Valuation Methods Used for Forest Environmental Goods and Services

1.2. Research projects in Vietnam

In Vietnam as well as in the world, there are not many research works on forest environment leasing and forest environment leasing policies, however, there are some related works as follows:

1.2.1. Research works on forest management system in Vietnam

Vietnam has an area of ​​forests and forestry land accounting for about 54% of the total national area, of which the forest area is mainly assigned to the Forest Management Board (32.6%), households (24.8%), People's Committees at all levels (18.3%) and State-owned enterprises (15.4%). This data shows that Vietnam's forests are mainly managed by the State, with special-use forests being completely managed by the State through the Forest Management Boards. The assessment results of some localities show that the efficiency after forest allocation only reaches 20-30%, many State-owned enterprises manage large areas of forests but are not capable of doing business and have not been created conditions for effective production and business. A very large part of the forest land area is assigned to local management, but in reality the land is still in a state of ownerlessness or is not well protected and managed; Many areas allocated to households and individuals have not yet promoted economic efficiency, and people have not yet been able to make a living from forestry [21]. The evaluation results in many reports show that the forest allocation policy still has many loopholes, and the effectiveness of policy implementation is not high. However, each type of forest will implement different forest and forest land allocation policies. For production forests, the State

assigned to more entities such as economic organizations, households, individuals, armed forces, scientific research organizations, Vietnamese people residing abroad, foreigners investing in Vietnam; in addition, it also leases forests and contracts forests to develop production forests and these forest owners themselves are recognized by the State for their ownership and right to use production forests. As for protective and special-use forests, the State assigns them to Forest Management Boards for protection and development with investment funds provided by the State. In reality, despite being allocated a relatively high budget (especially for national parks managed by the Central Government), special-use forests are facing major financial problems, leading to serious shortcomings in management. These shortcomings are further aggravated by institutional problems and limited inter-sectoral coordination. The participation of local communities is mainly through the form of protection contracts - a mechanism to compensate (to a certain extent) for the loss of access to forests, not a mechanism to encourage forest management. In special-use forests, there are currently no appropriate policies to ensure both conservation functions and economic benefits and reduce the financial burden on the State.

1.2.2. Research works on determining the value of forests in Vietnam

Forest valuation is an important content in forest management and use and is the basis for determining forest rental prices in Vietnam. A typical author in this field is Dr. Nguyen Nghia Bien with the research work "Method of valuation of natural forests in Vietnam" [4]. In this work, the author has determined the value components of forests and the method of valuation of natural forests with the results summarized (Table 1.3).

However, it is extremely difficult to fully account for the above values, or if it can be accounted for to determine the rental price, the price will certainly be very high, not feasible, and this study mainly stops at the aspect of orientation and suggestions on the method of implementing the valuation of natural forests in Vietnam.

Table 1.3. Methods of valuation of natural forests

Source: [4] Not stopping at theoretical issues, Vu Tan Phuong and his research team (2009) with the work: "Research on forest valuation in Vietnam", under the Ministry-level topic, have made great progress in research on this issue. This is a fairly comprehensive and large-scale study in both theory and practice on forest valuation in our country up to now. The topic has focused on researching 4 main contents: (1) Scientific basis on principles and methods for determining forest prices; (2) Valuation of some types of forests in the North, Central and South, (3) Building principles, methods and frameworks for forest prices at research locations and subjects, (4) Testing and perfecting principles and

method of determining the value of forest types [33].

The study was conducted on the following forest types: (1) Special-use forests: Na Hau Conservation Area (Yen Bai), Bach Ma National Park (Hue), Kon Ka Kinh National Park (Gia Lai). (2) Production forests: including natural forests (according to forest status) and industrial raw material plantations (acacia, eucalyptus, pine). The production forest research sites were conducted in the northern provinces (Bac Giang, Phu Tho,

Yen Bai), Central (Thanh Hoa, Quang Binh, Hue) and Southern (Gia Lai, Binh Dinh, Dong Nai). (3) Protective forests (upstream protective forests: Bo River basin, Ba River basin; coastal protective forests: mangrove forests in Giao Thuy-Nam Dinh; protective forests against sand blowing in Bao Ninh-Quang Binh). In general, the survey sites are relatively representative of the research sample. However, the explanation for selecting the research sites has not been presented clearly and convincingly. The author has not clarified the reason for the survey and the representativeness of the research sites.

There are some points that need to be discussed further: (1) The direct use value of forests and the indirect use value of forests are mentioned quite meticulously in the topic, but the total price of each type of forest (planted forest, natural forest) according to the purpose of use (production, protection, special use) is not clear, especially for multi-purpose forests. (2) The author has not shown what purpose this valuation serves? (3) How feasible is this method? What conditions are needed to ensure success when applying it? (4) Can the forest price, when fully calculated (including the direct use value of forests and the indirect use value), be used in transactions on the right to use natural forests and the right to own planted forests? (5) Forests are only an asset on land, so when valuing forests, is the land value included?

Currently, Decree No. 48/2007/ND-CP dated March 28, 2007 of the Government on principles and methods for determining prices of forest types has provided 3 methods.

applied to determine the price of forest use rights (protection forests; special-use forests, production forests are natural forests), the price of forest ownership rights (production forests are planted forests):

Table 1.4. Methods for determining prices of forest types

Method

valuation

Source: [13]

In general, forest prices determined by these methods mainly only include tangible economic values, not taking into account other values. Furthermore, there is no clear distinction between how to determine prices for each type of forest.

1.2.3. Research works on forest leasing and forest environment leasing

It can be affirmed that research works on this issue in Vietnam have not been available and have not received much attention. A typical example in this field is author Le Trong Hung (2008) with the work: " Research on theoretical and practical basis for building forest leasing policies, building and developing the market for land use rights for production forests in Vietnam" - under the topic of the Ministry of Agriculture and Rural Development. In this work, the author researches the construction of forest leasing models, forest leasing conditions, and determines forest leasing prices for each type of forest. However, the work only focuses on the research for the subject of production forests, although it mentions the leasing of special-use forests, it is not complete, and has not clarified the leasing policy for each specific forest type [26]. According to the author, the factors affecting the implementation of forest environment leasing policies in the National Park depend on:

- Location and complexity of management;

- The income the Government expects to derive from leasing the forest environment and the extent to which the Government is prepared to participate in forest management or relinquish control;

- Organizational capacity of state forestry management agencies to monitor forest environment leasing activities;

- Strengths of other solutions, such as a regulatory framework to ensure that appropriate forest lease management is implemented;

- Economic aspects of forest environment leasing: Here it mainly concerns the issue of forest leasing valuation, benefits obtained from forest environment leasing activities, and effective lease term;

- Capacity of forest environment leasing units and benefits they receive when implementing.

In general, research works by domestic and foreign scientists related to the policy of leasing forest environment in general and national parks in particular have partly helped to perfect the theoretical system as well as the practice of the policy of leasing forest environment in national parks in Vietnam. However, the concept of forest environment is still relatively abstract, the management policy of national parks in each country and each region is different, so it is relatively difficult to find perfect models of management as well as a policy suitable for all countries or all national parks. Research works in some aspects have pointed out related issues, a certain aspect of the policy, as well as certain experiences. In the face of the requirements of the process of economic integration and development, innovation and perfection in theory and practice of the policy of leasing forest environment is an inevitable trend in Vietnam today.