year (UN, 1999). By 2010, about 40 per

cent of the population is expected to live in cities (Dana ORourke, 2001). The more

population grows in urban areas and incomes rise, the more the number of automobiles,motorcycles increases in the cities. This is a big and increasing source of air pollution. Before

1980, 80 to 90% of urban dwellers used bicycles; in 2001, 80% of the people living in urban

areas used motorcycles (UNEP, 2001). According to data from the Ministry of Transport

(1999, 2001), there were 372,010 registered automobiles in the country in 1996 (not counting

Ministry of Defense vehicles); it had increased to 486,000 vehicles in 2000. Thus, there was

an average annual increase in automobiles of close to 10%. 4,022,683 motorcycles were

registered in 1996; their number had increased to 6,479,000 in 2000. This constitutes an

annual rate or increase of more than 15 percent. 44% of in-use motor vehicles are more than

20 years old; 20% is between 10 to 20 years old and 36% is less than 10 years old. So the

average age of automobiles is about 16 years. Of motorcycles 40% is less than 5 years of age;

the rest is older than 5 years. 75% of all automobiles use petrol, 25% use diesel, while all

motorcycles use petrol. Before the phase-out of lead in July 2001, 70% of total petrol used

was Mogas 83 and 30% Mogas 92. Mogas 92 has a lead content of 0.15g/l and Mogas 83 a

lead content of 0.40g/l. Therefore, emissions from vehicles did not only include dust, CO,

NO2, SO2, but also harmful lead (UNEP, 2001).

Currently, the number of vehicles, especially motorcycles, is increasing rapidly in all

cities of the country because the price of motorbikes has decreased due to the import of

reasonably priced motorbikes from China, Taiwan, and Korea. The report of Petrolimex

showed that the annual growth rate of fuel demand in Hanoi and HCMC is expected to be


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approximately 12% to 15% between 2005 and2010. According to Vietnam Business News

(2002), the Ministry of Transport is planning to invest US$ 3.78 billion to modernize the

roads in Vietnam over the next five years. At present, the Hai Van Tunnel is being built to

facilitate easier travel between the North and the South. The improvement and extension of

road infrastructure will produce even more traffic and pollution. The Ministry of Transport

forecasts the total number of vehicles in Hanoi to grow by 8.5% per year from 2000 to 2010.

Vehicles will be the main cause of air pollution in both Hanoi and HCMC in the years to

come (Tran Thien Trang, 2002).

9.3.3ThemainairpollutantsinVietnamThe main air pollutants in Vietnam are primarily particulate matter and SO2. In addition,

NOx, and CO are also a big concern in and near high traffic areas.

Particulate matter (PM) orfine dust is the main cause of air quality problems in Vietnam. The

measured PM concentration in various cities is one to five times higher than allowed by

Vietnam Ambient Air Quality Standards, which are already less stringent than those of the

World Health Organization (Multi-sectoral Action Plan Group, 2002). In residential areas that

are far away from main arteries or from production facilities and within green parks, PM is

approximately at the permitted levels (UNEP, 2001). Construction activities are the main

source of dust in urban areas, generating about 70 percent of the total dust volume. Next to

that transport, households and industry contribute to emissions of PM. Unfortunately, little

analysis of the industrial emission sources of the PM has been done up to now. However, it is

known that industries, such as the thermoelectric, chemical and cement sectors, generate the

highest volumes of PM from industry.

Diesel-powered vehicles are a major source of SO2 in Vietnam. Power generation and

fuel intensive industry are also large emitters of SO2. Some measurements at areas

surrounding power plants (thermoelectric plants, cement companies, coal mines and chemicalindustries) showed that SO2 concentration exceeded permitted standards by multiple levels

(NEA, 1999). Even though SO2 is lower than air quality standards allow in areas outside

cities, the concentrations tend to be on the increase (UNEP, 2001). The ongoing

industrialization of the country and growth in transport and traffic will cause an increase in

the concentration of this pollutant in the future unless stringent measures are taken to turn the

tide.

CO is emitted by thermoelectric plants, cement and construction material plants but

mainly by vehicle emissions. The national monitoring system has shown that daily CO levels

are below the Vietnam Ambient Air Quality Standards for the country at large but the

concentration exceeds the Vietnam Ambient Air Quality Standards in locations with high

traffic intensity, such as in large cities (UNEP, 2001). The rapid increase in the number of

motorcycles and the continued use of old vehicles will make this situation even worse.

Similar to SO2 and CO, NOx emissions result from fuel combustion. The main pollutant

in this group is NO2 which reaches high concentrations in heavy traffic areas, occurring on a

daily basis even in non rush-hours in large cities. However, according to the results of the

National Stations of Environmental Monitoring, in urban areas daily average concentrations

of NO2 gas were lower than permitted standards in recent years except at some major

intersections (UNEP, 2001).


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Three stations are monitoring acid rain, using a monitoring system based on national

environmental standards; the station in Lao Cai has begun measuring the acidity of rain water

from 1995 onwards. The other two stations, in HCMC and Quang Ngai respectively began

monitoring acidity in rain water since 1999. Acid rain, caused mainly by SO2 and NOx

emissions, has not been a problem in Vietnam up to now.

Lead pollution in urban air was generated by motor vehicles using petrol containing lead.

In Vietnam, lead pollution was not monitored or evaluated officially by the National System

of Environmental Monitoring (UNEP, 2001). Before 2001, lead content in air at some large

intersections approximated or equaled the maximum permitted standard. Nowadays, lead

pollution is not an issue because lead was phased out beginning in July 2001.

Odor pollution is serious in several urban areas because of canal sludge, waste dumping,

and lack of an adequate disposal system. Unfortunately, inhabitants still reside in these areas

because they do not have the financial ability to move and measures to solve that bottleneck

have not been taken.

Noise in Vietnam is a very big issue. Residents near industrial areas and high-traffic areas

not only bear dust and other pollutants but also have to bear noise levels that range from 98 to

116 decibels; this applies especially to workers. The standard for maximum noise level is 90decibels. A survey of 11 industrial enterprises showed that 11% of all industrial workers

becomes deaf (UNEP, 2001).

In summary, due to the rapid speed of industrialization and urbanization, air pollutants

generated by stationary sources and a huge number of motor vehicles tend to increase fast if

emissions remain unabated. Especially, out-of-date industrial technology and old vehicles

have become major sources of air pollution in urban areas, particularly in large cities such as

Hanoi, HCMC, HaiPhong and DaNang. Slow traffic and narrow, poor quality streets

exacerbate the health damage effects of air pollution on residents. Taking the TCVN

standards for ambient air quality (which are less stringent than the WHO air qualitystandards; see section 9.5.2.1) as a benchmark the current situation in Vietnam can be

summarized as follows: The PM levels often exceed TCVN standards; CO exceeds standards

only in major cities; SO2 levels are usually better than standards; and NOx concentrations are

generally below standards. Among the pollutants, PM probably requires the most attention.

According to the Environmental Vietnam Report 2001 of UNEP, the PM level is obviously

over the limit in many cities. All in all, air pollution in Vietnam is almost exclusively a

problem of urban areas.

9.4GovernmentEnvironmentalOrganizationBased on the mandate of the National Plan on Environment and Sustainable Development

19912000 of 1991, in 1992, a start was made in creating an institutional framework for

managing the environment with the establishment of the Ministry of Science, Technology and

Environment (MOSTE) at the central level; the Department of Science, Technology and

Environment (DOSTEs) at province level and the Environmental Bureau at district level.

These organizations were to be in charge of protecting the environment. The three layers are

related in technical matters only. In this respect it might be said that DOSTE is a local

department of MOSTE and the Environmental Bureau is a local department of DOSTE.


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However, politically, administratively and financially DOSTEs are under the control of the

Provincial Peoples Committees that form the governments of the provinces; Environmental

Bureaus belong to District Peoples Committees that is the local government. Besides

MOSTE, DOSTEs and Environmental Bureaus, there are other organizations at national and

provincial levels that also are in charge of environmental protection, such as the Ministry of

Transportation, the Ministry of Construction, the Ministry of Industry, the 23 Departments of

Science and technology that belong to 23 line ministries (national level); the Divisions of

Planning and Environment which belong to provincial Industrial Zone Management Boards

(provincial level). Their tasks and the relations between the three layers will be discussed in

the following subsections.

9.4.1NationallevelTheNationalEnvironmentalAgencyandtheVietnamEnvironmentalProtectionAgency

The Ministry of Science, Technology and Environment (MOSTE) was established in 1992.

MOSTE had overall responsibility for the technology and environment related issues such as

scientific research, technology development, standardization of equipment, protection of

industrial property rights, and environmental protection. In environmental protection policy,

the Ministry had two branches.

The Directorate for Standards and Quality (STAMEQ) was the body responsible for

drafting the National Environmental Standards (TCVN 1995; ambient air quality and

emissions standards) and for submitting TCVN drafts to the Ministry of MOSTE for

approval. In addition, in support of the Ministry of Transportation, STAMEQ sets emission

standards for vehicular sources.

The National Environmental Agency (NEA) was the executive department of MOSTE

with regard to environmental management and protection. NEA is responsible for making a

draft of environmental policy and sends it to MOSTE for review. Thereafter, the policy issubmitted to the Prime Ministers Office to be signed, and then it is presented to the National

Assembly for approval. NEA is also responsible for many other tasks, such as: establishing

the guidance for and organizing the implementation of environmental policy; codifying

environmental regulations and standards; making plans or strategies for protecting the

environment; making an assessment of and approving EIA reports for large/medium-sized or

high potential impact projects; issuing and withdrawing environmental licenses; establishing

and managing monitoring pollution control stations. NEA also supervises, inspects and

checks the adherence to environmental protection legislation of other related ministries, line

ministries and DOSTEs; it inspects the implementation of pollution control regulations of

plants; settles environmental disputes, appeals or complaints concerning environmental

protection; and applies sanctions for non-compliance. When NEA was first established in

1993, it had only 15 staff members; it increased to 67 in 2000 and a proposition was made in

that year to expand NEAs staff to approximately 350 persons (ORourke, 1999; Nguyen

Ngoc Sinh and Friederich, 1997; Nguyen Ngoc Sinh et al., 1999; NEA, 2000). Since 1999,

NEA has 9 divisions: Policy, Environmental Impact Assessment (EIA), Pollution Control,

Inspection, Conservation of Nature, Training and Awareness, Information and Data,

Monitoring; and International Relations.

According to article 38 of the Law on Environmental Protection (1994), at the national

level, MOSTE shall be responsible to the Government for performing these tasks to control


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pollution at both stationary and vehicular sources. MOSTE has to assess the environmental

situation of the country and report it to the Government and the National Assembly. Parallel

with MOSTEs functions of supervising, inspecting and checking the implementation of

environmental protection legislation, article 8 of the Law on Environmental Protection also

gives these rights to the National Assembly, the Peoples Council, the Vietnam Fatherland

Front and its member organizations.

According to Article 38 of the Law on Environmental Protection, at the local level, the

Province Peoples Committee shall be responsible for environmental protection tasks.

DOSTEs shall be responsible to the provincial Peoples Committee for environmental

protection in its localities. Being responsible in the central government at the national level

for environmental protection tasks, MOSTE/NEA has the right to delegate these tasks to

provincial Peoples Committees to protect the environment at local level. The Provincial

Peoples Committees delegate these tasks to DOSTEs. DOSTEs have to report the results of

implementation of their tasks to Province Peoples Committees and MOSTE/NEA.

In August 2002, the Ministry of Science, Technology and Environment was divided into

two ministries, namely the Ministry of Science and Technology (MOST); and Ministry of

Natural Resources and Environment (MONRE). All the environment-related issues werepassed to the Ministry of Natural Resources and Environment which also took over NEA.

NEAs name was changed to the Vietnam Environmental Protection Agency (VEPA) without

a change in function. STAMEQ was maintained as a branch of MOST.

OtherministriesBeside the ministry for the environment (MOSTE/MONRE) many of the ministries have the

authority to plan and manage environmental issues in specific sectors such as transport,

construction or industry.

Article 5 of Decree 175/CP (1994) on Guiding the Implementation of the Law on

Environmental Protection

provides that sector ministries have their own tasks in protectingthe environment. They have the authority to issue environmental protection documents within

their sector or draft documents on environmental issues that relate to their activities and to

submit their documentation to the Government for promulgation; to manage the projects of

their branch relating to environmental protection; to participate in the EIA committees to

make the Environmental Impact Assessment (EIA) reports; to settle disputes and complaint,

to the extent permitted, and to petition for punishment of violations of the Law on

Environmental Protection. They should cooperate with MOSTE to survey, monitor and

evaluate the environmental situation of their sectors. As article 38 of the Law on

Environmental Protection says, all other ministries, within the scope of their functions,

powers and responsibilities, cooperate with MOSTE in carrying out their environmental

protection duties in their sectors and branches. The purpose of this cooperation is to releasethe burden of MOSTE/MONRE and integrate environmental concerns into the decisions of

all sectors. For example, most of the programs for vehicular pollution sources control are the

responsibility of the transport and public works agencies and public security police. These

agencies must cooperate with MOSTE in issuing their environmental policy measures in

order to match the national environmental policy framework. The three sector ministries that

should have closest cooperation with MOSTE are Transportation, Construction and

Industries.


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The Ministry of Transportation (MOT) has responsibility for making transportation plans

and management, such as infrastructure, roads, intersections, and traffic control. MOT has the

authority to determine the types, quality, technical safety standards and to inspect the safety

of motor vehicles. The MOT also drafts, reviews and decides on motor vehicle emission

standards and enforces it for vehicles. The MOT grants certificates on meeting the emission

standards for vehicles. It cooperates with MOSTE. Viet Register is an agency which is part of

the MOT and also inspects the emission standards and safety of vehicles and, together with

STAMEQ, prepares the drafts of the vehicle emission standards. Giving its assistance to the

Vietnam Register is the Center for Vehicle Management and Inspection.

The Ministry of Construction (MOC) is responsible for policies on planning, design, and

construction as well as guidelines for houses, public works, and construction activities. These

include the environmental standards in construction. The policies cover such areas as

drainage and sanitation, waste management, slum improvement, and urban planning. The

National Institute for Urban and Industrial Projects plays a major role in the areas of pollution

prevention; it has authority to stop operations whenever very severe pollution occurs. The

MOC also has its provincial units to take primary responsibility for their tasks at the local

level.The Ministry of Industry (MOI) is responsible for planning of industrial development

strategies. It provides technical assistance for pollution reduction and partly funds for

environmental projects implemented within different industrial enterprises.

In practice, the sector ministries do not always cooperate with MOSTE in implementing

environmental policy in their sector. The scattering of environmental responsibilities over

different ministries results in overlap. The definitions and divisions of tasks and

responsibilities between them are not clear. Poor collaboration among government agencies

and their conflicts of interests also result in competition between ministries and agencies in

making decisions on environmental issues. In theory MOSTE/MONRE is equal to other

ministries, but in practice, it is often weaker than others, such as the Ministry of Industry,because environmental issues do not have such a high priority on the political agenda as is

proclaimed in official documents. The following example illustrates this. On paper,

NEA/VEPA has the authority to close firms that are continuously out of compliance with air

pollution standards. In reality, NEA/VEPA has no power to close those firms, especially if the

firms are joint ventures, foreign-owned, or state-owned (Phung Thuy Phuong, 2002). If state-

owned enterprises that belong to a sector ministry violate environmental protection laws, the

Minister of MOSTE/MONRE has to find a way to solve the problem with that ministry.

MOSTE/MONRE just cannot act directly even though the law provides that. In 1995, for

example, NEA recommended closing 13 firms, mostly state-owned enterprises, because of

their heavy pollution emissions and inability to comply with national environmental

standards. However, the sector ministries did not agree with this proposal and, in the end,none of the firms out of compliance was shut down.

The obligation to get the cooperation of other ministries which have interests other than

the protection of the environment clearly undermines the power of MOSTE/MONRE to

enforce environmental regulations. Thus, the dispersal of environmental management

between ministries without clearly identified responsibilities and functions, and without

adequate mechanisms to overcome inter-ministerial disputes, creates bottlenecks in limiting

environmental pollution.


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9.4.2ProvincialandDistrictLevelTheDepartmentofScience,technologyandEnvironment(DOSTE)

As discussed above, DOSTEs are local departments of MOSTE and exist in most provinces

and large cities. Politically, administratively and financially, DOSTEs are under the control of

provincial Peoples Committees which form the government of the province. MOSTE

delegates the environmental protection tasks to provincial Peoples Committees. ProvincialPeoples Committees delegate these tasks to DOSTE. Thus, DOSTEs relate to MOSTE only

with regard to technical matters, meaning DOSTEs are supposed to implement national

policies established by MOSTE/NEA. In each DOSTE, the Environment Division is its

executive body to implement the environmental tasks. These tasks are similar to

NEA/VEPAs tasks but at a provincial level. DOSTE issues environmental policy for its

provinces and provides guidance for the implementation provincial environmental policy. In

its province DOSTE is allowed to set and implement emission standards for stationary

sources and mobile sources more stringent than national emission standards. A major task is

to see that EIAs are prepared, contain appropriate control measures, and are approved by the

Provincial government. DOSTE inspects and monitors plants for compliance, settles

environmental disputes, and imposes sanctions for non-compliance, such as applying

administrative fines or withdrawing environmental licenses of plants. Notice that DOSTEs

have the authority to solve environmental problems in their territory, but only within the

scope of their delegated authority. For matters outside of their mandate, DOSTEs must obtain

permission of the national government bodies to act. For example, Provincial Peoples

Committees/DOSTEs have no authority to shut down polluting factories that are out of

compliance and located in their provinces but are under the control of the central government.

DOSTEs must ask for permission of MOSTE and involved sector ministries to deal with

these factories. DOSTEs also have to make plans or strategies to protect the environment in

their provinces. DOSTEs provide environmental training and awareness programs. In

addition, DOSTEs are also in charge of supervising the compliance with the Law onEnvironmental Protection by the environmental management units at district level. The

number of staff in the Environmental Division in DOSTE ranks from 3 to 16 staff depending

on the priority set in the province.

In some provinces, DOSTEs are very active. The HoChiMinh City DOSTE is an example

of how policy can be established to deal with industrial pollution in the city. It developed a

so-called Industrial Pollution Minimization Fund (IPMF) to support industries financially in

order to install waste reduction treatment. It organizes training on treatment technology for

enterprises; implementing some pilot projects in industry, together with awareness-raising

activities. It was the first DOSTE of the country to establish a black book of the most

polluting firms in the city and forced them to make a commitment to control their pollution

within a set period of time or else their factories would have to move out of the city. The

HoChiMinh City DOSTE also developed a casebook ofbest practice examples and made

that publicly known via the mass media in order to encourage industries to improve their

environmental pollution control. The DOSTEs of other provinces, including Hanoi DOSTE,

have learned from the experiences of HoChiMinh City DOSTE. Section 9.8 will give further

details on the example of HoChiMinh City DOSTE.


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TheDistrictLevelEnvironmental Bureaus at the district level are under control of the district government: the

district Peoples Committees. Similar to the relationship between MOSTE and DOSTEs,

Environmental Bureaus are local departments of DOSTE, linked to DOSTE in technical

matters only to take care of environmental issues. The main tasks of the Environmental

Bureaus are to implement environmental regulations, in the form of instructions that DOSTEs

delegate to them; to resolve small disputes and to process complaints stemming from

pollution in their localities. Environmental Bureaus inspect the pollution control measures

taken in plants and have the authority to warn factories that are out of compliance. Although

many disputes or complaints about industrial pollution are within their mandate they usually

prefer to transfer them to DOSTEs.

9.4.3SummaryandconclusionIn summary, Vietnam has a three-layer system of environmental management organization

from the central government to the regional and local government. At the national central

government level, MOSTE/MONRE is the main organization responsible for environmental

protection issues in both stationary and mobile sources. MOSTE promulgates environmental

regulations, sets ambient air quality standards and emission standards for stationary and

mobile sources nationally. MOSTE inspects DOSTEs for the implementation of MOSTEs

regulations and instructions. MOSTE also inspects and monitors projects with serious

potential environmental impact, and imposes sanctions on plants that are out of compliance.

Other ministries are requested to cooperate with MOSTE to protect the environment in their

sectors. The Ministry of Transportation especially has played a significant role in cooperating

with MOSTE to set emission standards for air pollution of motor vehicles and to inspect the

quality and safety of motor vehicles.

At the regional level, MOSTE delegates its environmental protection tasks to provincial

Peoples Committees/DOSTEs. Besides implementing the delegated tasks, DOSTEs areallowed to issue regulations to support the implementation of their tasks or to have better

results. Some DOSTEs have set emission standards for air pollution control of factories in

their region. The regional emission standards are not allowed to be less stringent than national

emission standards. Similarly, at the district level, DOSTEs delegate the environmental

protection tasks to district Peoples Committees/Environmental Bureaus. Thus, Vietnam has

its environmental management architecture in place as required by the Environmental

Protection Law.

However, in practice, MOSTE and DOSTEs lack broad political support and their power

is limited, compared especially to the power of the National Assembly, the Peoples Council,

the Vietnam Fatherland Front and its member organizations. Because of conflicts of interests

collaboration of other ministries with MOSTE in environmental protection has been very

poor. In addition, the Law on Environmental Protection does not define and devise tasks and

responsibilities between them clearly. The scattering of environmental responsibilities across

all ministries results in overlap and also results in competition between ministries and

agencies that make decisions on environmental issues. In theory, MOSTE/MONRE is equal

to other ministries, but, in practice, it is often weaker than others because environmental

issues do not have such a high priority on the political agenda as is proclaimed in official

documents. In addition, the environmental authorities have had great difficulty in enforcing

the Law on Environmental Protection when they deal with state-owned-enterprises (SOEs)


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and foreign companies. Besides that, there have never been enough human resources in these

organizations, particularly staff that has a specialization in environment-related subjects. The

lack of knowledge and information and inadequate funding also contribute to the difficulties

the environmental organizations have in performing their tasks. The shortage in

environmental experts is even more serious in the National Assembly, the Peoples Council,

the Vietnam Fatherland Front and its member organizations. Although the Environmental

Bureaus system at the district level is in place on paper, it does not or hardly seem to exist in

reality. If there is an Environmental Bureau in a district, it is very weak in all aspects.

DOSTEs have to cover most of their tasks.

9.5DevelopmentofenvironmentallegislationtocontrolpollutionofstationarysourcesThe development of environmental legislation in Vietnam shall be divided into two time

periods: before and after 1994. The division is based on the year when Vietnam first started to

take action on protecting the environment by enacting the national Law on EnvironmentalProtection in 1994, after a long period of time when the issue was mentioned solely on paper.

Subsection 9.5.1 will present the development of environmental legislation on air pollution

control in the period before 1994: how the environmental issues were treated under the

Socialist regime of the North and the Capitalist regime of the South; it also includes features

of environmental legislation development in the time after both regions were unified in 1975

until 1994. Subsection 9.5.2 will focus on the major characteristics of environmental

legislation since it became a political concern in 1994 and cover the period up to 2003. It will

include the presentation and assessment of all the major components of the national policy

approach in air pollution control of stationary sources: the establishment of ambient air

quality and emission standards, the Environmental Impact Assessment (EIA) andenvironmental certification, the monitoring, inspection and enforcement system, and the non-

command-and-control approaches which have been applied or discussed in Vietnam. National

planning to control pollution of stationary sources for the next 5 to 10 years is the subject of

subsection 9.5.3. Finally, the summary and conclusion of the section is presented in 9.5.4.

9.5.1Environmentallegislationbefore1994As mentioned in section 2, Vietnam had only small industrial zones in towns and some

industries scattered across the country. At that time, environmental pollution in general and

air pollution in particular was not an issue, even among scientists. There exist virtually no

documents or materials on the subject of air pollution control from that period of time. At

universities, however, courses were offered, which were indirectly related to air pollution. For

example, at the Hanoi Construction University of the North, the Department of so-called

Ventilation (Thong Gio) in the Faculty of Constructional Materials and Sanitary Technology

had specialized courses in Ventilation and Heat Supply (Cap Nhiet). The contents of the

teaching program were similar to those in universities of the former Soviet Union and

covered some issues related to air pollution, such as dust and chemical pollution, but only in

so far as it occurred in the work environment. Other institutions, such as the Labor Medical

Institute at Hanoi Medical University, also had programs on environmental subjects, but

limited to the work environment as well.


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In the South, no courses about the environment were taught at universities. However,

several books by American authors, such as Environmental Pollution (ue nhiem moi sinh)

and Chemical Clean-up Technology (ky thuat thanh hoa), were translated into Vietnamese.

In 1974, a chemical clean-up technology laboratory was established at the Civil Engineering

Faculty of Phu Tho Technology University. It also was the first time the university offered

students a special course in chemical clean-up technology (Nguyen Dinh Tuan, 2002).

After 1975, all activity concentrated solely on the economic recovery of the country.

Environmental issues were put behind other problems on the political agenda. The first signal

of change was the foundation of the Department of Environment-Biology Technology at the

Polytechnic University of HCMC in 1980. This department belonged to the

Construction/Building faculty. Years after that, other institutes were established with the help

of the Environmental Programs of the United Nations (UNEP), such as the Institute of

Tropical Technology and Environmental Protection.

In 1985 the Council of Ministers promulgated Resolution No. 246 on The Survey and

Rational Use of Natural Resources and Environmental protection. This Resolution was very

general; it did not contain statements specifying a policy to protect the environment. One stepfurther was the National Plan on Environmental and Sustainable Development 19912000,

approved by the Council of Ministers in 1991. This plan did emphasize environmental

protection issues: it confirmed the need to establish a central environmental authority and to

develop and implement an environmental policy including environmental ambient air quality

and emission standards for industrial pollution control. As a result of this plan, MOSTE was

established in 1992, and in 1993 the Law on Environmental Protection (LEP) was enacted by

the National Assembly which became effective in the beginning of 1994.

9.5.2Thedevelopmentofenvironmentallegislationfrom1994to2003Environmental policy in Vietnam has mainly followed the traditional model of command-and-control, characterized by standards and regulations, and a top-down implementation of

legislation since the moment environmental issues started to become a political concern in

1994. The Law on Environmental Protection (LEP) is the highest one in the hierarchy of

environmental legislation of Vietnam. It states that the purpose of the law is to protect

peoples health, to serve the sustainable development of the country and to contribute to the

environmental protection of the Asia region and the world. It includes 7 chapters and 55

articles. It devises the tasks for MOSTE, other ministries and DOSTEs (see section 9.4). It

stipulates that MOSTE has to set the national environmental standards, including national

ambient air quality standards and emission standards for existing and new stationary sources

(see 9.5.2.1). It requires that existing and new stationary sources submit EIA reports to the

authority. Further details on EIA will be discussed in 9.5.2.2. The Law also mentions the

necessity of having a monitoring, inspection and enforcement system in place (see 9.5.2.3).

Only 20 pages long, the Law on Environmental Protection is very general. It had to be

worked out in many other regulations, decrees, resolutions, and decisions that provide

instructions on how to implement national environmental law. Therefore, after the Law went

into effect a number of regulations were enacted. Decree 175/CP, issued in 1994, provides

guidelines on the implementation of the Law on Environmental Protection; Decree No. 26/CP

issued by the central government on April, 1996 provides regulations on administrative fines

for violation of the Law on Environmental protection; Circular No. 490/1998/TT-


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BKHCNMT, issued by MOSTE on April 1998, gives guidelines for the EIA of investment

projects. The contents of these regulations will be discussed in the following subsections.

9.5.2.1EnvironmentalstandardsFollowing the requirements of the Law on Environmental Protection and Decree No.175/CP

of the central government, issued in 1994, which provides guidelines on the implementationof the Law on Environmental Protection, the Vietnam environmental standards were set by

MOSTE in 1995: the so-called TCVN-1995. The TCVN-1995 was established by the

Directorate for Standards and Quality (STAMEQ), which is part of MOSTE and is the body

responsible for organizing technical committees for the development of TCVN drafts and

submitting them to the MOSTE Ministry for approval. Developing standards is a five-step

process. First, a technical-legislative committee of STAMEQ makes a proposal for standards

and gets the approval of STAMEQ. Second, the standards proposal is given to the technical

Committees to make a second draft of standards. There are 7 technical committees working

for environmental standards development including the technical committee on ambient air

quality. The technical committee comprises researchers, scientists of universities and research

institutes, experts of government agencies, representatives of industries, consumers, etc.

Third, the technical committees draft needs to get the approval of the majority of the

technical committees to become the TCVN draft. Fourth, the TCVN draft is submitted to

outside reviewers, and is circulated for comments. Finally, the draft must be passed by the

technical-legislative expertise of STAMEQ before being submitted to MOSTE for approval.

The following ambient and emission standards have been developed and issued since 1995:

1. TCVN 5937: 1995 Air quality Ambient air quality standards for 6 types of

pollutants: CO, NO2, SO2, Pb, O3 and suspended dust (SPM)27

.

2. TCVN 5938: 1995 Air quality maximum permitted concentration of hazardous

substances in ambient air (ambient air quality standards)28

.3. TCVN 5939: 1995 Air quality Industrial emission standards inorganic substances

and dust (including 19 types of pollutants, such as SO2, NOx, CO, etc.)

4. TCVN 5940: 1995 Air quality Industrial emission standards organic substances

(including 109 types of pollutants, such as CH3COCH3 (Aceton), C2H5OH (Etanol), C8H18

(Octan), C5H12 (Pentan), etc.)

5. Dozens of TCVN technical standards on analysis methods (sampling, measurement)

for ambient air quality standards and emission standards.

27 TCVN 5937: 1995 -Air quality (mg/m3)

Pollutants Hourly average 8-hour average 24-hour averageCO 40 (WHO: 30) 10 5 (WHO: 10)

NO2 0,4 (WHO: 0,4) 0,1 (WHO: 0,15)SO2 0,5 (WHO: 0,35) 0,3 (WHO: 0,1-0,15)Pb 0,005

O3 0,2 0,06SPM 0,3 0,2 (WHO: 0,15-0,23)

Source: STAMEQ, MOSTE (1999).

28 Similar to the chapters on the development of environmental policy in United States, this chapter on thedevelopment of environmental policy in Vietnam does not discuss hazardous pollutants.


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Thus, TCVN-1995 for air quality includes 3 types of standards: ambient air quality standards,

emission standards, and technical standards (methods of measuring, collecting, analyzing, and

treatment of samples). Ambient air quality standards are the targets of air pollution control

policy. The concentration of pollutants defined in the standards should not be exceeded. Some

of Vietnams ambient air quality standards are less tight than WHOs ambient air quality

standards and some are more tight (see footnote). Emission standards and technical standards

are the requirements to be complied with by firms which have to pass the EIA procedure.

Conceptually ambient air quality standards are the targets of air pollution control policy.

Emission standards are the tools of the environmental authority used to inform firms what

they should do and not do in containing emissions. The emission standards also function as

criteria in establishing whetherfirms have complied with their EIA or not. The TCVN-1995

emission standards are performance standards for most existing and new small, medium and

large stationary sources. Article 16 of the LEP and article 22 of Decree No.175/CP provide

that all types offirms and individuals who are in charge of environment-related activities

must comply with TCVN-1995. Article 29(2) of the LEP prohibits any activities that result in

a discharge of pollution into the air exceeding the Vietnam ambient air quality standards. The

TCVN-1995 mandatory emission standards were uniform and had to be applied equally forall pollution sources in the entire country, including existing and new or expanding sources.

The emission standards were revised in 2001. Further details are provided below. In 1998,

MOSTE issued Circular No. 490/1998/TT-BKHCNMT as guidance for the making and

assessment of EIA; the Circular stated that in any province that has its own environmental

standards, firms located in that province are obliged to apply the local environmental

standards, if the local environmental standards are more stringent than national environmental

standards TCVN-1995. In case of pollutants which are not on the list of TCVN-1995, the

investors must ask permission of MOSTE to apply the environmental standards of those

pollutants that have been applied in developed countries.

Interviews with staff from MOSTE, DOSTEs, factory managers, and environmental experts

in some institutions, and the articles of Nguyen Khac Kinh, (1999); Le Doan Thao and Dang

Viet Khoa, (1999); the Ministry of Industry, (1999), Phung Thuy Phuong (2002) reveal a

number of bottlenecks in implementing the standards.

First, TCVN-1995 is based on foreign models of environmental standards for ambient air

quality and emission to air. The policy-makers did not have knowledge about setting up

environmental standards. They just picked the environmental standards in some developed

countries. In their opinion, Vietnam should meet these standards as well, without considering

the existing technologies and investments that would enable industries to comply.

Second, the environmental emission standards are applied equally across the entire

country without considering the differences in scale, type of production, characters ofpollutants, and location of industries. In some cases, all polluters in a geographical area

comply with emission standards, while severe deterioration of the environmental quality still

continues due to strong local or regional concentration of stationary and mobile sources

and/or the limited self-purifying capacity of the area. Since the emission standards are

national minimum emission requirements the regional or local authority could set more

stringent regional or local emission standards for stationary sources. However, it might be

unwilling to do so from fear to remain behind in attracting new firms. On the other hand,

pollution control costs might cause unnecessary high costs for industries located in less


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polluted areas because of being excessively tight. These standards were not changed until the

end of the year 2002.

After 7 years of effort to implement emission standards TCVN-1995 with very little result,

some emission standards in the TCVN-1995 have been changed. From January 1, 2003 on

they replace the old ones. Emission standards TCVN-2003 also apply to small, medium, and

large, new and existing stationary sources. The ambient air quality standards in TCVN-1995

are still in place and were not revised.

The emission standards TCVN-2003 in air pollution control are:

1. TCVN 6991: 2001 Air quality emission standards for inorganic substances in

industrial emission discharged in industrial zones.


industrial emission discharged in urban regions.


industrial emission discharged in rural regions.

4. TCVN 6994: 2001 Air quality emission standards for organic substances in

industrial emission discharged in industrial zones.5. TCVN 6995: 2001 Air quality emission standards for organic substances in

industrial emission discharged in urban regions.

6. TCVN 6996: 2001 Air quality emission standards for organic substances in

industrial emission discharged in rural regions.

Thus, instead of the uniform emission standards regulated in TCVN-1995 for inorganic

substances, dust and organic substances applied to all firms in all locations, the emission

standards set in TCVN-2003 are differentiated, distinguishing emission standards levels for

three different locations: industrial zones, urban regions, rural regions. Based on the reality

that air pollution is always more concentrated in industrial zones rather than in other regions,and also based on the characteristic that most existing small and medium sized industrial

firms in Vietnam are located in urban areas, emission standards TCVN-2003 are more

stringent in industrial zones than in urban and rural regions. Similarly, the emission standards

forfirms located in urban regions are more stringent than those forfirms located in rural

regions.

It is still too early to assess the implementation of TCVN-2003.

It has to be noted that TCVN emission standards of 1995 and 2003 apply to new and old

sources alike and do not differentiate between types of source, for example based on their

scale and capacities to control emissions at relatively low costs.

9.5.2.2Environmentalimpactassessment(EIA)andenvironmentallicensingEIA is the process of analyzing, evaluating, and forecasting the environmental impacts caused

by the implementation of socio-economic development projects, master plans, production

units, enterprises, and other significant economic, scientific, technical, health care, security,

and defense projects (Le Thac Can, 1997; Phung Thuy Phuong, 2002). Theoretically, the EIA

process can mitigate the environmental impacts of economic development. According to the

OECD (1999), EIA has become one of the most commonly used environmental policy tools

for countries in economic transition. In Vietnam, EIA was introduced in the mid-1980s to

promote environmental protection and sustainable development (Le Trinh, 1997). At that


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time, EIA was not yet officially required as an element of feasibility studies or in design

phases of development projects (Phung Thuy Phuong, 2002). In 1994, the Law on

Environmental Protection changed the situation by making the EIA procedure compulsory for

the approval of investment projects and also for the continuation of existing industries. In

addition, Decree No. 175/CP outlines more details about Environmental Impact Assessment

(EIA) procedures.

According to articles 17, 18 of the LEP and article 9 of Decree No. 175/CP, both existing

and new sources, including most small, medium and large sources, have to prepare and

submit their EIA report for assessment and approval by the authorities. The EIA report

includes an evaluation of the environmental status at the location where the firm has been/will

be located, an assessment of the environmental impact of investment projects, including the

establishment and expansion of industrial plants. The EIA has also to address the suggested

measures required to control emissions for mitigating negative environmental effects (article

10 of Decree No. 175/CP).

A public authority (national or regional) has to evaluate the report and decide on the

pollution control measures to be taken. For existing sources, should the EIA report show that

they might fail to meet environmental standards (TCVN-1995), the authority shall give thema period of time to correct it. If they continue to fail after the given time, the authority shall

report it to higher authority level to make a decision about whether to suspend operations or

otherwise impose a penalty on those polluting firms. For new sources or those being

expanded, once the authorities have approved the EIA, steps could be taken to give land grant

permits as well as construction licenses. Thus, the approval of an EIA report constitutes a

legal foundation for investors to implement their projects. If their EIA is not approved,

investors could not conduct their business. The LEP (article 50) regulates that firms which fail

to comply with the commitments in their EIA report shall be penalized with administrative

fines or criminally prosecuted (the next subsection will give further details on this).

Decree 175/CP also allocates the authority to approve EIAs for different types of projectsto different government agencies. It distinguishes projects of national and regional

significance for which an EIA has to be made and approved by either national or provincial

public authorities and next to that, small projects that do not need an EIA. On behalf of the

investor, the EIA report has to be prepared by agencies or organizations that have qualified

staff and the necessary facilities (Article 12(2) of Decree 175/CP) and the report has to be

submitted to the public authority, either nationally (MOSTE) or regionally (DOSTE). As was

described in section 9.4, NEA/VEPA (for MOSTE) and DOSTE (for Peoples Committee of

that province/city) are in charge of assessing the submitted EIA on its quality, completeness

and the sufficiency or insufficiency of the pollution control measures proposed in the EIA. In

case of important projects, the NEA or the DOSTE can assess the performance through

committees especially installed for the task. In addition, MOSTE or DOSTE respectivelyhave responsibility to supervise the technical design and implementation measures to protect

the environment which were proposed in the EIA report (Article 17 of Decree 175/CP).

As was said, after the EIA report has been approved, the land use permit and the

construction permit can be issued. The firm then constructs its facilities and installs the

pollution control technology that was proposed in its approved EIA report. Once the

construction is completed, the environmental agency inspects the plant to see if the investor

has followed up the measures stated in its approved EIA report. If it does, the firm is allowed

to start operations. Article 6 of Circular No. 276-TT/MTg, issued by MOSTE on March 6,


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1997 as guidance for industries in controlling pollution after their EIA has been issued, states

that after the firm has started its operations, the investor has to apply for the Certificate of

implementing pollution control measures.

Finally, after all the above steps have been completed, the firm has to apply for an

environmental license by submitting its approved EIA and its certificate of implementing

pollution control measures. The environmental license states the environmental requirements

to be met by the plant. For the firm receiving the license functions as evidence that it has

complied with the measures which were stated in its EIA report. It also means that the firm

has complied with environmental standards TCVN-1995. Basically, the measures to control

emissions suggested in the EIA, and approved by the public authority, should be copied into

the environmental license. According to Circular No. 2781-TT/KCM, issued by MOSTE on

December 3, 1996 as guidance for granting, extending and withdrawing environmental

licenses for industries, all firms including existing and new or expanding firms must apply for

the environmental license. An environmental license is valid for 3 or 5 years depending on

the size of the factory and type of industry it belongs to. The authority granting EIA approval

also has the right to grant, extend, and withdraw the environmental license. Firms that operate

without an environmental license or that violate the commitments in the environmentallicense will be suspended or criminally prosecuted.

The steps that an investor needs to make to comply with the environmental requirements

are summarized in the following scheme. Normally the next step should only be taken after

the requirements of the earlier stage have been met.

Firm needs EIA

L

Firm starts EIA procedure

L

Approval of EIAL

Application for land use and construction permit

L

Permit granted

L

Construction

L

Inform environmental agency of completion of construction

L

Environmental agency inspects plant

L

Agency approves

L

Start of operations

L

Application for certificate of implementing pollution control measures

L

Certificate granted

L


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Application for environmental license

L

Monitoring of emissions during operations

L

License granted

The environmental licensing procedure is similar to the procedure applied to starting an

industrial plant in developed countries, including the U.S. as we have seen in chapter 3. The

similarities bring out that the basic instrument of environmental policy in Vietnam is the

command-and-control approach similar to the approach in the industrially developed world.

The difference between the U.S. and Vietnam is that in the U.S. acquiring the environmental

license usually does not involve making an EIA. EIA are made only for very big investment

projects with potentially large negative environmental consequences.

According to Le Thac Can (1997) the review of the EIA reports for new projects in

Vietnam found that there were projects which had to change their production process,

materials input, or fuel or invest more in pollution control to get the approval of their EIA

report. Some investment projects were not approved because the location of the project or thetechnological processes involved was considered to be inappropriate. It might be said that

EIA procedures could be effective when followed properly. Yet, even when procedures are

followed meticulously, the bottleneck emerges that members of the EIA report assessment

committees lack knowledge and experience in environmental management and technology.

The result is that sometimes a project is easily granted an environmental permit as a nominal

procedure. In addition, the number of environmental experts is small; experts who make EIA

reports and who make an evaluation of an EIA report know each other, sometimes closely or

as friends. As a consequence, many projects are approved because environmental experts try

to avoid conflict and disagreement between themselves in approving the projects (Phung

Thuy Phuong, 2002). In Vietnam, culturally, personal emotions and relationships easilyinfluence people in their public jobs. Deficiencies in EIA reports are not easily detected and

corrected: there is no quality control in the review of EIA either by an independent agency or

by the public and there is no compulsory public participation in EIA evaluation and

monitoring. On paper, representatives of local people are included in the EIA evaluation

committee at the local level, but in practice, there is just very little public access to the final

EIA.

Major bottlenecks also occur in implementing the conclusions of approved EIAs. After

granting approval, there is no monitoring in the implementation phase of the projects.

Therefore, most investors do not implement the pollution control measures as their EIA

reports stated.

Finally, it is possible that firms circumvent or manipulate EIA already in its preparationstage: because of corruption in the bureaucratic system, investors could buy EIA reports and

assessments easily without going through the EIA evaluation procedures (Phung Thuy

Phuong, 2002). Another possibility is that, although investors have an obligation to submit

EIA reports as a requirement for a land use permit and construction licenses, they actually

only start making EIA reports when the construction of the infrastructure has already started.

Later on, investors just ask for the EIA report evaluation for fulfilling the administrative

procedure (Chu Thi Sang, 1999).


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One result of all these features is the virtual lack of a relationship between a firms

environmental performance and its approved EIA. Usually, firms rely on an approved EIA

report as legal proof that they do not violate environmental protection laws even though in

reality they are (Phung Thuy Phuong, 2002). Sheltering behind this legal proof, they do not

let the authority come inside the firm to inspect. As ORourke (1999) said: EIAs are still

required in most provinces, but have largely become money-making ventures rather than

environmental initiatives.

In 1998, Circular No. 490/1998/TT-BKHCNMT enacted by MOSTE, confirmed that EIA

approval of investment projects needed to be obtained before land use permits and

construction licenses, which give the investor permission to start construction of the site,

could be issued. If applied such a rule can prevent that the authority comes under pressure to

approve an EIA because so much has already been invested and would be lost in case of

refusal.

Spurred by the economic crisis in Asia the Circular also announced that the mandatory

EIA was abolished for a firms planned investment project on a location in industrial

zones/estates which already has its own EIA approval. Instead of submitting the EIA report,these investment projects needed to follow a simpler procedure by submitting to DOSTE a

form called A registration for securing environmental standards. This form includes the

description of the type of pollution emitted and most importantly a promise to follow the

environmental standards of TCVN-1995. DOSTE will decide whether or not the investor

needs to install pollution treatment facilities. If yes, the investor has to submit the design of

facilities together with the form to DOSTE. If the form and the design are approved by

DOSTE, the next steps can be taken from the construction to monitoring as described in the

scheme above. This Circular does not apply for investment projects which are going to locate

in industrial zones/estates that have not obtained their own EIA approval. The purpose behind

this decision was to reduce the administrative and bureaucratic red tape so that investors,especially foreign investors, would be attracted to invest in industrial estates.

In August 2002, MOSTE issued for the first time a specific Regulation on the Protection of

the Environment in Industrial Zones/Estates, even though most industrial zones/ estates have

been in operation since 1994. The Regulation has 10 chapters with 53 articles. The

Regulation applies to any organization or individuals, including foreigners, involved in any

activities (e.g. investment) that relate to industrial zones/estates (Article 2). In principle, the

contents of the Regulation are similar to the related industrial environmental protection

articles provided in the Law on Environmental Protection, Decree No. 175/CP, Circular No.

490/1998/TT-BKHCNMT. The so-called Infrastructure Development Company is

responsible for making the EIA report for its own industrial zone investment project and

submits it to MOSTE (Art. 8). The Infrastructure Development Company is allowed to start

establishing the infrastructure for the industrial zone only after the EIA report is approved

(Art. 11). The industrial zone must be established on the basis of the environmental protection

measures stated in the EIA (Art. 12). The authority will check and inspect for compliance

with the EIA. If the EIA is violated, depending on the type of violation, a penalty (e.g.

suspension orfine) will be applied (Art. 13). Firms that invest in an industrial zone/estate that

has its own approved EIA and firms that have invested in industrial zones and already have an

approved EIA, have only to apply for a registration for securing environmental standards


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(Art. 15). In the case of air pollution, article 21 of the Regulation provides that firms in

industrial zones which emit in excess of permitted air pollution levels must implement

pollution-reduction treatment at the sources to make sure of compliance with TCVN for

discharge of emissions into the air.

As was said, the Regulation on the Protection of the Environment in Industrial

Zones/Estates is just an accumulation of all related environmental protection codes for

industrial zones/estates or investment projects that had previously been regulated in the Law

on Environmental Protection, Decree No. 175/CP, Circular No. 490/1998/TT-BKHCNMT.

The restatement of policy seems to have had little effect: a year after the Regulation took

effect, no discernible progress on the implementation of the Regulation had been made.

Assessment

In summary, EIA was introduced in Vietnam more than two decades ago, but it did become a

mandatory procedure together with the requirement to hold an environmental license in the

1994 Law on Environmental Protection. EIA and environmental license have become

environmental policy tools to prevent pollution. Initially most stationary sources, including

existing and new sources, were required to have an approved EIA report in order to continueto operate or to be granted land use and construction permits respectively. Next to that, firms

must have an environmental license to prove that they have complied with their EIA reports.

Later on, to simplify the EIA procedure, MOSTE issued the Circular No 490 in 1998 and the

Regulation on the Protection of the Environment in Industrial zones/estates in 2002. The

Circulars allowed firms that planned to locate their premises in industrial zones/estates which

already have their own EIA approval to skip the EIA procedure. These investments projects

only needed to apply for a registration for securing environmental standards instead of

going through the complete EIA procedure.

The EIA procedure has worked far from perfect. To see the bottlenecks in perspective one

has to recall that Environmental Impact Assessments have been developed in the USA andother Western industrialized countries in the late nineteen-seventies as an instrument to assess

the potential environmental damage of planned, large investment projects with potential

environmentally highly harmful consequences. Such an EIA would help to decide not to go

on with the projects or to change their design drastically at an early stage in the policy

process. However, in Vietnam the original legislation required an EIA for about every

economic activity: from large to most of small sources and not only for new and modified

sources but even for existing sources. This seems far too costly, a waste of time and money

and even impossible given the limits on manpower and expertise. It seems that this failure in

policy design has been recognized. In 1998 an effort was made to reduce the number of EIAs

by dropping the EIA requirement forfirms establishing a plant in a zone/estate which has an

EIA approved for the zone. However, this effort to make the procedure leaner had the

unhappy effect of making it even more ineffective than it already was.

Apart from being too demanding, which one can see as a design error, the EIA also shows

a lot of shortcomings in its implementation, as was mentioned before: they appear in about

every stage of the procedure running from drafting the EIA till operating the plant. The

deficiencies are mainly due to lack of personnel and expertise to implement and to monitor

the implementation of the EIA procedure even after it was simplified. Next to that the

tendency to avoid conflicts and straightforward corruption of bureaucracies has created a real

obstacle in the implementation of the EIA.


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9.5.2.3Monitoring,InspectionandEnforcementFour topics will be discussed in this section: first, the monitoring of air quality; second, the

inspection of emission sources; third, the enforcement of compliance, and finally the

enforcement will be assessed.

Monitoringair

quality

Air quality monitoring is one of the significant tasks of environmental protection agencies. It

is an essential element for establishing or adjusting environmental standards and for

developing air pollution control instruments to achieve the environmental protection target.

NEA is in charge of this task at the national level. NEA has delegated the operation of

monitoring to three institutions. Hanoi Civil Engineering University (CEETIA) is responsible

for monitoring in Northern Vietnam; the Environmental Protection Centre (EPC) is

responsible for the central and some southern parts of Vietnam; and the Institute for Natural

Resources and Environment is responsible for the Mekong Delta region. At the local level,

DOSTEs are in charge of monitoring air quality. In industrial zones/estates the Infrastructural

Development Company is responsible for monitoring air quality and reporting the results to

DOSTE twice a year. In Vietnam, there has been a lack of equipment for monitoring stations

as well as too little funding for this activity. Only ambient air and water quality is monitored

at a few locations, with a limited number of samples addressing a small number of parameters

at each location. In 1994, there were only 5 air monitoring stations for the whole country.

This number has increased to 53 stations in 2002, including 17 monitoring stations under

NEA/VEPA and the rest monitoring under DOSTE (Vietnam Register, 2002). The monitoring

stations take measurements four times a year at the beginning of each quarter. In practice,

each major city collects the data using different methods, so the data might not be reliable.

Besides that, the calibration between stations is also inconsistent. Furthermore, the collected

data are not easily accessible to the public. Nevertheless, the monitoring system is improving

gradually even though there continues to be a shortage of funding.

InspectionofemissionsourcesInspecting installations in operating plants or even better direct measurement of emissions

helps authorities to check whether a firm complies with environmental standards. Every six

months, firms in industrial zones/estates must report their compliance with environmental

standards to the Industrial Management Board and DOSTE.

Infrastructural Development Companies have to report once a year on compliance with

environmental protection measures of their industrial zones/estates to DOSTE.

Environmental protection agencies are responsible for inspections to determine

compliance with environmental policy. There are three types of inspection:

(1) Regular inspections are based on a schedule prepared in advance. Normally, an

inspection is conducted every six months or annually. The environmental agencies conduct

inspections whether or not firms are in compliance with their EIA, environmental standards,

applying measures to prevent environmental damage, etc.

(2) Sudden inspections occur when there was an environmental policy violation that

happened suddenly.

(3) Complaint-based inspections. Due to the lack of personnel, both at national and local

levels, inspections occur when there are continuing complaints. At the national level, MOSTE

is responsible for inspecting those firms whose EIA was approved by MOSTE or when


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DOSTEs request an inspection. At the local level, DOSTEs perform inspections when there

are many complaints in the Community or from neighboring firms.

EnforcementofcomplianceWhile implementing the inspection tasks, should the authority detect firms that are not in

compliance with environmental laws or their EIAs, a sanction will be imposed on those firms.

MOSTE and the Provincial Peoples Committee/DOSTE are responsible for implementing

the enforcement system.

The sanctions for not complying with environmental regulations can be divided into

administrative sanctions and criminal sanctions. Decree No. 26/CP issued by the central

government in April, 1996 provides for the following types of administrative sanctions: a

warning, with an order to redress the situation so as to comply; paying a fine; withdrawal of

the environmental license for six months, which implies the plant is not allowed to operate

during that period; paying compensation for damages inflicted.

The most often used enforcement tool forfirms out of compliance

Environment Policies in Vietnam

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