Supporting Sustainable Forest Plantations in Vietnam

March 27, 2015

A World Bank-supported project has brought strong social, environmental and economic benefits to local communities

HUE, March 27, 2015 – More than 43,000 households in central Vietnam have received access to micro finance and technical support to establish over 76,500 hectares of forest under a World Bank-supported project.

Implemented from 2005 to 2015 in the provinces of Binh Dinh, Quang Ngai, Quang Nam, Thua Thien Hue, Nghe An and Thanh Hoa, the Forest Sector Development Project has brought strong social, environmental and economic benefits to local communities.

“Many families have escaped poverty thanks to forest plantations under the project,” said Pham Quoc Chien, Director of the Project Central Coordination Unit.

The project funded efforts to survey land and facilitated the issuance of land use right certificates for about 35,000 households. Farmers use the certificates to apply for low-interest loans from the project’s fund managed by the Vietnam Bank for Social Policies.

“The project is the first, and to date, the only one in Vietnam using the approach of lending to small-holder plantation which proves to be much more sustainable, compared to the country’s traditional approach of subsidizing plantation,” said Nguyen Thi Thu Lan, World Bank Sr. Environmental Specialist, Project Task Team Leader.

Project officers often provided regular training and on-site support for farmers on developing business plans, budget estimates, planting, monitoring and harvesting.

Under the project, a pilot area of 850 hectares received the International Stewardship Forest Certification for meeting strict international technical, social and environmental standards. The price of certified timber is 30% higher than non-certified timber of the same type.

More than 400 km of access track have been upgraded, which has lowered transport costs, significantly increased labor productivity and income as well as generated more employment for local people. The project has also supported the construction of 86 fire watchtowers and 102 information boards across the project area to raise public awareness on forest protection and minimize risks of forest fires and damages.

Although the project was completed in March 2015, the revolving fund, managed by the Vietnam Bank for Social Policies, will continue to run for 20 more years after the project completion, so many more households will have access to this source of credits.

“The modernization of forestry approaches under the project is an internal part of Vietnam’s efforts to modernize agriculture,” said Victoria Kwakwa, World Bank Country Director for Vietnam. “I hope that good practice from this project can be scaled up so many more households in Vietnam will have access to credits and modern forest plantation approaches.”

The project received financing of more than 100 million USD from the International Development Association (IDA) of the World Bank Group, the Trust Fund for Forestry, and the Government of Vietnam.

Media Contacts
In Hanoi and Hue
Huong Lan Vu
Tel : +844 3934 6600 (ext. 8373)
In Washington
Diana Chung
Tel : (1-202) 473-8357