A major driver of forest degradation in Vietnam is communities unsustainably using forest resources as a form of income, causing deforestation and forest degradation which affects watersheds that hydropower companies rely on to generate energy. Vietnam’s nation-wide Payment for Forest Environmental Services system, designed, launched, and implemented since 2008 with USAID support, has generated more than $1 billion in payments to communities to protect their watershed areas from companies that benefit from the environmental services they provide. However, for communities in Son La province, which are getting paid the least due to the smaller size of their watershed, more is needed to incentivize conservation efforts. In partnership with the province’s leaders, communities, and 50 hydropower companies, USAID is helping to pilot a supplementary payment system that will be implemented from 2023 to 2025 and is expected to generate approximately $3 million.
Providing Son La communities with alternatives to degrading forests for income will improve the management of 7,000 hectares of forest and restore 670 hectares of forest to provide ecosystem services including carbon sequestration and a secure water supply for downstream forest service users.