Southeast Asia

G7 Upgrade $15bn Coal Transition Deal Offer to Vietnam


The G7 group of industrialised nations has made a new revised $15 billion offer to Vietnam to help speed up its transition away from coal, sources claim.

Vietnam, which is among the world’s top 20 coal users, was initially slated to sign up for the so-called Just Energy Transition partnership with the Group of Seven (G7) nations at the global COP27 climate summit in November, but high-level talks broke off before the meeting.

To persuade Vietnam to back the deal, Western negotiators led by the European Union and Britain have now proposed a bigger financial package, which includes $7.5 billion made up almost exclusively of loans from the public sector and the same amount in pledges from the private sector, the sources said.


Also on AF: Plunging Trade Risks China’s Status as the ‘World’s Factory’


All three Western officials, who declined to be named because talks were confidential, said it would be the final offer from the G7 before a summit of European Union and Southeast Asian nations in Brussels on December 14, which EU officials have repeatedly indicated as the new target date for a deal.

The offer has gradually expanded from an initial pledge of just $2 billion in public funds with undefined additional private support.

It is unclear whether it could be further revised if no deal was reached next week.

It remains unclear whether Vietnam would be prepared to accept the increased offer, because its main concerns do not appear to have been addressed.

The Southeast Asian country had asked for more grants, because it is traditionally opposed to taking on large loans.

One of the sources said there was a “50/50” chance of a deal next week. Another noted talks were still under way and final figures may still change slightly.

Vietnam’s energy security remains potentially at risk as the G7 plan focuses on renewable energy which may result in power shortages in the booming nation without a credible back-up in the event of low power output from wind farms or solar panels.

Immediately after talks broke off in November, when Vietnam’s authorities cancelled a meeting due to take place in Hanoi with top US and EU climate envoys, the country’s industry ministry circulated a new draft for its long-term power plans which boosted the use of coal compared to a previous version of the same document.


  • Reuters with additional editing by Sean O’Meara


Read more:

India Burns Even More Coal Despite Climate Pledge Pressures

US, Japan Raising $20bn for Indonesia’s Shift from Coal




Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.

Recent Posts

China Services Activity Jumps in January as Covid Curbs End

China's dropping of travel curbs resurrected services activity in January for the first time in five…

45 mins ago

China to Build Antarctica Ground Stations for Ocean Satellites

The China Aerospace Science and Technology Group is to build the $6.53 million stations amid…

15 hours ago

China Battery Firm CATL Seen Eyeing $5bn Swiss Listing Boost

The global depositary receipts listing could even see CATL raise $8 billion if market conditions…

16 hours ago

Xpeng Secures Key Permit to Launch ‘Flying Car’ – TechCrunch

The 'special flight permit' from the Civil Aviation Administration of China will allow the Xpeng…

20 hours ago

Paris Club Seen Giving Sri Lanka Support for IMF Bailout

The Paris Club of creditor nations is ready to provide financing assurances for Sri Lanka,…

20 hours ago

China Needs Tech Self-Reliance to Avoid Being Strangled: Xi – SCMP

President Xi Jinping warned this week that China must speed up moves to become self-reliant…

20 hours ago