Viet Nam: Forests for Livelihood Improvement in the Central Highlands (Sector Loan)

Sovereign Project | 34341-013 Status: Active

Summary

The Project objectives and activities include: (i) formulating technically sound and socially relevant SFM plans for over 3 million ha of natural forests and plantations on bare land. SFM plan preparation will include (a) delineating forest conservation and use zones, (b) rationalizing Government's and stakeholders' roles and responsibilities, and enabling effective participation of the local communities and the private sector in SFM, and (c) providing investments for improving the condition and productivity of household, community, and state managed forests; (ii) providing wage generating and livelihood improvement investments, especially for forest-dependent ethnic minorities; (iii) supporting stakeholder technical and operational capacity building for SFM; and (iv) providing project implementation support.

Latest Project Documents

Consulting Notices See also: CMS

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Procurement Documents


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Project Name Forests for Livelihood Improvement in the Central Highlands (Sector Loan)
Project Number 34341-013
Country Viet Nam
Project Status Active
Project Type / Modality of Assistance Grant
Loan
Technical Assistance
Source of Funding / Amount
Grant 0060-VIE: Forests for Livelihood Improvement in the Central Highlands
LRG - Forests for Livelihood Improvement US$ 8.00 million
Loan 2269-VIE: Forests for Livelihood Improvement in the Central Highlands (Sector Loan)
Concessional ordinary capital resources / Asian Development Fund US$ 45.00 million
TA 4859-VIE: Capacity Building for Forests Livelihood Improvement in the Central Highlands ( Formerly Central Highlands Livelihood and Natural Resource Management)
Technical Assistance Special Fund US$ 250,000.00
Trust Fund for Forests US$ 7.57 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Private sector development
Sector / Subsector

Agriculture, natural resources and rural development - Forestry

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The Project objectives and activities include: (i) formulating technically sound and socially relevant SFM plans for over 3 million ha of natural forests and plantations on bare land. SFM plan preparation will include (a) delineating forest conservation and use zones, (b) rationalizing Government's and stakeholders' roles and responsibilities, and enabling effective participation of the local communities and the private sector in SFM, and (c) providing investments for improving the condition and productivity of household, community, and state managed forests; (ii) providing wage generating and livelihood improvement investments, especially for forest-dependent ethnic minorities; (iii) supporting stakeholder technical and operational capacity building for SFM; and (iv) providing project implementation support.
Project Rationale and Linkage to Country/Regional Strategy

Viet Nam's development success especially in expanding food production, and moving from a rice deficit country to the world's second largest rice exporter is attributed to (i) the allocation of land to individual farmers and households, (ii) rationalizing and reducing the role of the state in the sector; (iii) strengthening technical and operational capacity of state and non-state stakeholders; and (iv) increased investments and access to markets. Viet Nam's forestry sector has the necessary policies, laws, and sector strategies in place for replicating the successful experience of agriculture sector. But weak institutional, technical, and human resource capacity is a barrier to transitioning to a pro-poor and market oriented governance and incentive regime. Consequently, even in the Central Highlands, which has the highest potential for forest-based economic development and poverty reduction in the country, the sector is in serious decline largely due to resource over-exploitation. A key factor for the poor performance is the uncertainty over forest "ownership", management, and use rights and roles.

Government's Forest Development Strategy (2001-2010) and sector plans call for making forestry an important economic sector by (i) protecting and developing forest resources and increasing forest cover from 32 to 43% by 2010; (ii) achieving an annual growth rate of over 3.5% during 2006-2010 period, (iii) accelerating and completing forest land allocation; (iv) using forestry to improve livelihoods and reduce poverty in mountainous and ethnic minority dominated areas; and (iv) increasing efficiency and value of country's wood processing industry. The Government's policy is to restrict the state's role to forest and biodiversity protection, and let the non-state sector dominate the production forestry sub-sector.

The Comprehensive Poverty Reduction and Growth Strategy (CPRGS) emphasizes the need to focus on the disadvantaged rural areas that have high proportions of ethnic minorities. It is in these areas where most of the remaining forest still occurs, and the CPRGS recognizes this. It calls for investment of $600-800 million or about 12% of the agriculture sector investment over five years.

The Central Highlands is Viet Nam's most important forestry region contributing more than 60% of the country's annual hardwood production. And ecological conditions and terrain is suitable for sustainable forestry with population densities still relatively low compared to country's other regions. Improving road network is increasing access to national and regional markets, and incremental wood production from the Project will reduce the raw material supply shortages faced by the local processing enterprises. Project interventions have the potential to secure over 90% of Viet Nam's 2010-2015 domestic timber needs. Accordingly, draft 2006-2010 Socio Economic Development Plan (SEDP) identifies Central Highland as a priority forestry region.

Central Highlands, home to over 5 million people, is the second poorest region in the country with poverty rates as high as 57% among the ethnic minorities. Over 2.5 million people are in work force, but only about 11% are in wage earning occupations. Therefore, unemployment is high. Because they have forestry relevant skills and knowledge, engaging these communities in forestry will lead to improved forests, forestry, and livelihoods.

The Project is linked to the following:

1. The Government's Forest Development Strategy (2001-2010) and sector plans which call for making forestry an important economic sector by (i) protecting and developing forest resources and increasing forest cover from 32% to 43% by 2010, (ii) achieving an annual growth rate of over 3.5% during 2006?2010, (iii) accelerating and completing forestland allocation under the Land Law and the revised Forest Protection and Development Law, (iv) using forestry to improve livelihoods and reduce poverty in mountainous areas dominated by ethnic minorities, and (iv) increasing the efficiency and value of the country?s wood-processing industry.

2. The comprehensive poverty reduction and growth strategy (CPRGS) emphasizes the need to focus on the disadvantaged rural areas with high proportions of ethnic minorities, such as the Central Highlands, where minorities dominate. These areas are where most of the remaining forest survives, and the CPRGS recognizes this.

3. The draft 2006-2010 socioeconomic development plan identifies the Central Highlands as a priority forestry region.

Impact Improved forest productivity and livelihoods and reduced poverty in the Central Highlands

Project Outcome

Description of Outcome State-owned and other forests sustainably-managed in the Central Highlands.
Progress Toward Outcome The policy for collection, management and use of funds recovered from the plantation activities is now being endorsed to MOF.
Implementation Progress
Description of Project Outputs

Six performance-enhancing, sustainable forest management plans covering over 3 million ha and timber stocks worth $4.4 billion

30,000 ha of high yielding plantations established, and 99,000 ha of natural forests protected, under non-state sector forestry, improving livelihoods of over 80,000 hh.

Forest planning and management decision-support systems, and capacity of project stakeholders and forestry education and training institutions enhanced at provincial, district and commune levels in 6 provinces and 60 communes.

Enhanced business models and capacity of six provincial forestry departments, at least 3 SFEs, 60 SMEs and 75 community groups

Status of Implementation Progress (Outputs, Activities, and Issues)

(i) 5 out of 6 province has approved project plans to protect and develop forests by 2020. The total forest area in 6 provinces by the end of 2015 is 3,030,675 ha

(ii) As of 30 Oct 2015: (a) total area planted for production forests by households is 13 869 ha (79%) of the designed goals; (b) total area planted for protective forest is 1,118 ha (16%) of the target design; and (c) average income per person in one month by revenue in the project area has increased almost 5.8 times from VND 0.522 million in 2006 to VND 3.041 million in 2015.

(iii) The project has supported 55 plantation enterprises in 6 provinces, including 30 forestry companies and 25 SMEs.

By December 10, 2016, the Project held 1,628 training courses for a total of 59,160 people attended, especially in the number of people attending 41,000 participants are ethnic minorities and 13,000 participants are women.

(iv) The project supported in preparing three business plan for forestry companies and 18 SMEs in six provinces. At the present time, success and failure in business enterprises supported by the project are not evaluated yet.

Geographical Location The project will be implemented in the Central Highlands provinces of Viet Nam, namely Dak Lak, dak Nong, Gia Lai, Kon Tum, Lam Dong and Phu Yen.

Safeguard Categories

Environment B
Involuntary Resettlement C
Indigenous Peoples A

Summary of Environmental and Social Aspects

Environmental Aspects The project will enhance environmental quality by protecting nationally and globally significant biodiversity and improving the performance of forest-based environmental services.
Involuntary Resettlement There is no resettlement impact.
Indigenous Peoples

Significant positive impacts are expected. The Project is devoted almost entirely to improving conditions for ethnic minorities. It will improve their legal access to productive forestland and provide opportunities for their participation in land use planning, demarcating boundaries, and allocating land. It will facilitate access to improved extension and technology support from government agencies. It will provide value-adding opportunities locally, so that ethnic minority households and communities may benefit from better incomes and process for their produce. It will help build critically needed social development skills such as numeracy, particularly among children and women. Adult learning programs will improve people's ability to assimilate information and participate effectively in public consultations and decision making.

A Livelihood Improvements and Ethnic Minorities Development Plan (LIEMDP) was developed provide an enabling environment which a suitable strategy and appropriate mechanisms to ensure sustainable livelihood improvement and access to benefits for the target communities. It was formulated such that most beneficiaries belong to indigenous and other minority groups.

Stakeholder Communication, Participation, and Consultation
During Project Design PPTA has produced an in-depth participatory assessment in the project provinces.
During Project Implementation Participation is carried out during establishment of the commune development fund, land demarcation, rehabilitation of small infrastructure.

Business Opportunities

Consulting Services The Project will require 167 person-months of international consulting services and 1,300 person-months of national consulting services and contracted staff. The international and national consultants will be recruited in a single package from a consulting firm, using ADB quality- and cost-based selection through a full technical proposal in accordance with ADB Guidelines on the Use of Consultants. Contracted staff will be recruited by MARD in consultation with ADB and in a manner consistent with ADB's policy on national staff recruitment. Expressions of Interest (EOI) will be accepted until 31 December 2006.
Procurement All supplies, equipment, and services financed from the ADB loan and technical assistance will be procured in accordance with ADB's Guidelines for Procurement. Vehicles, equipment, civil works, and materials will be procured by international competitive bidding where the cost is valued at more than $1,000,000 equivalent, or by international shopping where the cost is valued below $1,000, 000 equivalent. Where several local suppliers can offer satisfactory service facilities, then vehicles, equipment, civil works, and materials valued at less than $100,000 equivalent may be procured under local competitive bidding procedures acceptable to ADB, or through direct purchase. To commence the Project on time, ADB has approved, at Government's request, an advance action for procurement. The Government has been advised that approval of such advance action does not commit ADB to finance any part of the Project.

Responsible Staff

Responsible ADB Officer Ranawana, S.
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Environment, Natural Resources & Agriculture Division, SERD
Executing Agencies
Ministry of Agriculture and Rural Development
Dinh Duc Thuan
[email protected]
29 La Thanh, Ha Noi, Viet Nam

Timetable

Concept Clearance 30 Aug 2005
Fact Finding 01 Jun 2005 to 07 Jun 2005
MRM 09 Sep 2005
Approval 26 Oct 2006
Last Review Mission -
PDS Creation Date 11 Dec 2006
Last PDS Update 30 Mar 2017

Grant 0060-VIE

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Oct 2006 06 Jun 2007 06 Jun 2007 31 Oct 2014 - 06 Aug 2013
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 8.00 Cumulative Contract Awards
ADB 0.00 26 Oct 2006 0.00 5.49 69%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 8.00 26 Oct 2006 0.00 5.49 69%

Loan 2269-VIE

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Oct 2006 07 Dec 2006 08 Jun 2007 30 Jun 2015 30 Jun 2016 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 75.09 Cumulative Contract Awards
ADB 45.00 26 Oct 2006 0.00 44.33 97%
Counterpart 30.09 Cumulative Disbursements
Cofinancing 0.00 26 Oct 2006 0.00 44.10 97%

TA 4859-VIE

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Oct 2006 25 Oct 2007 25 Oct 2007 31 Oct 2014 30 Nov 2016 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
250,000.00 7,570,000.00 0.00 0.00 0.00 0.00 7,820,000.00 26 Oct 2006 5,184,216.93

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Title Document Type Document Date
Livelihoods Improvement and Ethnic Minorities Development Plan Indigenous Peoples Plans/Indigenous Peoples Development Plans Sep 2005

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


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