A win-win situation for greenhouse gas emission cuts

November 12, 2021 | 19:00
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Enterprises operating in Vietnam still have opportunities to pay for carbon value or ecology services voluntarily via partnerships with forest owners. These initiatives will provide win-win prospects for domestic enterprises and smallholder forest owners in the effort to cut greenhouse gas (GHG) emissions.
By Nguyen Dinh Dai - Chief of Office MCNV Office in Central Vietnam
By Nguyen Dinh Dai - Chief of Office MCNV Office in Central Vietnam

Towards implementing the Paris Agreement, the Ministry of Natural Resources and Environment has drafted and proposed a decree on GHG emission reductions and other climate change adaptation measures.

At COP26 last week, Prime Minister Pham Minh Chinh said that Vietnam is committed to supporting global initiatives to respond to climate change, and this political willingness will strongly affect the implementation of cutting GHGs in Vietnam in the coming years.

Parallel with this roadmap, enterprises operating in Vietnam can also help in deforestation and lessening degradation. This alternative can be approached by either purchasing carbon credit from commercial markets, or voluntarily purchasing from a certified natural forest of smallholder forest owners.

A recent potential success story in this area has been taking place in the central province of Quang Tri. It has the first model from the Forest Stewardship Council (FSC) certified for the natural forest of smallholders. Together with support from development agencies, these communities plan to achieve FSC certification for carbon sequestration by October 2022.

However, in reality, just a small number of households receive payment for environmental services. As of December 2020, Quang Tri allocated 20,000 hectares of national forest for 108 groups and approximately 1,000 households to manage.

However, only 6,700ha is receiving payments for ecosystem services. The costs are payments to farmers or landowners who have agreed to take certain actions to manage their land or watersheds to provide an ecological service.

In another example, households in Huong Phung commune of the central province of Quang Tri were allocated to manage nearly 1,000ha forest since 2017. However, to date, they have received little benefit from the work.

In the context of Vietnam’s commitment to GHG cuts at COP26, the demand for developing a service ecosystem from forests, including CO2 absorption capacity, is very important and related parties should be paid adequately.

In Vietnam, numerous manufacturers coordinate with households to plant forests with the direction to attain an FSC certificate, which will create a win-win benefit for the parties involved. Such manufacturers include Scansia Pacific, the partners of the world’s leading furniture retailer IKEA; Nam Dinh Forest Productions JSC; and the leading wooden furniture manufacturer in Vietnam, Woodsland JSC.

Linking with households to develop legal plantations in accordance with FSC standards is a sustainable model for enterprises. For example, in the wood processing industry, Vietnamese enterprises mainly import wood materials from abroad, but the current trend of customers in developed countries is to buy wooden furniture with legal origins.

Thus, manufacturers are proactive in creating a legal source of raw materials in the country, especially for furniture exporters. This model creates an advantage in product prices and has a sustainable source of raw materials, cutting out the middle stages and contributing to protecting the living environment.

It should be encouraged to extend the linkage model to enterprises in other sectors such as construction and retail. In order to do that and while waiting for the legal framework on selling/purchasing carbon credits in Vietnam, local authorities, as well as domestic and international organisations, need to have a strategy and be ready to promote cooperation mechanisms between businesses that need to reduce emissions and communities that are managing huge forest resources.

In this, the determination of local leaders is a crucial factor in solving this bottleneck.

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