Forest rules to take root

Vietnam’s rich landscape offers great forest growing potential

The Ministry of Agriculture and Rural Development (MARD), the Vietnamese-German Forestry Programme and Forest Sector Support Partnership are jointly devising Vietnam’s new forestry development policy for 2011-2015 period.

MARD deputy minister Hua Duc Nhi said the new policy would include more incentives for luring foreign forest planters, especially advantageous regulations for joint ventures to operate.

The regulations would more strictly govern contractual ties between foreign investors and local forest planters and allow local authorities’ to solve disputes.

The government said the MARD was in charge of combining with localities to instruct farmers in clinching forest plantation contracts with foreign investors.

At present, the Decision No80/2002/QD-TTg dated June 24, 2002 on policies to encourage the contractual sale of commodity farm produce and the government’s Instruction No25 dated August 25, 2008 on boosting contractual sales of farm produce are the only legal documents for foreign enterprises to cooperate with local forest planters.

However, the MARD said that cooperation or joint ventures between foreigners and local forest households remained unstable. Many farmers’ households do not abide by contracts inked with foreign enterprises.

“For example, Vietnam-Japan Paper Material Joint Venture (Vijachip Danang) succeeded in cooperating with farmers between 1993-2000, with 30,000 hectares of forests planted. However, the figure has over the past years reduced due to many farmers refusing to cooperate with the company,” said a MARD report on Vietnam’s forestry development.

The MARD reported that almost joint ventures in forest plantation in Vietnam were small-scaled. Some big ones included Vijachip Danang, a Lang Son province-based 200ha joint venture between locally-owned Loc Binh Forestry Company and Chinese Yang Shan Pai farm. Besides, Chinese Hui Sheng company cooperates with local forest planters to grow over 15,700ha in service of its wood processing factories.

Between 1995, when the first foreign forest plantation project was licenced, and August 10, 2010, Vietnam was home to eight licenced projects of this kind, with total registered investment capital of $286.09 million, of which $22.729 million had been disbursed. These projects are wholly-foreign invested.

The total forest land areas prescribed in the eight projects’ investment licences are 288,974ha, of which 18,571ha have been given to investors and 13,871ha have been planted with trees.

The eight projects, all of which have lifespan of 50 years, include Japanese-backed Vietnam Quy Nhon Forest Plantation Company’s 9,777ha project licenced in 1995 with land having been leased in central Binh Dinh province, South Korean-backed Vinaphygen Company Ltd’s 671ha project licenced in 2006 with land having been leased in southern Binh Phuoc province, US-backed Green Tree Company’s 50ha project licenced in 2007 with forest having been planted.

Meanwhile, Taiwanese-backed InnovGreen group’s five forestation projects in Lang Son, Quang Ninh, Nghe An, Quang Nam and Kon Tum provinces, with total areas of 274,848ha prescribed in the investment licences, which were granted in 2006, 2007 and 2008, have been underway.