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Research Report

Payment is good, control is better: Why payments for forest environmental services in Vietnam have so far remained incipient

Sven Wunder
Bui Dung The
Enrique Ibarra
Copyright Date: Jan. 1, 2005
Pages: 75
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Table of Contents

  1. (pp. 1-3)

    Payments for environmental services (PES) have emerged in recent years as a concept and tool for achieving ecosystem conservation, and at the same time improving the livelihoods of environmental-service providers. Nevertheless, in Vietnam as elsewhere considerable uncertainty remains as to what exactly PES means, and how much of it is currently being implemented. In broadly defined terms, environmental services refer to those services from natural areas that contribute to maintain or enhance society’s welfare (e.g. drinking water, maintenance of micro-climate and soil, recreation areas). Though these services are often substantial, they are frequently ignored in resource-use and land management decisions....

  2. (pp. 4-12)

    The PES definition used in this study refers to a voluntary arrangement where a well-defined environmental service is being ‘bought’ by a (minimum of one) service buyer who compensates a (minimum of one) service provider—and does so if and only if the service provider continuously secures the provision of that service (conditionality) (Wunder 2005).

    The emergence of direct economic incentives for the conservation of environmental services indicates a shift from the predominant use of command-and-control mechanisms (such as park establishment or logging bans) to, it is hoped, more flexible and efficient ecosystem protection (Landell-Mills and Porras 2002). The World...

  3. (pp. 13-23)

    During the last decade, in the context of the country’s reforms, Vietnam’s forestry sector has undergone significant changes, resulting in, among other things, the recovery of forest resources. The country seems to be regaining its forest cover, following rapid loss from 43% in 1943 to 29% in 1991, rising to 33.2% by the end of 1999. The forest-loss turnaround is thus probably due to a combination of strong extrasectoral trends (a rise in lowland agricultural productivity that has rendered highland agriculture less profitable) and active reforestation and protection policies—the relative force of the two factors is under debate. Forest...

  4. (pp. 24-40)

    The province of Quang Nam is located in central Vietnam. The province’s area is nearly 11 000 km² with a population of nearly 1.4 million people. Quang Nam has 429 921 ha of natural forest with important primate populations distributed in all forest areas (Long et al. 2004).

    Cu Lao Cham is an archipelago with one large island and seven smaller islands, lying about 12 km off the coast of the province of Quang Nam (see Figure 4.1). The topography of Cu Lao Cham is dominated by two peaks: a 517-m peak in the centre of the island and a...

  5. (pp. 41-51)

    The answer to the question “who are the environmental service buyers and sellers?” is associated with who has control over the resources generating the services. What production factors create environmental services, and should thus be compensated for their provision? Labour efforts and capital investments can certainly contribute to the production of environmental services, but in most cases environmental-service provision is tied to land use: whoever controls the land also has a large degree of power over the provision of the environmental service. In Vietnam, land is not privately owned. By constitution, all lands (including forestlands) belong to the Government. Although...

  6. (pp. 52-56)

    When the UK-based IIED screened the situation in Vietnam with regard to future work on PES (in the early 2000s), they came to the conclusion that PES was at this stage a non-starter in Vietnam, since the fundamental preconditions for PES were not met (J. Hardcastle, personal communication). Our assessment basically confirms this view. We encountered several conditions that explain why PES are not implemented in Vietnam so far. These are:

    1. Few of the environmental services provided are paid for: The focus of forest environmental service rewards has been exclusively on watershed protection; other services from forests outside of protected...