Presented by Mr. Duong Ngoc Phuoc (University of Agriculture and Forestry. Hue University), at "National workshop: 12 years of PFES impacts in Vietnam" on 24 November 2020

1. Impacts of Payment for Forest
Environmental Services (PFES)
policies in A Luoi district, Thua
Thien-Hue province
Duong Ngoc Phuoc MSc., University of Forestry and
Agriculture, Hue
Email: duongngocphuoc@huaf.edu.vn
Pham Thu Thuy – CIFOR; Email: t.pham@cgiar.org

2. Contents
• Context for PFES in Thua Thien-Hue
• Environmental impacts
• Economical impacts
• Social impacts
• Key take away mesages

3. PFES in Thua Thien Hue
• 311,051.09 ha of forest (2019), of which 68.21% is
natural forest; forest coverage: 57.34%.
• PFES started in 2011
• 13 mandate contracts (12 for hydropower production, 01
for clean water supply). Total revenue: VND 205.5 billion
(2012 – 2019)
• Average unit price: VND 407,000 VND/ha/year (2019)
• 589 owners (9 state entities, 4 Commune PCs, 576
communities/HH groups/HHs) receives payment for ESs
from 152,625 ha of forests. Total cost: VND 177.1 billion
(2014 – 2019)

4. Environmental Impacts

5. Improve the participation
• Before PFES: there were 300 rangers in Hue (200 field rangers
and 100 office-based ones, however, not still enough human
resources)
• After PFES: more than 140-150 rangers added
• On average, each PFES received family devote 6.83 months an
years for forest protection work
• In PFES villages, percentage of HHs involve in forest protection is
70 times higher than ones without PFES.
• Patrolling stations
77.7%
1.6%
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%
Percentage of HHs participated in forest protection
Villages without PFES
Villages with PFES

6. The number of illegal forest
clearing cases tends to decrease
Year Number of cases Area (ha)
2006-2010 137 84.59
2011 171 47.78
2012 143 28.5
2013 90 16.22
2014 37 7.13
2015 45 10.04
2016 30 13.75
2017 56 9.79
2018 30 12.01
2019 53 10.35
Source: TT-Hue FPD

7. … however, forested area is still
decreasing after PFES started
294,651.05 294,665.98 294,947.10 296,075.84 297,802.40 298,577.80
283,003
288,087.54 288,196.89 288,194.74
99,527.93 99,313.78 99,323.96 99,402.03 99,782.72 100,189.89
90,796.30 95,491.62 95,362.84 91,934.43
0.00
50,000.00
100,000.00
150,000.00
200,000.00
250,000.00
300,000.00
350,000.00
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Forest Area (TT-Hue) Forest Area (A Luo district)
Source: TT-Hue FPD

8. changes in forest conversion into
other landuses
TT Type of infrastructures No. of
const.
Area (ha)
1 Reservoirs 6 1,050.66
2 Roads (transportation, special-use roads,
electricity mantainance roads, rescue roads etc.)
20 222,162
3 Housing, offices, dometries 11 132,225
4 Rural development projects 3 39,284
5 Mining projects 1 26,410
6 Cemetery construction project 3 68,841
7 Solar power project 7 2,033
8 Religious (Buddhism) facilities 2 5,356
Total 51 1,546.971
Infrastructure development

9. Environmental impacts
• 77% interviewed HHs believed that the forest condition is
improved while only 1% said that it is degraded
• Since PFES was introduced, PFES villages have higher percentage
of HHs involved in forest clearance activities (0.83% vs 4.12%)
• The biggest difficulty: when communities detect violators, they
inform FPD, however, the treatment is not appropriate
• People in the PFES beneficiary communities have good
awareness, but as for the others, they are still encroaching forest
lands, illegally logging for housing and other commercial purposes
• Lack of safety equipment
• High risks of accidents when patrolling in bad weather conditions
(rain, storm). Some were also attacked by wild animals (snakes,
etc.)
• When people are mobilized for duties, some of them obeyed and
some were not virtuous and continued to encroach on the forest
areas

10. Economic impacts

11. Added financial resources for forest
protection work
PFES funding
released (2019)
48,762,073,000
Provincial budget
for sustainable
forest
development
programme
(2019)
13,100,000,000*
4 times
22%
Provincial
budget for
none-business
environmental
work (2019)
224,273,000,000*
(*): 2019 estimation
Source: TTH Dept. of Finance & TTH Fund for Forest Development and Protection

12. PFES’ contribution in HH income
The payments are different between villages due to the forest areas and
number of HHs involved, average: VND 1.64 million/HH, ranked 5th, 2.67%
total HH income
1.05
2.64
1.52
1.33
0.00
0.50
1.00
1.50
2.00
2.50
3.00
A Hươr Pa E Đụt - Lê Triêng 2 A Đeeng Parlieng
1
A Đeeng Parlieng
2
PFES to HHs (VND million)
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
Income sources of PFES recepients – VND million
Animalraising
Labours
Remuneration
Assetleasing,
lending
Giftsfrom
lelatives
Othergifts
OtherState
programmes

13. Economical impacts
Strengths
• PFES is more stable and longer
term than normal projects.
• 50% interviewees confirmed the
improved livelihoods since PFES
• 30% interviewees confirmed
increased income since PFES vs.
7% said that their income was
decrease
• Most of donor projects require
counterpart funds, PFES therefore
can be used for this purpose
Challenges
• Cutting trees for housing was forbidden
• No forest clearance for cultivation leading to
lack of production land
• Income of some HHs (who used to cut timber
for income) was reduced
• HH Payment norm is rather low due to PFES
payment has to cover other expenditures such
as clothing, community programs,
management fees etc.
• People have to go far to collect the payment
• Area of community forests is small, so,
payment level is low
• Conflict between communes and FPDs: FPD
can be benefited from PFES but CPC.
• PFES is often said to be a voluntary program,
however, CPCs as all HHs have to participate.
Hence, the number of payees is high, so
monetary values received is small

14. Other contingencies
No Item
% of planned
payment
% of actual
payment
1 Daily allowance for patrolling 60-70 60-70
2
Procurement of closing and supporting
equipment
8-10 5
3 Annual meetings 8-10 5
4 Payment for management boards 5-10 5
5 Stationary 1-2 1
6
Community activities (festivals,
infrastructures)
10
7 Allowance for local staffs 4-10
8 Others 3-4 Rest
Source: indepth interviews, group discussion, 2020

15. Incurred Costs
Total revenue deducted for the commune: in a year with
deduction for forest rangers is 5%, some years is 20% due to
many opposition
This rate is determined based on an agreement between
commune officials, forest rangers and local people
Many villagers do not want the deduction, but the commune
does it nonetheless with a 10% deduction before distributing
to the people
Just finished receiving money, the commune would call to
request villagers for other payments
Even though the village already has its own plan to pay for
PFES, the commune has no knowledge of this. Hence, the
commune still calls on the village head follow its plan. The
village head refuses to follow

16. Social Impact

17. Steps to escape poverty
Step Strategies
10 Open banks’ saving accounts and invest in children’s education
9 Buy more lands for production
From moderate to well-off
8 Buy plows, tractors, water pumps
7 Continue to buy more breeds of chickens, pigs, and cows
6 Build or repair a house, buy household appliances
Escaped poverty
5 Buy buffalo breeds, cows, fertilizers, animal feed
4 Repair or renew pig cages
3 Buy pig and goat breedings
2 Buy food, chicken and duck breedings
1 Lack of productive land, no labor force, no capital, temporary housing
situations
Source: Focus group discussions (2020)

18. The use of PFES income for welfare
purposes
Source: Household interviews (2020)
BƯỚC 2
BƯỚC 3
BƯỚC 10
PAPOLD
BƯỚC 5
BƯỚC 6
80%
2%
4%
17%
9%
11%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Mua lương thực, mua cây giống
Mua con giống heo, dê
Mua phân bón
Mua các vật dụng trong gia đình
Gửi tiết kiệm, đầu tư cho con cái…
Trả nợ
Chữa bệnh
How PFES’s income is spent

19. Social Impact
Achievements
• 79% have better understanding and
access to information
• 21% of households mentioned they used
PFES money to contribute for the village
to repair electricity, buy furniture,
renovate cultural houses, build a village
welcome gate, contribute to the wedding
or funeral fund and hold a year-end
meeting
• The biggest impact of PFES is public
participation.
• Before PFES: people confronted forest
rangers with deep conflict
• After PFES: The relationship between
forest rangers and villagers has been
improved
• Build trust with villagers about the forest
policy. In the past, forest was allocated
without actual payments (only promised)
Difficulties:
• Conflict between those who are paid
and those who are not + between
patrols and illegal loggers
• The annual increase or decrease in
payments was prescribed and guided,
but some members did not
understand so they blamed the
community for bad management,
leading to the management board
being blamed.
• Information is only accessible to
village leaders. Hence, people have
very little access to information
• The Kinh do not have to pay for
bookkeeping while ethnic minorities
face many difficulties with this

20. Gender Impact
• Hong Ha Commune: 30% of the proceeds from
PFES will be kept as a fund, the rest is calculated
according to patrolling workdays. Women are very
happy to join because they can stay in the
watchtowers, men can patrol directly. Annually, the
team leader would receive 600,000 VND

21. Conclusion
• Together with other forest protection and development policies, PFES
has helped raise people’s awareness of the role of forests, create a
driving force for maintaining community-based forest protection
activities, and supplement funding for protection. Therefore, the
efficiency of forest protection is improved.
• The money received from PFES helps people with additional income to
cover the essential needs of life, help them escape poverty. Villages
also have more funds for communal activities and connect spirit
solidarity in the community
• However, households wish for a higher level of payment to reward
their efforts more deservedly in forest protection activities. There is
also a need to further promote communication, raise awareness and
provide thorough training for local people.
• The policy implementation, monitoring and evaluation process should
involve adequate participation of the people to ensure the
transparency and effectiveness of the policy.

22. Recommendation
• Organize training classes for bookkeeping as well as building
an effective payment plans
• Build a focus team with people in charge bookeeping
instead of many communities working together
• Create a hotline for better communication with the fund in
times of difficulties. Simplify administrative procedures.
• Request the national fund and the Ministry of Finance to
issue one archive system. It is also necessary to have
consensus among different provincial funds in the country,
for simplified audit purposes
• Improve the efficiency of communication, information
dissemination and law so that people can understand their
community's rights and obligations when participating in
the policy implementation.

23. Thank you!