Net-zero industrial precinct model expected to spur growth for Ho Chi Minh City

The concept of an NZIP is fairly simple, meaning that stakeholders work together to reduce greenhouse gas emissions and achieve net zero within a specific geographic zone.

Rather than a single industry, company or government operating in a silo, everyone works together to build on the efficiencies offered by shared infrastructure, technology, and investment in a bid to accelerate the shift to renewable energy, efficiency, and electrification and reap the resulting benefits.

Taking this place-based approach, the roadmap centers on five industrial zones that together account for over 70 percent of the total energy use of all industrial zones in the city, including Saigon Hi-Tech Park, Tan Thuan Export Processing Zone, Tan Tao, Hiep Phuoc, and Dong Nam.

Climateworks Center Vietnam policy manager and report author Ben Khuat said NZIPs offer an opportunity to future-proof Vietnam's industrial sector and by extension, the whole economy.

“The transition to a low-carbon economy through the NZIP approach represents a new engine of growth for Ho Chi Minh City and a pathway to regional leadership,” he said.

“By enabling the city to efficiently upgrade its energy infrastructure, modernize production, and foster collaboration, NZIPs can support local manufacturing industries to move up the global value chain, attract green investment, and help Ho Chi Minh City remain competitive in the race to net zero.”

While Vietnam has maintained an average GDP growth rate of around seven percent over the last two decades, among the fastest in the region, this rapid economic expansion has fueled a sharp rise in emissions.

Emissions have surged by a staggering 140 percent in just 10 years, with the industrial sector accounting for 54 percent of national energy use.

On a global scale, it is a similar story. More than one third of global emissions come from industry.

“These numbers mean industry plays an essential role in reaching net zero by 2050 globally, and leveraging NZIPs can enable industry to drive down emissions at the scale and pace needed,” Ben said.

“Ho Chi Minh City can position itself as regional leaders for low-carbon production, where innovation and collaboration turn industrial transition into a powerful driver of economic growth.”

This report builds on a body of work identifying NZIPs across Australia and Southeast Asia.

It was developed with support from the Center for Consultation, Information, Economic Management and Business (CIT) under the Ho Chi Minh City Institute for Development Studies.

Climateworks Center bridges the gap between research and climate action, operating as an independent not-for-profit within Monash University for the past 15 years.

It develops specialist knowledge to accelerate emissions reduction, in line with the global 1.5°C temperature goal, across Australia, Southeast Asia, and the Pacific.