Aluminum recycling in Vietnam: opportunities and challenges

Aluminum is a lightweight metal that is easy to recycle and has high economic value — each ton of recycled aluminum consumes only about 5% of the energy required to produce new aluminum from bauxite. In Vietnam, with rapidly growing demand in construction, automotive, electronics, and packaging industries, aluminum recycling technology has become a key solution to secure raw materials and reduce production costs.

The boom in demand for extruded aluminum profiles for construction (windows, frames) and for manufacturing automotive and electronic components has driven domestic businesses to invest heavily in modern recycling technologies, aiming to cover around 20% of the country’s total extruded aluminum output.

Applications of Recycled Aluminum

• Construction: Recycled aluminum is widely used to produce doors, window frames, curtain walls, and other extruded profiles, meeting requirements for durability, aesthetics, and end‑of‑life recyclability.
• Automotive & Transportation: Light components such as wheels, body frames, and engine parts leverage recycled aluminum to reduce vehicle weight and improve fuel efficiency.
• Electronics & Home Appliances: Casings for laptops, smartphones, refrigerators, cookware, etc., exploit aluminum’s excellent thermal conductivity and strength.
• Packaging: Aluminum cans and boxes for food and pharmaceuticals increasingly prefer recycled content to meet green and circular‑economy standards.

Government Regulations and Incentives

1. Law on Environmental Protection 2020 & Decree 19/2015/ND‑CP
   • Recycling enterprises receive tax and fee incentives for environmental protection activities and recycled‑content products under Article 55 of Decree 19/2015/ND‑CP and Decree 04/2009/ND‑CP.
   • Companies must obtain environmental permits and meet national standards for air emissions, wastewater treatment, and solid‑waste management.
2. Credit and Financial Incentives
   • Under Resolution 198/2025/QH15, green and circular‑economy projects (including aluminum recycling) qualify for subsidized loan interest rates at 2% per year, plus corporate‑income‑tax exemptions for the first two years and 50% reductions for the following four years.
3. Value‑Added Tax (VAT) & Import‑Export Duties
   • Decree 181/2025/ND‑CP stipulates that products with recycled content accounting for ≥51% of total cost are subject to a 5% VAT rate or VAT exemption.
   • Export duty exemptions apply to unrefined aluminum ingots from scrap, per Customs Official Letter 7283/TCHQ‑TXNK (2012) and Ministry of Industry and Trade Official Letter 11248/BCT‑HC (2012).

Challenges and Future Directions

• Traditional Workshop Pollution: In Mẫn Xá, reliance on dirty fuels (coal, waste oil) in melting furnaces without proper emission controls leads to severe smoke, dust, and slag pollution, harming local health.
• Technology & Management: There is a need to accelerate investment in closed‑loop melting furnaces and multi‑stage emission‑control systems, while tightening environmental permitting and discharge monitoring.
• Sustainable Development: Strengthen green investment incentives (financial and tax), and promote public–private partnerships to build modern recycling industrial clusters that relieve pollution pressure on traditional villages.

Aluminum recycling in Vietnam is driven by rising domestic demand and supportive state policies. To ensure sustainable growth, it is essential to improve the legal framework, adopt environmentally friendly technologies, and build a circular‑economy value chain linking businesses and communities.