Vietnam has entered the world’s carbon credit trading market after a long period striving for sustainable forest management. This is a major event, marking a positive start in mobilising new resources for forest protection and improving forest quality and sustainable forest management, thereby helping Vietnam realise its climate targets.
The Forest Carbon Partnership Facility pledged to purchase 10.3 million tonnes of carbon dioxide emissions from six northern central provinces of Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, and Thua Thien Hue, at US$ 51.5 million in total, via the Emission Reductions Payment Agreement (ERPA) in the 2018-2024 period, which was recently signed between the World Bank (WB) and the Ministry of Agriculture and Rural Development.
The Forest Carbon Partnership Facility (FCPF) is a global partnership of governments, businesses, civil society, and Indigenous Peoples' organisations focused on reducing emissions from deforestation and forest degradation, forest carbon stock conservation, the sustainable management of forests, and the enhancement of forest carbon stocks in developing countries, activities commonly referred to as REDD+.
Since its launched in 2008, the FCPF has worked with 47 developing countries across Africa, Asia, and Latin America and the Caribbean, along with 17 donors that have made contributions and commitments totalling US$1.3 billion.
Vietnam’s Emission Reductions Programme is designed to address the underlying causes of forest loss in the country’s north central region and by so doing reducing emissions from deforestation and forest degradation. The program will also support forest restoration.
The north central region was chosen for its critical biodiversity importance and socio-economic status. The program area covers 5.1 million hectares of land (16% of the land area of the country), of which 3.1 million hectares are currently forested, and include five internationally recognised conservation corridors.
According to Ha Cong Tuan, Deputy Minister of Agriculture and Rural Development, Vietnam’s programme follows a preparation phase for the country’s readiness to engage in an emission reduction payment agreement of this kind and is a step towards full implementation of forest carbon services in Vietnam.
This agreement also highlighted the collaboration between Vietnam, FCPF and the World Bank to meet international climate targets laid out in the Paris Agreement, he said, adding that the programme will mobilise important additional financing to invest in Vietnam’s forests and reduce forest degradation while generating income for forest owners and improving sustainable development in the north central region.
Vietnam is the first country in the Asia-Pacific region and fifth globally to reach such a milestone agreement with the FCPF. ERPAs are innovative instruments that incentivise sustainable land management at scale and help to connect countries with other sources of climate financing. The resources from the FCPF provide new opportunities to conserve and regenerate forest landscapes and biodiversity while simultaneously supporting sustainable economic growth, which is critical for Vietnam’s development going forward.
“Vietnam has shown tremendous leadership in developing robust programs to deliver forest emission reductions on a large scale,” said Carolyn Turk, World Bank Country Director for Vietnam.
The agreement is an important event of Vietnam’s forestry sector. The ERPA will bring practical benefits while opening opportunities to realise the implementation of payment for forest environmental services in Vietnam. The ERPA contributes to generating income for forest owners, people and businesses through selling carbon credits, increasing forest productivity, and improving sustainable livelihoods. It will also help to raise awareness of authorities, management agencies, forest owners, communities, households, and the private sector of forest carbon services as well as benefits and economic and environmental values of forests.
The agreement will help to increase the existing forest area and improve the forest coverage in the north central region; support forest restoration, and mitigate impacts of climate change. The ERPA also illustrates Vietnam’s vision and responsibility in working together with the international community in a joint effort to adapt to climate change and protect forest resources for the peace and prosperity of the world.