The forestry industry is focusing on restructuring towards multi-use value development, which encourages the development of effective investment projects, focusing on improving the productivity, output, and value of planted forests, especially through planting large timber forests and enhancing the welfare value of forests for people, as well as preserving biodiversity and implementing international commitments in a responsible manner.
On May 24, 2024, the Government issued Decree No. 58/2024/ND-CP on a number of investment policies in forestry. The decree adjusted some investment levels and support for various activities related to forest protection and development compared to the current investment policy.
This is an important source of support and investment through the state budget and other legal capital sources to help organisations and businesses, including foreign invested enterprises, households and communities, in properly implementing forest protection and development activities, processing forest products for export with high efficiency, and contributing to the sustainable economic development of the forestry industry.
The Ministry of Agriculture and Rural Development highly appreciates the participation and interest of the international community and agencies in sharing responsibilities and proposing recommendations to enhance the implementation of circular agriculture.
To strengthen cooperation with countries and international organisations, the Ministry of Agriculture and Rural Development has made many cooperation agreements and signed contracts with partners.
Vietnam and the Republic of Korea (RoK) have held many activities to strengthen bilateral cooperation on forestry.
The forestry industry and the Korea Forest Service (KFS) have signed a cooperation agreement in the field of forestry. To date, Vietnam and RoK have actively and effectively implemented cooperative activities within the ASEAN Plus Three cooperation framework and the Asian Forest Cooperation Organisation (AFoCO).
The RoK has supported Vietnam in the areas of forest restoration and development, as well as combating land degradation through technical assistance projects. Additionally, there is ongoing support for training and coaching Vietnamese forestry experts and staff.
Through KFS, the Korean government is sponsoring the "Rehabilitation and Sustainable Management of Mangrove Forests in the Red River Delta" project in the provinces of Nam Dinh and Ninh Binh.
This significant project has a total investment of nearly 4.4 million USD, with the RoK providing approximately 3.8 million USD in non-refundable aid capital, and the remaining amount being contributed by Vietnam as counterpart capital.
The joint efforts in this venture underscore the shared commitment of both governments, reflecting Korea's social responsibility amid the increasingly complex challenges posed by global climate change.
The German government, through the German Federal Ministry for Economic Cooperation and Development (BMZ), has committed to supporting the implementation of the "Governance and Management of Protected Areas in Vietnam" project.
The project is being jointly implemented by the German Agency for International Cooperation (GIZ) and the Forestry Department under Vietnam’s Ministry of Agriculture and Rural Development. The German government has also committed to providing an additional budget for the "Upscaling Sustainable Forest Management and Certification in Vietnam (SFM)" project. The two sides have agreed to supplement the budget for this project to provide the necessary resources to extend the current period.
To manage forests sustainably, Japan has cooperated and supported Vietnam a lot in the field of forestry in recent times.
Through non-refundable technical assistance ODA programs and projects and preferential loan projects, Japan has supported Vietnam in strengthening forest management, improving livelihoods for forest-based communities, preserving biodiversity, and combatting climate change in forestry.
Most of the programmes and projects that have been and are being implemented in Vietnam are considered effective, contributing to the success of the forestry industry in recent years.
In the field of wood and wood product trade, Japan has been among the five countries in the world with the largest export turnovers for Vietnam, with about 1.5 to 2 billion USD annually.
The export wood processing industry is becoming a reliable "address" attracting projects with large capital and modern technology and techniques.
According to the Vietnam Timber & Forest Products Association (VIFORES), there are currently hundreds of foreign investment projects in the field of wood processing. Many FDI enterprises are operating very effectively, contributing to generating large revenues from the export of wood and wood products.
In 2023 alone, the wood industry attracted 57 new FDI projects with total investment capital of about 300 million USD. Of which, projects with equity from China account for 49.1% of the number of projects and 35.5% of investment capital.
Localities receiving the largest number of new projects include Binh Duong (18 projects), Binh Phuoc (15 projects), and Long An and Bac Giang (both receiving three projects).
Minister of Agriculture and Rural Development Le Minh Hoan said that Vietnam has more than 14.7 million hectares of forest with a coverage of more than 42%, playing a very important role in sustainable development and ensuring environmental security.
Strengthening and expanding cooperation with countries, territories, and international organisations are creating favourable conditions for the forestry sector to effectively manage, protect, and develop forests, thus promoting the development of forestry economics, especially long-term strategic projects that bring high economic value, encourage forest growers to improve forest quality, protect forests effectively, and protect the environment sustainably.
The agreement signed between the Ministry of Agriculture and Rural Development and the World Bank (WB) to reduce emissions in the in the northern part of the central region in the 2018-2024 period is considered as an important milestone in the strategy of developing multi-use value from forests.
For the first time in the forestry sector, Vietnam successfully sold 10.3 million tonnes of carbon emissions through the WB at a unit price of 5 USD per tonne, earning 51.5 million USD.
According to Deputy Minister of Agriculture and Rural Development Nguyen Quoc Tri, in 2024,
The forestry sector must focus on completing the National Forestry Planning and documents to guide localities to meet the Land Law (amended). It is necessary to support businesses, cooperatives, agricultural and forestry companies, and forestry production households to strongly shift from forestry production thinking to forestry economics.
According to the Forestry Department’s calculations regarding the potential of the carbon credit market, with the current forest area, Vietnam can sell about 40 million carbon credits. This is a large source of income, equivalent to the industry's annual public investment.
The transfer and trade of forest carbon credits will mobilise important and additional financial resources to reinvest in forests, create jobs, increase income, improve people's livelihoods, and contribute to protecting biodiversity and the sustainable environment.
Encouraging investment in the forestry sector has contributed to shifting the structure of forestry production towards increasing the added value of the production chain.
The export value of wood and forest products have reached an average of 15.8 billion USD per year, with a high trade surplus ratio. Revenue from forest environmental services have reached more than 3,650 billion VND per year, contributing to reducing pressure on state budget expenditures, making payments to protect about 7.3 million hectares of forest, becoming an important and sustainable financial source for the forestry industry.
(Source: Department of Forestry - Ministry of Agriculture and Rural Development)
