09.07.2018

New business models for acacia plantations in Viet Nam

Managers of forest enterprises at field training for implementing the models; photo: © UNIQUE forestry and land use GmbH

Managers of forest enterprises at field training for implementing the models; photo: © UNIQUE forestry and land use GmbH

On 31 May 2018, the final conference of the IKI project 'Business models to address drivers of deforestation' was held at the Hué University in Viet Nam. Since May 2014, the project has been working on developing and implementing pilot projects for scalable business models for the land-use sector in Viet Nam and Colombia. In particular, the models should have significant mitigation potential in the context of implementing REDD+ and offer land users sustainable and profitable alternatives for land use. The project, which runs until late 2018, is being jointly implemented by UNIQUE forestry and land use GmbH and the Institute of Resources and Environment (IREN).

In Viet Nam, UNIQUE and IREN have developed and promoted business models for short-rotation acacia plantations in the context of the project – namely, improved management and the gradual reintroduction of high-value native tree species. The reference model in the form of short-rotation acacia plantations that are harvested by means of clear felling after 3–5 years is a common type of land use. For a long time, it was a working business model with considerable potential for economic and ecological development. As the economy grows very rapidly, so do the labour costs, thus continuously reducing the profitability of this work-intensive land use.

In view of this and its international climate protection obligations, the Viet Nam Government is trying to restructure its forestry sector. The business models developed are in line with Viet Nam’s priorities for the sector, as expressed, for example, in the Forest Sector Development Strategy (2006–2020), the Nationally Determined Contribution (NDC), the National REDD+ Action Plan (NRAP), and Sustainable Forest Management and Forest Certification strategies. Scaled up successfully, the models can contribute significantly to achieving these and other targets, like the SDGs. Thus, the models are explicitly included in the REDD+ pilot programme that is currently being developed for Viet Nam's North Central Coast and, on successful implementation, is intended to generate results-based payments from the FCPF Carbon Fund.

Left: Discussion of the models with interested forest owners in a typical short-rotation acacia plantation; photo: © UNIQUE forestry and land use GmbH

During the project, the project team has not only developed the models, but also assessed their technical and financial feasibility and identified the challenges for successful implementation and upscaling. Since 2016, UNIQUE and IREN have piloted the models with state forest owners from various provinces. In a series of targeted training events and workshops, the technical capacities of state forest enterprises and representatives of local authorities were developed. Studies were also carried out on how to address specific challenges for implementation; for example, how forest owners who are keen to be involved in implementation can bridge liquidity gaps during transfer, choose suitable areas and mitigate the risks of wind damage.

The final conference 'Business models for short-rotation acacia plantations in the context of REDD+' was co-chaired by the director of the Ministry of Agriculture and Rural Development (DARD) of Thua Thien Hué province. Over 80 participants, including representatives from around 10 provinces, forest owners, provincial authorities, international organisations and academia, accepted the invitation to Hué and discussed models in the context of current programmes and activities. Presentations and project publications are available here online.

Paul Jacovelli (UNIQUE) discusses with managers the growth dynamics of native tree species in a demonstration plot in Thua Thien Hué province; photo: © UNIQUE forestry and land use GmbH

In the remaining project term until the end of 2018, the team will establish two further demonstration sites for the two models on a total area of 23 hectares in the forest enterprise Bac Hai Van PFMB in Thua Thien Hué province. UNIQUE and IREN will provide support at these sites beyond the lifetime of the project to further promote the implementation of models by interested forest owners – for example in the context of the FCPF Carbon Fund Programme in the North Central Coast of Viet Nam, which is expected to start in 2019. The sites will be used for training, research and demonstration purposes. Together with a research partner, UNIQUE is also developing a replicable wind risk study that shows forest owners where they should implement the models and where they must apply silvicultural measures to try to reduce storm risks.