B1.3.1. Management of REDD+ funding

B1.3.1. Management of REDD+ funding

B1.3.1. Management of REDD+ Funding

As described under SIS B1.2.1, Viet Nam has created dedicated institutions with competence for promoting transparency of the forest sector activities, which include supervision and monitoring of funds. Forest budgets are to be scrutinised by a parliamentary and governmental process, and information about the forest agency budgets should be made publicly available. Public scrutiny of draft socio-economic development plans, budgets and land-use planning decisions are also addressed in the Law on Anti-Corruption (2018).[1] Where State Agencies have the authority to consider and approve projects and state budgets, explanations/justifications must be provided, and budgets must be audited.[2]

The National REDD+ Action Program (NRAP, 2017)[3] states that the transparency of financial resources and organisations for the implementation of REDD+ must be assured, to enable the participation of relevant stakeholders, including government bodies, socio-political organisations, non-governmental organisations and international parties. The NRAP outlines the following expected funding during 2017-2020:

a) Domestic resources:

  • State budget allocated for relevant Target Programmes on: sustainable forest development; responding to climate change and green growth; education, vocational training and occupational safety; agricultural economic restructuring; natural disasters prevention and mitigation; residential life stability; and other national programmes and projects in the period 2016-2020.
  • Investments by enterprises and other economic actors through various market mechanisms; proceeds from offset forest plantation policies and contributions other related programmes, projects and individuals.
  • Loans and credits (including commercial loans and investment for development)

b) International resource contributions: Development assistance and trust funds of other countries, international organisations, non-governmental organisations, businesses and individuals and other financial institutions; revenues received from REDD+ performance, including revenues from forest carbon credit trading schemes.

c) Other legal sources: The Ministry of Agriculture and Environment and the Ministry of Finance were called upon to establish a Viet Nam National REDD+ Fund, and the Ministry of Planning and Investment charged with coordinating with the Ministry of Finance to allocate counterpart funds for projects implementing the NRAP.

Viet Nam established the VNFF in 2008.[4] In practice, the VNFF had receives revenue from REDD+ on the basis of emission reductions transfer agreements signed between Viet Nam and international partners (e.g FCPF ERP) and coordinates funds with the Provincial VNFFs (after deduction fund management costs and program operating costs) based on the emission reductions results of each province. The Provincial VNFFs (after deducting their fund management costs) will pay beneficiaries (see SIS B2.3 on benefit sharing for more information). VNFF also implements the Payments for Forest Environmental Services (PFES) program, which earned more than VND 31,089 billion (about USD 1.24 billion) during the period 2011-2024.[5]

 

[1] The Law on Land (2024), Aticles 60.

[2] The Law on State Budget (2015), Articles 15 & 23. https://vanban.chinhphu.vn/?pageid=27160&docid=180627&classid=1&typegroupid=3

[3] NRAP (2017), Decision No 419/QD-TTg dated 5/4/2017

[4] Decision No. 114/2008/QD-BNN of MARD on the establishment of the VNFF

[5] Consolidated data from MARD and MAE announcements/statistics