Greenhouse gas emissions in Vietnam: an analysis based on a social accounting matrix with firm heterogeneity

ABSTRACT Vietnam is one of the fastest-growing polluters in the world – due to rapid industrialization facilitated by massive foreign investments. This study estimates the sources of greenhouse gas (GHG) emissions arising from activities of firms using a social accounting matrix (SAM) that incorporates firm heterogeneity based on ownership style, namely, state-owned enterprises, private firms, and foreign-invested enterprises. The results show that an increase in exports or investments increases GHG gas emissions to varying degrees depending on whether the increase occurs in state-owned enterprises, private firms, or foreign-invested enterprises (FIEs). The largest increase in emissions results from an increase in exports and investments of FIEs, whereas the increase in emissions due to private firms and SOEs is much smaller. The results imply that it is important to consider the impact of foreign investments and the activities of foreign firms on GHG emissions in Vietnam.