07/12/2017
In 2008, the Vietnam Forest Protection and Development Fund (VNFF) was founded to mobilize social resources to protect and develop forest land in the country. After eight years of operations, the VNFF has made its mark in forest protection and development activities, contributing significant financial resources to the forestry sector and improving the earning and living conditions of those who work in the sector. To provide an explanation of the operations and achievements of the VNFF as well as of the Payment for Forest Environmental Services Programme (the PFES Programme), Vietnam Environment Administration Magazine (VEM) spoke with Nguyễn Bá Ngãi, Deputy Director of Vietnam Administration of Forestry at the Ministry of Agriculture and Rural Development (MARD).
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| Nguyễn Bá Ngãi, Deputy Director of Vietnam Administration of Forestry |
Can you reveal the results after eight years of operating the VNFF and five years of implementing the Payment for Forest Environmental Services Programme (PFES Programme)?
On January 1, 2008, the government issued Decree 05/2008/ND-CP regulating the Vietnam Forest Protection and Development Fund (Decree 05) to attract and approach non-State financial resources for the management, protection and development of the forest, and the PFES Programme is one of the key resources for the VNFF. On April 10, 2008, the Prime Minister issued Decision 380/QD-TTg regulating the pilot implementation of the PFES Programme in Son La and Lam Dong provinces. After two years of the pilot implementation, which was considered successful, the government issued Decree 99/2010/ND-CP on 24/9/2010which making the PFES Programme officially valid across the country on January 1, 2011 (Decree 99).
After eight years of operation, including five years of implementing the PFES Programme, the VNFF has made a lot of achievements, results and positive impacts. The VNFF has consulted with the Vietnam Administration of Forestry under the Ministry of Agriculture and Rural Development (MARD) to issue multiple legal documents to manage and instruct local authorities to implement forestry environment policies. To date, 41 provinces and cities in the country have developed their own funds, and these are being run properly and effectively.
Initial success in socializing forest protection and development efforts by the VNFF is expected to raise trillions of dong in investment from non-State sources. Total payments for forest environmental services up to December 30, 2016, amounted to VND 6.51 trillion. In the period 2011 - 2015, the annual average payment for forest environmental services was VND1.2 trillion, equal to 22 %% of the total yearly average social investment for the forestry sector. This has proved to be a stable, sustainable financial resource for the VNFF due to the increase in forestry services and businesses, which helps reduce State spending on the forestry sector. On November 2, 2016, the government issued Decree 147/2016/ND-CP (Decree 147) to amend and supplement Decree 99, which has become an important factor in resolving difficulties arising from the implementation of the previous decree. In addition, raising charges on hydropower plants (from VND20/kwh to VND36/kwh) and clean water suppliers (from VND40/m3 to VND52/m3) has increased the revenue from payments for forest environmental services. Therefore, people, especially ethnic minorities and those living in remote, disadvantaged areas, can yield higher profits and benefits from the VNFF. Decree 147 also helps people earn more from the PFES Programme, ensuring better living conditions and encouraging them to make further efforts to protect and develop the forest.
The revenue from the PFES Programme has helped management agencies protect more than 4.6 million hectares of forest. Besides the main income sources, such as hydropower plants, clean water suppliers and travel agencies, the VNFF has tested some new sources, such as industrial zones, seafood processors and carbonate absorption services. Based on the pilot results, the VNFF will consult MARD to issue a new policy and apply it across the country to diversify the financial resources of the PFES Programme.
It can be said that the PFES Programme has been proven to meet the development initiatives of Việt Nam and the world in terms of environmental protection and improving the management and exploitation of forestry resources in a sustainable way, while contributing to the growth of the Vietnamese economy. In addition, it also improves the living conditions of millions of local people in the mountains, offering them plenty of employment opportunities, reducing poverty and ensuring social security and order.
How is the PFES Programme carried out?
The money received from businesses involved in the PFES Programme is paid back to forestland owners under the supervision of the VNFF. A total of VND5 trillion has been paid to forest owners, who include households, individuals and organizations, to manage and protect 5.87ha of forestland (42 %% of the total forest area in the country). Local authorities are allowed to use nearly VND385 billion to help forest owners develop silvicultural methods and facilities to protect and develop the forest. Since the launch of the PFES Programme, the management and protection of forestland has improved, with the number of cases violating the Law on Forest Protection and Development and the total destroyed forest area falling by 32.9 %% and 58.2 %%, respectively, compared with the 2011 - 2015 period and the 2006 - 2010 period.
At the moment, there are more than 500,000 households and groups receiving payments from the PFES Programme in cash and packages. The average payment of VND 2 million per household per year has improved the living conditions of the local people, especially the ethnic minority groups, and has become an important earning source for households located in remote, disadvantaged regions.
Further, the PFES Programme has financed forest owners wishing to develop, manage and protect their forest areas, especially forestry companies, forest management agencies and local people, helping them increase their earnings and improve their living conditions.
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| People of San Thanh Commune, Lai Chau City, Lai Chau Province receive payments for forest environmental services |
What are the problems and obstacles encountered in conducting the PFES Programme? What are the causes of these problems?
In addition to its achievements, the VNFF and the PFES Programme have encountered some problems. One of the problems is that revenue from the PFES Programme has remained low compared to the programme’s potential, while charges to other subjects besides those included in the programme, including industrial zones, seafood processors and carbonate absorption services, are not carried out nationwide. Charges for forest environmental services to hydropower plants and clean water suppliers are much lower than the value of the environmental services generated by nature. For example, charges to hydropower plants is VND36/per kwh, up from the previous level of VND20/kwh, but it is still much lower than the value of environmental services produced by the forest, which ranges between VND63 and VND368/ kwh and averages at VND214/kwh. Meanwhile, charges to clean water suppliers is VND52/m3 compared with the environmental service value of VND65/m3.
Further, the average income of VND2 million per household per year for households across the country is considered too low, making it difficult to ensure adequate living conditions. A number of hydropower plants, clean water suppliers and travel agents, which use natural resources from the forest, have not paid their fees or have delayed payments to local authorities, putting themselves in debt and affecting the provinces’ plans for spending on forest protection, management and development efforts. Besides this, the legal framework of the VNFF has remained unclear, so local authorities have misunderstood the framework and applied the regulation in various incorrect ways. Moreover, the provinces have met with difficulties in operating their forest protection and development funds due to the lack of self-financing.
On the other hand, payments for forest environmental services are a new, non-State source of finances. A number of leaders and officials from local authorities have misunderstood the nature of the payments and considered them State spending, thus putting the payments under the management of the State's regulations and making it harder to manage and spend the programme’s money.
What do you recommend to improve the efficiency of implementing the PFES Programme in the future?
To continue implementing the PFES Programme effectively in the future, we will propose that the National Assembly approve the amended Law on Forest Protection and Development, which includes policies on the VNFF and PFES Programme. We will also propose that the government allow and assign MARD to lead and work with other ministries and sectors to develop a new decree in 2018 to amend and supplement Decree 05 and relevant instructional circulars to match the current conditions in order to implement Decree 147 effectively.
In the near future, the VNFF will actively push local authorities to promote Decree 147 to the targeted subjects and apply new charges under the PFES Programme, enhance the monitoring of the programme's implementation, ensure that the charges are collected in full, and ensure the media reports on businesses and local authorities that strictly follow the regulation on the payments for forest environmental services and other required charges to bring the sectors, ministries, organizations, individuals and society to a consensus. In addition, the VNFF will enhance its supervision of the implementation of the PFES Programme and disburse payments on time to forest owners and households as well as develop and complete the overall forest administration project so that the project becomes a foundation for the PFES Programme■
Thank you!
Hương Trần
(Implemented)
