Payment for Forest Environmental Services in Vietnam
- minhanh1702021
- Jan 6
- 4 min read
Vietnam forest cover in 2021 [13]
Vietnam has pioneered a unique approach to environmental conservation through its national Payments for Forest Environmental Services (PFES) program, officially streamlined by Decree No. 99/2010/ND-CP, updated by Decree No. 156/2018/ND-CP (Detailed regulations for the implementation of certain provisions of the Forestry Law). Unlike traditional conservation efforts, Vietnam's PFES is strategically designed to achieve broader socio-economic objectives. The program aims to simultaneously support environmental protection, enhance social well-being, and alleviate the state's financial burden by redirecting payments to farmers responsible for forest protection [1].
The decree defines forest services comprehensively, including:
Watershed protection
Natural landscape and biodiversity conservation for tourism
Forest carbon sequestration
Greenhouse gas emissions reduction
Hydrological services supporting coastal fisheries and aquaculture [2]
At the time of this study, only watershed protection and tourism-related landscape conservation had clear implementation guidelines, with other service frameworks still under development. The program identifies environmental service (ES) users as hydropower enterprises, water supply companies, and eco-tourism businesses. ES sellers are individuals or groups with government-delegated forest land titles, such as forest owners, local organizations, protected forest management boards, and forest companies [2].
An interesting nuance in the PFES mechanism is that ES users often function as intermediary "fee collectors" rather than direct payers. For instance, PFES payments are typically embedded in end-users' electricity and water bills, often without their explicit knowledge [3]. All transactions are managed by the Vietnam Forest Development and Protection Fund (VNFF), which is responsible for collecting, distributing payments, and resolving potential conflicts [2].
Ca Mau's Mangrove PFES: A Thesis Exploration
As the focus of my thesis research, Ca Mau's mangrove Payments for Forest Environmental Services (MPFES) represents a groundbreaking approach to ecosystem conservation. I was drawn to this case study because it involves an innovative private sector model that challenges traditional government-controlled environmental service schemes. Unlike most PFES implementations in Vietnam, which rely on centralized state mechanisms, Ca Mau's approach demonstrates how voluntary enterprise participation and direct negotiations can create a more flexible and potentially more effective conservation strategy.
Ca Mau's Decision No. 111 in 2016 marked a significant milestone, becoming the first official implementation of a PFES model specifically for aquaculture provision. This initiative is particularly noteworthy as it is one of the few global mangrove forest PES schemes, with only limited precedents in countries like Kenya, Thailand, and Madagascar [4].
The decision emerged from a collaborative five-year project by the International Union for Conservation of Nature (IUCN) and the Netherlands Development Organization (SNV), titled "Promoting Ecosystem-based Adaptation through Mangrove Restoration and Sustainable Use in Vietnam and Thailand" (MAM-I) [5].
What makes Ca Mau's approach innovative is its departure from traditional PFES implementations. While most Vietnamese PFES programs are mandated and pass through government-controlled trust funds [6], Ca Mau introduced a pioneering private scheme. The model involves voluntary enterprise participation through a certification process, where companies take full responsibility for forest requirements, shrimp quality, payment negotiations, and direct transactions.
In future post, I will delve deeper into the research findings, exploring the nuanced implications of this approach for sustainable ecosystem management and community development.
PFES Implementation Challenges in Vietnam
Vietnam's PFES implementation is significantly constrained by systemic governance challenges. The forest management landscape is characterized by centralized government control, creating pronounced power imbalances between national, local stakeholders, and community levels [7].
The policy development process is predominantly driven by a technocratic network of senior policymakers, experts, and donors, effectively marginalizing local communities and companies from meaningful participation [6][8][7]. Decision-making frequently overlooks local knowledge and needs, with community rights remaining ambiguously defined and limiting their negotiation capacity [9].
Key implementation challenges include:
Centralized decision-making that reinforces state forest bureaucracies [6]
Insufficiently defined ecological service parameters [10]
Lack of transparent benefit-sharing mechanisms [1][11]
Inadequate monitoring and evaluation systems [12]
Absence of accessible grievance mechanisms [6][12]
The current monitoring and evaluation framework is particularly problematic. It fails to effectively assess ecosystem service enhancements, contractual compliance, financial flow appropriateness, and socio-economic impacts [12]. Without robust oversight, there's a risk of superficial conservation efforts and potential non-compliance among payment recipients [10].
The uniform, state-determined payment rates, initially calculated from a single pilot project and then nationwide, further highlight the systemic limitations. These rates do not account for the diverse social and environmental contexts across different regions [10].
Conclusion
Vietnam's PFES program represents an ambitious attempt to link environmental conservation with economic incentives. However, its success is contingent upon addressing the current governance and implementation challenges, particularly by enhancing local stakeholder engagement, improving transparency, and developing more nuanced, context-specific approaches.
References
Loft, L. et al. (2017) Whose Equity Matters? National to Local Equity Perceptions in Vietnam’s Payments for Forest Ecosystem Services Scheme. CIFOR.
Pham, T.T. et al. (2013) Payments for Forest Environmental Services in Vietnam: From Policy to Practice. CIFOR Occasional Paper 93.
Do, T.H., Patton, I., and Catacutan, D. (2022) Towards Pro-Poor and Voluntary PES: Assessment of Willingness to Pay and Accept PES Contracts in Central Vietnam. Journal of Land Use Science.
Thompson, B.S., Primavera, J.H., and Friess, D.A. (2017) Governance and Implementation Challenges for Mangrove Forest Payments for Ecosystem Services (PES). Ecosystem Services.
IUCN (2016) Promoting Ecosystem-Based Adaptation through Mangrove Restoration and Sustainable Use in Vietnam and Thailand (MAM-I).
McElwee, P. et al. (2014) Payments for Environmental Services and Contested Neoliberalisation in Developing Countries: A Case Study from Vietnam. Journal of Rural Studies.
To, P. and Dressler, W. (2019) Rethinking "Success": The Politics of Payment for Forest Ecosystem Services in Vietnam. Land Use Policy.
Pham, T.T. et al. (2014) Local Preferences and Strategies for Effective, Efficient, and Equitable Distribution of PES Revenues in Vietnam. Human Ecology.
Truong, D.D. (2022) Impacts of Payment for Forest Environmental Service Policy in Vietnam. Trees, Forests and People.
McElwee, P., Huber, B., and Nguyễn, T.H.V. (2020) Hybrid Outcomes of Payments for Ecosystem Services Policies in Vietnam. Development and Change.
Duong, N.T. and de Groot, W.T. (2018) Distributional Risk in PES: Exploring the Concept in the Payment for Environmental Forest Services Program, Vietnam. Forest Policy and Economics.
Pham, T.T. et al. (2015) Monitoring and Evaluation of Payment for Forest Environmental Services in Vietnam. Ecosystem Services.
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