PFES experiences in Lam Dong andPFES experiences in Lam Dong andSon La provinces, Viet NamSon La provinces, Viet NamDr. Nguyen Chi Thanh Director of the Research Center of Forest and Wetlands (FORWET)Key member of the PFES policy makers group
EBA Workshop in Ha Noi, 15-16 October 2013
What PES policies that Viet Nam has issued?
The Law of Biodiversity (2008) stipulates in the Article 74 (Environmental services related to biodiversity) that:
1. Organizations and individuals using environmental services related to biodiversity shall pay charges to service providers.
2. The Government shall specify environmental services related to biodiversity.
This is a regulation of the Biodiversity Law, not is a policy for implementation yet
The policy on Payment for Forest Environmental Services(PFES) to implement
the Law of Forest Protection and Development and the Law of Biodiversity
The Vietnamese Government issued the Decree No.99 dated 24/9/2010 on the policy of PFES
This policy shall apply to: State agencies; Organizations, households, individuals, village communities in the country; Vietnamese residing overseas, foreign organizations and individuals
with operations relating to supply, use, and payment for forest environmental services and management of the payment from forest environmental services
Why the Government of Vietnam Why the Government of Vietnam issued the issued the Policy on Payment Policy on Payment for Forest for Forest EnvironmentalEnvironmentalServices?Services?
Viet Nam has: Viet Nam has: Over 10,000,000 ha of natural forestOver 10,000,000 ha of natural forest 80% of which is low quality80% of which is low quality
At present, natural At present, natural forests have been forests have been destroying even the destroying even the special use forests and special use forests and watershed protection watershed protection forestsforests
Over 20 millions people living in the forest andOver 20 millions people living in the forest and moutainous areas moutainous areas
They are mostly ethnic minority people and They are mostly ethnic minority people and the poorsthe poors
Their subsistance is still depending on forest,Their subsistance is still depending on forest, have not been improved by forest employment have not been improved by forest employment
Social awareness on forest value is still limitedSocial awareness on forest value is still limited
Many consider that forest is created by natureMany consider that forest is created by nature so they take it for granted and investment intoso they take it for granted and investment into forest is responsibilities of the Governmentforest is responsibilities of the Government
The state budget is not enough to coverThe state budget is not enough to cover activities of protection for over 10 millions haactivities of protection for over 10 millions ha of natural forestof natural forest
Therefore a new financing mechanism for forest Therefore a new financing mechanism for forest protection in close linkage with livelihoodprotection in close linkage with livelihood improvement for local people is very urgent improvement for local people is very urgent and and neededneeded
That is reason why the Government of Viet Nam That is reason why the Government of Viet Nam issued the Decree on Payment for Forest issued the Decree on Payment for Forest Environmental Services (PFES) Environmental Services (PFES)
Objectives of the policy are: Objectives of the policy are: to prevent deforestation and forest to prevent deforestation and forest degradationdegradation to eleminate hunger and reduce poverty forto eleminate hunger and reduce poverty for local people local people to develop socialization of forest protectionto develop socialization of forest protection to develop a new financing mechanism forto develop a new financing mechanism for protecting forest protecting forest
Some main concepts of the Some main concepts of the PFES policy that are stipulatedPFES policy that are stipulatedby Vietnamese Government:by Vietnamese Government:
What is forest environmental services?What is forest environmental services?
Forest environmental service is the Forest environmental service is the work to provide the use values of forest work to provide the use values of forest environment to meet the needs of the environment to meet the needs of the society and people society and people
What is payment for forest What is payment for forest environmental services?environmental services?
Payment for forest environmental Payment for forest environmental services is a providing and payment services is a providing and payment relationship in which the users of forest relationship in which the users of forest environmental services pay to the environmental services pay to the suppliers of forest environmental suppliers of forest environmental services services
What are types of PFES?What are types of PFES?
2. Regulation and maintenance of water 2. Regulation and maintenance of water sources for production and living activities sources for production and living activities of the societyof the society
1. Soil protection, reduction of erosion and 1. Soil protection, reduction of erosion and sedimentation of reservoirs, rivers, and sedimentation of reservoirs, rivers, and streamsstreams
3. Forest carbon sequestration and 3. Forest carbon sequestration and retention, reduction of emissions of retention, reduction of emissions of green house gases through measures green house gases through measures for preventing forest degradation and for preventing forest degradation and loss of forest area, and for forest loss of forest area, and for forest sustainable developmentsustainable development
4. Protection of natural landscape and 4. Protection of natural landscape and conservation of biodiversity of forest conservation of biodiversity of forest ecosystems for tourism servicesecosystems for tourism services
5. Provision of spawning grounds, sources of 5. Provision of spawning grounds, sources of feeds, and natural seeds, use of water from feeds, and natural seeds, use of water from forest for aquacultureforest for aquaculture
Mechanism on Payment Mechanism on Payment for Forest Environmental for Forest Environmental
Services in Viet NamServices in Viet Nam
UsersUsers
PayersPayers
Forest Forest FundFund
ProvidersProviders
FES providing
FES providing
PayingPaying
PFES in coastal wetland ecosystemsPFES in coastal wetland ecosystems
ProviderProvider
UserUser
Provider
Provider
UserUser
PROGRESS OF PFES POLICY IN VIET NAMPROGRESS OF PFES POLICY IN VIET NAM
2007Idea & policy
writing
10/4/2008 – Decision 380PM decided piloting PFES policy in Lam Dong & Son La provinces
2010Wrap up
piloting work
24/9/2010 – Decree 99Government decided
implementing PFES policy in whole country up to now
Decision 380 of the PM dated 10/4/2008 Decision 380 of the PM dated 10/4/2008 on piloting PFES in Lam Dong and Son La on piloting PFES in Lam Dong and Son La
provincesprovincesForest environmenal services for piloting: 1.Soil protection, reduction of erosion and sedimentation of reservoirs, rivers, and streams
for Hydropower electricity production
2.Regulation and maintenance of water sources for production and living activities of the society
for Living water production
3.Protection of natural landscape and conservation of biodiversity of natural forest ecosystems
for Tourism services
Payment levels regulated in the Payment levels regulated in the Decision 380 of the PM dated 10/4/2008Decision 380 of the PM dated 10/4/2008
20 VND/KWhCommondity of electricity
40 VND/m3
Commondity of water
1-2 %Revenue of tourism in period
General achievements after two years of General achievements after two years of PFES piloting in Lam Dong and Son La under PFES piloting in Lam Dong and Son La under the Decision 380 of the PM dated 10/4/2008the Decision 380 of the PM dated 10/4/2008
FES suppliers in Lam Dong were: Forest owner is MB of Da Nhim Forest Protection 3,342 local contracted HHs of poor and ethnic minority 112,208 ha of watershed forest of Da Nhim river
FES users in Lam Dong were: Da Nhim Hydropower Company Dai Ninh Hydropower Company Sai Gon Water Company (SAWACO) Tourism Companies in Da Lat city
11
FES suppliers in Son La were: 4,507 organizations, FMUs, households, household groups, communities locate in 9 communes of 9 districts 50,894 ha of watershed forest of Da river
FES users in Son La were: Hoa Binh Hydropower Company Suoi Sap Hydropower Company Son La Water Company
22
Total PFES fund that Lam Dong province received in two piloting years of 2009 and 2010 is 108 billion VND equivalent to $US 5.4 million
33
Total PFES fund that Son La province received in piloting year of 2009 is 60 billion VND equivalent to $US 3.2 million
44
Ave. PFES fund of one HH in Lam Dong is 11 mill. VND/yearAverage PFES fund of one HH in Son La is 8 mill. VND/yearThis amount is very significant for poor and ethnic HHs though this is still limited to cover their subsistence
55
Forest protection is better. Number of illegal violation to forest reduced 50% in two years 2009 and 201088
The people of Ho Chi Minh City has been paying for their water using service monthly for forest protectors in the upstream region of Dong Nai river
99
Local households understand clearly position, boundary, area of the forest plot that they have to protect66
Hydropower, water and tourism busineses understand clearly their obligation on payment of PFES fund77
It is the first time in Viet Nam the forest protection work is recognized as a service and the payment mechanism is established and implemented in the context of forest and forest land is managed by the State, not private property
1010
The PFES policy makes the local people living in forest area very happy because they are received money by their labor to protect forest with the detail objectives and higher than the money they receive before
1111
Current situation on PFES Current situation on PFES Implementation in Viet NamImplementation in Viet Nam
At present, the PFES policy under the Decree 99 has been implementing payment in 25 provinces
with the total PFES fund in 2012 is 1,172,000,000 VND equivalent to $US 57,000,000
About 500,000 poor local households who are PFES suppliers received PFES fund
About 3,500,000 ha of forest which are forest area to supply forest environmental services are protected and illegal violations to forest reduced 50% for 4 years
from 2008 to 2012
There are 3 forest environmental service types which have been implementing in 25 provinces, including:
Service 1: Soil protection, reduction of erosion and sedimentation of reservoirs, rivers, and streams
Service 2: Regulation and maintenance of water sources for production and living activities of the society
Service 4: Protection of natural landscape and conservation of biodiversity of forest ecosystems for tourism services
Two forest environmental service types which have been waiting for guiding documents of the Prime Minister for
implementation, including:
Service 3: Forest carbon sequestration and retention, reduction of emissions of green house gases through measures for preventing forest degradation and loss of forest area, and for forest sustainable development
Service 5: Provision of spawning grounds, sources of feeds, and natural seeds, use of water from forest for aquaculture
The experiences from PFES The experiences from PFES policy of Viet Nam for sharingpolicy of Viet Nam for sharing
FES users/payers
PFES Fund FES providers
GovernmentGovernment
Forestmanagers
Contractedhouseholds
1. The role of the Government is very important
2. Awareness raising of PFES policy for levels from the top to the root is very important
PFES POLICY PFES POLICY
3. Accuracy of forest data for forest plot of each household is very important to determine exactly obligation on forest protection and benefit
Household
Forest plot
4. Current payment levels are still limited to meet the daily subsistance of the poor people who are forest environmental services suppliers in moutainous region
20 VND/KWh
40 VND/m3
1-2% revenue
5. PFES monitoring action is very important but this is not regulated in the Decree 99 yet
The monitoring activities shall be include:
Monitoring variation of forest area and illegal impacts to forest
Monitoring income of local households
Monitoring livelihood of local households
Thank you Thank you for your attentionfor your attention