Strengthening the role of Vietnam forest protection and development fund in the enforcement of the policy on payment for forest environmental services

With the role of an entrusted fund and it is responsible for the Vietnam Administration of Forestry and MARD, VNFF needs to advise to finalize legal regulations on remaining forest en[r]

F

VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY

PHAN THI QUYNH HOA

STRENGTHENING THE ROLE OF VIETNAM FOREST PROTECTION AND

DEVELOPMENT FUND IN THE ENFORCEMENT OF THE POLICY ON

PAYMENT FOR FOREST ENVIRONMENTAL SERVICES

MASTER'S THESIS PUBLIC POLICY

VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY

PHAN THI QUYNH HOA

STRENGTHENING THE ROLE OF VIETNAM FOREST PROTECTION AND

DEVELOPMENT FUND IN THE ENFORCEMENT OF THE POLICY ON

PAYMENT FOR FOREST ENVIRONMENTAL SERVICES

MAJOR: PUBLIC POLICY CODE: PILOT

RESEARCH SUPERVISOR: Dr NGUYEN NGOC HUY

i TABLE OF CONTENTS

ABBREVIATIONS ii

LIST OF TABLES AND FIGURES iv

LIST OF ANNEXES v

ABSTRACT vi

ACKNOWLEDGEMENT vii

INTRODUCTION

LITERATURE REVIEW

Review some models of PES implementation in the world

PES program in Costa Rica

Programs targeting watershed services in China

Payment for ecosystem services in Japan

Payment for Environmental Services program in Cambodia 14

PFES policy and VNFF in Vietnam 18

PFES policy in Vietnam 18

VNFF in implementation of PFES policy 24

Review some reports on VNFF and PFES 26

2.3.1 Report on years of operations of forest protection and development funds and years of implementation of the PFES policy 26

Report on reviewing 10 years of organization and operation of forest protection and development funds from 2008 – 2018 29

RESEARCH METHODOLOGY 34

Data collection method 34

Methods of data processing and analysis 35

RESEARCH FINDINGS 37

VNFF’s organization and operation 37

Implementation of PFES policy 40

Some specific results from interviews and surveys 42

General evaluation on VNFF 43

Stakeholders’ understanding about VNFF 44

DISCUSSION 47

Organization and human resource 48

Legal regulations and guidelines on PFES policy 49

PFES management and utilization 50

CONCLUSION AND RECOMMENDATIONS 52

Conclusion 52

Recommendations 52

ii

ABBREVIATIONS

ADB Asian Development Bank BoD Board of Directors

CBD Convention on Biological Diversity

CCICED China Council for International Cooperation on Environment and Development

CIFOR Center for International Forestry Research

CITES Convention on International Trade in Endangered Species CPC Communal People’s Committee

DARD Provincial Department of Agriculture and Rural Development ES Environmental services

EWS Eco-compensation for Watershed Services FCPF Forest Carbon Partnership Facility

FES Forest Environmental Services

FONAFIFO Fondo de Financiamiento Forestal de Costa Rica (National Forestry Financing Fund of Costa Rica)

iPFES “Improving Payment for Forest Environmental Services” project

MARD Ministry of Agriculture and Rural Development M&E Monitoring and Evaluation

MoF Ministry of Finance

MPI Ministry of Planning and Investment

MU Management Unit

NGO Non-Governmental Organizations

OECD Organization for Economic Co-operation and Development PES Payment for environmental/ecosystem services

PFES Payment for Forest Environmental Services

PFPDF Provincial Forest Protection and Development Fund PPC Provincial People’s Committee

PPSA Pago por Servicios Ambientales (payment for ecosystem services program in Costa Rica)

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REDD+ Reducing emissions from deforestation and forest degradation, conservation of existing forest carbon stocks, sustainable forest management and enhancement of forest carbon stocks

SLCP Sloping Land Conversion Program

UN United Nations

UNCCD United Nations Convention to Combat Desertification UNDP United Nations Development Programme

UN-REDD Programme

The United Nations Programme on Reducing Emissions from Deforestation and Forest Degradation

VFDS The Vietnam Forestry Development Strategy VNFF Vietnam Forest Protection and Development Fund VNFOREST Vietnam Administration of Forestry

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LIST OF TABLES AND FIGURES List of Tables

Table 2.1 River basins between Vietnam and China

Table 2.2 Payment level to partner producers 10

Table 2.3 Types of forest in Japan 11

Table 2.4 River basin between Vietnam and Cambodia 14

Table 2.5 Policies and strategies related to PES in Cambodia 14

Table 2.6 Total entrusted contracts as of Oct 2018 31

Table 2.7 The PFES collection as of Sep 2018 31

Table 4.1 Update changes in VNFF structure & operation 37

Table 4.2 PFES amount paid for forest owners in 2018 41

List of Figures Figure 2.1 FONAFIFO’s organization structure

Figure 2.2 Programs of Kanazawa’s Five-Year Action Plan 13

Figure 2.3 Community-based ecotourism program in Cambodia 17

Figure 2.4 Milestones of developing PFES policy 19

Figure 2.5 Payment level for FES users 21

Figure 2.6 PFES distribution mechanism 22

Figure 2.7 PFES stakeholders 23

Figure 2.8 VNFF’s Organizational structure 25

Figure 2.9 Development of PFPDF quantity as of 2015 28

Figure 2.10 Status of FPDFs from 2009 - 2018 30

Figure 3.1 Subjects of survey and interview 35

Figure 4.1 Statistics of general evaluation on VNFF 43

Figure 4.2 Satisfaction rate 44

Figure 4.3 Stakeholders’ understanding about VNFF 45

Figure 4.4 VNFF’s activities in implementing PFES policy 46

v

LIST OF ANNEXES

Annex List of legal documents related to implementation of PFES policy 58

Annex List of handbooks on PFES policy implementation 62

Annex List of provincial forest protection and development fund 64

Annex Survey form for VNFF’s staff 66

Annex Survey form for provincial forest protection and development fund 72

Annex Survey form for VNFF’s users 77

vi

ABSTRACT

vii

ACKNOWLEDGEMENT

I am really happy because I managed to finalize the thesis “strengthening the role of Vietnam Forest Protection and Development Fund in the enforcement of policy on payment for forest environmental services” within the timeframe assigned by the Vietnam Japan University, Vietnam National University, Hanoi This report cannot be completed without the great supports and absolute trust of professors, relatives and colleagues

First of all, I would like to express my deep gratitude to my supervisor, Dr Nguyen Ngoc Huy, who directly guided and gave me valuable comments on my thesis Even he is very busy, but he has always spent a lot of time and efforts to direct me throughout the process of researching and completing this report

In addition, I would like to sincerely thank the all professors and staff working in Vietnam Japan University, especially in the public policy program who dedicated to convey valuable knowledge and help me in the process of learning and researching Finally, I am also thankful to my family, friends and colleagues who have always encouraged me and provided me utmost support to complete all assignments in the process of studying as well as finalizing this topic

Although there are many attempts, but this research topic will not free of shortcomings, I look forward to receiving the comments of professors, experts, friends and colleagues so that my topic can be better completed

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INTRODUCTION

In recent years, initiative of payment for environmental/ecosystem services (PES) has been widely adopted in the world It is considered as one of effective tools to support environmental protection and biodiversity conservation According to Wunder, PES is defined as “a voluntary transaction where a well-defined environmental service (ES) is being “bought” by a (minimum one) ES buyer from a (minimum one) ES provider if and only if the ES provider secures ES provision” (Wunder, 2005) After many years, this definition is broadened by Tacconi "A PES scheme is a transparent system for the additional provision of environmental services through conditional payments to voluntary providers" (Tacconi, 2012) The payment is conducted based on a voluntary agreement between providers of environmental services and users of these services Some (PES) programs have the direct involvement of the providers and users but some others, they need the support from Government and intermediate organizations to work as a bridge between the users and providers

Users of environmental services (FES user) are the beneficiaries of the environmental services such as hydropower companies, water supply, tourism business companies, industrial production facilities, etc They use natural resources for their production and business such as water, ecological system, forest environment therefore they are defined to pay for the environmental services they use Providers of environmental services (FES provider) are those involving in protecting the environment and living in the areas that providing environmental services

PES in Vietnam is linked to the payment for forest environmental services (PFES) This term is clearly regulated in the Government Decree no.99/2010/ND-CP dated 24 September 2010 (Decree 99) It is understood as “a provision and payment relationship in which users of forest environment services pay to providers of these services”1 This

policy is firstly implemented in Lam Dong and Son La from 2008 to 2010 according to

1 Article 3, Decree no.99/2010/ND-CP dated 24 September 2010 of the Government on

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the Decision 380/QD-TTg dated 10/4/2008 of the Prime Minister and then is applied at the national level as the Decree 99 of Government and encouraged the participation of all people to the forest protection The PFES policy has created a new, stable financial mechanism, contributing to better forest protection (VNFF, 2018)

Forest protection and development fund (FPDF) is an intermediate agency to receive

the indirect payment of FES users to pay for FES providers in Vietnam, it was established by Government Decree No.05/2008/ND-CP dated 14 January 2008, in which defined as “a state financial institution, with legal entity, having specified seal, and able to open an account at a bank or State treasury according to statute law”2 The

system of this fund is set up from the central to the provinces that have forests and plays as the entrusted role to ensure the successful implementation of the PFES policy

Vietnam Forest protection and development fund (VNFF) is the central fund of forest

protection and development It was established by the Decision of Ministry of Agriculture and Rural development (MARD) no 114/2008/QD-BNN, dated 28 November 2008 This is considered as a lead agency to receive and coordinate the PFES in Vietnam

The fact of implementing the policy during the pilot phase until now as well as the result from surveys, some shortcomings and difficulties have been defined such as not all environmental services stated in the Government’s regulations are paid, pending payment of forest users, direct payment has not been applied, the limitation in PFES monitoring and evaluation These shortcomings affected a lot the implementation of the PFES policy Decree 99 regulated five types of forest environmental services to be paid includes: (i) Soil protection, restriction of erosion and sedimentation of reservoirs, (ii) Regulation and maintenance of water sources for production and social life, (iii) Forest carbon sequestration and retention, (iv) Protection of natural landscape and conservation of biodiversity, (v) Provision of spawning grounds, sources of feed and natural seeds,

2 Article 6, Decree No.05/2008/ND-CP dated 14 January 2008 of the Government on

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use of water from forests for aquaculture3 Despite of clear regulations on types of FES,

FPDFs only collected PFES from hydropower companies for the first type, clean water suppliers for the second type, some tourism business companies for the forth type Even though, some of these FES users still delay the payment, that affect the disbursement to the forest providers The collection for the industrial companies and aquaculture facilities is piloting, the service of carbon sequestration has not been implemented which show the gaps in the policy consultation and enforcement At present, only indirect payment has been conducted through the FPDFs, FES users have not paid directly to FES providers and the PFES monitoring and evaluation is still limited which set higher requirements for FPDFs, especially the VNFF

Based on the analysis and evaluation from legal documents of Vietnam, some PES models of other countries as well as the surveys for relevant stakeholders of VNFF and PFES in Vietnam, the author expects to provide a comprehensive information of VNFF’s position during the implementation of PFES policy Therefore, the aim of this report is to clarify the major causes of shortcomings and difficulties that VNFF encountered while operating, then propose some recommendations to strengthen the role of VNFF in the implementation of the PFES policy To achieve those objectives, the following questions will be answered in the report including:

- What shortcomings and difficulties has VNFF encountered while operating and complying PFES policy?

- What are key recommendations to strengthen the role of VNFF?

This report contains six Chapters with general introduction in Chapter 1; reviewing some typical PES models of other countries, legal regulations and some previous reports on VNFF and PFES in Chapter 2; description of research methodology in Chapter Chapter provides some findings after literature review and conducting surveys to relevant stakeholders Chapter will discuss VNFF’s organization and human

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LITERATURE REVIEW

In this chapter, some models of PES implementation from countries are reviewed to clarify the foundation of the PES schemes in the world and provide useful lessons for Vietnam In addition, with the review of actual PFES programs and the performance of VNFF in Vietnam in the past years, the PFES policy will be presented in detail, thereby determining more clearly the factors affecting role of VNFF

Review some models of PES implementation in the world

The author will firstly review and inherit some results of researches on the international experience of implementing PES schemes, especially focus on some cases such as: the PES program in Costa Rica; programs targeting watershed services China; payment for ecosystem services in Japan; and payment for environmental services programs in Cambodia

PES program in Costa Rica

The payment for environmental service in Costa Rica is called Pago por Servicios Ambientales (PPSA) program This is a national program to conduct payment for the landscapes protection and biodiversity conservation, carbon storage and hydrological services with the purpose of reducing the rate of deforestation in Costa Rica

PPSA is managed by Fondo de Financiamiento Forestal de Costa Rica (FONAFIFO), a national forestry financing Fund, established under the Forestry Law no 7575 in 1996 The objective of the fund (i) promote, for the benefit of small and medium producers, forest management, reforestation, afforestation, plantations and agro-forestry; and (ii) collect funds for the payment of ecosystem services4 This is the governmental

institution that has instrumental legal status and supports for forest conservation by issuing Forest Conservation Certificates (CCB) that landowners can use to pay taxes and fees to Government FONAFIFO uses this taxes and fees to fund for PPSA program According to the approval of the Ministry of Environment, Energy and

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Telecommunications (MINAE), the administrative structure of the FONAFIFO (FONAFIFO, 2008) is presented as below:

Figure 2.1 FONAFIFO’s organization structure5

As shown in the Figure 1, the Ministry of Environment, Energy and Telecommunications (MINAE) is the management agency that makes policy on forestry sector The FONAFIFO’s board of directors includes five members, of which three representatives are from the public sector and two remaining members are from the private sector This is the administration agency to advise MINAE on forestry policy Five subordinate divisions and departments with their functional units have the role to support the FONAFIFO’s General Directorate conduct activities approved by MINAE The environmental services defined in PPSA include (i) mitigation of greenhouse emissions through emissions reduction and carbon fixation, capture, storage or absorption; (ii) protection of water for urban, rural or hydroelectric use; (iii) biodiversity conservation for conservation, sustainable use, scientific investigation or genetic enhancement; and (iv) protection of ecosystems or scenic natural beauty for tourism or science (Forestry Law - Law No 7575, Republic of Costa Rica, 1996) PPSA program

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of Costa Rica contributed a lot to increasing the forest coverage of this country from less than 30% in 1980s to 54% in 2015 (Juhern Kim, Roger Madrigal, Francisco Alpizar, and Silvia Rojas Fernandez, 2016) The PES model in Costa Rica shows the important role of the Government in establishing the state-authority to manage and implement the PES program

However, this model is also facing some challenges, for example, even FONAFIFO uses the payment from hydropower companies and water users to fund for PPSA, but no legal requirements on the payment level is identified and FONAFIFO negotiates with users and comes to agreements with them It seems that the payment by water users is good but there are some limitations in charging for biodiversity and carbon services In Costa Rica, the payment for biodiversity services is mainly come from the Global Environment Facility and the financing from local tourism industry is not recognized significantly The beneficiaries from carbon service are difficult to be defined

Programs targeting watershed services in China

China and Vietnam share a long border and have territories located in the Mekong basin Both countries have great potential of hydropower development through the below river basin (McElwee, P., Thanh, N.C., 2014)

Table 2.1 River basins between Vietnam and China River basin Location in

Vietnam

Basin area in Vietnam

Basin area outside

Vietnam

Note

Bang Giang – Ky Cung

Northwest 13,260 km2 1,980 km2 Share basin

with China Hong River Northeast 169,020 km2 82,340 km2 Share basin

with China Cuu Long (River

of Nine Dragons)

Cuu Long Delta

761,417 km2 724,252 km2 Share basin

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Thai Lan, Cambodia

Note: Data compiled from the Report on reviewing years of PFES policy

implementation in Vietnam (2011-2014) conducted by McElwee, P and Thanh, N.C Along with the rapid economic growth in China is the degradation of natural resources and the increase of environmental problems Factors related to this degradation also include rapid urbanization, expanding population and economic development demand Moreover, integration into the international market has increased the competitive pressure that lead to the use of more and more natural resources The increase of environmental protests and disputes require China's Leaders to have the movements in the environment policies

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Another program in China is Sloping Land Conversion Program (SLCP) with the purpose of reducing soil erosion and desertification and increasing forest coverage This program covers 25 provinces of China Bare hills and agricultural slopes are converted to afforestation The farmers who involve in this program will be compensated For the converted sloping area, the farmers will receive compensation in cash or annual in-kind of grain or free saplings for the plantation period Both grain and cash subsidies are compensated for years if ecological forests are planted and for years if economic forests are planted (Zhen, L., & Zhang, H, 2011) This is the first national PES program in China that encouraged the participation of households based on voluntary basic for land management, thus integrated the environmental protection objectives In order to implement the program, many agencies were involved, include the State Forestry Administration, Ministries of Land and Resources, Agriculture, and Water Resources, departments from forestry and grain supply, etc Each agency has specific tasks and role in compensation delivery, land contract management, dealing with disputes, measuring land area for conversion, distributing saplings, monitoring results of conversion, etc (Kolinjivadi, V K., and T Sunderland, 2012) Some challenges of the program are recorded include the sloping area may be converted to agriculture production right after the completion of the scheme, in some areas, the farmers have no choice because their neighbours and village selected to participate in the program This requires the solutions from the policy – makers to achieve the sustainable conservation objectives

It can be said that the local governments are lead agencies in developing and implementing PES schemes in China The role of Government and market is very important to establish the compensation schemes However, the centralization government system should be established with the close collaboration among agencies The central level should also provide more specific guidance, legal and financial basis for the local to develop the PES schemes

Payment for ecosystem services in Japan

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residents, local government, consumers or companies who pay for the natural resources or ecosystem services In Japan, there are three types of payment schemes include: (i) direct negotiation between the ecosystem services suppliers and the beneficiaries (or providers); (ii) governmental intervention by environmental taxes and (iii) trading schemes of ecosystem services (Hayashi, K., & Nishimiya, H., 2010) The third type of payment scheme on ecosystem services trading is not mentioned much in the materials that the author can access, therefore this report only reviews some PES models related to the type one and type two as stated above

One good example of payment according to the direct negotiation is implemented in Kumamoto prefecture, Kyushu island In this area, the groundwater is very important, that provides freshwater for all residents Thus, they pay a lot of attention on groundwater recharge The recharge capacities of Shirakawa river basin is known as times or more than that of other areas (Hayashi, K., & Nishimiya, H., 2010) To avoid the decrease of groundwater, the companies which have production activities in this region negotiate directly with farmers to flood their paddies in the summer Under the government policy on groundwater protection, Sony Semiconductor Kyushu Corporation conducted the started project of groundwater recharge in 2003 with the close participation of the local agricultural cooperative, farmers and Kumamoto City To operate its semiconductor plants, the company uses groundwater extracted from the ground According to the project of groundwater recharge, the company called for the volunteer from the local producers to flood their rice paddies after harvesting, then water will be drawn from Shirakawa river to permeate back to the ground (Conserving water by recharging ground water in Kumamoto, 2010) Therefore, the groundwater in this area is recovered The payment is defined as below:

Table 2.2 Payment level to partner producers

Days of flooding Payment amount (Yen/1,000 m2)

30 days 11,000

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90 days 22,000

Note: Information is compiled from Sony Semiconductor Kyushu Corporation, 2009

https://www.biodic.go.jp/biodiversity/shiraberu/policy/pes/en/water/water03.html In addition, the employees of the company also join in planting and harvesting rice grown in this area with less pesticides, per kilogram of rice is sold with the higher price This activity encouraged employees to offset water consumption One kilogram of rice grown is believed to recharge 20-30m3 of groundwater (Hayashi, K., & Nishimiya, H.,

2010)

Regarding the payment agreement with the governmental intervention, the forest environmental taxes have been applied for many prefectures in Japan Forests plays important role in mitigating climate change, preventing floods and landslides, absorbing CO2, providing habitats for various living species, etc Types of forest in Japan as follow:

Table 2.3 Types of forest in Japan

Unit: Thousand hectares Types of forest National forest Non-national forest Total

Natural forest 4,690 8,690 13,380

Plantation forest 2,370 7,980 10,350

Total 7,060 16,670 23,730

Others 1,370 1,370

Note: Source: Forestry Agency, survey on status of forest resources (31 March 2007)

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Figure 2.2 Programs of Kanazawa’s Five-Year Action Plan

These programs encourage the participation of many citizen, experts, organizations in the conservation and restoration of forest protection and water source

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attention The PES schemes are implemented separately in different regions thus its lack of connectivity and systematic in the implementation

Payment for Environmental Services program in Cambodia

Cambodia has common border with Vietnam, so it has an important strategic position on economy, politics, society, national security and defence in the region Both countries are in the lower Mekong Basin with great potential for hydropower generation The river basins shared with Vietnam as below table (McElwee, P., Thanh, N.C., 2014):

Table 2.4 River basin between Vietnam and Cambodia River basin Location in

Vietnam

Basin area in Vietnam

Basin area outside

Vietnam

Note

Sai Gon - Dong Nai

South East 40,294 km2 6,700 km2 Share basin

with Cambodia Cuu Long (River

of Nine Dragons)

Cuu Long Delta

761,417 km2 724,252 km2 Share basin

with Cambodia, Trung Quoc, Lao, Thai Lan

Note: Information collected from report on reviewing years of PFES policy

implementation in Vietnam (2011-2014) conducted by McElwee, P., Thanh, N.C At present, a legal framework has not been developed for applying PES nationally, however, Royal Government of Cambodia approved some important policies and strategies that mention this scheme

15 Policy/strategy Year of

approval

Brief content

Law on protected areas

1993 Manage and implement the preservation of biological resources and sustainable use of natural resources

Law on

Environmental

Protection and Natural Resource

Management (environment law)

1996 Provide regulations to address environmental protection, management of natural resources and public consultation

Law on community 2002 Provide basic framework for the rural communities in forest management

Forestry law 2002 Regulate the forest management under jurisdiction of the Ministry of Agriculture, Forestry and Fisheries (MAFF)

National Green Growth Roadmap

2009 Regulate the green growth implementation

REDD+ Readiness Roadmap

2010 Develop REDD+ planning during the readiness phase, the UN-REDD Programme National Document, and Readiness Preparation Proposal (R-PP) of the Forest Carbon Partnership Facility

National Forestry Programme for 2010-2029

16 Policy/strategy Year of

approval

Brief content

forestry; (v) capacity and research development; and (vi) sustainable forest financing

National Policy and Strategic Plan for Green Growth 2013– 2030

2013 Promote green economy, green finance and green investment to balance between economic and social development, and the environment

National Strategic Development Plan (NSDP) for 2014– 2018

2013 Regulate the importance of natural resources protection and sustainable development

National biodiversity strategy and action plan

2016 Provide a comprehensive strategic document for biodiversity conservation and management in Cambodia and represent an important milestone for the future

Note: information compiled by author

In Cambodia, the implementation of PES schemes has come mostly from the international donors and multilateral agencies Conducted PES schemes focus on biodiversity and watershed conservation, recreation/landscape beauty, and carbon sequestration and storage (Naret, H., & Sopheak, K., 2016) Subjects involve in the implementation of PES schemes include the Kingdom of Cambodia, government agencies like Ministry of Environment and Ministry of Agriculture, Forestry and Fisheries (MAFF), local authorities at provincial, district and communal levels, international organizations, local NGOs and households

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(Donal, 2016) The bird nest protection program was established in 2002 to prevent the collection of bird nests for eggs and chicks According to this program, the villagers living in Kulen Promtep Wildlife Sanctuary will come to individual contracts to protect bird nests and they will receive $2/day for the protection

The activity of community – based ecotourism was designed in 2004 in the village of Tmatboey in Kulen Promtep Wildlife Sanctuary as below figure:

Figure 2.3 Community-based ecotourism program in Cambodia6

The purpose of this program is to protect endangered wildlife through local tourism contracts between local people or contracted community wildlife rangers and the Sam Veasna Center (SVC) SVC is working with WCS on this project with the role of managing bird viewing tours, supervising nest protectors and conducting direct conservation payment for them This program is highly appreciated and is can be considered as a good model for the PES implementation in the field of biodiversity conservation

PES is considered as an important financial tool to provide incentives for the natural resource management, biodiversity conservation and sustainable utilization This scheme is expected to apply throughout the country by 2020 (Kingdom of Cambodia,

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2016) To achieve this target, some activities need to be implemented such as awareness raising on PES, institutional strengthening, developing options for payments, PES agreement and contracts, monitoring and evaluation as well as draw lessons learnt Despite of some success in PES implementation, this scheme in Cambodia is still facing up with challenges such as the dependency on the international support which create the less positiveness and the cease of PES when the support completed; the lack of legislation document specialized on PES at national scale; the limited knowledge on PES and gap between the rich and the poor also lead to the damage activities to the environment

PFES policy and VNFF in Vietnam

In this part, the author will review context of formulating and implementing of PFES policy in Vietnam and overview the establishment and structure of VNFF

PFES policy in Vietnam

Vietnam has joined in many international commitments and conventions related to forestry (CITES, RAMSAR, CBD, UNCCD, etc ) that opened more favourable conditions for agriculture and forest enterprises With the total of forest land area is nearly 14.5 million hectares7, forests play an important role in the economy and social

life of Vietnam In addition, many Vietnamese people are currently living in or near forests, most of them are ethnic minorities whose living depends on forests including foods, culture, habits, customs, beliefs Fuelwood, bamboo shoots, rattan, wildlife and herbs are the forest products widely harvested by local people The Government has a lot of policies to protect and develop forests as well as to ensure the life of people in the mountainous areas in which the ethnic minorities is considered as the core factor of forest protection However, state budget to support the forestry sector is limited, cannot satisfy increasing demand for the development of mountainous people and forestry sector Experience from many countries in the world show that the implementation of payments for environment services especially for forest environmental services bring huge revenues to compensate for the budget shortage Thus, the development of PFES

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policy will create a stable mechanism to mobilize social resources to support the forest protection and provide more income for local people

Recognizing the above context, Government of Vietnam conducted important steps to formulate the PFES policy The key milestones were summarized as below:

Figure 2.4 Milestones of developing PFES policy

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development funds (FPDFs) This Decree regulates the establishment, management and utilization of FPDFs from the central to the local levels These funds operate under the entrusted regime for non-profit purposes to (i) mobilize resources of the society for forest development and protection, (ii) raise awareness about, and responsibilities for, forest development and protection for those benefiting from forests or involved in activities that have direct impacts on forests and (iii) increase forest owners’ capacity and efficiency in forest protection, use and management, contributing to implementing the forestry development strategy

At the same year, PFES scheme was being piloted in Lam Dong in the Central Highlands and Son La in the North for two years under the Prime Minister’s Decision no 380/QD-TTg dated 10/4/2008 During this pilot phase in Lam Dong, Vietnam received the important support from United States Agency for International Development (USAID) through the project on “Dong Nai River Basin Conservation” conducted by Winrock International organization This project was a part of Asia Regional Biodiversity Conservation Program (ARBCP) that supported Vietnam in successful implementation of pilot program of PFES, improved livelihood of the rural poor while promoting biodiversity conservation in Lam Dong Province (Nguyen, T B T., et al., 2011) The pilot phase in Son La received support from the German Agency for International Cooperation (GIZ) through researches under the program on management for natural resources These agencies provided financial and technical supports to complete the pilot phase and created a basis for the formulation of a legal framework on the PFES policy applicable nationwide The most important legal document to mark the full application of PFES policy at the national scale is the Decree 99 in 2010 and the Decision no 147 in 2016 revising some Articles related to the payment level of Decree no 99 These decisions provide important regulations that created a payment mechanism between forest environmental service users and suppliers Accordingly, the payment for forest environment services is understood as a provision and payment relationship in which users of forest environment services pay to providers of these services8 It can be

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said that the Vietnamese Government has a set of specific legal framework and essential pilot process to disseminate the implementation of PFES throughout Vietnam

Following the issuance of the Decree 99, a range of guiding documents have been developed and come to life List of these legal documents is shown in the Annex In the new context with many changes of forest status as well as the factors related to the PFES such as the inflation, high demand on income increase, consumption price for the FES changes and there are more and more FES users involve in national economy The Government therefore updated and supplemented regulations on PFES activities The Law on Forestry no 16/2017/QH14 dated 15 November 2017 is the highest legal document that regulates provisions on PFES and FPDFs The Decree 156 of the Government dated 16 November 2018 guiding the enforcement of the Law on Forestry is the latest legal document on PFES implementation in Vietnam

The figures below will show clearly the major changes of these legal documents

Figure 2.5 Payment level for FES users

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20/kwh in Decree 99 to VND36/kwh in Decree 156 and from VND 40/m3 in Decree 99 to VND52/m3 in Decree 156 There is still policy gap in regulations related to carbon

sequestration services Despite of various studies on this issue but it seems very difficult to develop policy on this service

Beside the legal regulations of Governments and Ministries, the professional agencies like VNFF and provincial FPDFs also provided technical guidelines for not only FES users but also FES providers to implement PFES activities A lot of handbooks and manuals were developed as the useful tools that specified the guidelines and instructions to support the smooth performance of the policy List of these handbooks stated in the Annex

Even there are some changes in rate of payment as mentioned above, the PFES distribution mechanism is still regulated the same as follow:

Figure 2.6 PFES distribution mechanism9

The figure describes the way PFES money comes from the FES users to the FES providers As regulation, forest protection and development funds will collect money from FES users through signing entrusted contracts After deducting administration fee and contingencies for provincial funds, remaining amount will be transferred to FES

9 Source: Graph of PFES distribution mechanism Reprinted from Leaflet Vietnam and PFES, by VNFF, 2017,

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providers (or FES delivers) If FES providers are households, individuals or communities, they will receive 100% amount of PFES In the case that FES providers (forest owners) are organizations, they are deducted 10% for administration fee, the remaining will be transferred to households, individuals or communities which contracted to forest protection The organizations also keep a part of PFES for their self-protection of forests According to this payment mechanism, the stakeholders related to PFES implementation are defined as below:

Figure 2.7 PFES stakeholders10

In this model, PFES policy in Vietnam regulates close relationship among relevant stakeholders They are forest owners who are households, communities, forest management boards, state forest enterprises, organizations or individuals contracted to

10 Source: Graph of PFES stakeholders Reprinted from VNFF’s profile – Vietnam’s green future, by VNFF, 2017,

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forest protection and management FES users such as hydropower companies, clean water suppliers, tourism companies, industrial production facilities, aquaculture facilities or any subjects which use ecosystem services for their production and business In principle, FES users are responsible to pay for the forest environment services they used, and the forest owners are FES providers who protect the forest area providing those environment services Certainly, the system of FPDFs and forest management agencies from the central to the local are also included in this model In the PFES implementation process, FPDF plays as intermediate agency to sign entrusted contract with FES users to collect PFES money and disburse to forest owners The forest management agencies are responsible for monitoring and controlling the whole process of PFES policy implementation The nature of this model is to regulate the relationship between users and suppliers, or in other words is the relationship between buyers and sellers in the field of forest environmental services

VNFF in implementation of PFES policy

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Figure 2.8 VNFF’s Organizational structure11

VNFF is established under the Decision no 114 of the Ministry of agriculture and rural development (MARD) in 2008, accordingly, VNFF is a state financial institution, operates under the management of MARD The structure of the fund includes the Board of Director, control board and the management unit The BoD includes nine members who are leaders of MARD, representatives of MPI, MoF, departments under MARD such as planning; finance; international cooperation; science, technology & environment; forest protection; Vietnam administration of forestry BoD is in charge of approving the annual work and financial plan of the VNFF, issuing regulations to serve the VNFF’s operation, organizing the receipt, management and utilization the finance of the VNFF in an effective manner Two BoD meetings are organized every year to listen reports on VNFF’s performance and endorse the plan as well as the big issues of VNFF within the year The control board of the fund includes three members from MARD departments, supports BoD to monitor and supervises the implementation of VNFF under the approved regulations, timely defines and reports BoD the violations of the VNFF during its operation The members of Control Board are able to join in the BoD meetings but not have the right of voting The VNFF management unit (VNFF

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MU) consists of the Director, 01 Deputy Director, Chief Accountant and functional units Director of the VNFF MU is appointed and dismissed by the Minister of MARD according to the request of the BoD At present, members of BoD, control board and Director of VNFF MU are government officers and part-time work Deputy Director, Chief accountant and some key staff of VNFF MU are seconded from government and full time work The remaining officers are not government officers and work full time as signed contracts The organization structure of VNFF also includes funding windows with REDD+ fund and others, however, until now, the REDD+ fund has not been established and others are not recorded

According to the PFES distribution mechanism, VNFF signs entrusted contracts with the big companies, which locate from two provinces It will keep 0.5% of collected PFES for administration fee and remaining will be transferred to the provincial FPDFs Provincial funds will disburse this PFES to forest owners after deduction of 10% admin fee and 5% contingency This means only indirect payment is conducted through the FPDF system and VNFF will not pay directly to forest owners Therefore, in the process of PFES implementation, VNFF only works directly with provincial FPDFs, big FES users and the forest management authorities With a lot of benefits created, this policy is considered as a good policy to support the development of forestry sector in Vietnam and VNFF plays a very important role in the whole process of implementing the policy

Review some reports on VNFF and PFES

From 2008 until now there are many studies on the system of forest protection and development funds and PFES, however, two typical reports are usually mentioned including: Reports on years of operation of forest protection and development funds issued in 2016 and after that is the report on reviewing 10 years of operating these funds issued in 2018 This part will focus on these studies to see the VNFF’s achievements, and shortcomings during its operation

2.3.1. Report on years of operations of forest protection and development funds and years of implementation of the PFES policy

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Context of conducting this report firstly come from the requirements of MARD under the Decision No 485/QD-BNN-TCLN dated 18 February 2016 issuing the plan of reviewing years of organizing and operating forest protection and development funds from 2008 to 2015 and years of implementing the PFES policy This decision stated clearly the objectives, contents, the roadmap of the evaluation The scope of this evaluation covers across the country for the whole system of FPDFs from the central to the local The necessity of implementing this national evaluation due to the process of implementing regulations and policies has revealed some shortcomings and limitations, namely: The organization and management model of the FPDF has not been clearly defined in the system of legal documents; The PFES debt situation is still popular; disbursement progress of PFES is still slow; payment level in some places is still low, there is a big difference in average unit price per hectare among river basins

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Figure 2.9 Development of PFPDF quantity as of 201512

Experts showed the difference in legal position of provincial FPDFs and proposed to adjust regulations in the Decree 05 on this issue The authors also pointed out the different regulations on the self-control and self-financing mechanism among provinces which cause the difficulties in defining legal status of some FPDFs as well as the obstacles during their operation The structure of VNFF at that time not only takes over the tasks of PFES implementation but also includes other funds like REDD+ Fund, TFF, etc that may be integrated or established and work as child fund under the VNFF Regarding the implementation of PFES policy, the difficulties and challenges in PFES collection were presented clearly According to the VNFF’s report on PFES implementation in 2015, many hydropower companies delayed the payment with the big amount of debt Even VNFF had a lot of measures but the situation has not been solved This is caused by the climate change when the dry season last longer and the less rainfall in rainy season which did not provide enough water for hydropower production Therefore, these companies cannot operate and stay in debt Meanwhile the PFES revenue at present is mostly come from the payment of hydropower companies

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These are some examples on the difficulties and challenges in the years reports The experts provided their analysis on these issues as well as propose recommendations for each content It can be said that this evaluation report provided very fruitful information and inputs VNFF also used information to propose higher level with the adjustment and supplement some legal document After this assessment mission, the Decree no 147/2016/ND-CP dated 02 November of the Government on revising, supplementing some articles of Decree No 99 Most of the recommendations of the experts are related to the Decree 05 on the establishment of FPDFs and some guiding Circular Some of them was used by VNFF in developing another report on March 2017 to review FPDF organization and operation for the period 2008 – 2016 and Implementation of PFES policy for the period 2011 – 2016

Both two reports above provided deep analysis & extremely helpful recommendations to for the better operation of the FPDF system and implementation of PFES policy

Report on reviewing 10 years of organization and operation of forest protection and development funds from 2008 – 2018

This report is conducted according to the requirements of Ministry of Agriculture and Rural development on reviewing 10 years of organization and operation of forest protection and development funds Purpose of this report is to summarize all achievements, obstacles and challenges that impact the organization and operation of FPDFs system from the central to the local in the period 2008 – 2018, then draw the lessons learnt to revise and supplement current legal documents and mechanism for better operation of FPDF system in the future During the preparation of the report, there have been technical contribution and inputs of experts from Institute for forest ecology and environment The final report was finalized and presented by VNFF management unit at the workshop on review 10 years of operating FPDF system organized in Hanoi on 19 October 2018

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16/2017/QH14 on forestry, Circular 04/2018/TT-BTC on guiding the management and utilization of PFES money and some other relevant documents These are key regulations which have a major impact on policy enforcement as well as fund operations The new regulation of the Decree 147 is the increase of payment level for some environmental services such as hydropower generation, clean water supply, and provide regulation for using water from forest for industrial production and aquaculture as mentioned in the previous part The Decree 41 revised some Articles of Decree 157/2013/ND-CP provided specific regulations in Article on the violation activities, sanctions forms and level, measures for violations, etc in the field of forest management, development and protection, and forestry product management Circular 04 in 2018 also regulates in the Article that the VNFF and provincial FPDFs manage and use PFES money in accordance with the financial autonomy mechanism for Public Administrative Units This is recommendation stated in many studies and reports The issuance of new law on forestry in 2017 and the Circular 04 in 2018 consolidated the legal framework on the PFES implementation and FPDF operation

As of 2018, there have been 44/60 forested provinces established FPDFs The number of FPDFs is initially provincial funds in 2009 up to 44 provincial funds in 2018 After pilot phase of implementing the PFES policy in Lam Dong and Son La from 2008 – 2010, entrusted model of forest protection and development fund has been highly appreciated and applied quickly at the national scale

The following data is printed from VNFF report in 2018:

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As recorded by VNFF in 2018, 11 PFPDFs are under management of PPC and 33 PFPDFs are under management of DARD Depend on the scale of each fund, the structure of provincial FPDF management unit may be divided into different functional divisions Only Son La province has the system of FPDF at district level and under the management of provincial fund Detail list of provincial FPDFs is described in the annex After 10 years of operation, through the updates of legal documents, the position of FPDFs system become important in implementing PFES policy, especially in the context of increasing PFES revenues by adjustment of unit price for current environmental services and the piloting more services of industrial water and aquaculture According to the VNFF’s report, total contracts have been signed until Oct 2018 as below:

Table 2.6 Total entrusted contracts as of Oct 2018 Types of FES VNFF Provincial

FPDFs

Total contract via services Hydropower

generation

75 312 387

Clean water supply 17 133 150

Tourism services 76 76

Total contracts 92 521 613

Note: Data from VNFF, 2018

As above table, the VNFF and provincial FPDFs have signed 613 entrusted contracts, of which 92 contracts from VNFF and 521 contracts from provincial FPDFs However, VNFF has not signed any contract with tourism companies The result of PFES collection as of Sep 2018 is indicated in the below table:

Table 2.7 The PFES collection as of Sep 2018

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Collected PFES 7.211,6 2.814,6 10.026

% 72% 28% 100%

Note: Data from VNFF, 2018

Even the number of contracts signed by VNFF is less than contracts signed by provincial FPDFs, however, the PFES amount collected by VNFF is more than provincial funds, account of 72%

The results of 10-year implementation of PFES policy also include a lot of contributions from international organizations such as GIZ, Winrock, CIFOR, ADB and some NGOs in Vietnam The contributions and cooperation are expressed through the workshops, trainings, capacity building activities to achieve the high consensus of all agencies, partners involve in the PFES implementation at all levels In addition, VNFF also cooperated in conducting projects and non-project activities related to PFES The IPFES is considered as a good technical assistance from Japanese partners through ADB to improve the PFES implementation Under this project, the models of cold-water fish farming and water supply for industrial production in Lao Cai province have been successfully piloted, to create basis for disseminate to other provinces Especially the support of VFD project funded by USAID will be used to support for PFES implementation that focus on carbon stock services, development of monitoring and evaluation indicators and payment for forest owners through online transaction

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RESEARCH METHODOLOGY

This report adopted mainly qualitative research methods associated with interpretive and descriptive statistics based on the inheritance, analysis and synthesis of relevant sources of data and information The author also designed survey forms for PFES stakeholders to collect more information serving the report Collected data has been analysed and referred to previous researches to reinforce the author's point of view in VNFF and PFES

Data collection method

The secondary data has been collected from VNFF management units, include statistics from 2008 until 2018, communication publications of VNFF such as profile, leaflets, posters, handbooks, etc The published reports, studies of MARD, independent experts, domestic and international organizations and related agencies have been used on this report Some news and information from website of organizations working in the field of payment for ecosystem services is also considered to use as good examples

The primary data has been collected through survey forms designed for PFES stakeholders These forms and questionnaires were sent to them via EMS, emails, delivered in some events organized by Vietnam Administration of forestry to receive the feedback and answers The author also made phone calls, met and discussed directly with the PFES stakeholders as well as experts for deep consultation

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provincial FPDFs, FES users, providers and authorities The graph below describes the summary of subjects to be interviewed and provided data:

Figure 3.1 Subjects of survey and interview

In the process of collecting data, author has not designed a separate survey form for the forest owners, this is because in the process of PFES distribution, VNFF has not directly worked with forest owners Only provincial FPDFs has directly contacted with them for the payment Within the framework of this study, author only focus on subjects which have direct relationships with VNFF

Methods of data processing and analysis

With the above data collection method, the report will include, but not limited to emphasis on the common understanding of experts and study papers, review options and raise the author’s point of views on the current VNFF model Through the study of secondary documents including legal documents, reports made by independent consultants such as the reports on reviewing the years of implementing PFES policy, years and 10 years of operating the system of forest protection and development fund, author can draw the achievements and the limitations that VNFF experienced since its establishment until 2018

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the provincial FPDFs also include the general information of each fund, information of forest area providing PFES and forest owners, FES users in province The questions on the role of VNFF are also raised to study the view of FPDFs in cooperation with VNFF Annex presents clearly those contents The survey for FES users also includes general information, their understanding on PFES policy and VNFF This form focuses on the FES users that signed entrusted contracts with VNFF Detail contents can be seen in Annex Finally, the survey for the stakeholders is the most comprehensive form This form also includes the requirement to provide background information, then the evaluation on the cooperation activities with VNFF to study their knowledge on PFES policy, VNFF, the satisfaction in the cooperation activities with VNFF and final part is to collect data on the role of VNFF The detail contents are shown in the Annex With the data collected and summarized, the evaluation of the outputs in comparison with the initial objectives is very important to see the achievements, success or weakness during the operation process of VNFF

SWOT analysis with strengths, weaknesses, opportunities and threats of VNFF during implementation of PFES policy is used to define the strategic targets propose recommendations on planning, mechanism of monitoring and evaluation for the orientation of VNFF development in the coming time

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RESEARCH FINDINGS

In this part, based on reviewing various studies and summarizing the results from interviews and surveys, the achievements and shortcomings of VNFF in the implementation of PFES policy will be further clarified The report will focus on the structural organization of VNFF as well as its entrusted role in implementing the PFES policy

VNFF’s organization and operation

VNFF is established by MARD via Decision 114/2008/QD-BNN in 2008 and its organization and operation are regulated by the Decision 128/2008/QD-BNN in the same year The Law on forestry in 2019 reaffirmed that the forest protection and development fund is “a non-state budget financial fund, organizes and operates under the form of public non-business units This fund is set up by the state competent authorities” (National Assembly, 2017) In principle, as regulated in the Item 2, Article 95 of the Law on forestry, all activities of the fund are “non-profit purposes and only support programs, projects, non-project activities related to forest protection and development that state budget not invest or not cover adequately as the investment requirements” Therefore, VNFF must follow these principles during its operations By studying the legal regulations on the structure of VNFF, we can see the changes from the establishment up to now:

Table 4.1 Update changes in VNFF structure & operation Adjusted contents Government’s Decree 05

in 14 Jan 2008

Government’s Decree 156 in 16 Nov 2018

Legal status The Fund has its legal status, its own seal, can open accounts at banks and the State Treasury

The Fund is a state financial institution, has the legal status, its own seal, can open bank accounts or the State Treasury Type of operation NA Financial autonomy, Public

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Structure organization BoD, Control board, Management unit

BoD, Control board, Management unit & specialized divisions

VNFF management unit

Established under Department of Forestry (MARD)

Regulated by Minister of MARD

Support from state budget

VND 100 billion NA

Communication and dissemination

activities

NA Added in VNFF’s tasks

M&E activities NA Added in VNFF’s tasks

Relationship between VNFF and provincial FPDFs

(i) Provide finance for provincial fund

(ii) Provide guidance, check & monitor the

management and

utilization of PFES transferred by VNFF (iii) Exchange experience & profession on fund management

(i) Provide finance and technical support for provincial fund

(ii) Coordinate PFES money and other entrusted fund (iii) Organize trainings and provide professional guidance for provincial fund

(iv) Organize experience exchange on professions and fund management among provincial funds

(v) Check and monitor the PFES management and utilization of provincial funds

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With study the evaluation reports conducted by independent experts and the State agencies in the previous time and according to the newly amended legal document such as Law on forestry and the Decree 156, many changes can be seen in the structural organization and the operation process of the VNFF Firstly, the legal status of both VNFF and provincial fund has been clarified that avoid the confusion in their operation According to the new regulations, VNFF can manage and use 0,5% of collected PFES based on the financial autonomy mechanism for public non-business units13 This is a

significant step to help VNFF proactive in its activities In VNFF’s structure, the specialized divisions are added that allow VNFFMU take advantages of its strength, especially in the field of finance management and technical support At present, VNFF management unit has 15 officers, five of them are government officials The director works as part-time staff and deputy director works full-time staff Eleven officers of VNFFMU are in charge of different positions in the fields of technical issues, policy, accounting & finance, communication and international relations The functional units are not separated and there are no funding windows operated

The new regulation has removed the state budget amount of VND 100 billion mentioned in the Decree 05 to support the establishment of forest protection and development fund The actual of 10 years implementing PFES policy, there is no case that record the use of this initial state budget for the VNFF’s operation

Refer to the model of Stakeholders in PFES implementation, VNFF works directly with provincial FPDFs, big FES users (hydropower companies locate from provinces), and forest management agencies VNFF does not work directly with forest owners therefore its understanding of forest owners sometimes is limited The activities of communications and M&E on PFES policy have been added in the new legal document will be effective tools for VNFF to study about forest owners

Until now there are 44 provincial FPDFs have been established, of which 11 funds are under management of PPC and 33 funds are under management of DARD According to new law on forestry the relationship between VNFF and provincial FPDFs are further clarified It is not the relationship between the lower level and the higher level, this is

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express the coordination mechanism in the activities related to PFES However, the different management level of provincial FPDFs may causes the inconsistent collaboration between VNFF and provincial funds

In the new context, with the increase of PFES collection, the PFES management and coordination therefore become more complicated that requires more efforts of VNFF However, during its operation, it still lacks handbooks and guidelines to direct the review of forest owner identification, update PFES database, develop PFES map, manage and use financial source of FPDFs, payment via bank account, etc

The changes as mentioned in the table are entirely suitable to the actual condition In the new context, the role of VNFF become more and more important and indispensable in the process of implementing legal regulations on PFES in Vietnam, therefore it requires the changes in VNFFMU to meet with practical condition VNFF staff when sending feedback on author’s questions also express their willingness to have changes in VNFFMU’s structure to match the new situation and reduce working pressure

Implementation of PFES policy

From studying the reports and results from surveys as well as deep interviews with stakeholders, author can discover some findings related to the implementation of PFES policy as below:

According to VNFF report in 2018, and author’s survey, VNFF has signed 95 entrusted contracts of which 75 contracts were signed with hydropower companies & 17 contracts were signed with clean water suppliers and there are no contracts with tourism companies, industrial production or aquaculture facilities It shows that the PFES collection capacity for VNFF is still potential and requires further study on these services to have sufficient guidelines for the provincial funds

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users which has the forest area under the basin located in administrative boundaries from two or more provinces For the forest area under the basin located within one province, those FES users will sign contract with provincial funds14 The companies located on

the area from two provinces are big companies, thus, the revenue collected from these companies is also much The numbers express collection of VNFF is much more than collection of provincial fund but the human resources for VNFFMU is limited It is essential to have capacity building activities for the VNFF’s staff

PFES disbursement contributed a lot to improve the livelihood of the local people as well as help to reduce burden to State budget According to the statistics of VNFF in 2018, PFES contributed to protect more than mil of forest in the basin providing FES

Table 4.2 PFES amount paid for forest owners in 2018

Forest owners Qty Area of forest management (ha)

PFES received in 2018 (bil dong) Management board of

protection forest 152 1,757 mil 592.4

Management board of

special use forests 75 1,148 mil 250.8

State forest enterprises 79 657.5 thousand 146.69 Commune People's

Committee 544 618.3 thousand 80.8

Police, soldiers, businesses

and 205 396.3 thousand 74.9

Individuals, households and

communities 66,221 731 thousand 178.4

Note: (VNFF, 2018)

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The VNFF report also stated that households and communities have an average income of VND 2mil/household/year from PFES Even this money is not much but it helps the local people especially the ethnic minorities to improve their life, they can have more money to buy livestock and send their children to school For the forest owners who are organizations, PFES supported them to protect more than mil forest This is very important source for the state forest enterprises and forest management boards which have financial difficulties in the context of closing and stopping exploitation of natural forests

During the implementation process of PFES policy, even some hydropower companies have well complied the payment but they still think that PFES is one type of fee or tax and complained of paying so many fees and considered PFES as the water resource tax For the consumers, many of them did not know that PFES is also calculated by ENV to be included monthly electricity bills Some of people has been asked did not know the meaning of PFES This mean that in fact, the implementation of PFES policy seems to be “an order” from Government This require VNFF to carefully consider the communication activities as urgent tasks which need to cooperate with provincial fund for effective implementation

In the context that the activities of monitoring and evaluation of PFES policy implementation are supplemented as the task of VNFF (GoV, 2018), it is needed to develop a set of M&E indicators on PFES With these indicators, VNFF is able to conduct monitoring and evaluation more easily Some stakeholders also mentioned this issue in their feedback to author’s survey

Organizing workshops, trainings, policy dialogues to raise awareness among stakeholders is one of the important activities to implement in the coming time

Some specific results from interviews and surveys

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After contacting via email, phone call, meeting and discuss directly, results have been collected with the participants of 18 staff of VNFF, 32 officers of provincial FPDFs, 25 officers of FES users (from hydropower companies, clean water facilities, tourism companies) and 75 other stakeholders (from international and domestic NGOs and projects working in the field related to PFES and forestry, independent experts and state authorities in MARD and some others from the local levels

Basically, interviewees support the survey and willing to share information With deep interview and discussion with experts, many good results have been collected and presented in the below graph and via comments

General evaluation on VNFF

General evaluation on VNFF is conducted with the feedback from provincial funds, FES users, state forest agencies, NGOs and other experts working related to PFES in Vietnam In total of around 120 people answered this question, communication method via phone, working directly of VNFF as well as the qualification of VNFF’s officer is highly appreciated There are some limitations of indirect contact and the cooperation with provincial fund and FES users Some recommendations from the local said that VNFF should take into account the context of provinces to have better coordination

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The question related to satisfaction rate has been sent to around 90 people from VNFF and stakeholders who are state forest agencies, NGOs and other relevant experts

Figure 4.2 Satisfaction rate

As showing in Figure 13, most of respondents satisfied with VNFF and wish to work with it for a long time NGOs considered VNFF as a strategic partners and are willing to introduce VNFF to other partners It is clearly that they recognized the benefits when working with VNFF

Stakeholders’ understanding about VNFF

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Figure 4.3 Stakeholders’ understanding about VNFF

Most of stakeholders basically understand about VNFF People who has not understood about VNFF requested to have trainings and capacity building activities The specific criteria show the effectiveness of communication activity Many people understand VNFF and its activities However, there are some people still misunderstand VNFF’s programs, projects and non-project activities as well as it funded activities This is stated clearly in the new law and decree 156 but there is less communication activities on these field Especially there is no record on programs, projects and non-project activities funded by VNFF Therefore, this field should have more trainings to call the interests in fully implementation

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Figure 4.4 VNFF’s activities in implementing PFES policy

The results from surveys and deep interview show that there is a limitation on updating PFES database In 2015, VNFF got a project funded by Trust fund for forests to develop a database to manage and monitor PFES implementation This database after that had been integrated into the management information system for the forestry sector (FORMIS) At present, the institute for forest ecology and environment is supporting with technical issues, especially using this software to develop a map for PFES This is very useful software but it depends on the support from outside VNFF internally not have enough personnel on this field to maintain the software The feedback from provincial funds said that they need more trainings on using this system The exercises of planning, checking, supervising and reporting PFES are also evaluated at the average level and need more guidelines This requires VNFF to promote their actions in order to effectively implement PFES policy

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reduction in 61 poor districts; (ii) Decree 75/2015/ND-CP on forest protection associates with cultivation and improve incomes of ethnic minorities; (iii) Decision 57/QD-TTg in 2012 approving the forest protection and development plan, etc Within the above reasons, the payment delay of FES users is considered as the main reason of PFES delay Some FES users said that they are not clear about PFES disbursement therefore they refused to conduct payment, some of them has problems with financial issue and they are unable to conduct payment It seems that the reporting mechanism between the FPDFs and FES users is limited In addition, it takes time to pay the collected PFES to forest owners The rights of FES users in M&E for the forest area providing FES is not clear Some FES users said that they have no time to join in the M&E missions but in some cases, they are not invited to join in In this case, online payment is one of a good method to make PFES more transparent and effective, thus, FES users will feel more confident in the disbursement mechanism and provincial FPDFs as well as VNFF can well fulfill their entrusted role

DISCUSSION

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of Cao Sơn commune, Đà Bắc district, Hịa Bình province received more than VND 113.8 million from Hoa Binh FPDF for their community forest management 73 households of the village with 98% of them are Dao ethnic minority agree with the PFES policy and they also issue the village regulations and regulations on the forest management and protection (RECOFTC Thailand delegation visits and learns about PFES in Vietnam, 2018) RECOFTC Thailand mission highly appreciated the model of PFES policy implementation in the community of Vietnam

Organization and human resource

Currently, beside the members of Board of Directors and members of Control boards working as part - time condition, the VNFF MU includes 15 members with the positions as below:

Figure 5.1 VNFF MU Human resources

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MARD the scheme on the establishment of functional divisions under VNFFMU The VNFF structure is similar to FONAFIFO model in Costa Rica It also includes the management of a Ministry (MARD in Vietnam), BoD, general directorate (management unit in Vietnam) Therefore, Vietnam can refer the development of functional units in Costa Rica with considering its own context for better structure

In addition, even the funding windows have been set up in the VNFF’s structure for many years, but in fact, there is no REDD+ fund or other funds included in this model In the past, when some forestry funds came to end due to the finish of funding from international partners or closing project, it is expected that these funds will be integrated into the VNFF and will work as a “child-fund” under the umbrellas of VNFF After those projects and funds have completed their mission, the outputs have been handed over to VNFF, but all staff has left for other positions Therefore, no personnel of these funds are recorded to work for VNFF The establishment of these funding windows in the VNFF’s structure should be considered to meet the actual situation

Through interview and survey in the local, some big provincial FPDFs have set up their fund into different divisions For example, Son La FPDFs includes more than 60 staff and gathered in divisions of Organization and Administration, Planning and Finance, Technical and Inspection and supervision In the context of increasing payment level and more forest environmental services, there are more and more requirements of support from the local as well as PFES stakeholders The role of VNFFMU should be further promoted, the activities of capacity building for the staff of VNFF therefore are very urgent

Legal regulations and guidelines on PFES policy

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and domestic organizations, services related to carbon sequestration, aquaculture still facing a lot of difficulties Less regulations and specific guidelines on payment for services of carbon storage, aquaculture and industrial production lead to the limitation in implementing the policy

In addition, together with the development of the science and technology, requirement of using Geographic Information System (GIS) in developing payment maps is very necessary Demand of online payment to forest owners is now attracting a lot of interests from both state agencies and the FES providers Through surveys and interviews, there are many comments on providing guidance about method of implementing and collection level for the industrial production using water as well as the collection level for the production facilities that cause greenhouse gas emissions

VNFF should also acknowledge its position in the enforcement process of PFES policy Promoting to apply remaining forest environmental services, M&E activities, payment through bank account & online transaction, etc are priorities for action in the coming time Until now, many provinces have used Viettel pay for payment to forest owner But it is piloted and need more guidelines to apply nationally

Develop handbook & training to guide the review of forest owner identification, update PFES database, develop PFES map, manage and use financial source of FPDFs, payment via bank account, etc

PFES management and utilization

It is clear that PFES collection is still less than potential payment in Vietnam In some areas, people still refuse to receive PFES because the received amount is limited and the different payment that did not encourage them to join in policy implementation as well as involvement in forest protection and management

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FPDFs and FES users to have agreements on the payments China also has good experience in providing incentives for the upstream and downstream authorities, thereby, encourage them to implement PES programs Vietnam should take into account the very important role of the local authorities in implementing the PFES policy The encouragement for the participation of FES users is very important It will help to raise their awareness and understanding to PFES In China, when the users found that the provided water quality was not up to standard, they will refuse to pay for ecosystem services This will make the service providers more responsible for the forest or water protection and management

Regulations on VNFF’s funding for activities of using PFES are available, but no programs are recorded Japan has good lessons in using PFES, beside the direct payment to service providers, this money is also used for programs of biodiversity conservation and water conservation

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CONCLUSION AND RECOMMENDATIONS Conclusion

VNFF has well-implemented the PFES policy however, it is essential to improve shortcomings on human resource, PFES management mechanism, operation tools, communication and its role in advising policy making as well as relationship with provincial FPDFs and relevant stakeholders to ensure the transparent and effective payment

VNFF proved its role in the success of implementing the PFES policy It is expressed by strong commitment of the Vietnamese Government in the forest protection and development as well as in developing good policy to mobilize social resources to support the forestry sector During the operation, VNFF has some certain limitations but it improved the success of Vietnam in formulating and implementing a new policy at the national scale to support the forest environmental protection and development

Recommendations

Based on the above findings and discussions, some major recommendations are proposed in this part to help VNFF further strengthen its role or amend for better performance Many ideas from experts said that VNFF only needs to focus on its function of “entrusted service”, in which it is a bridge between the FES providers and FES users By well doing its role, VNFF will make PFES policy strongly promoted, contribute to the development of national economy, establish the commodity economy, wherein environmental services are important items

Organization and human resource:

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In addition, VNFF should also finalize proposal on establishing specific divisions This is very important in the context of increasing PFES collection as well as issuing legal regulations on new forest environmental services

In order to avoid misunderstanding on PFES as well as to raise awareness of this policy, it is important for VNFF to organize more activities of communication and capacity building This activity should not limit the implementation methods, topic, target audience Initiatives are more diversified, the more participants are involved, therefore, communication effectiveness will increase

Finalizing legal framework:

With the role of an entrusted fund and it is responsible for the Vietnam Administration of Forestry and MARD, VNFF needs to advise to finalize legal regulations on remaining forest environmental services (carbon sequestration and industrial water), M&E, payment through bank account & online transaction, etc This is an important legal framework to implement the PFES policy in the new context

In accordance with the legal documents, handbooks should be developed to clarify regulations and provide guidelines for the PFES implementation Under legal regulation, VNFF should provide guidelines on developing programs/non-activities funded by VNFF This will create more chance of using PFES in an effective way, increase the participation of local people in the process of implementing PFES

Strengthening the cooperation with relevant agencies:

It is important to promote cooperation among relevant agencies Some recommendations for each subjects can be defined as below:

For MARD & other state forest agencies: it is essential to increase connection among VNFF’s BoD members and advise the Government to issue regulations on the remaining forest environmental services such as: carbon sequestration, using water for industrial production and aquaculture

54

For FES providers: these subjects are recommended to use PFES in an effective way and ensure the good quality of forest area under their protection They are also encouraged to develop proposals funded by VNFF on using PFES

For provincial PPDFs: they should advise PPC to issue regulations on new services and new payment methods such as online banking or mobile banking

For the VNFF: Closely working with provincial funds is very important because provincial funds are the main stakeholders within the process of PFES implementation They are the only agency to transfer PFES to forest owners

In the case of limited budget and strict regulation of using PFES, VNFF should call for international funding for piloting payment for remaining services such as carbon sequestration and storage services, using water for the aquaculture and industrial production With the great supports from international partners and other sources will reduce burden for state budget

It is useful for VNFF to cooperate with relevant agencies in payment via bank account and as well as applying science and technology in PFES monitoring & evaluation Pilot model of Viettel pay conducted by provincial fund to pay for forest owners is a new step in PFES implementation If this program can be disseminated nationwide, it will save a lot of time and cost for payment in cash This will be a foundation to come up with direct payment in the future

55 References

(2017) Retrieved from VNFF: http://vnff.vn/communication/publications

(2018) Retrieved from RECOFTC Thailand delegation visits and learns about PFES in Vietnam: vnff.vn/news/central-news/2018/9/recoftc-thailand-delegation-visits-and-learns-about-pfes-in-vietnam

ADB (2016) Toward a national eco-compensation regulation in the People’s Republic

of China. Mandaluyong City, Philippines

Conserving water by recharging ground water in Kumamoto (2010) Retrieved from

https://www.biodic.go.jp/biodiversity/shiraberu/policy/pes/en/water/water03.html Donal, Y (2016) Payments for Ecosystem Services Programs in Cambodia. Phnom Penh: Wildlife Conservation Society, Cambodia Program

FONAFIFO. (2008) Retrieved from Organization chart:

https://www.fonafifo.go.cr/en/conozcanos/organigrama/

Forest environment tax in Kanagawa Prefecture (2007) Retrieved from

https://www.biodic.go.jp/biodiversity/shiraberu/policy/pes/en/forest/forest03.html

Forestry Law - Law No 7575, Republic of Costa Rica (1996) Retrieved from

https://theredddesk.org/countries/laws/forestry-law-law-7575-1996-costa-rica GoV (2018) Article 76, Decree 156.

Hayashi, K., & Nishimiya, H (2010) Good practices of payments for ecosystem services in Japan EcoTopia Science Institute Policy Brief

Juhern Kim, Roger Madrigal, Francisco Alpizar, and Silvia Rojas Fernandez (2016)

Bridging the Policy and Investment Gap for Payment for Ecosystem Services: Learning

from Costa Rican Experience and Roads Ahead. Seoul, Korea: Global Green Growth

56

Kingdom of Cambodia (2016) National biodiversity strategy and action plan. Phnom Penh: National Council for Sustainable development

Kolinjivadi, V K., and T Sunderland (2012) A review of two payment schemes for watershed services from China and Vietnam: the interface of government control and

PES theory Retrieved from http://dx.doi.org/10.5751/ES-05057-170410

MARD (2018) 2.3.2 Report on reviewing 10 years of organization and operation of

forest protection and development funds from 2008 – 2018. Hanoi: VNFF

MARD (2018) Report on reviewing 10 years of organization and operation of forest

protection and development funds from 2008 – 2018. Hanoi: VNFF

McElwee, P., Thanh, N.C (2014) Report on reviewing years of PFES policy

implementation in Vietnam (2011-2014). Hanoi: Vietnam Forests and Deltas (VFD)

Naret, H., & Sopheak, K (2016) A Review of PES Implementation In Cambodia.

Laguna, Philippines: EEPSEA SRG Report No 2016-SRG5 National Assembly (2017) Vietnam Law on forestry, Article 95

Nguyen, T B T., et al (2011) Payment for Forest Environmental Services: A Case Study on Pilot Implementation in Lam Dong Province, Vietnam from 2006 - 2010.

Winrock International

Tacconi, L (2012) Redefining payments for environmental services Ecological

economics 73

Thanh, N.C., Quynh, V.V (2016) Report on years of operations of forest protection

and development fund and years of implementation of the PFES policy. VNFF

VNFF (2018) Report on reviewing 10 years of organization and operation of forest

protection funds from 2008 to 2018. Hanoi: MARD

Wang, H., Dong, Z., Xu, Y., & Ge, C (2016) Eco-compensation for watershed services in China Water International, 41(2), 271-289

Wunder, S (2005) Payments for environmental services: some nuts and bolts CIFOR

57

Zhen, L., & Zhang, H (2011) Payment for Ecosystem Services in China: An Overview

58 ANNEXES

Annex 1.List of legal documents related to implementation of PFES policy No Ref No Issue Date Brief Type of

document Issue agency Decision 911/QD-BNN-TCLN 19-Mar-19 Announcing National Forest Status in 2018

Decision MARD

2 Decree 156/2018/NÐ-CP 16-Nov-18 Guiding the implementation of several articles of the Forestry Law

Decree Government

3 Decision 1187/QD-BNN-TCLN 3-Apr-18 Announcing National Forest Status in 2017

Decision MARD

4 Decision 742/QD-BNN-TCLN 2-Mar-18 Announcing forest areas in basins as a basis for

implementing the PFES policy

Decision MARD

5 Circular 04/2018/TT-BTC 17-Jan-18 Guiding the management and utilization of PFES money

Circular MoF

6 Decision 5581/QD-BNN-TCLN 29-Dec-17 Announcing administrative procedures that are replaced under management function of MARD

Decision MARD

7 Law No

16/2017/QH14 15-Nov-17 Law on forestry Law

National Assembly Circular 23/2017/TT-BNNPTNT 15-Nov-17 Regulating plantation of replacement forest when transferring forest land to other purposes

Circular MARD

9 Circular 22/2017/TT-BNNPTNT 15-Nov-17 Guiding some contents to implement the policy on payment for forest

environmental services

59

No Ref No Issue Date Brief Type of document Issue agency 10 Decision 4539/QD-BNN-TCLN 6-Nov-17

Issuing software to update forest changes

Decision MARD

11 Decision 1819/QD-BNN-TCLN 16-May-17 Announcing National Forest Status in 2016

Decision MARD

12 Decree 41/2017/NÐ-CP 5-Apr-17 Amendment to decree on administrative penalties for violations in agriculture

Decree Government

13 Decision 489/QD-BNN-TCLN 24-Feb-17 Announcing the adjustment of forest areas in the basins as a basis for implementing the PFES policy

Decision MARD

14

Decree 147/2016/NÐ-CP

2-Nov-16

Decree on Revising, supplementing some articles of Decree No 99/2010/ND-CP dated 24th

September 2010 of the Government on the policy for payment for forest environmental services

Decree Government

15 Decision 1439/QD-BNN-TCLN 25-Apr-16 The management and use of the Forestry Management

Information System

Decision MARD

16 Decree 40/2015/NÐ-CP 27-Apr-15 Revising and Supplementing some articles of Decree

No.157/2013/ND-CP on 11

November 2013 of the Government regulating sanctions against

60

No Ref No Issue Date Brief Type of document Issue agency administrative violation on forest/forest products management, development and protection (Vietnamese only) 17 Law No

55/2014/QH13 23-Jun-14

Law on Environment Protection

Law National Assembly 18 Decree 157/2013/NÐ-CP 11-Nov-13 Regulating sanctioning administrative violations in forest management, development and forest product management

Decree Government

19 Joint Circular 62/2012/TTLT- BNNPTNT-BTC 16-Nov-12

Instructions on the mechanism of managing and using PFES Joint circular MARD & MoF 20 Circular 60/2012/TT-BNNPTNT 9-Nov-12 Regulating the principles and methods to identify the forest area within the basin for PFES

Circular MARD

21 Circular 85/2012/TT-BTC 25-May-12 Guiding financial management regime for Provincial Forest Protection and Development Funds

Circular MoF

22

Decision 15/QD-VNFF-BÐH

24-Sep-12

Issuance of the working regulations of the Management Unit of VNFF

Decision VNFF

23 Decision 14/QD-VNFF-HÐQL 23-Aug-12 Issuance of regulation on operation of the Control Unit of VNFF

61

No Ref No Issue Date Brief Type of document Issue agency 24 Decision 13/QD-VNFF-BÐH 23-Aug-12 Issuing the Regulations on receiving, processing and management of the documents and information of Management Unit of VNFF

Decision VNFF

25

Circular 20/2012/TT-BNNPTNT

7-May-12

Guiding on PFES validation

procedures

Circular MARD

26 Circular 80/2011/TT-BNNPTNT 23-Nov-11 Methods guiding identification of PFES

Circular MARD

27 Decision

2284/QD-TTg 13-Dec-10

Approving the Scheme on

implementation of the Government's Decree No 99

Decision Prime Minister

28

Decree 99/2010/NÐ-CP

24-Sep-10 PFES policy Decree Government

29 Decree 05/2008/NÐ-CP 14-Jan-08 The Forest Protection and Development Fund

Decree Government

30 Decision 128/2008/QD-BNN 31-Dec-08 Promulgating the regulation on organization and operation of VNFF

Decision MARD

31 Decision 114/2008/QD-BNN 28-Nov-08 Establishing Vietnam Forest Protection and Development Fund (VNFF)

Decision MARD

32 Decision 111/2008/QD-BNN 18-Nov-08 Promulgating the Regulations on organization and operation of the Provincial Forest Protection and Development Funds

Decision MARD

33 Decision

380/QD-TTg 10-Apr-08

The pilot policy on

PFES Decision

62

Annex 2.List of handbooks on PFES policy implementation No Handbook Year of

issuance Brief content

Handbook on financial

management of forest protection and development fund

2018

Guiding the financial

management and accounting in accurate and systematic manner

2

Handbook on guiding payment for forest environmental services via bank account

2018 Guiding payment for FES providers via bank transaction

3

Handbook for developing a map of payment for forest environmental services

2018

Guiding method of developing PFES map and synchronizing forest inventory data

4

Handbook developing the plan on Payment for Forest Environmental Services

2016

Guiding document on developing the

Plan on the implementation of the policy on payment for forest environmental services at provincial level

5

Handbook on management and use of Payment for Forest

Environmental Services money at the village level

2016

Guiding the procedure on receiving PFES money, enhance the capacity and participation of communities in forest protection and

development activities as well as effectively utilize PFES money

6

Handbook guiding the use of software on the online GIS data sharing (WebGIS)

2016

Guiding the use of WebGis software to serve the

development PFES database, linking and integrating Database of FORMIS

7 Handbook on community of PFES

policy implementation (COP) 2014

Guiding local levels to maintain group activities and share experience in PFES implementation

8 Handbook on accounting and

Financial management for PFES 2015

Focusing on the issues related to the accounting and financial management for payments for forest environmental services

Handbook guiding PFES database Collection, Update, Management and Utilization

2015

63

No Handbook Year of

issuance Brief content 10 Handbook on climate change and

REDD+ 2010

Provide positive solutions for the countries to participate in REDD+

11 Handbook guiding the

implementation of PFES policy 2010

Introducing steps of PFES policy implementation 12 Handbook guiding Forest

Inventory to serve PFES 2015

64

Annex 3.List of provincial forest protection and development fund

No Provincial FPDFs Managed by

PPC DARD

Northwest (04)

1 Lai Chau x

2 Son La x

3 Dien Bien x

4 Hoa Binh x

Northeast (10)

5 Yen Bai x

6 Lao Cai x

7 Tuyen Quang x

8 Ha Giang x

9 Cao Bang x

10 Bac Kan x

11 Phu Tho x

12 Thai Nguyen x

13 Bac Giang x

14 Lang Son x

Red river delta (03)

15 Ninh Binh x

16 Quang Ninh x

17 Hai Phong x

North Central (06)

18 Thanh Hoa x

19 Nghe An x

20 Ha Tinh x

21 Quang Binh x

22 Quang Tri x

23 Thua Thien Hue x

South Central (08)

24 Quang Nam x

25 Quang Ngai x

26 Da Nang x

27 Binh Dinh x

28 Phu Yen x

29 Khanh Hoa x

30 Ninh Thuan x

31 Binh Thuan x

Central highland (05)

65

No Provincial FPDFs Managed by

PPC DARD

33 Dak Nong x

34 Gia Lai x

35 Kon Tum x

36 Lam Dong x

Southeast (05)

37 Binh Phuoc x

38 Dong Nai x

39 Tay Ninh x

40 Ho Chi Minh x

41 Ba Ria-Vung Tau x

Cuu Long Delta (03)

42 Kien Giang x

43 Tra Vinh x

66 Annex 4.Survey form for VNFF’s staff

SURVEY FORM

THE ROLE OF VIETNAM FOREST PROTECTION AND DEVELOPMENT FUND (VNFF) IN THE ENFORCEMENT OF THE POLICY ON PAYMENT

FOR FOREST ENVIRONMENTAL SERVICES (PFES) (Applied for VNFF’s staff)

Introduction

Thank you for your time to provide information of this survey This is one of the activities to collect data for the Master thesis of Public policy program of Vietnam Japan University, Vietnam National University

Thesis title: Strengthening the role of Vietnam Forest Protection and Development Fund (VNFF) in the implementation of the policy on payment for forest environmental services

Purpose of this survey is to collect information of the VNFF's role in implementing the PFES policy to be the basis of proposing recommendations for better policy enforcement

A BACKGROUND Q Please tell your gender?

 Male Female

Q Please tell me which age are you?

 From 18 – 25 years old  From 26 – 35

 From 36 – 45  Over 45

Q Please tell me your certificates?

 Bachelor  Master  Doctor

Q How long have you worked at VNFF?

67

From to years  From to years From years

Q How is your monthly average income?

 Less than mil

 From – to less 10 mil  From 10 – to less 15 mil

 From 15 mil

B SATISFACTORY LEVEL

Evaluation grade is ranged from to

CONTENTS Grade

1 Office culture Strongly

disagree Disagree

No

idea Agree

Strongly agree

Clear job purposes

Encourage staff’s idea on common

issues

Organizing many team building

activities

Comply with procedures, regulations

Comply with leader’s order

Opening, supporting

You can learn from mistakes

2 LEADERSHIP STYLE

Leader only care about his / her

requirements

Leaders always show clear leadership

68

Leaders are people with visionary and

have strategic vision

Encouraging subordinators to work in

an innovative way

Caring and satisfy with employee

Always suggest solutions from various

aspects

3 Working features

Your capacity can be used for your

work

Your work is interesting

Your work is challenging

Your work is clear

Well complete will have good

appraisal

4 WORKING ENVIRONMENT

Your work is high pressure

Your work require overtime frequently You are well equipped with working

conditions

You are always shared with information related to procedures, finance, position of VNFF

1

You feel working environment is

stressful

69 You are paid equally to your

performance

You got annual salary increase

Salary is paid equally among

employees

Current salary is fair with labour

market

6 Training and promotion

You have necessary skills from VNFF

to take over current job

VNFF’s evaluation helps you to have clear plan on training and career development

1

You have many promotion chances in

VNFF

VNFF creates many chances for your

personal development

7 Satisfaction

In general, you satisfied when working

with VNFF

You wish to cooperate with VNFF for

a long term

You consider VNFF as your second

home

You are willing to introduce VNFF to

other partners

C ROLE OF THE CENTRAL FUND

70

Contents Good Average Poor Provides guidelines to implement PFES

policy

Update PFES database on the system Provide communication on PFES policy Sign entrusted contract on PFES

International cooperation

Accounting and finance exercises Developing plan

Report, check and supervise

2 In your opinion, how does VNFF cooperate with agencies related to PFES policy? Agencies Good Average Poor Ministry, ministerial agencies

Agencies under MARD Provincial fund

FES users

Local and international NGOs VNFF’s Board of Director VNFF’s control board

3 In your opinion, which difficulties does VNFF have in advising and implementing the PFES policy (please indicate)?

71

……… Do you have any comment on this survey?

72

Annex Survey form for provincial forest protection and development fund SURVEY FORM

THE ROLE OF VIETNAM FOREST PROTECTION AND DEVELOPMENT FUND (VNFF) IN THE ENFORCEMENT OF THE POLICY ON PAYMENT

FOR FOREST ENVIRONMENTAL SERVICES (PFES) (Applied for Provincial forest protection and development fund) Introduction

Thank you for your time to provide information of this survey This is one of the activities to collect data for the Master thesis of Public policy program of Vietnam Japan University, Vietnam National University

Thesis title: Strengthening the role of Vietnam Forest Protection and Development Fund (VNFF) in the implementation of the policy on payment for forest environmental services

Purpose of this survey is to collect information of the VNFF's role in implementing the PFES policy to be the basis of proposing recommendations for better policy enforcement

A BACKGROUND

1 Name of provincial forest protection and development fund: ……… Tel: ………Email: ………… … ………

3 Total staff of provincial fund:………

B FOREST AREA AND FOREST OWNER OF RECEIVING PFES 1 Total forest area in province (ha): ………

2 Forest area providing PFES in province in 2018 (ha): ………… Total forest owner received PFES in 2018:

4 Total forest owners receive PFES in 2018:

5 Details of forest owners received/not receive FES in 2018 in province:

No Forest owner Received PFES in

73 Management board of

protection forest

2 Management board of special use forest

3 State forest enterprises Other organizations Communal People’s

Committee

6 Households, individuals Community

6 Reasons that forest owners has not receive PFES (more options can be selected): a Not define list of forest owners to be paid for FES

b Not define forest boundary to be paid for FES

c Having violations of forest protection and management d Central fund delays support / late transfer PFES e FES users delay PFES transferring

f Forest owners refuse to receive PFES due to the payment level is low / not satisfy with Payment policy

g Other causes, please clarify

……… ……… ……… ……… C FES USER

1 Forest environmental services conducted in 2018 include Hydropower production

74 Industrial production

Carbon sequestration and stock Other:

2 Number of FES users signed entrusted contract with provincial FPDFs in 2018: 3 FES users in province includes:

Hydropower company Clean water supply Tourism company Aquaculture facility

Industrial production facility

4 FES user paid/not pay for FES in 2018

FES user in 2018 Paid for FES in 2018

Not pay for

FES in 2018 Note Hydropower company

2 Clean water supplier Tourism company Aquaculture facility

5 Industrial production facility

5 Reasons that FES users not pay for FES (more than one option can be selected): a Do not sign PFES entrusted contract

b Your organization has difficulties about:

(i) finance (ii) apply science and technology (iii) personnel c Do not satisfy with PFES policy

d Other causes, please clarify

75

1 In your opinion, how does VNFF support for provincial fund to implement PFES policy

Contents Good Average Poor Provides guidelines to implement

PFES policy

Update PFES database on the system

Provide communication on PFES policy

Sign entrusted contract on PFES International cooperation

Accounting and finance exercises Developing plan

Report, check and supervise

2 How you evaluate VNFF?

Contents Good Average Poor Direct contact (via phone and

directly working)

Indirect contact (in paper and email exchange)

Capacity of VNFF’s staff

76

3 In your opinion, which difficulties does VNFF have in support provincial fund to implement the PFES policy (please indicate)?

……… ……… ……… 4 Do you have any proposal to strengthen the role of VNFF in implementing the PFES policy in province (please clarify)

……… ……… ……… Do you have any comment for the survey?

………

77 Annex 6.Survey form for VNFF’s users

SURVEY FORM

THE ROLE OF VIETNAM FOREST PROTECTION AND DEVELOPMENT FUND (VNFF) IN THE ENFORCEMENT OF THE POLICY ON PAYMENT FOR FOREST ENVIRONMENTAL SERVICES

(PFES)

(Applied for FES USER) Introduction

Thank you for your time to provide information of this survey This is one of the activities to collect data for the Master thesis of Public policy program of Vietnam Japan University, Vietnam National University

Thesis title: Strengthening the role of Vietnam Forest Protection and Development Fund (VNFF) in the implementation of the policy on payment for forest environmental services

Purpose of this survey is to collect information of the VNFF's role in implementing the PFES policy to be the basis of proposing recommendations for better policy enforcement

A BACKGROUND

1 Do you work for any FES users as below?

Hydropower company Clean water supplier

Tourism company Aquaculture facility

Industrial production facility

2 Do your company sign PFES entrusted contract?

Yes No

3 If yes, which one you sign contract with?

VNFF FPDF of (province)………

A INFORMATION OF PFES POLICY IMPLEMENTATION

1 Please use the below grade to evaluate your knowledge of PFES policy: 1) Not understand

78

No Contents 1 2 3

1 General information of PFES entrusted party and receipt party

2 Principle of payment

3 Declare, method and time of payment for forest environmental services

4 Rights and obligations of PFES entrusted party and receipt party

5 Process of PFES management and utilization

2 In 2018, did your company pay for forest environmental services?

Yes No

3 Whether is PFES money calculated in the selling price to customers??

Yes No

4 Reasons cause your late payment or no payment for forest environmental services:

a Do not sign PFES entrusted contract b Your organization has difficulties about:

(i) finance (ii) apply science and technology (iii) personnel c Do not satisfy with PFES policy

d Do not receive enough guidelines in the implementation of PFES policy e Other causes, please clarify

……… ……… ……… C THE ROLE OF VNFF

1 In your opinion, how does VNFF support for enterprises to implement PFES policy?

79 Provides guidelines to implement

PFES policy

Update PFES database on the system

Provide communication on PFES policy

Sign entrusted contract on PFES International cooperation

Accounting and finance exercises Developing plan

Report, check and supervise

2 How you evaluate VNFF?

Contents Good Average Poor Direct contact (via phone and

directly working)

Indirect contact (in paper and email exchange)

Capacity of VNFF’s staff

Coordination mechanism between enterprises and VNFF

3 In your opinion, which shortcomings does VNFF have while supporting enterprises to implement the PFES policy (please indicate)?

80

……… ……… ……… ………

81

Annex 7.Survey form for VNFF’s stakeholders SURVEY FORM

THE ROLE OF VIETNAM FOREST PROTECTION AND DEVELOPMENT FUND (VNFF) IN THE ENFORCEMENT OF THE POLICY ON PAYMENT

FOR FOREST ENVIRONMENTAL SERVICES (PFES) (For VNFF’s stakeholders)

Introduction

Thank you for your time to provide information of this survey This is one of the activities to collect data for the Master thesis of Public policy program of Vietnam Japan University, Vietnam National University

Thesis title: Strengthening the role of Vietnam Forest Protection and Development Fund (VNFF) in the implementation of the policy on payment for forest environmental services

Purpose of this survey is to collect information of the VNFF's role in implementing the PFES policy to be the basis of proposing recommendations for better policy enforcement

A Background

1 Please tell your gender: Male Female

2 Please tell me, which of the following subjects you belong to: State agencies

INGO, international partners Enterprises

Domestic individuals and organizations Others

3 Which fields have you worked with VNFF? State management Implement PFES project

Implementing PFES policy Conduct non-activities of PFES Others, please give details

82 From 01 to less than years From 03 to less than years More than years

B COORDINATION WITH VNFF

1 How you understand about PFES policy: No Basic information of PFES Not

understand

Basically understand

Fully understand Type of forests and type of forest

environmental services

2 PFES principles and type of payment

3 Subjects and type of services must pay for forest environmental services

4 Subjects to be paid for forest environmental services

5 Management and utilization of PFES money

6 Rights and obligations of FES users and providers

2 How you know about Vietnam Forest protection and development: No Basic information Not

understand

Basically understand

Fully understand Functions and tasks of VNFF

2 VNFF’s structural organization Relationship between VNFF and

83

No Basic information Not understand

Basically understand

Fully understand Financial source of VNFF

5 Activities of using VNFF’s finance Activities of managing and

implementing programs, projects and non-project activities conducted by VNFF

7 Activities of managing and implementing programs, projects and non-project activities supported by VNFF

3 Please give your satisfactory in working with VNFF:

Contents

Idea Strongly

disagree Disagree

No

idea Agree

Strongly agree 1 LEADERSHIP

Leader only care about his / her

requirements

Leaders always show clear leadership

values and principles

Leaders are people with visionary and

have strategic vision

Encouraging subordinators to work in

an innovative way

Always suggest solutions from various

aspects

84 Open-minded and transparent

environment

VNFF has clear target and

development plan

VNFF always shares relevant

information

You are always supported by VNFF

when encountering difficult problems Do you feel that VNFF lack of

proactiveness in coordination

3 BENEFITS FROM COOPERATION

VNFF provides trainings on necessary

skills to take care of your current job VNFF gives a lot of opportunities for

your career development

Through the coordination with VNFF, you have many opportunities to work with partners

1

VNFF creates effective finance and

technical assistance for forestry sector 4 Satisfaction

In general, you satisfied when working

with VNFF

You wish to cooperate with VNFF for

a long term

You consider VNFF as a strategic

partner

You are willing to introduce VNFF to

85 C THE ROLE OF VNFF

1 How does VNFF implement PFES policy

Content Good Average Poor Provides guidelines to implement

PFES policy

Update PFES database on the system

Provide communication on PFES policy

Sign entrusted contract on PFES International cooperation

Accounting and finance exercises Developing plan

Report, check and monitor

2 In your opinion, how does VNFF cooperate with other agencies related to PFES policy?

Stakeholders Good Average Poor Ministries and ministerial

agencies

Agencies under MARD Provincial FPDFs FES users

International and domestic NGOs VNFF Board of Directors

86 3 How you evaluate VNFF?

Contents Good Average Poor Direct contact (via phone and

directly working)

Indirect contact via document and email exchange

Professional capacity of VNFF’s staff

Coorperation with provincial FPDFs

Coorperation with FES users

4 In your opinion, What difficulties does VNFF have when advising the PFES policy development and implementation (please indicate)?

……… ……… 5 What you propose to strengthen the role of VNFF in the implementation of PFES policy:

……… ………

Do you have any comments on this survey?

………