THE PRIME MINISTER

Article 1.- To approve Vietnam's Forestry Development Strategy in the 2006-2020 period with the following principal contents:

1. Actual situation of the forestry sector

By December 31, 2005, the national forest area was 12.61 million ha, including about 10.28 million ha of natural forests and 2.33 million ha of plantation forests; forest cover was 37%. Total timber deposit was 813.3 million m3 (of which 94% was from natural forests) and there were about 8.5 billion bamboo trees. While the forest area increased, the quality of natural and plantation forests remained low, failing to meet production and protection requirements. Nationwide, the area of unused land was 6.76 million ha, including 6.16 million ha of bare land, accounting for 18.59% of the country's natural area, most of which was degraded land. This is a potential for as well as a challenge to forestry development.

2. Forestry production activities in the 1996-2005 period

- Major achievements of the forestry sector

Forest protection and development work in the whole country saw some progress in preventing degradation in forest area and quality. The forest area increased from 9.30 million ha in 1995 to 11.31 million ha in 2000 and 12.61 million ha in 2005 (an average increase of 0.3 million ha a year). At present an average of about 200,000 ha are afforested annually. The annual output of timber harvested from plantation forests reaches about 2,000,000 m3, which was supplied as raw materials for processing forest products for export and domestic consumption.

The wood and forest product processing industry saw vigorous developments, step by step meeting domestic demands, making increasing contributions to export turnover and creating opportunities for the development of raw-material supply plantation forests. The export turnover of wood products rose from USD 61 million in 1996 to USD 1,035 million in 2004 and USD 1,570 million in 2005.

The forestry sector's production activities saw vigorous changes as the sector switched from a state-run sector operating under a centralized planning mechanism to a socialized one with a multi-sectoral economic structure and operating according to the mechanism of a commodity production economy. As a result, the forestry sector made active contributions to creating jobs and improving living standards for nearly 25% of Vietnam's population living in forested mountainous areas, ensuring political and social security and creating an impetus for national development in the past years.

- Problems and weaknesses

Though the forest area increased but the quality and biodiversity of natural forests continued to decrease; in some places, forests were further destroyed and the planting of production forests under Project 661 failed to keep to its schedule.

The forestry sector grew at a low rate and in an unsustainable manner, with low productivity and profits and weak competitiveness, failing to exploit all natural forest resources, particularly non-timber forest products and eco-environmental services.

3. Viewpoints, objectives and general tasks of the Forestry Development Strategy in the 2006-2020 period

Forestry is a specific econo-technical sector embracing all activities related to the production of forest commodities and provision of forest services such as protection, planting, harvest, transportation, production and processing of forest products and environmental forest services. At the same time, the forestry sector plays a very important role in protecting the environment, conserving biodiversity, and eradicating poverty and reducing poverty, especially for mountainous inhabitants, contributing to social stability, security and defense.

a/ Development viewpoints

- Forestry shall be developed in a coordinated manner from management, production, development and reasonable use of natural resources, plantation, improvement and enrichment of forests to harvest and processing of forest products, environmental services, ecotourism, etc.

- Forestry shall be developed to make considerable contributions to economic growth, hunger eradication and poverty alleviation, and environmental protection.

- To manage, use and develop forest in a sustainable manner is the foundation of forestry development.

- Forestry development shall be based on accelerating and deepening the socialization of afforestation, and attracting resources for investment in forest protection and development.

b/ Objectives toward 2020

To establish, manage, protect, develop and use in a sustainable manner 16.24 million ha of land planned for forestry; to increase the rate of land with forests to 42-43% by 2010 and 47% by 2020; to ensure wide participation of all economic sectors and social organizations in forestry development in order to make more and more contributions to socio-economic development, eco-environmental protection, conservation of biodiversity and provision of environmental services, contributing to hunger eradication and poverty alleviation and raising of living standards for rural and mountainous inhabitants and preservation of security and defense.

c/ Economic tasks

- The production value of the forestry sector (including forest product processing industry and environmental services) will grow at from 3.5% to 4% a year, striving for the target that the sector's GDP will account for 2-3% of national GDP by 2020.

- To establish, manage, protect, develop and use in a sustainable manner forests of three types, including 8.4 million ha of production forests, of which 4.15 million ha are plantation forests covering consolidated forests supplying industrial raw materials, non-timber forest products, etc., 3.63 million ha of production forests being natural forests and 0.62 million ha of regenerated natural forests for combined agro-forestry production (striving for the target that at least 30% of the area with forest certificates); 5.68 million ha of protection forests and 2.16 million ha of special-use forests.

- To afforest 1.0 million ha by 2010 and 1.5 million ha afterwards. To reforest 0.3 million ha following exploitation a year. To carry out dispersed plantations with 200 million trees a year.

- The domestic timber output will reach 20-24 million m3 a year (including 10 million m3 of big timber), basically meeting the raw materials needs of forest product processing and pulp industries and export. To meet the needs for fuel wood mainly in rural areas and maintain the level of 25-26 million m3 a year.

- The value of exported forest products will reach over USD 7.8 billion (including USD 7 billion of timber products and USD 0.8 billion of non-timber forest products).

- To increase revenues from forest environmental value through the clean development mechanism (CDM), protection of water sources, ecotourism, etc., (up to USD 2 billion).

d/ Participation in solving social problems

- To create more jobs for laborers (in the processing of timber and non-timber products and in fine-arts and handicraft villages).

- To generate incomes, contributing to eradicating poverty and reducing the number of poor households in key forestry areas.

- To complete the allocation and lease of forests and forestland to organizations, enterprises, households, individuals and village communities before 2010.

- To increase the percentage of trained forestry workforce to 50%, especially ethnic minority and poor households and women in deep-lying and remote areas.

e/ Assurance of environmental stability

- To protect forests and conserve the nature and biodiversity in order to make effective contributions to watershed protection, coastal and urban protection, natural disaster mitigation, erosion prevention, water source preservation, protection of habitats and generation of revenues from environmental services (environmental charges, reduction of carbon dioxide emissions, ecotourism, etc.).

- To increase forest cover to 42-43% by 2010 and to 47% by 2020.

- By 2010, to have new 0.25 million ha of protection and special-use forests.

- To minimize violations related to forest natural resources and restrict the slash-and-burn farming practice.

4. Development orientations

a/ Orientations on the planning for the structure of three types of forests and forestland

- For protection forests: To review and rearrange the system of national protection forests of about 5.68 million ha, including 5.28 million ha of watershed protection forests; 0.18 million ha of wavebreak and sea encroachment protection forests; 0.15 million ha of windbreak and sandbreak forests and 70,000 ha of protection forests in service of environmental protection for big cities, industrial parks and national border areas. Depending on the level of importance, it is necessary to combine protection with agro-forestry production, commercial operation of landscape sites, resort and eco-environmental tourism, and other benefits of protection forests.

- For special-use forests: To review and strengthen the system of existing national special-use forests with a total area not exceeding 2.16 million ha toward raising forest quality and biodiversity value.

- For production forests: The total area of planned production forests will be 8.4 million ha, including 3.63 million ha of natural forests and 4.15 million ha of plantation forests; importance will be attached to establishing consolidated industrial raw-material supply forest zones and managing their sustainable use for multiple purposes. The remaining area of land of 0.62 million ha planned for development of production forests will be used for forest regeneration and combined agro-forestry production.

b/ Orientations for forest management, protection, development and use

- Forest management: The entire area of 16.24 million ha of forests and forestland shall be uniformly managed on the basis of establishing permanent national forest estates according to the system of sub-areas, compartments and lots on the map and in the field. By 2010, basically all forest and forestland areas shall be allocated or leased to forest owners of all economic sectors according to the plannings and plans approved by competent authorities and to state mechanisms and policies. To modernize forest management work on the map and the field based on the wide application of information technologies, aerial photos' in forest management, statistics, inventory and monitoring of changes in natural forest resources and forestland.

- Forest protection: To determine forest protection as protection of an ever developing ecosystem while ensuring regeneration and optimal use of forests on the principle of development for protection. To attach importance to propaganda and raising awareness for administrations at all levels, all branches and everyone.

People's Committees at all levels shall organize forest protection and take responsibility for the occurrence of violations of the Law on Forest Protection and Development in localities under their management. To enhance the capacity of, and strengthen full-time and part-time forest protection forces of forest owners and village communities to be able to handle violations of forest law and cope with natural disasters such as forest fires and pests. To attach importance to inspection of the process of exploiting forest products in forests. To inspect and control the circulation and consumption of forest products is just a measure for forest protection.

To reorganize and rearrange the forest ranger force along the line of enhancing its role of giving advice to provincial, district and commune-level administrations in forest protection and forestry law enforcement. To adopt policies and regulations to prioritize and encourage the strengthening of local forest ranger forces which shall collaborate with local administrations in providing guidance for inhabitants to protect forests in each lot or compartment.

- Forest development:

+ To plan, classify and develop forests of three types (special-use forests, protection forests and production forests), combine conservation and protection with development of ecotourism, resort tourism and other environmental services.

For special-use forests, the major development orientation is to conserve forests in their original state, creating the best environmental conditions for conserving and developing endemic fauna and flora species and specific ecosystems in order to conserve gene sources and biodiversity to meet the requirements of national socio-economic development in the current period and the future.

For protection forests, planning and development aim to ensure protection requirements to the utmost, contribute to conserving biodiversity, preserving a stable balance of soil environment (preventing erosion, desertification and toxic chemical residues), water environment and climate, fighting natural disasters and ensuring sustainable socio-economic development and perpetuation of the nation.

For production forests, planning and plans shall be drawn up for their in-depth development, creation of medium and large consolidated raw-material supply zones where intensive cultivation is practiced with a view to supplying sufficient raw materials for processing industries and increasing the effectiveness of land use, productivity and quality; agro-forestry and fishery shall be combined.

+ The Ministry of Agriculture and Rural Development shall assume the prime responsibility for, and coordinate with other ministries and branches in, promulgating policies to encourage all economic sectors to invest in developing forests for commercial purposes, policies to prioritize and support development researches into plant varieties, wild animal species, intensive cultivation and animal raising techniques, building of forestry infrastructures, systems of prevention and fight of forest fires and prevention and control of forest pests, etc., in accordance with international commitments in which Vietnam has participated in.

To apply scientific and technological advances and perpetuating silvicultural experience of local inhabitants; to conduct forest development researches in the two major directions of improving forest tree species and applying silvicultural measures.

+ To attach importance to strongly developing dispersed plantations to promptly and effectively meet on the spot local inhabitants' needs for timber for household use and fuel wood, especially in delta and coastal areas. To step up the planting and development of non-timber forest products (rattan, bamboo, pharmaceutical materials, etc.) to meet the needs for raw materials for the production of highly competitive handicraft and fine-art goods for domestic consumption and export.

- To use forests and develop the forest product processing industry

+ Forest exploitation and use:

To rationally exploit and use forests is a silvicultural measure to regenerate forests and improve their quality; at the same time to exploit to the utmost forest environmental services to generate revenues for forest protection and development. To use natural forests in a sustainable manner according to forest management plans.

For production forests that are natural forests, to attach importance to further zoning them off for tending, improvement and enrichment in order to increase their quality to create sources of supply of big timber, other forest products and provision of environmental services after 2010. To apply the major exploitation method only to forests with rich deposits. For forests with medium and poor deposits, to attach importance to applying the exploiting, tending and enriching method; to accelerate the planting, development and use of non-timber forest resources, focusing on such advantaged product groups as rattan, bamboo articles, pharmaceutical materials, resin oil and foodstuffs; to encourage the breeding and raising of wild animals; to apply a mechanism of guiding forest owners to lawfully exploit and use non-timber forest products.

To encourage the use of fuels made of by-products from plantation forests (thinly pruned top branches, etc.), by-products of agriculture and other sources of substitute fuels with a view to minimizing the use of fuel wood from natural forests.

+ To develop the forest product processing industry

Forest product processing and trade must become the spearhead of forestry economy, develop according to the market mechanism on the basis of advanced technologies, and be highly competitive to meet export and local consumption demands. To encourage all economic sectors to actively invest in and promote the development of the forest product processing industry.

To strongly develop advantaged products in export processing. From now to 2015, to concentrate efforts on reviewing, strengthening and upgrading small- and medium-sized forest product processing industrial establishments; to develop the industry on a large scale after 2015.

To build and expand forest product processing industrial parks in areas where sufficient raw materials can be supplied in a stable manner. To step up modernization of the processing industry on a large scale, step by step develop and modernize small-scale processing industries in rural areas and traditional craft villages. To accelerate the processing of artificial boards, gradually reduce the processing of paper chips for export. To encourage the use of products from artificial boards and plantation forest timber.

+ To set orientations for export of forest products.

+ To properly organize the import of forest raw materials to meet the needs of production in service of domestic consumption and export, while increasing the plantation of forests supplying raw big timber and non-timber forest products to urgently meet the needs for raw materials for processing industries and gradually reduce dependence on imported raw materials.

+ To conduct research and training in the designing of household wood articles, renew technologies of manufacturing and processing forest products, diversify and continuously increase the quality and designs of processed products to cater for various domestic and foreign customers' tastes; to accelerate the issue of forest certificates and develop trademarks for export goods.

5. Solutions to implementing the Strategy

a/ Policy and law-related solutions

- Forest and forestland management

To build a legal setting for establishing permanent national forest estates and place markers on the field. To revise and perfect policies on allocation and lease of forests and forestland. To prioritize the allocation and contracting of protection forests to communities, economic organizations and households for long-term management, protection and benefit sharing according to approved plannings and plans.

To create favorable conditions for those who are assigned or contracted land and forests to exercise the rights to use land and use and own forests according to the provisions of law in their production and business activities to meet the requirements of a commodity economy; to make forests to truly become a commodity and a source of funding for forestry development. To encourage land accumulation for forming consolidated raw-material supply plantation forests in the form whereby households, economic organizations and individuals lease or contribute shares with their forest and forestland use rights.

To continue piloting before widely applying models of community-based forest management; to perfect forest management regulations and benefit- sharing mechanisms applicable to all economic sectors. To pilot and build a legal foundation for all economic sectors to be allocated or leased special-use forests for eco-tourist and resort business activities and services.

To urgently accelerate the review, formulation and perfection of legal documents on forest management, protection, development and use; to abolish cumbersome and ineffective administrative procedures. Fine local customs and practices should be considered, studied and perfected for incorporation into forest protection and development rules suitable to each locality.

To further decentralize state management of forests to district- and commune-level administrations. To clearly define responsibilities and powers of forest owners, administrations at all local levels, law enforcement bodies and villages in localities where forests are lost or destroyed.

To intensify law dissemination and education to raise the forest protection and development awareness and responsibility of administrations at all levels, branches, every forest owner, every citizen and the entire society, along with enhancing state management, institutions and laws.

- Finance and credit

To develop specific capital construction investment mechanisms and renew the mode of state investment in the forestry sector according to the approved forest protection and development plans so as to gradually replace the current allocation of funds based on average investment support ratios.

To develop an insurance mechanism and ensure that all economic sectors taking part in forestry production and business access and borrow long-term loans from investment funds and credit sources on an equal basis, which are suitable to the forestry business cycle.

To switch state investment from direct to indirect investment (infrastructure, seeds and seedlings, science and technology, etc.). To increase the state investment budget for the management, protection and development of special-use forests, protection forests, production forests, scientific research, forestry extension, human resource training, etc., and reserve adequate investments in building forestry infrastructure.

To formulate policies to encourage all economic sectors to invest in the protection, development and use of forests and the processing of forest products based on linking and sharing benefits with the community. To create a transparent and stable investment environment; to ensure clear industrial property rights and the rights to use land, use or own forests in a permanent manner; to support the setting up of a forestry insurance fund, exempt and reduce some taxes for forest owners and investors engaged in forest business activities, and simplify administrative procedures for investors in the forestry domain.

To publicize forestry development plannings, pilot and widely apply the bidding for lease of forests for production, ecotourism or resort tourism services depending on the functions of forests. The State shall promote planning work and support the formulation of some projects on consolidated industrial raw-material supply forests to call for domestic and foreign investment.

To create and step by step implement a mechanism of collecting environmental service charges from organizations and individuals benefiting from forests as an additional source of reinvestment in forestry. To collect watershed protection charges for hydropower projects and clean water facilities, and build on a pilot basis a CDM-based afforestation project.

The State shall allocate annual operational and non-business funds for special-use forest and protection forest management units and implement a policy to pay for some expenses for the operation of commune or village forest protection teams. For production forests, the State shall provide financial supports for the planting of rare and previous tree species, trees with a long business cycle and the building of forestry infrastructures, mainly forestry roads, forest fire prevention and fight facilities and equipment, etc., particularly in consolidated raw-material supply forests.

To devise a mechanism of contracting protection forests for protection with the increased possibility of directly enjoying forest benefits, including revenues collected from environmental services, in order to gradually replace the current contracting with cash payments from the state budget.

For households engaged in forest protection and development, especially households of the poor and ethnic minority people in mountainous, remote or deep-lying areas, the State shall implement such support mechanisms as provision of preferential loans, supply of food, seedlings, fertilizers, etc., for the planting of small production forests and combined agro-forestry production when they have not yet obtained any incomes from forests, and shall minimize the slash-and-burn farming practice.

To carry out the valuation of forests as a basis for forest-related transactions. To set up central and local forest protection and development funds from various funding sources and work out appropriate mechanisms of managing and using these funds in order to accelerate the socialization of silviculture and the forestry sector as a whole.

b/ Renewing the production and business system and encouraging all economic sectors to participate in forestry development

- To develop mechanisms and policies to facilitate the renewal of state-owned forestry farms into forestry companies engaged in production and business activities associated with the processing industry and trade, acting as the core in the sector's development. To step by step promote the equitization of state-owned forestry enterprises; to develop forms of joint venture and association among different economic entities in forestry production and business and forest product processing.

- To attach importance to developing forestry production and business based on households, farms, village communities and economic cooperation. The State shall adopt mechanisms to support poor and ethnic minority households to participate in enterprises' and farms' activities of planting raw-material supply forests, industrial trees, and processing forest products on a small scale, so as to create more jobs and generate more incomes for them.

c/ Planning and supervisory solutions

- To review the planning on three types of forests, identify permanent national forest estates and place markers on the field;

- To make statistics on, inventory and monitor natural forest resource changes in association with collecting statistics on and inventorying land. To create and update a database on natural forest resource management and apply advanced technologies to improve the quality of forest planning investigations.

- To improve the quality of formulation and implementation of forest protection and development plannings and plans at all levels. While formulating plannings and plans on protection of special-use forests, to formulate plannings and plans on protection and development of buffer zones and biodiversity corridors. To integrate forestry projects into local hunger eradication and poverty alleviation projects and agricultural and rural development projects carried out in deep-lying and remote areas. Special-use forest and protection forest management units and forestry companies shall direct their business activities at providing services or participating in managing local socio-economic development projects.

- To plan and develop the processing industry and trade in combination with reviewing and establishing consolidated raw-material supply forests. To plan the replacement of low-yield plantation forests. To pay attention to planning the development of villages engaged in producing and processing forest products on a small scale and of forestry farms.

- To renew planning methods and raise planning quality toward promoting cross-cutting connection, using inter-branch information and involving the participation of concerned parties.

- To intensify monitoring and evaluation of the implementation of forest protection and development plannings and plans. To soon create a monitoring and evaluation system and enhance the capacity of the sector financial planning and management and monitoring agencies and units at all levels.

- To strengthen the forestry sector information and monitoring system to serve monitoring work and the evaluation of the implementation of the Forestry Development Strategy, meeting the requirements of the sector management and international integration.

d/ Sector organization and management solutions

- To urgently set a roadmap for renewing the organization of the forestry sector toward establishing a uniform organizational system of state management of forestry which is strong from the central to local levels combined with administrative reforms and international integration. To regard the establishment of state management organizations and the increase of forestry management officers in districts and communes with forests as a top priority in the coming five years. In communes with large forests, to arrange full-time forestry officers.

- To encourage and support the establishment of associations and unions of forestry product producers, traders, processors, imports and exporters.

- To develop a mechanism of long-term coordination between forestry research, education, training and extension and forest owners, enterprises and communities to combine forestry research, training and extension with forestry production and business.

e/ Scientific and technological solutions

- Forestry scientific and technological research activities must meet the requirements of production and market and be participated by forest owners and enterprises.

- To review, formulate and perfect technical processes and standards.

- To formulate and implement a Forestry Research Strategy from 2006 to 2020, concentrate on breakthrough researches in the sector such as bio-technology, refining of non-timber forest products, planting of high-yield forests, improvement of impoverished natural forests, etc.

- To implement the Forest Tree Seed Strategy in the 2006-2020 period, first of all to meet the needs for high-quality seeds for afforestation under Project 661 and other projects.

- To implement the national scheme on conservation and development of non-timber forest products in the 2006-2020 period.

- To develop a system of national standards of sustainable forest management, product movement sequence and a set of national standards for timber products and non-timber forest products.

- To increase equipment and technical and material foundations for research institutions. To promote the application of modern, environment-friendly technologies and equipment in forest product production and processing; to regard foreign investment as a new channel of technology transfer.

- To set up a system of forestry extension organizations from the central level to provinces and districts with many forests (provinces with more than 50,000 ha of forests and forestland), which are attached to the agricultural extension system at all levels .To arrange full-time and part-time forestry extension officers in communes with many forests. In places hardly accessible by the State-built agricultural extension system, to quickly set up voluntary forestry extension organizations with necessary state supports.

- To step by step renew activities and build the capacity of forestry institutes and schools to turn them into strong consultancy centers of the sector. To encourage the establishment of other, scientific and technological consultancy, transfer and service centers under forestry research, training and extension agencies. To perfect the mechanism of enhancing the autonomy and accountability of forestry research, training and extension organizations for the quality and quantity of products.

f/ Human resource training solutions

- To formulate and implement a strategy on training and capacity building for forestry staffs at all levels, especially at the commune level. To attach importance to providing training for ethnic minority people and transferable training for forestry officers in deep-lying and remote areas. To pay greater attention to forestry training and extension activities for the poor.

- To raise the capacity of managers, enterprises, communities and households engaged in silviculture and forest product processing through short-term training and forestry extension so that they can step by step make, implement and monitor their own production plans.

- To raise the capacity and improve material and technical foundations of forestry training units. To elaborate a scheme on comprehensive renewal of the forestry education and training system in terms of structure, teaching programs, contents and methods and administration mechanisms for the purpose of raising training quality. To strive to have one or two forestry institutes and schools up to international standards by 2020.

- To develop short-term training programs on different subjects, prioritize training of forestry farmers and officers and craftsmen in craft villages.

- To encourage forestry training and extension organizations, non-governmental organizations and international projects to support forestry training and extension activities.

- To draw up a plan on and train scientists and lecturers specializing in forestry domains, particularly economics, and create favorable conditions for young scientists to take part in research and teaching activities.

- To develop forms of distance training to meet increasing learning and research needs. To integrate soon forest environment education into curricula of schools nationwide.

g/ International cooperation solutions

- To promote international economic integration in the forestry sector through active participation in and close cooperation with regional and bilateral international forestry organizations.

- To step up strategic mobilization, attraction and use of ODA for proper purposes. To manage and efficiently use the funding source of the Trust Fund for Forests (TFF) and the Vietnam Conservation Fund. To gradually create a favorable legal corridor and improve the investment environment to attract direct investments from foreign investors, especially in the planting of industrial raw-material supply forests, forest product processing and technology transfer.

- To strengthen and step up activities of the Forestry Sector Support Program (FSSP) partnership and the Partnership Coordination Committee to coordinate international financial supports for the implementation of the programs of the Forestry Development Strategy.

- To take the initiative and actively cooperate with other states, world and regional advanced institutes and schools in promoting quick approach to advanced scientific and technological forestry standards, develop human resources and upgrade equipment for the sector.

- To further implement multilateral environment agreements and international commitments related to forestry which Vietnam has acceded to, with a view to raising Vietnam's status in the world and the region and seek for additional funding sources.

6. Major programs and tasks

a/ The program on sustainable forest management and development

- To establish permanent national forest estates for three types of forests.

- To allocate or lease all forests and forestland to forest owners of all economic sectors before 2010, and enhance the capacity of forest owners.

- To manage forests in a sustainable manner. Owners of forests used for production and business purposes shall make and implement forest management plans, with at least 30% of production forests to be granted forest certificates.

- To afforest 1 million ha by 2010 and 1.5 million ha in the subsequent period, raise the yield of plantation forests; to enrich 0.5 million ha of impoverished forests; and to plant 200 million dispersed trees a year.

- To produce domestic timber in a stable manner to reach 9.7 million m3/year by 2010, 20-24 million m3/year by 2020 (including 10 million m3 of big timber).

- To supply small timber for pulp processing, 3.4 million m3 by 2010 and 8.3 million m3 by 2020.

- To procure equipment and facilities to modernize periodical forest management and inventory work; to strengthen and update the database on natural forest resources.

b/ The program on protection and conservation of biodiversity and development of environmental services

- To effectively protect 16.24 million ha of forests and forestland of three types (special-use forests, protection forests and production forests).

- To disseminate 100% of regulatory documents on forest protection to forest owners and local inhabitants.

- To reduce by 80% of cases of violation of the law on forest protection and development.

- 100% of forest owners, and villages and communes with forests will have forest protection forces, 100% of protection and special-use forests will have managers and protection and development plans. 100% of forest protection and development staffs, especially commune ranger officers and forest protection forces of forest owners and villages and communes, will be trained to improve their capacity.

- To increase investment in infrastructures, equipment and facilities and funds for forest protection, forest fire prevention and fight and forest pest prevention and control, etc.

- To establish and strengthen the system of protection forests with a total area of about 5.68 million ha and the system of special-use forests with a total area of about 2.16 million ha.

- To continue piloting before widely applying the community-based forest management model and other forms.

- To study and set charges for forest environmental services, develop a mechanism of payment for the forest sector's environmental services. From 2007, to set up and put into operation the forest protection and development fund.

c/ The program on orientations for forest and forestland planning, the progress of implementation of the Strategy in the 2006-2010 period and the implementation of priority schemes and projects in the 2007-2020 period

- To implement the contents of orientations for forest and forestland planning till 2010 and 2020 (according to Table 2 enclosed with Vietnam's Forestry Development Strategy in the 2006-2020 period).

- To implement the planned contents of the Strategy in the 2006-2010 period (according to Table 3 enclosed with Vietnam's Forestry Development Strategy in the 2006-2020 period).

- To implement priority schemes and projects in the 2007-2010 period (according to Table 4 enclosed with Vietnam's Forestry Development Strategy in the 2006-2020 period).

d/ The program on timber processing and forest product trade

- To reorganize the timber and non-timber forest product processing industry.

- To enhance the capacity of the forest product processing industry to basically meet domestic and export needs, specifically:

+ Total output of sawn timber: 6 million m3/year.

+ Particle boards: 320,000 m3 of products/year.

+ MDF boards: 220,000 m3 of products/year.

+ Value of exported timber products: USD 7 billion (3.5 million m3 of products).

+ Value of exported non-timber forest products: USD 0.8 billion.

- By 2020, non-timber forest products will become a major commodity, accounting more than 20% of total value of forestry production, and the value of exported non-timber forest products will increase 15-20% on average; to employ about 1.5 million laborers; and incomes generated from non-timber forest products will account 15-20% of rural household economy.

e/ The program on forestry research, education, training and extension

- To concentrate on conducting researches in some spearhead areas such as bio-technology, non-timber forest product refining technology, plantation of high-yield forests, agro-forestry and improvement of impoverished natural forests. To renovate technologies, equipment and facilities for the forest product processing industry to raise competitiveness and meet the requirements of international economic integration. To study scientific and practical grounds for the formulation of breakthrough policies in the forestry sector.

- To provide formal training for about 5,000 students and pupils on average every year. To pay attention to providing advanced training for key officials. To intensify vocational training for farmers engaged in silviculture and inhabitants in forest product processing villages. From 2008, to incorporate forest and environment protection education into teaching programs in general education schools. To provide training for 80% of local forest management staffs in forest inventory and formulation and implementation of forest management, protection and development plans, and identification of forest criteria. To enhance the capacity of lecturers and provide essential equipment and facilities for forestry institutes and schools. To perfect and update training programs and textbooks to meet the requirements of renewal and international economic integration. To promote linkages between the forestry training system and the forestry extension system. To have one to two forestry training institutions up to international standards by 2020.

- To attract 50% of economic sectors and mass organizations to take part in forestry extension activities; to raise forest management and protection knowledge and skills for 80% of farmer households. To place at least one full-time or part-time forestry extension officer in each commune with large forests; to develop and enhance the capacity of the voluntary forestry extension system. To improve forestry extension contents and methods to suit farmers' levels. To build up linkages between the forestry extension and training system and forest owners and forest product processing enterprises.

e/ The program on renewal of institutions and policies, planning and sector monitoring

- To build and update a system of policies, laws and institutions toward delegation of more powers to localities and on sustainable forestry development directed at commodity production and socialization of silviculture.

To develop mechanisms and policies as a momentum for stimulating all economic sectors to engage in forest protection and development, encourage all economic sectors at home and abroad, village communities and households to develop forestry.

- To reorganize, and raise the effectiveness of, state management agencies in charge of forestry in the direction of unifying the functions of managing, protecting, using and developing forests; to make clearer the functions and tasks of forestry organizations at all levels and diversify forestry services.

- To develop mechanisms and policies applicable to state-owned forestry farms which have been re-organized, re-arranged and converted into companies and are running production and business activities efficiently. To step by step equitize forestry business companies, creating favorable conditions for them to operate according to the market mechanism. To form, implement and expand the model of community-based forest management and protection. To establish a state-owned forestry extension system at all levels and introduce mechanisms to support voluntary forestry extension organizations in villages and communes with large forests.

- To establish specialized monitoring and evaluation units along with strengthening the forestry planning system at all levels.

7. General estimates of funds and funding sources for the 2006-2010 period (unit of calculation: VND billion)

a/ Total investment funds: 33,885.34

in which:

- The sustainable forest development management program: 16,214.55

- The forest protection, biodiversity conservation and environmental
services program: 3,817.00

- The timber processing and trade program: 10,428.07

- The forestry research, education and training and extension program: 546.98

- The sector policy renewal, planning and monitoring program: 885.57

b/ Regular expenditures on activities:

Forest management and protection activities: 1,939.17

c/ Ratios of investment funding sources for the 2006-2010 Strategy:

+ State budget funds: 23.9%

+ State credit: 15.6%

+ ODA capital: 13.1%

+ State enterprises and cooperatives: 11.3%

+ Households: 11.2%

+ FDI: 24.5%

+ Other sources: 0.4%

Article 2.- Organization of implementation:

1. To assign the Ministry of Agriculture and Rural Development:

- To act as the coordinator with the prime responsibility for, and coordinate with other ministries, branches and provincial/municipal People's Committees in, organizing the implementation of the Forestry Development Strategy and incorporating its contents into the national, ministerial, sectoral and local socio-economic development plans.

- To establish sub-committees to coordinate the implementation of the programs of the Strategy, which are composed of representatives of related agencies, units, communities and enterprises and concerned partners and international projects that voluntarily participate in the programs.

- To coordinate with other ministries, sectors and localities in evaluating the implementation of the Strategy on an annual basis and report it to the Prime Minister. Forest protection and development shall be regarded as an important content of the Government's year-end report to the National Assembly.

2. The Ministry of Planning and Investment and the Ministry of Finance shall coordinate with the Ministry of Agriculture and Rural Development in balancing and assuring investment funds for the effective implementation of the Strategy.

3. The Ministry of Natural Resources and Environment shall coordinate with the Ministry of Agriculture and Rural Development in instructing localities to review land use plannings and allocate or lease forestland according to the objectives and tasks of the Forestry Strategy and elaborate schemes integrating forest inventories with national land inventories conducted once every five years.

4. The General Statistics Office shall coordinate with the Ministry of Agriculture and Rural Development and related parties in identifying contents and indicators for the forestry sector monitoring and evaluation; direct and guide localities in making statistics, inventory forests and study the forestry sector's economic and environmental contributions, etc., according to criteria compatible with the requirements of renewal and international economic integration of the forestry sector, and submit them to the Government for revision and supplementation of the forestry sub-sector in Decree No. 75/CP of October 27, 1973.

5. Ministries, ministerial-level agencies and government-attached agencies, heads of related agencies and provincial/municipal People's Committees shall perform their duties assigned in the Strategy, and coordinate with the Ministry of Agriculture and Rural Development in sending annual reports to the Prime Minister.

Article 3.- This Decision takes effect 15 days after its publication in "CONG BAO."

Article 4.- Ministers, heads of ministerial-level agencies, heads of government-attached agencies, presidents of provincial/municipal People's Committees, and heads of concerned agencies shall implement this Decision.-

Vietnam has a total land area of 33.12 million ha, including 12.61 ha of land with forests and 6.16 million ha of bare land usable for agro-forestry. The forestry sector has been carrying out management and production activities on the largest land area compared to other economic sectors. Forestland exists mostly in underdeveloped hilly and mountainous regions throughout the country inhabited by 25 million people who are of many ethnic minority groups, have a low educational level, practice backward farming methods and meet many difficulties in their lives.

Silviculture not only turns out commercial forest products and services contributing to the national economy but also plays an important role in environmental protection such as protecting watershed, retaining soil and water, making the climate equable, etc., contributes to safeguarding national security, especially protecting border areas and islands; and makes important contributions to improving living standards, eradicating hunger and alleviating poverty for rural and mountainous inhabitants.

According to current regulations on grades of economic sectors, forestry is a grade-II economic sector with main activities of planting and protecting forests and exploiting forest products, and some forestry services. End products are forest materials supplied for processing industries and consumption.

According to current data, the forestry sector's GDP accounts for only more than 1% of national GDP. Forestry value in GDP, by current statistics methods, only covers the value of official production activities according to plan but not the value of forest products exploited, processed and marketed by inhabitants; particularly, forest product processing has not yet been taken into account. Enormous effects of forests, such as protection of watersheds, coastal areas and urban environment, conservation of biodiversity, gene sources, ecotourism, etc., have not yet been reflected into the sector's GDP. This has resulted in inadequate awareness of administrations at all levels, branches and society about the effects of a sector that manages forests and forestland representing more than half of the country's territory, with abundant natural forest resources and inhabited by more than 25 million people. This inadequate awareness has negatively affected the process of making state development and investment policies with respect to the forestry sector.

According to the concept of the United Nations Food and Agriculture Organization (FAO) and the United Nations classification of the forestry sector, which has been recognized by many states, and based on the practical situation in Vietnam, a complete definition of forestry sector should be as follows: Forestry is a specific econo-technical sector covering all activities related with production of goods and with services from forests such as planting, exploiting, transporting, producing and processing forest products and providing environmental forest services; the forestry sector plays a very important role in protecting the environment, conserving biodiversity, eradicating hunger and alleviating poverty, particularly for mountainous inhabitants, contributing to social stability, security and defense.

On the basis of the 2004 Law on Forest Protection and Development and other relevant laws; pursuant to the national socio-economic development orientations in the new period and the above definition of forestry sector, comprehensive adjustments to the sector's development orientations are needed to meet the requirements of renewal and international economic integration, creating conditions for attracting domestic and foreign resources for investment in the sector development. Only an adequate awareness and concerted actions regarding the role, position and demand of the sector can help the sector develop rapidly and vigorously, contributing to the cause of industrialization and modernization in rural areas and agriculture, hunger eradication and poverty alleviation for mountainous farmers, and environmental protection, and turn Vietnam into a basically industrialized country along the line of modernization by 2020 as laid down in the Resolution of the Xth National Party Congress.

For the above reasons, it is necessary to formulate the National Forestry Development Strategy for the 2006-2020 period as a basis for orienting long-term development of the sector. This Strategy perpetuates the Forestry Development Strategy for the 2001-2010 period approved by the Ministry of Agriculture and Rural Development and the Forestry Sector Support Program, added with new viewpoints and orientations in response to the requirements of renewal, integration and sustainable development.

The Strategy consists of eight parts:

Part one: Present situation of the forestry sector.

Part two: Context and development forecasts

Part three: Viewpoints, objectives and development orientations.

Part four: Implementation solutions.

Part five: Programs.

Part six: Organization of implementation.

Part seven: Monitoring and evaluation.

Part eight: Projected fund estimates and funding sources and tables and appendices to this Strategy.

1. Present situation of natural forest resources and land potential for forestry development

Because of unsustainable management and use and enormous demands for forestland reclamation and forest products for socio-economic development, the forest area and quality kept decreasing over the past years. According to available documents, in 1943, Vietnam had 14.3 million ha of forests and forest cover of 43%. In 1990, there remained only 9.18 million ha and forest cover of 27.2%. In the 1980-1990 period, an average of more than 100,000 ha of forests were lost each year. However, since 1990, the forest area has continuously increased as a result of afforestation and rehabilitation of natural forests (except for the Central Highlands and eastern South Vietnam where the forest area still tends to decrease). As publicized in Decision No. 1970/QD/BNN-KL-LN of July 6, 2006, by December 31, 2005, the area of forests nationwide was 12.61 million ha (with forest cover of 37%), including 10.28 million ha of natural forests and 2.33 million ha of plantation forests, which was classified into three types as follows:

- Special-use forests: 1.93 million ha, accounting for 15.2%

- Protection forests: 6.20 million ha, accounting for 49%;

- Production forests: 4.48 million ha, accounting for 35.8%.

Total timber deposit was 813.3 million m3 (of which 94% was from natural forests and 6% from plantation forests) and there were about 8.5 billion bamboo trees. The average timber deposits of natural forests and plantation forests were 76.5 m3/ha and 40.6 m3/ha respectively. Timber mainly exists in three regions, namely the Central Highlands: 33.8%; northern Central Vietnam: 23%; and southern Central Vietnam: 17.4% of total deposit. Total area of plantations supplying non-timber forest products was 379,000 ha, mostly existing in northern Central Vietnam, the Central Highlands and the northeast.

With the above forest area, our current average indices are 0.15 ha of forest per capita and 9.16 m3 of timber per capita, which are much lower than the corresponding world average indices of 0.97 ha per capita and 75 m3 per capita.

The area of unused land was 6.76 million ha nationwide, including 6.16 million ha of bare land, accounting for 18.59% of the country's total area, which was distributed by region as follows: in the northeast, 28% of total bare land area; in the northwest, 21%; in the northern Central Vietnam, 19%; in the southern central coast, 13%; in the Central Highlands, 12%; in the eastern South Vietnam, 5%, etc. Of total bare land area, 71% was at the height of less than 700 m and 38% at the sloping degree of 16-35o. This area of bare land is a potential as well as a challenge for forestry development in the next period as most of which is sloping, exhausted and scattered.

II. Evaluation of forestry activities in the 1996-2005 period

1. Major achievements of the forestry sector

- Nationwide, our country has left behind the period of decrease in forest area. The forest area increased from 9.30 million ha in 1995 to 11.31 million ha in 2000 and 12.61 million ha in 2005 (an average increase of 0.3 million ha a year). The afforested area rose from 50,000 ha/year to 200,000 ha/year. The area of rehabilitated natural forests helped considerably increase forest capacity of protection and biodiversity conservation. The volume of timber harvested from plantation forests increased about 2,000,000 m3 a year, which was supplied for the industries of paper, mining, wood chips for export and fuel wood, contributing to lessening pressure on natural forests.

- The processing of timber and forest products for export has seen vigorous developments in recent years (the export value of wood products rose from USD 61 million in 1996 to USD 1,034 million in 2004 and USD 1,570 million in 2005), making important contributions to national export value and creating opportunities for the development of industrial raw-material supply plantation forests.

- The forestry sector has made active contributions to creating jobs and generating incomes for the people, especially ethnic minority people (for example, in Bac Kan province 32.8% of total income generated by households living above the poverty line were from forestry, 16.8% for well-off households; in the Central Highlands, these ratios were nearly 40% and 17% for well-off and poor households respectively); and met most of domestic demands for household wooden products and fuel wood.

The achievements were mostly attributed to the following:

- The State has paid more attention to forest protection and development, implemented policies and large target investment programs such as land and forest allocation policy, Program 327, Five Million Ha Afforestation Project, etc. The awareness of the society, people of all strata and administrations at all levels about forest protection and development has been raised;

- The national economy's constant and sustainable growth, particularly in agriculture, creates favorable conditions for forestry development;

- Silvicultural science and technology transfer has seen progress, contributing to raising afforestation quality and effectiveness in recent years;

- The international community has provided significant assistance for forest protection and development and hunger eradication and poverty alleviation efforts in rural and mountainous areas. Foresters have made great efforts and sacrifices under difficult working conditions.

2. Constraints and weaknesses

- Though the forest area has increased, the quality and biodiversity of natural forests in many places still further decrease (compared with the results of the general forest inventory conducted in 1999, in 2005 the area of rich natural forests shrank 10.2%, the area of medium forests decreased 13.4%, whereas the area of rehabilitated forests rose 20.7%; and the area of plantation forests increased 50.8%). Afforestation work under the Five Million Ha Afforestation Project fails to achieve the set target. Particularly in the 1998-2005 period, the total afforested area reached only 70% of the planned target while the area of planted industrial raw-material supply forests reached only 49% of the planned target). In some localities forests continued to be devastated due to change of use purposes, illegal exploitation, slash-and-burn farming practice, etc. (during 2000-2005, an average of 9.345 cases of forest destruction occurred a year and the destroyed forest area was 2,160 ha a year). Unexpected floods, droughts and landslides were partly attributed to forest loss or degradation.

- The forestry sector saw low and unsustainable growth (according to the General Statistics Office, the forestry sector' development rate was 4.9% in 2000, 1.9% in 2001, 1.6% in 2002, 1.1% in 2003, 1.1% in 2004, and 1.2% in 2005), with low profits, weak competitiveness, forest resource potential not yet tapped in a coordinated and rational manner, especially non-timber forest products and environmental services. The productivity and quality of plantation forests and natural forests remained low, failing to meet socio-economic development needs, particularly for large-timber materials for the processing industry and export.

- The forest product processing industry saw rapid developments in recent years, which, however, took place in a spontaneous and unstable manner without strategic planning and vision. Its competitiveness was not high while production association and division were not good. No trademark was created yet on the world market. Investments in development and technology modernization were insufficient. The supply of raw materials was unstable and still depended on imported raw materials (over the past four years, the export value of processed forest products soared 400% but imported raw materials accounted for 80% of total need quantity);

- The forestry sector's impacts on hunger eradication and poverty alleviation remained limited. Not many jobs were created. Forester incomes remained low and unstable (in Thanh Hoa province, well-off households earned an average of VND 461,000/person/year from forestry; households living just above the poverty line earned VND 786,000/person/year and poor households earned VND 241,000/person/year). Most mountainous inhabitants could not live on silviculture while forestry officers, employees and workers still met with many economic difficulties.

Following are causes of major constraints:

* Subjective causes:

- The awareness of branches and administrations at all levels about forestry is incomplete and incomprehensive. They have not yet had a correct assessment of the environmental values of forests to the society and a clear determination of the role of forestry as a complete economic sector from afforestation, exploitation and processing of forest products to provision of forest services. Particularly, a portion of state management officials has not changed their awareness about the role and position of the sector in the new mechanism and the process of accelerated rural and agricultural industrialization and modernization and international integration. They have not yet realized the fact that forestry is a specific, important econo-technical sector which needs adequate budgetary investments and particular mechanisms and policies;

- Forestry policies remain inconsistent and incompliant with the guideline on socialization of silviculture and the market mechanism. New policies on investment in the development of production forests and processing of timber and non-timber forest products have not yet been adopted in time to create a momentum for promoting economic sectors, especially households, communities and individuals, to participate in developing silviculture;

- The socialization of forestry has not yet seen marked progress; the forest and forestland management still reveals many constraints and the land and forest allocation remains slow. Many localities remain too cautious in allocating natural forests and plantation forests to local inhabitants, especially communities, households and private entities (by March 31, 2006, land use rights were allocated and land use rights certificates were granted to households for only nearly 20% of forestland area). The non-state sector's participation in forestry activities has not yet matched its potential.

- The system of management of the forestry sector lacks uniformity and remains uncoordinated and partitioned. The quantity, capacity and qualifications of managers, scientific and technical personnel, etc., fail to meet requirements of the market mechanism and international integration. Imbalanced arrangement of staffs between forest protection and forest development jobs has reduced the effect and effectiveness of the management apparatus. Forest and forestry management has basically been decentralized to localities but local administrations still lack mechanisms and policies, material and technical foundations and staffs to well bring into play their role in forest management, protection and development, particularly at district and commune levels;

- Science and technology has not yet created an impetus for substantially raising economic benefits of silviculture, linked production to the market, laid down adequate orientations for the development of forest tree seeds, made considerable contributions to raising productivity of natural forests and identified solutions to rationally using millions of ha of impoverished natural forests to generate incomes for mountainous inhabitants. The network of forestry extension organizations remains inadequate and weak.

- Forestry development has so far mainly relied on state budget funds and has not yet mobilized to the utmost resources from the non-state sector and environmental services. Investments in the forestry sector and silviculture remain lower than expected; the management of use of investment resources has not been strict, unified and effective. The investment structure remains imbalanced with a lot of investment in protection and special-use forests, less investment in production forests and no investment in building forestry infrastructure.

* Objective causes:

- Forests are located in large areas while the population pressure on forestland and forest products keeps increasing, especially in mountainous areas with shortage of cultivation land and free migrants.

- The production cycle of forest trees is long, with low profits and many risks while forests are located mainly in mountainous areas with poor economic and social conditions. Compared to many crop plants, forest trees are much less competitive.

III. Opportunities and challenges

1. Opportunities

- The demand for forest products is strongly increasing in the domestic and world markets. Our continued stable economic development at a high rate and the process of international integration will create a big opportunity for farmer households, communities, and state and private enterprises to accelerate development and expansion of forestry production and business, and forest product processing and trade.

- International economic integration will offer opportunities for improving the investment environment and penetration into the world forest product market, acquisition of advanced technologies and financial investment, particularly in the development of the industry of processing timber and non-timber forest products for export, thereby accelerating the process of sustainable forest management;

- The Party, State and society as well as international community have paid greater and greater attention to forest protection and development work.

2. Challenges

- Growing population, continued free migration and inefficient modalities of use of agricultural land and forestland have exerted increasing pressure on forests for the expansion of agricultural land areas;

- Ever-increasing demands for forest products are exerting pressure on natural forest resources and the environment, especially on natural forests. At present, forest product demand exceeds the sustainable supply capacity of forests. Land areas suitable for the planting of high-yield production forests remain very limited and scattered;

- The forestry production competitiveness is low. International integration offers big opportunities and poses great challenges to the processing and trade of forest products. In future, competition will become fiercer on the international market and even on the domestic market;

- The forestry sector's limited resources (human resources, infrastructure, funds, management qualifications, etc.) have many constraints in meeting the requirements of rapid, comprehensive and sustainable development;

- The forestry sector's importance has not yet been fully, objectively and justly appreciated, which affects the process of making investment and development policies for the sector.

I. Socio-economic background

1. Some world trends that affect national socio-economic development

- Economic globalization is an objective trend and economic integration is inevitable and expanded to most domains, creating opportunities for development as well as showing many factors of inequity and causing big difficulties and challenges to many states. Economic and trade competition and the fight over natural resources, energy, markets, funding sources, technologies, etc., among countries have become fiercer. Science and technology, particularly information technology, continues its development in leaps and bounds, promotes the formation of a knowledge economy and has exerted multiple impacts on and generated profound changes in all areas of social life in all countries.

- Peace, cooperation and development constitute a common trend in the region and the world. Global issues, such as population, environment, financial security and food security, diseases, etc., have become ever severer. The increasing need for development cooperation dictates from the outset the selection of development strategies by all national economic sectors, including forestry. The construction of a trans-Asia highway and an economic corridor linking North Vietnam to China's southwest will create many opportunities for agricultural production and forestry development.

- For foreign capital flows: It is a general trend that ODA will decrease and FDI will increase in territories with a favorable investment environment and highly profitable production industries;

These world and regional development trends will have vigorous impacts on the domestic situation. They create opportunities for taking new steps forward in socio-economic development in general and in the forestry sector in particular.

2. National development in the past years

- After 20 years' renewal (1986-2005), many achievements have been recorded in national socio-economic development. GDP grows at an average rate of 7.5%. However, economic growth is not truly stable with low quality and growth effectiveness;

- Industrial production grows at a high rate, an annual average of 15.7%. Particularly, the sub-sector of forest product processing has prospered, with the export value increasing 400% over the past four years. Agricultural and rural reforms help quickly increase production value, turning Vietnam into one of top world exporters of rice, coffee, pepper, etc. Nevertheless, the rate of technological renewal is slow and competitiveness remains low. The use of land in agriculture and forestry is irrational, with low productivity and quality and slow production restructuring and rural and agricultural industrialization and modernization. Science and technology have not yet truly become a foundation as well as momentum for agricultural production and forestry development;

- Many achievements have been recorded in social aspects. The people's living standards have markedly improved. Poverty continues to decrease. Human resources development has seen positive changes even in rural and mountainous areas. However, the rate of hungry and poor households remains high and the danger of relapse into poverty still lingers, especially among ethnic minority groups in deep-lying and remote areas. The quality of human resources fails to meet renewal requirements;

- Many policies and laws have been promulgated or amended to better accord with market mechanisms and international integration, step by step forming a complete, secure and favorable legal environment for production and business activities. However, economic law remains incomplete and inconsistent. Administrative reforms have not yet been carried out resolutely and the administrative apparatus remains ineffective and slow to be renewed. Civil servants remain weak in capacity and quality.

- International economic integration has seen significant developments. Total export turnover increases rapidly over 16% a year. The trade liberalization policy has created a driving force for domestic and foreign enterprises to directly participate in export and import business activities, including export and import of timber and non-timber forest products. The accession to and implementation of international commitments and conventions concerning forestry such as the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the RAMSA Convention on Wetlands, the Biodiversity Convention (CBD), the United Nations Convention to Combat Desertification (UNCCD) and so on, have created many favorable conditions as well as posed not a few challenges to agricultural and forestry enterprises in their competition on the world market and even on the local market.

The Forestry Development Strategy is formulated at the time of beginning the implementation of the 2006-2010 five-year socio-economic development plan with the objective of soon taking our country out of underdevelopment status, creating a foundation for our country to basically become an industrialized country developing toward modernization.

II. Forecasts on population development and GDP by 2020

- Population: Vietnam's population will reach about 100 million by 2020 (at the growth rate of 1.5% during 2001-2010 and 1.3% during 2011-2020) or 98.6 million (at the corresponding rates of 1.4% and 1.2%).

- GDP is projected to grow at 7.2%/year in the 2006-2020 period. According to Vietnam's 2006-2010 five-year socio-economic development plan, GDP per capita is expected to reach USD 1,050-1,100 by 2010, with which Vietnam will no longer be considered a poor country. According to orientations, by 2020 Vietnam will basically become an industrialized country developing along the line of modernization.

III. Forecasts on demands for forest products and environmental services

Population growth and economic development will affect demands for forest products and environmental services. Analyses and forecasts in the Strategy focus on forest products, mostly timber (see details in Table 1 enclosed herewith).

I. Development viewpoints

1. Forestry shall be developed comprehensively from management, protection, development and reasonable use of natural resources, planting and improvement of forests to exploitation and processing of forest products, environmental services, ecotourism, etc. (as per the definition of forestry in the Part Introduction).

Forestry, like agriculture, is not merely production of crude products but covers also processing, trading and services. Evaluation of the sector's contributions should take into account added value of its products from production, processing and trading and its services. Only with such evaluation can forestry be treated equally as other economic sectors.

2. Forestry development must make greater and greater contributions to economic growth, hunger eradication and poverty alleviation, and environmental protection.

Forestry development must comply with the national socio-economic development line and accord with the market mechanism. Forestry shall be soon turned into an efficient and sustainable commodity production sector in response to renewal and integration requirements. Aggregate benefits of forest shall be rationally tapped and importance shall be attached to productivity, quality and effectiveness of production and business activities, particularly forest environmental services.

Forestry development must contribute to diversifying rural economic activities, creating jobs and generating incomes and improving living standards of people engaged in silviculture, especially ethnic minority people in mountainous, deep-lying and remote areas; and to hunger eradication and poverty alleviation in rural areas, protection of the ecological environment, conservation of biodiversity and preservation of security and defense.

3. Sustainable forest management, use and development is the foundation for forestry development

Forests must be closely managed and have specific owners; only when forest owners (organizations, enterprises, households, communities, etc.,) have clear benefits, powers and responsibilities can natural forest resources be protected and developed in a sustainable manner.

Forestry production activities shall be based on sustainable management according to forest protection and development plannings and plans with a view to continuously raising forest quality. Forest protection, conservation and development shall be combined with rational forest use; afforestation, forest regeneration, rehabilitation and enrichment shall be closely combined with protection of existing forest areas; forestry shall be combined with agriculture, fishery and rural trades; planting of economic forests for multiple purposes shall be accelerated; protection and development of trees for timber and non-timber products shall be combined with development of the forest product processing industry so as to contribute to economic growth, social development, environmental protection and national sustainable development.

4. Forestry development shall be based on accelerating and deepening the socialization of silviculture and attraction of resources for investment in forest protection and development

To further carrying out and deepening the socialization of silviculture. To introduce multi-sector use of natural forest resources (including special-use and protection forests) and multi-owner management and use of production forests and forest products processing establishments. To step by step extensively equitize forestry production and processing establishments associated with raw-material supply zones.

To protect forests is the duty of forest owners as well as administrations at all levels, branches, organizations, village communities and the entire society. Forest protection shall rely on the people, full-time protection forces and local administrations.

To diversify resources for forestry development, further attract funds from the private sector, ODA capital, FDI, revenues from environmental services, etc., for forest protection and development.

State investment in forestry is social payment for the environmental values of forests. Economic branches that use forest products and forestry services (environmental protection, tourism, water supply, etc.) shall make payments in return for forest protection and development activities and account these payments as their production and service costs.

II. Objectives and tasks by 2020

1. Objectives

To establish, manage, protect, develop and use in a sustainable manner 16.24 million ha of land planned for forestry; to increase the percentage of land with forests to 42-43% by 2010 and 47% by 2020; to ensure wider participation of all economic sectors and social organizations in forestry activities in order to make greater and greater contributions to socio-economic development, protection of the ecological environment, conservation of biodiversity and provision of environmental services, hunger eradication and poverty alleviation, raising of living standards of rural and mountainous inhabitants, and preservation of security and defense.

2. Tasks

a/ Economic tasks: To establish, manage, protect, develop and use in a sustainable manner forests of three types. To properly manage existing natural forests, expand the area and raise the quality of plantation forests, promote agro-forestry activities and effectively use bare land areas appropriate for forestry development. Production and processing of timber and non-timber forest products must be competitive and sustainable to basically meet domestic and export demands for timber products and other forest products, specifically:

- The growth rate in production value of the forestry sector (including forest product processing industry and environmental services) will be from 4-5% a year, striving to increase the share of the sector's GDP in national GDP to 2-3% by 2020;

- To manage in a sustainable and effective manner 8.4 million ha of production forests, of which 4.15 million ha are plantation forests covering consolidated forests supplying industrial raw materials, non-timber forest products, etc., and 3.63 million ha of production forests being natural forests. The area of regenerated natural forests and for combined agro-forestry production will be 0.62 million ha. To strive for at least 30% of production forests to be issued forest certificates (assessed and issued certificates of compliance with standards of sustainable forest management);

To rationally plan, manage and effectively use about 5.68 million ha of protection forests and 2.16 million ha of special-use forests.

- To afforest 1.0 million ha by 2010 and 1.5 million ha afterwards. To reforest 0.3 million ha a year following exploitation.

- To zone off and regenerate 0.8 million ha of forests.

- To carry out dispersed plantation with 200 million trees a year.

- To increase the domestic timber output to 20-24 million m3 a year (including 10 million m3 of big timber), basically meeting the demands of forest product processing and pulp industries for raw materials and export demands.

- To harvest fuel wood with 25-26 million m3 a year for rural areas.

- To increase the value of exported forest products to over USD 7.8 billion (including USD 7 billion of timber products and USD 0.8 billion of non-timber forest products).

- To increase revenues from the forest environment values through the clean development mechanism (CDM), ecotourism, prevention of erosion, protection of water sources, etc., up to USD 2 billion by 2020.

b/ Social issues:

To improve the livelihood of inhabitants engaged in silviculture through socializing and diversifying forestry activities; to create jobs, raise awareness, capacity and living standards for inhabitants; to pay special attention to ethnic minority people, poor households and women in deep-lying and remote areas to step by step help inhabitants engaged in silviculture live on silviculture, contributing to hunger eradication and poverty alleviation, preservation of security and defense; specifically:

- To create 2 million jobs in forestry (including the processing of timber and non-timber products and fine-arts and handicraft villages);

- To generate incomes, contributing to eradicating poverty and reducing 70% of poor households in key silviculture areas;

- To complete the allocation and lease of forests and forestland to organizations, enterprises, households, individuals and village communities before 2010;

- To increase the percentage of trained forestry workforce to 50%, especially ethnic minority and poor households and women in deep-lying and remote areas.

c/ Environment:

- To protect forests and conserve the nature and biodiversity in order to effectively perform the functions of the forestry sector, including watershed protection, coastal protection, urban environmental protection, natural disasters mitigation, erosion prevention, water source preservation, protection of habitats and generation of revenues for the forestry sector from environmental services (environmental charges, carbon dioxide emissions market, ecotourism, cultural tourism, resorts, etc.), making contributions to the national economy.

- To increase forest cover to 42-43% by 2010 and to 47% by 2020.

- By 2010, to have new 0.25 million ha of protection and special-use forests.

- To minimize violations related to forest natural resources. To restrict slash-and-burn farming on forestland.

III. Orientations for forestry development

1. General orientations

a/ Orientations for planning three types of forests and forestland

On the basis of criteria of special-use forests and protection forests and the requirements of development of production forests to achieve socio-economic objectives, the orientations for planning forest and forestland areas are as follows:

- For protection forests:

+ To review and rearrange the system of national protection forests of about 5.68 million ha, mostly very crucial, including 5.28 million ha of watershed protection forests; 0.18 million ha of wavebreak and anti-sea encroachment protection forests; 0.15 million ha of windbreak and sandbreak forests and 70,000 ha of protection forests in service of environmental protection for big cities and industrial parks, and establish protection forests in border areas and on islands;

+ For watershed protection forests, to review and rationally arrange existing projects while focusing on formulating investment projects on protection and regeneration of protection forests in the northern mountainous region (in the basins of Da river, Red river, Lo river, Gam river, etc.), the northern Central Vietnam (in the basins of Ma river, Ca river, Gianh river, etc.), the southern Central Vietnam (in the basins of Cai river, Con river, Da Rang river, Tra Khuc river, etc.), and the Central Highlands (in the basins of Xe Xan river, Ba river, Dong Nai river, etc.);

+ For wavebreak, anti-sea encroachment, windbreak and sandbreak protection forests, to concentrate efforts on formulating a project on protection, rehabilitation and development of submerged forests in coastal areas in the north, northern Central Vietnam, coastal Central Vietnam and Mekong river delta, and strengthen and develop the system of sandbreak and wavebreak forests in coastal Central Vietnam areas;

+ For protection forests for environmental protection, to concentrate efforts on establishing forests in big cities like Hanoi, Ho Chi Minh City, Da Nang, Hai Phong, Ha Long and Can Tho, and industrial parks like Dung Quat, Vung Tau, Bien Hoa and Binh Duong;

+ To establish protection forests in the areas bordering on China, Laos and Cambodia.

- For special-use forests:

To review and strengthen the system of existing natural special-use forests with a total area not exceeding 2.16 million ha in the direction of raising forest quality and biodiversity value, ensuring the criteria set by the Ministry of Agriculture and Rural Development; to refrain from extensively developing national gardens and nature reserves. For ecosystems which have not yet existed or exist in few places, it is possible to invest in establishing several new reserves in the northern mountainous region, northern Central Vietnam and the Central Highlands and in wetland areas in the northern and southern deltas. To establish biodiversity corridors with a view to forming larger ecological zones.

- For production forests:

+ The total area of planned production forests will be 8.4 million ha, including 3.63 million ha of natural forests and 4.15 million ha of plantation forests; importance will be attached to establishing consolidated industrial raw-material supply forest areas; to manage sustainable use for multiple purposes. The remaining land area planned for development of production forests and 0.62 million ha of impoverished natural forests will be used for rehabilitating forests and agro-forestry production.

- Under the Law on Forest Protection and Development, forests are classified into special-use forests, protection forests and production forests. However, in order to approach international classification, it is necessary to study the classification of forests into two types: protection forests and production forests.

(See details in Table 2 enclosed herewith).

b/ Orientations for forest management, protection, development and use

- Forest management:

+ The entire area of 16.24 million ha of forests and forestland shall be uniformly managed on the basis of establishing permanent national forest estates according to the system of sub-areas, compartments and lots on the map and in the field. Forest management shall be based on associating investment costs, economic benefits and environmental values, and associating and sharing benefits between forest owners and communities;

+ By 2010, basically all forest areas (natural forests and plantation forests) and forestland areas shall be allocated or leased to forest owners of all economic sectors, specifically:

State organizations shall manage most of special-use forests (about 85%), protection forests of national importance and large protection forests (about 70%), and a number of protection forests that are consolidated plantation forests or natural forests (about 25%). All remaining area of production forests (75%), special-use forests (15%) and protection forests (30%) shall be managed by state enterprises, private enterprises, communities, cooperatives, households and individuals in accordance with law.

Households and village communities shall be allocated or leased according to law production forests that are natural forests or plantation forests, forestland and a number of small and dispersed special-use forests or protection forests that have been associated with communities for ages. Dispersed forest and forestland areas located close to villages shall be allocated to households, first of all poor households and ethnic minority households, for constructing forest gardens to meet their household needs;

Enterprises shall be allocated or leased according to law small production forests (natural forests or plantation forests), special-use forests or protection forests. To widely apply models of participation by communities, households and individuals in managing and protecting forests under the management of state organizations.

+ Allocation and lease of forests to forest owners must comply with the plannings and plans approved by competent authorities. Depending on those that are allocated or leased forests and on the type of forests, the State shall collect forest and forestland use levies at appropriate rates in accordance with law;

+ To modernize forest management work based on the wide application of information technologies, aerial photos' in statistics, inventory and monitoring of changes in natural forest resources and forestland, etc.

- Forest protection, nature and biodiversity conservation:

+ To change the perception that forest protection is merely protection of forest trees to that of protection of a constantly developing ecosystem combined with regeneration and optimal use of forests. To attach importance to inspecting the process of exploitation of forest products in forests; to inspect and control the circulation and sale of forest products is a measure for forest protection;

+ Forest protection and conservation shall adhere to the principle of development for protection and creation of every condition for forest owners and local inhabitants to participate in forest protection and development activities and generate lawful incomes so that they can live on silviculture. The State shall provide necessary supports for communities, households and individuals engaged in forest protection when they have not yet received any direct incomes from forests;

+ To protect and conserve forests is the direct responsibility of forest owners with the assistance of village communities and effective support of state management agencies in charge of forestry and of local administrations. Forest owners shall organize by themselves forest protection forces. Village communities act as important local forest protection forces;

+ To protect forests is the responsibility of local administrations and law enforcement bodies. Presidents of People's Committees at all levels shall organize forest protection and take responsibility for the occurrence of violations of the Law on Forest Protection and Development in localities under their management;

+ To attach importance to building and strengthening full-time and part-time forest protection forces of forest owners and village communities to be able to quickly respond to violations of the forest law and natural disasters such as forest fires and pests, etc;

+ Forest conservation must combine site conservation with conservation outside natural habitats on a large scale and with the breeding and rearing of forest animals of high economic value in accordance with law so as to create commercial products and serve forest conservation. To pay attention to developing buffer zones and establishing biodiversity corridors;

+ The forest ranger force is the key force that assists forest owners and villages and communes as well as the main force in handling violations of the law on forest protection and development, and, at the same time, gives advice to administrations at all levels on forest protection work. For communes with forests, local forest rangers and commune forestry officers are advisers of commune People's Committee on forest protection and development work. Armed forces and law enforcement bodies shall regard forest protection as an important political task of protecting national security, particularly for border protection forests;

+ The State shall ensure regular non-business funds and other funds for forest protection activities of special-use forest and protection forest management units. To quickly introduce the collection of charges for environmental forest services to provide additional funds for forest protection work;

+ To step by step enhance the role of associations, forest product producers and consumers and users of forest services in forest protection work;

+ To attach importance to propaganda work to raise the awareness of people of all strata about forest protection and development and the State shall allocate an adequate fund for this important political task.

- Forest development: To plan, classify and develop forests of three types (special-use forests, protection forests and production forests), combine conservation and protection with development of ecotourism, resort tourism and other environmental services.

+ Special-use forests shall be developed mainly through conservation of their original state to create the best habitats for conserving and developing endemic fauna and flora species and specific ecosystems with a view to raising the quality of these forests and the values of their biodiversity;

Apart from protecting the original state of specific forest ecosystems in strictly protected zones, for land areas without forests, to elaborate a plan on meadows and open ground areas where forest animals can live or to zone off for regeneration natural forests in which indigenous tree species are additionally planted or agro-forestry activities are carried out, etc, so that inhabitants living in special-use forests can generate incomes. To retain sufficient areas for strictly protected sub-areas, attach importance to making investments in eco-rehabilitation zones with a view to enhancing the capacity of conserving endemic fauna and flora species. To promote ecotourism, resort tourism, etc., and study and renew the method of managing special-use forests in compliance with the new global conception of nature conservation.

+ Protection forests shall be developed to meet to the utmost requirements regarding watershed protection, wavebreak, sea encroachment, sandbreak, etc., and contribute to conserving biodiversity. Though it is perceived that all forest areas have the protective function, only forests with a very important protection function are arranged and called protection forests. Depending on the level of importance, protection may be combined with agricultural production and fishery, landscape, resort and eco-environmental tourism business, exploitation of forest products and other benefits from protection forests.

Watershed protection forests must be built into consolidated, inter-regional and multi-layer forests, mainly through natural regeneration. Protection forests with windbreak, sandbreak, wavebreak, sea encroachment or environmental protection functions must be developed into forest belts suitable to natural conditions in each region.

+ Production forests shall be developed mainly in the direction of intensive cultivation with importance attached to their productivity and quality and combination with agricultural production, fishery, ecotourism, resort tourism and other environmental services;

For production forests that are natural forests, necessary forestry interventions should be made to increase to the utmost their productivity and benefits. To step up rehabilitation and development of natural forests through applying forestry measures of tending and enriching them with multi-effect tree species and non-timber forest resources so as to raise the quality and value of these forests and generate incomes for mountainous inhabitants. For areas of impoverished natural forests which are unsuccessfully regenerated and poor-quality plantation forests, new forests with higher economic benefits or environmental values can be planted.

For production forests that are plantation forests, to prioritize their development according to the planning on processing industry material supply zones in combination with planting quickly growing small-timber trees and perennial big-timber trees; to encourage the growing of multi-purpose trees and non-timber forest resources, attach importance to developing tree species that are Vietnam's strengths. To develop production plantation forests in response to market demand and in areas with competitive edge, stable production and high economic benefits. To concentrate efforts on quickly raising the productivity of plantation forests through applying modern bio-technologies and intensive cultivation practices with a view to basically meeting the demand of the forest product processing industry for raw materials by 2020.

+ To vigorously develop dispersed plantations so as to meet in time and effectively local needs for wood products and fuel wood, especially in delta and coastal areas;

+ To encourage all economic sectors to invest in developing forests and establishing large and medium consolidated raw-material supply zones so as to ensure raw materials for processing industries and increase the effectiveness of land use. To encourage all forms of joint venture, partnership and the establishment of forestry cooperatives;

+ To apply science and technology as a driving force for forestry development on the basis of applying advanced scientific and technological achievements and perpetuating silvicultural experience of local inhabitants. To conduct forest development researches in two major directions of improving forest tree species and applying silvicultural measures to increase the productivity and quality of forests as well as their values of environmental protection, nature and biodiversity conservation.

+ The State shall accelerate the building of infrastructure in service of forest development, pay special attention to the system of seed forests, national seed gardens, forestry roads and the system of prevention and fight of forest fires and prevention and control of forest pests, etc.

+ To diversify sources of income through developing short-term crop plants and rearing domestic animals to generate immediate incomes while planting small forests, participating in managing, protecting and enriching natural forests, developing rural trades, particularly medium- and small-scale processing of forest products, to generate higher incomes for mountainous inhabitants, especially poor households at risk of relapse into poverty.

- Orientations for the use of forests and development of the forest product processing industry:

+ Forest exploitation and use:

To reasonably exploit and use forest resources, which is also a silvicultural measure to regenerate forests and improve their quality; to provide exploitation guidelines suitable to the protection functions and level of forests;

To conduct sustainable exploitation and use of natural forests according to forest management plans and on the principles that forests, mainly rich forests, shall be exploited at an intensity level depending on the growth volume of forests; medium and poor forests shall be mainly exploited at different intensity levels for the purposes of nurturing and enriching forests.

To exploit to the utmost environmental forest services, such as watershed protection, protection of coastal and urban environment, ecotourism and resort services, carbon credit under the Clean Development Mechanism, etc., to generate revenues for reinvestment in forest protection and development;

Forest exploitation and use must bring about profits for forest owners and communities participating in forest management and protection, and reduce adverse environmental impacts. The State shall encourage organizations, households, individuals and local communities to invest in, manage, exploit and use forests in a sustainable manner;

About 70% of existing production forests are impoverished natural forests and newly rehabilitated forests in which forest products cannot be exploited in the next 5-10 years. Therefore, it is necessary to further nurture, improve and enrich these forests to raise their quality so as to create sources of supply of big timber, non-timber forest products and environmental services after 2010;

To encourage the use of fuels that are waste materials from plantation forests and agriculture and of other fuels with a view to minimizing the use of fuel wood from natural forests.

To accelerate the planting and use of non-timber forest resources, concentrating on product groups that are our strengths such as rattan, bamboo articles, pharmaceutical materials, resin oil and foodstuffs; to encourage the breeding and raising of forest animals; to introduce a mechanism that allows forest owners to lawfully exploit and use non-timber forest products.

+ To develop the forest product-processing industry:

Forest product processing and trade must become the economic spearhead of the forestry sector, develop according to the market mechanism on the basis of advanced technologies, and increase to the utmost benefits of forest products in order to meet export and local consumption demands.

The non-state sector shall play an important role and be encouraged to invest in developing the forest product processing industry. To attach importance to development quality by applying measures to renew management mechanisms, renew state enterprises, encourage participation of the private sector, and create more healthy and transparent markets;

To focus on developing highly competitive products such as home wood furniture, outdoor wood articles, fine-art wood items and rattan and bamboo products. From now to 2015, to concentrate on reviewing, strengthening and upgrading small- and medium-sized forest product-processing industrial establishments and developing the industry on a large scale after 2015;

To build and expand forest product processing industrial parks in areas where sufficient raw materials can be supplied in a stable and infrastructure is convenient, ensuring profits and competitiveness on the regional and world markets. To step up modernization of the processing industry on a large scale and, at the same time, step by step develop and modernize small-scale processing industries in rural areas and traditional craft villages, contributing to diversify agricultural and rural economy. To encourage the formation of establishments that produce and processing plantation forest timber and non-timber forest products.

To accelerate the processing of artificial boards and pulp, gradually reduce the processing of paper chips for export. To encourage the use of products from artificial boards and plantation forest timber.

+ Orientations for import and export of forest products:

To respond to the international integration trend, the forest product processing industry shall be developed in the direction that all raw materials will not be self-supplied. At present, Vietnam still has to import raw materials for export processing and domestic consumption. To properly organize the import of forest raw materials together with accelerating the planting of raw-material supply forests that supply big timber and non-timber forest products to meet the demands for raw materials for processing, gradually reduce dependence on imported raw materials and increase added value of processed products;

Major export products will be home wood furniture, outdoor wood articles, fine-art wood items, and refined non-timber products. To pay attention to big markets, namely the US, EU and Japan;

To diversify and continuously improve the quality and designs of processed products suitable to domestic and foreign customers' tastes. To accelerate the creation of trademarks and issue of certificates for export goods.

2. Orientations for region-based forestry development

a/ The northern midland and mountainous region

- Northwestern sub-region (Dien Bien, Lai Chau, Son La and Hoa Binh):

+ To establish and strengthen watershed protection forests at hydropower plant sites along Da river in order to reduce droughts, floods and erosion and increase water supply for hydropower plants and irrigation works;

+ To continue conserving tropical forest ecosystems on mountainous areas and gene sources of rare and precious forest flora and fauna species, and develop ecotourism;

+ To diversify sources of income based on developing socialized forestry, gradually reducing and replacing slash-and-burn farming with agro-forestry production in order to protect and develop forests and improve living standards for communities;

+ To establish raw-material supply zones for the industry of processing timber (paper and artificial boards) and non-timber forest products. To prioritize development of small-scale processing of timber and special non-timber forest products suitable to the characteristics of each region.

- The northeastern sub-region (Ha Giang, Cao Bang, Bac Kan, Lao Cai, Tuyen Quang, Yen Bai, Lang Son, Thai Nguyen, Quang Ninh, Vinh Phuc, Phu Tho, Bac Giang and Bac Ninh):

+ To establish raw-material supply zones associated with the processing industry to basically meet the demands for paper, woodchips, pit-props and wood products on the basis of practicing intensive cultivation on 1.5 million ha of production forests (including both natural forests and plantation forests), and establish consolidated industrial raw-material supply zones on high-productivity land areas among nearly 1 million ha of bare land;

+ To build forest product processing and trade industrial clusters for the northern region in the development triangle of Hanoi, Hai Phong and Quang Ninh, and its vicinity. To develop forest product processing villages. To build another MDF board plant with an annual output of 100,000 m3 and modernize existing artificial board plants in Viet Tri, Thai Nguyen, etc. To promote export, with attention paid to the Chinese market;

+ To establish and strengthen the system of watershed protection forests at river estuaries, and coastal protection forests;

+ To continue establishing and consolidating national gardens, nature reserves and historical landscape forests; to develop ecotourism.

b/ The northern delta region (Hanoi, Hai Phong, Ha Tay, Hai Duong, Hung Yen, Ha Nam, Nam Dinh, Thai Binh and Ninh Binh):

- To establish and strengthen protection forests in service of environmental protection in urban centers and industrial parks and coastal protection; to step up dispersed plantations, improve landscape and partly meet the demand for timber for domestic use;

- To strengthen and protect existing national gardens such as Cuc Phuong, Ba Vi, Cat Ba and Xuan Thuy, nature reserves, historical and cultural relic and landscape sites; to promote ecotourism and resort services.

To renew technologies and enhance capacity for enterprises and traditional trade villages engaged in processing wood products and non-timber forest products.

c/ The northern Central Vietnam region (Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri and Thua Thien Hue):

- To concentrate efforts on establishing and consolidating watershed and coastal protection forests to prevent flying sand, waves and coastal landslides;

- To protect and strengthen national gardens of Pu Mat, Vu Quang, Ben En, Bach Ma, Phong Nha - Ke Bang and other nature reserves. To establish special-use forests in northern and central Truong Son mountain range to protect biodiversity in the region in combination with watershed protection;

- To establish and develop raw-material supply zones to supply timber and non-timber forest products, which are associated with the processing industry, so as to form industrial forest product processing zones in localities based on potential and market. To promote the processing of wood products (first of all paper chips) and develop rural trade villages, with attention paid to non-timber forest products (pine latex, bamboo, rattan, etc);

- To promote community-based forest management, especially for scattered watershed protection forests and sandbreak protection forests, and activities of improving infertile soil.

d/ The coastal southern Central Vietnam region (Da Nang, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan and Binh Thuan)

- To strengthen the system of watershed protection forests, especially in deforested sloping mountainous areas. To promote the planting of protection forests to prevent wind, flying sand and coastal landslides;

- To step up protection of existing forests and afforestation in barren areas in Ninh Thuan and Binh Thuan provinces for improving water sources and cultivation land;

- To protect and strengthen existing national gardens like Nui Ong and Takou. To continue establishing special-use forests in southern Truong Son mountain range and traditional historical and cultural areas, and promote and develop ecotourism;

- To establish key plantation forests supplying industrial raw materials and non-timber forest products linked to the key export processing zone from Quy Nhon to Da Nang. To upgrade technologies and equipment in the processing of woodwork for export, artificial boards and pulp;

- To build another particle board plant with an annual output of over 100,000 m3 of products.

e/ The Central Highlands region (Gia Lai, Kon Tum, Dak Lak, Dak Nong and Lam Dong)

- To immediately identify permanent forest estates in the Central Highlands for establishing production forests that supply big timber; at the same time to strengthen and protect the system of watershed protection forests in the coastal southern Central Vietnam and the southeast;

- To promote protection of national gardens and nature reserves rich in biodiversity such as Ngoc Linh, Yok Don, Chu Yang Shin, Bi Dup ' Nui Ba, Chu Mom Ray, etc., To conserve endemic species in Khop forests and pine forests and develop ecotourism;

- To properly manage natural forests, regenerate, tend and enrich them. To promote terrain potential for planting multi-purpose forests (big timber, small timber, non-timber forest products, eco-environmental values), in order to basically meet the raw materials demands of processing centers in the Central Highlands and coastal southern Central Vietnam provinces.

- To enhance capacity and upgrade equipment and technologies for forest product processing clusters in Buon Ma Thuot, Buon Ho, Pleiku, An Khe, Kon Tum, etc.

- To expeditiously implement land policies, allocate land and forests and develop community-based forestry, contributing to creating jobs, improving living standards and raising knowledge for Central Highlands ethnic minority inhabitants, especially in deep-lying and remote areas;

f/ The southeast region (Ho Chi Minh city, Binh Phuoc, Tay Ninh, Binh Duong, Dong Nai and Ba Ria – Vung Tau):

- To expeditiously establish permanent forest estates; to strengthen and protect the system of watershed protection forests and protection forests of reservoirs, dams and hydropower plants such as Tri An, Dau Tieng, Thac Mo, etc., to step up the establishment of environmental protection forests for industrial parks, big cities and coastal areas.

- To accelerate the processing of forest products in the region and the planting of forests for intensive farming so as to partially supply raw materials for export processing parks in Ho Chi Minh City, Bien Hoa, Binh Duong and Vung Tau, and Tan Mai paper plant in Dong Nai.

- To promote protection and conservation of biodiversity in special-use forests like national gardens of Bu Gia Map, Con Dao, Cat Tien, Lo Go - Sa Mat and Can Gio, and other nature reserves. To attach importance to developing ecotourism and resort services.

g/ The Mekong river delta region (Long An, Dong Thap, An Giang, Tien Giang, Hau Giang, Vinh Long, Ben Tre, Kien Giang, Can Tho, Tra Vinh, Soc Trang, Bac Lieu and Ca Mau):

- To expeditiously establish permanent forest estates for three types of forests. To step up dispersed plantations on land areas under aquaculture and agriculture. To properly handle the relationship between protection of submerged forests and aquaculture;

- To establish and strengthen wavebreak protection forests to protect the shore and other projects;

- To strengthen and protect special-use forests; to expeditiously rehabilitate the submerged forest ecosystem and the cajuput forest ecosystem. To study and implement effective measures to prevent and fight cajuput forest fires. To encourage conservation and development of traditional endemic animal species such as python, crocodile, tortoise, snake, bee, etc.

- To build forest product processing establishments of appropriate sizes, prioritize researches into the use of mangrove, cajuput, eucalyptus, etc., as raw materials for the production of pulp, artificial boards and woodwork for domestic consumption and export.

To organize combined agro-forestry and fishery production and business activities to ensure people's life and protect the environment.

I. Policy and law-related solutions

1. Policies on forest and forestland management

- To build a legal corridor for establishing national permanent forest estates and place markers on the field;

- To revise and perfect policies on allocation and lease of forests and forestland so as to create a driving force for encouraging all economic sectors to participate in protecting, developing and trading in forest products and to ensure satisfactory benefits for forest owners;

- To prioritize the allocation and contracting of protection forests to communities, cooperatives and households for long-term management, protection and benefit sharing according to plannings and plans approved by competent authorities;

- To facilitate forest owners to exercise the rights to use land and use and own forests according to the provisions of law in their production and business activities in compliance with the law of commodity production to make forests truly become a commodity and a source of funding for forestry development. To encourage land accumulation for forming consolidated raw-material supply plantation forests in the form whereby households and individuals lease or contribute shares with their forests and forestland use rights;

- To continue piloting and widely applying models of community-based forest management; to perfect regulations on forest management and benefit sharing involving multiple sectors. To perfect and implement mechanisms and policies to lease production forests and protection forests that are natural forests. To pilot and build a legal foundation for the allocation and lease of special-use forests to non-state economic sectors, especially for ecotourism and resort services.

- To step up the review, formulation and perfection of legal documents on forest management, protection, development and use; to abolish cumbersome and ineffective administrative procedures. Fine local customs and practices should be considered, studied and perfected for incorporation into forest protection and development rules suitable to each locality.

- To further decentralize state management of forests to district- and commune-level administrations. To clearly define responsibilities and powers of forest owners, administrations at all local levels, law enforcement bodies and villages in localities where forests are lost or destroyed;

- To intensify law dissemination and education to raise the forest protection and development awareness and responsibility of administrations at all levels, branches, every owner, every citizen and the entire society in combination with enhancing state management, institutions and laws.

2. Financial and credit policies

- To develop specific capital construction and investment mechanisms for the forestry sector and renew the mode of state investment in the sector according to the forest protection and development plan to replace the current allocation of funds according to average investment ratios;

- To develop a mechanism to ensure that all economic sectors taking part in forestry production and business access and borrow long-term loans suitable to the forestry tree business cycle from investment capital and credit sources on an equal basis.

- In order to attract investors, particularly foreign investors, to create a transparent and stable investment environment, ensure clear industrial property rights, rights to use land and use and own forests for a long term, supply accurate information on investment opportunities and forest resources, and simplify enterprise formation procedures. To implement policies to switch state investment from direct to indirect investment (infrastructure, seeds, science and technology, etc.) and create favorable conditions for private enterprises to invest in forest product production and processing;

- To publicize forestry development plannings, pilot and widely apply the bidding for lease of forests for production, ecotourism or resort services. The State shall make more efforts to formulate a planning on and support the formulation of some projects on consolidated industrial raw-material supply plantation forests to call for domestic and foreign investment;

- To formulate and implement an economic policy mechanism to ensure retrieval of environmental service values created by the forestry sector and provided to the society such as protection and creation of water sources for hydropower and irrigation projects, coastal protection, environment protection for urban centers, ecotourism, cultural tourism, resort tourism, etc. For organizations and individuals benefiting from the forestry sector's environmental services, they are obliged to pay charges for these services as a financial source for reinvestment to ensure the forestry sector's balanced and sustainable development. Thus, the requirement of formulating a forestry policy mechanism in the new period is to enable the forestry sector to "tend forests with forests" rather than with state subsidies.

To carry out on a pilot basis a small afforestation project applying the clean development mechanism (CDM) to create incomes for poor population communities and small enterprises, and a larger project for other enterprises.

- To step up the valuation of forests as a basis for forest-related transactions. To set up central and local forest protection and development funds from different sources of funding (budgetary fund, ODA capital, environmental service charges, carbon credit, ecotourism, fines collected for violations of the Law on Forest Protection and Development, and other contributions), and work out appropriate mechanisms of managing and using these funds.

- To increase budgetary funds for the management, protection and development of special-use forests, protection forests and production forests, scientific research, forestry extension, human resource training, establishment of a modern forest management system, forest inventory and planning, establishment of high-quality seed forests and gardens, and make adequate investments in building forestry infrastructure like agricultural infrastructure;

- For protection forests and special-use forests, the State shall allocate annual non-business funds for their management units and funds for the operation of village or commune forest protection teams; for production forests, the State shall support the planting of rare and precious tree species, trees with a long business cycle and the building of forestry infrastructure, particularly forestry roads, forest fire prevention and fight facilities and equipment and forest pest prevention and control for consolidated raw-material supply plantation forests.

- The State shall accelerate the contracting of protection forests for protection along the line of directly enjoying forest benefits and other incomes, including charges collected from environmental services; shall conduct further researches and make adequate investments in developing combined agro-forestry and producing non-timber forest products (from consolidated forests and under forest canopy) to gradually replace the current mechanism of contracting with money from the state budget;

- The State shall implement a mechanism to provide preferential loans for households engaged in forest protection and development, especially households of the poor and ethnic minority people in mountainous, remote or deep-lying areas, so that they can develop production by the mode of combined agro-forestry, non-timber forest products, rearing of big cattle and cultivation of crop plants when they have not yet got incomes from forests;

- The State shall supply seeds, seedlings, fertilizers, etc., for households, individuals and village communities, particularly poor households, to plant small production forests. This is regarded as payments of the State to forest planters for environmental benefits brought about by their forests to the society.

- To study an afforestation risk insurance mechanism for forest owners; in the immediate future, to use the risk support amount from the Forest Protection and Development Fund.

II. Renewing production and business organization and management and encouraging all economic sectors to participate in forestry development

- To promote the equitization of state-owned forestry enterprises (the State shall not hold dominant shares); to develop forms of joint venture and association between state companies and private enterprises and communities in forest planting and protection and forest product processing; to develop cooperative economy in forestry;

- To renew state-owned forestry farms and reorganize effectively operating ones into medium or big forestry state companies engaged in diversified production and business activities connected with forest product processing and trade in regions with consolidated forestland areas, acting as the core in the sector's development; to proceed to equitize them, allow them to enjoy financial autonomy and conduct various production and business activities in accordance with law. The State shall provide funds for them to carry out forest and forestland allocation or lease procedures, support training to raise the capacity of their personnel; and provide funds for forest inventory and elaboration of forest management plans for the first cycle;

- To attach importance to developing forestry production and business based on households, farms, village communities and cooperatives. For mountainous households, the State shall provide funds for them to restructure crop plants in the direction of combined agro-forestry in order to minimize slash-and-burn farming;

- To implement a mechanism to prioritize the participation of poor and ethnic minority households in forestry enterprises' and farms' activities of planting consolidated industrial forests and processing forest products on a small scale so as to create more jobs and generate incomes for them;

- To encourage the private and non-government sectors to participate in forestry research, training and extension activities through public bidding;

- To implement policies to encourage all economic sectors, especially the private sector at home and abroad, to invest in forest business and forest product processing. To exempt forestland use tax for enterprises, households and individuals engaged in forestry production in the first cycle; to exempt taxes for forest product processing enterprises that are newly built or renew their technologies; to simplify procedures for commercial exploitation and marketing of forest products.

III. Planning, plan and supervisory solutions

- To review the planning on three types of forests, change protection forests and special-use forests that fail to meet required criteria into production forests, identify permanent forest estates and place markers on the field;

- To make statistics on, inventory and monitor natural forest resource changes in combination with making statistics on and inventorying land. To create and update a database on forest resources management and apply advanced technologies to improve the quality of forest planning investigations;

- To improve the quality of formulation and implementation of forest protection and development plannings and plans at all levels, of forestry units and communities in association with local socio-economic development plannings and plans. While formulating plannings and plans on protection of special-use forests, to formulate plannings and plans on protection and development of buffer zones and biodiversity corridors.

- To renew the planning method and improve the planning quality in the direction of promoting networking combined with the use of inter-branch information and involving the participation of concerned parties;

- To plan and develop forest product processing and trade industrial parks along with reviewing and establishing consolidated industrial raw-material supply areas. To plan replacement of low-productivity plantation forests. To pay attention to planning the development of villages engaged in producing and processing forest products on a small scale and of forestry farms;

- To integrate forestry projects into hunger eradication and poverty alleviation and agricultural and rural development programs and projects in localities so as to achieve more effective use of ODA capital and government funds. Special-use forest and protection forest management units and forestry companies should participate in providing support services or managing local socio-economic development projects;

- To intensify monitoring and evaluation of the implementation of plannings and plans on forest protection and development, forest statistics and inventory and monitoring of natural forest resource changes. To soon create a monitoring and evaluation system and enhance the capacity of planning and financial management agencies and units at all levels so as to ensure closer coordination in planning and financial management work;

- To strengthen the forestry sector information and monitoring system to serve the monitoring and evaluation of the implementation of the Forestry Development Strategy, meeting the requirements of the forestry sector management and international integration.

IV. Sector organization and management solutions

- To renew the sector organization toward building a unified state management organization system in charge of forestry which is sufficiently strong from the central to grassroots level nationwide;

- To urgently work out a roadmap for renewing the organization of the forestry sector in association with administrative reform and international integration; to regard the establishment of state management organizations and the increase of forestry management staffs in districts and communes with forests as a top priority in the coming five years. In communes with forests, to arrange full-time forestry officers.

- To encourage and support the establishment of associations and unions of forestry product producers, traders, processors, importers and exporters.

- To develop a mechanism of long-term coordination between forestry research, education, training and extension and forest owners, enterprises and communities to combine forestry research, training and extension with forestry production and business.

V. Scientific and technological solutions

- Forestry scientific and technological research activities must meet production and market requirements and involve the participation of forest owners and enterprises.

- To review, formulate and perfect technical processes and rules on afforestation, forest rehabilitation, improvement, tending and enrichment, prevention and control of forest pests, prevention and fight of forest fires, forest exploitation and use, etc.;

- To formulate and implement a Forestry Research Strategy in the 2006-2020 period, concentrate on breakthrough researches in the sector such as biotechnology, technologies of refining non-timber forest products, planting of high-yield forests, improvement of impoverished natural forests, conversion and effective use of land areas under slash-and-burn farming; identification of environmental values of forests, combined agro-forestry measures, and mechanisms and policies to attract economic sectors to engage in and get rich from silviculture;

- To formulate and implement a forest tree seed strategy for the 2006-2020 period, first of all to meet the needs for high-quality seeds for afforestation under Project 661 and other programs and projects;

- To formulate and implement a national scheme on conservation and development of non-timber forest products in the 2006-2020 period;

- To concentrate on researches into such solutions as combined agro-forestry, planting of non-timber forest products and rearing of big cattle, etc., so as to increase incomes for inhabitants engaged in silviculture, especially poor households;

- To build a system of national standards of sustainable forest management, and a product movement sequence. To build a set of national standards for timber products and non-timber forest products, which meet the requirements of major export markets;

- To promote the application of modern technologies and equipment in the processing of forest products; to regard foreign investment as a new channel of technology transfer. To encourage the application of advanced technologies that are environment-friendly, save fuels and use agricultural waste wood and materials in the processing of forest products. To encourage research into and use of new materials to substitute timber and fuel wood with a view to reducing pressure on forests;

- To step by step renew activities and enhance the capacity of forestry institutes and schools into strong consultancy centers that meet various requirements of forestry management agencies, processing enterprises and forest owners;

- To encourage the establishment of forestry technology transfer centers, forestry science and technology consultancy centers and specialized training service centers under research, training and forestry extension agencies;

- To set up forestry extension organizations from the central level to provinces and districts with many forests as part of the forestry extension system at all levels. To arrange full-time or part-time forestry extension workers in communes with many forests, with priority given to employing those who are of ethnic minority groups in deep-lying and remote areas. To quickly set up voluntary forestry extension organizations in communes and villages, particularly in deep-lying and remote areas hardly accessible by the State-built agricultural extension system. The State shall provide necessary supports for these organizations;

- To perfect the mechanism of increasing the autonomy and accountability of research, training and forestry extension organizations on the basis of contracting the quality and quantity of products through public biddings.

VI. Human resource training solutions

- To formulate and implement a strategy on training and capacity building for forestry staffs at all levels, especially at the commune level and in deep-lying and remote areas, so as to meet sector renewal and international integration requirements;

- To pay greater attention to providing training and forestry extension services for the poor, particularly ethnic minority inhabitants and women, so that they are capable of diversifying crop plants and domestic animals, and generate stable incomes. To attach importance to providing training for ethnic minority inhabitants and providing transferable training for forestry officers in deep-lying and remote areas;

- To enhance the capacity of managers, enterprises, communities and households engaged in silviculture through on-site and short-term training and forestry extension so that they can step by step make, implement and monitor their own forest protection and development plans;

- To enhance the capacity and improve material and technical foundations of forestry training units. To increase training to turn out capable cadres and skilled workers for forestry product production and processing establishments, forestry farms and handicraft villages;

- To elaborate a scheme on comprehensive renewal of the forestry education and training system in terms of structure, teaching programs, contents and methods and administration mechanisms for the purpose of raising training quality. To provide training based on demand, combine theory with practice, and increase the duration of pupils' and students' practice at production establishments. To strive to have several forestry institutes and schools up to international research and training standards by 2020;

- To develop short-term training programs on specific topics, prioritize training of farmers engaged in silviculture, forestry workers and craftsmen in craft villages;

- To encourage domestic raining and forestry extension organizations, non-governmental organizations and international projects to support training and forestry extension activities for inhabitants engaged in silviculture, with priority given to poor households and women;.

- To draw up a plan on and train scientists and lecturers specializing in forestry domains, particularly economics, forest management and social forestry, and create favorable conditions for young, female and ethnic minority scientists to take part in scientific research and teaching activities.

- To develop forms of distance training to meet ever increasing learning and research needs. To integrate soon forest environment education into curricula of schools nationwide.

VII. International cooperation solutions

- To promote international economic integration in the forestry domain when Vietnam is a member of the World Trade Organization (WTO) through active participation in and close cooperation with regional and bilateral international forestry organizations;

- To step up strategic mobilization, attraction and use of ODA capital for forest protection and development, biodiversity conservation, environmental protection, hunger eradication and poverty alleviation and improvement of the livelihood of inhabitants living on forests, and raising of the effectiveness of the forestry sector management. To improve ODA management methods in the sector, accelerate disbursement of capital for ODA-funded projects, manage and efficiently use the funding source of the Trust Fund for Forests and the Vietnam Conservation Fund. To pilot and widely apply the new approach (sector- and program-based approach) so as to more effectively use international funding sources;

- To gradually create a favorable legal corridor and improve the investment environment to attract direct investment (FDI) from foreign investors, especially in the planting of industrial raw-material supply forests, forest product processing and technology transfer;

- To strengthen and step up activities of the Forestry Sector Support Program (FSSP) and the Partnership Coordination Committee to coordinate international financial supports for the implementation of the programs of the Forestry Development Strategy;

- To take the initiative in and actively cooperate with other states, world and regional advanced institutes and schools in forestry research, education, training and extension, in order to quickly approach advanced scientific and technological forestry standards in the region and the world, develop human resources and upgrade equipment for the sector;

- To further implement multilateral environment agreements and international commitments related to forestry which Vietnam has acceded to such as the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the United Nations Biodiversity Convention (UNDCBD), the United Nations Convention to Combat Desertification (UNCCD), the United Nations framework Convention on Climate Change (UNFCCC), etc., with a view to raising Vietnam's status in the world and the region and seek for new support funding sources such as the Global Environment Facility (GEF), the Clean Development Mechanism (CDM), etc..

Part 5

PROGRAMS

The objectives and orientation of the Forestry Development Strategy will be realized through the following programs:

Three development programs:

1. The program on sustainable forest management and development

2. The program on protection of forests, conservation of biodiversity and development of environmental services

3. The program on forest product processing and trade

Two support programs:

1. The program on forestry research, education, training and extension

2. The program on renewal of institutions and policies, planning and monitoring of the forestry sector

I. The program on sustainable forest management and development

1. Objectives

To manage, develop and use forests in a sustainable and effective manner to basically meet the demand for forest products for domestic consumption and export, make contributions to national economic growth and social stability, particularly in ethnic minority and mountainous areas and, at the same time, ensure their function of protection, biodiversity conservation and provision of environmental services, contributing to national sustainable development.

2. Tasks

- To establish permanent forest estates for three types of forests, draw maps and place markers on the field, to manage in a sustainable and effective manner all the area of production forests, and stabilize 3.63 million ha of natural forests and 4.15 million ha of plantation forests (including industrial raw material and non-timber product supply plantation forests and other types of plantation forests);

- To allocate or lease all forests and forestland to forest owners before 2010;

- To formulate and implement forest management plans and enhance capacity for forest owners such as forestry companies, cooperatives, communities, forest-invested enterprises;

- To produce in a stable manner timber from natural forests, plantation forests and dispersed plantations to reach 9.7 million m3/year by 2010, 20-24 million m3/year by 2020 (including 10 million m3 of big timber), and develop non-timber forest products to meet most of domestic consumption and export demands;

- To supply small timber for pulp processing, 3.4 million m3 by 2010 and 8.3 million m3 by 2020;

- To raise the productivity and quality of plantation forests to reach an average of 15 m3 of timber/ha/year on the basis of implementation of the Forest Tree Seed Strategy in the 2006-2020 period;

- To enrich 0.5 million ha of impoverished forests, thereby improving the quality of natural forests;

- To afforest 1 million ha by 2010 (including 0.75 million ha of production forests and 0.25 million ha of protection and special-use forests) and 1.5 million ha in the subsequent period; to reforest 0.3 million ha of exploited forests a year;

- To plant 200 million dispersed trees a year, equivalent to 100,000 ha of forest to meet the needs for domestic timber and fuel wood in localities;

- To conduct periodical forest inventories, to strengthen and update the database on forest resources and relevant socio-economic information;

- 100% of production and business unit shall make, implement, monitor and evaluate forest management plans;

- At least 30% of production forests shall be granted sustainable forest management certificates by 2020;

- To supply equipment and facilities to modernize forest management work.

II. The program on forest protection, biodiversity conservation and development of environmental services

1. Objectives

To protect forests and conserve biodiversity in an effective manner with the active participation of local communities and greater contributions from environmental forest services.

2. Tasks

a/ Protection of forests (protection, special-use and production)

- To effectively protect 16.24 million ha of forests and forestland

- To disseminate 100% of regulatory documents to forest owners and local inhabitants;

- The State shall continue contracting the protection of 1.5 million ha of protection forests and special-use forests till 2010;

- To reduce by 80% cases of violation of the law on forest protection and development;

- 100% of forest owners, villages and communes with forests will have forest protection forces. 100% of commune forest rangers and forest protection forces will be provided with training to improve their capacity;

- To invest in infrastructures, equipment and facilities and funds for forest protection, forest fire prevention and fight and forest pest prevention and control;

b/ Management of the system of protection forests and special-use forests

- To establish and strengthen the system of protection forests (for watersheds, coastal areas and urban environment) with a total area of about 5.68 million ha and the system of special-use forests with a total area not exceeding 2.16 million ha;

- 100% of protection and special-use forests will have managers (state organizations, private entities or communities) and medium- and long-term protection and development plannings and plans till 2010;

- To continue piloting before widely applying the community-based forest management model and other forms (community-based management, shareholding companies, cooperatives, joint venture and association, etc.).

c/ Environmental services

- To study and set charges for environmental forest services, such as protection of water sources, prevention of soil erosion, prevention of accumulation and absorption of carbon dioxide, ecotourism, etc; to develop a mechanism of payment for environmental services in the 2006-2010 period;

- From 2007, to set up and put into operation the forest protection and development fund.

III. The program on forest product processing and trade

1. Objectives

To produce products that are internationally competitive mainly based on sustainable sources of timber and non-timber forest products; to apply environment-friendly advanced technologies to basically meet domestic consumption and export demands; to build the forest product processing industry into an economic spearhead of the forestry sector.

2. Tasks

a/ To reorganize the timber and non-timber forestry product processing industry so as to balance production capacity and stable supply of raw materials.

b/ To enhance the capacity of industrial production of forest products to basically meet domestic and export demands, specifically:

- Total output of sawn timber: 6 million m3/year.

- Particle boards: 320,000 m3 of products/year.

- MDF boards: 220,000 m3 of products/year.

- Value of exported timber products: USD 7 billion (3.5 million m3 of products).

+ Value of exported non-timber forest products: USD 0.8 billion.

c/ By 2020, non-timber forest products will become a major commodity, accounting for more than 20% of total value of forestry production, and the value of exported non-timber forest products will increase 15-20% on average; to attract 1.5 million laborers and incomes from non-timber forest products will account 15-20% of rural household economy.

IV. The program on forestry research, education, training and extension

1. Objectives

To raise the quality and effectiveness of forestry research, education, training and extension activities in order to developing high-quality human resources for the forestry sector. To take science and technology as a momentum for developing the sector, to link research and training to production and market so as to increase contributions to forestry economic growth, environmental protection, and improve living standards for inhabitants engaged in silviculture.

2. Tasks

a/ Research

- To focus on conducting researches in some breakthrough areas such as bio-technology, non-timber forest product refining technology, plantation of high-yield forests, agro-forestry and improvement of impoverished natural forests;

- To renovate technologies and equipment and facilities for the forest product processing industry to increase competitiveness and meet the requirements of international economic integration;

- To study scientific and practical grounds for the formulation of breakthrough policies in the forestry sector (production with high profits, socialization, development of non-timber forest products, pricing of environmental services, attraction of funds from the private sector at home and abroad, etc.).

b/ Education and training

- To provide formal training for an annual average of about 5,000 students and pupils at schools of the Ministry of Agriculture and Rural Development, to pay attention to providing advanced training for key officials.

- To provide vocational training for 50% of farmers engaged in silviculture and inhabitants in forest product processing villages.

- From 2008, to incorporate forest and environment protection education into curricula in all general education schools;

- To provide training for 80% of local forest management cadres in forest inventory and formulation and implementation of forest management and protection plans;

- To enhance the capacity of lecturers and provide essential equipment and facilities for forestry institutes and schools;

- To perfect and update training programs and textbooks to meet the requirements of renewal and international economic integration.

- To promote association between the forestry training system and the forestry extension system. To have one to two forestry training institutions up to international standards by 2020.

c/ Forestry extension

- To raise forest management and protection knowledge and skills for 80% of farmer households;

- To attract 50% of private entities and mass organizations to take part in forestry extension activities;

- To place at least one full-time or part-time forestry extension cadre in each commune with many forests; to develop and enhance the capacity of the voluntary forestry extension system;

- To improve and update forestry extension contents and methods to suit the level of farmers, particularly poor and ethnic minority households;

- To build up linkages between the forestry extension and training system and forest owners and forest product processing enterprises.

V. The program on renewal of institutions and policies, planning and monitoring of the sector

1. Objectives

To create a favorable legal environment for forestry activities driven by the market and international integration, with the broad participation of households, communities and private entities; to strengthen the organizational system while renewing planning and supervisory work of the forestry sector.

2. Tasks

a/ To build and update a system of policies, laws and institutions toward delegation of more powers to localities, sustainable forestry development driven by the market, and socialization of silviculture.

b/ To develop mechanisms and policies as a momentum to stimulate all economic sectors to join in forest protection and development, encourage all economic sectors at home and abroad to develop forestry economy.

c/ To reorganize, and raise the effectiveness of, state management agencies in charge of forestry in the direction of unifying the functions of managing, protecting, using and developing forests; to make clear the functions and tasks of forestry organizations at all levels and diversify forestry services.

d/ To organize a number of forestry state companies operating according to the market mechanism in remote and difficult forestry areas in which non-state economic sectors are not ready to invest; to equitize forestry production and forest product processing state companies that are operating inefficiently.

e/ To develop, implement and expand various models of community-based forest management and protection.

f/ To establish a state-owned forestry extension system at all levels and introduce mechanisms to support voluntary forestry extension organizations in villages and communes with forests.

g/ To establish specialized monitoring and evaluation units in combination with strengthening the forestry planning system at all levels.

I. Assignment of duties

- The Ministry of Agriculture and Rural Development shall act as the coordinator with the prime responsibility for, together with other ministries, branches and provincial/municipal People’s Committees, organizing the implementation of the Forestry Development Strategy and incorporating its contents into the national, ministerial, sector and local socio-economic development plans;

- The Ministry of Planning and Investment and the Ministry of Finance shall coordinate with the Ministry of Agriculture and Rural Development in balancing and allocating funds, and computing funds from the state budget and other sources for the effective implementation of the Strategy;

- The Ministry of Natural Resources and Environment shall coordinate with the Ministry of Agriculture and Rural Development in instructing localities to review land use plannings and allocate or lease forestland according to the objectives and tasks of the Forestry Strategy and elaborate schemes combining forest inventories with national land inventories conducted once every five years;

- The National Statistics Office shall coordinate with the Ministry of Agriculture and Rural Development and related parties in identifying contents and indicators for the forestry sector monitoring and evaluation; direct and guide localities in making statistics, inventory forests and study the forestry sector's economic and environmental contributions, etc., according to the new definition of forestry, and submit them to the Government for revision and supplementation of the forestry sub-sector in Decree No. 75/CP of October 27, 1973.

- Other ministries and branches shall organize the implementation of the Strategy's contents related to their respective branches. Provincial/municipal People's Committees shall organize the implementation of the Strategy through formulating and implementing their local forestry development plannings and plans. Local forestry projects shall be integrated into hunger eradication and poverty alleviation and agricultural and rural development projects carried out in localities;

- Annually, the Ministry of Agriculture and Rural Development shall coordinate with other ministries, branches and localities in evaluating the implementation of the Strategy and report it to the Prime Minister. Forest protection and development shall be regarded as an important content of the Government's year-end report to the National Assembly.

II. Establishment of sub-committees to coordinate program implementation

For each program, an implementation-coordinating sub-committee shall be established.

1. Composition

- The sub-committee head is a leading official of an agency attached to the Ministry of Agriculture and Rural Development and related to the program;

- Members are representatives of concerned agencies, units, communities, and state and private enterprises and international partners and projects that are interested and voluntarily participate in the program.

2. Tasks

- To make medium-term and annual plans for the program, covering the objectives, activities, outcomes, budget and financial supports for the program implementation;

- To propose activities of coordination between the participating parties and seek funds for the program implementation.

- To support the formulation of contents of specific projects of the program and call for financial supports from ministries, international organizations and the private sector.

- To discuss and propose the formulation or revision of relevant policies and mechanisms.

- To discuss and propose the formulation or revision of econo-technical processes, rules, textbooks and norms.

- To hold periodical plenary meetings and topical seminars with the participation of the participating parties, use the Strategy's forum for information exchange between concerned parties.

- To collaborate with international partners, concerned agencies and organizations in seeking funding sources for medium-term and annual activities of the sub-committee.

III. Expected implementation schedule of the Strategy in the 2006-2010 period

(See details in table 3 enclosed herewith)

IV. List of schemes/projects prioritized for implementation in the 2007-2010

On the basis of the (2007-2010) plans of actions of the programs in the Strategy, in order to effectively use domestic resources and, at the same time, make use of the assistance of international partners for the performance of key tasks of sector development, 21 schemes/projects are prioritized for formulation and implementation in the 2007-2010 period (see Table 4 enclosed herewith).

I. Monitoring

To monitor the implementation of the Forestry Development Strategy aims to raise the effectiveness and efficiency of the implementation of the Strategy through supplying information and feedbacks for policymakers to adjust plans and take timely remedies.

Major contents of monitoring of the implementation of the Strategy:

- Assessing the achieved results as well as constraints against the objectives and implementation progress;

- The situation of mobilization of resources and financial sources at all levels;

- Analyzing and assessing impacts in the process of implementation of the Strategy at all levels;

- Assessing the effects of relevant policies in the realization of the Strategy's objectives;

- Identifying and analyzing major problems inside and outside the sector and international issues that may affect the process of implementation of the Strategy and necessary adjustments.

II. Evaluation

To focus on evaluating major development impacts. To make detailed plans for surveys and evaluations based on the Strategy's objectives and tasks. In order to ensure objectivity, evaluation shall be assigned to independent organizations and agencies, including international organizations and non-governmental organizations.

Contents of evaluation:

- Evaluating political, economic, social and environmental changes pertaining to the Strategy's objectives;

- Supplying information in the results of realization of the Strategy's objectives, such as conservation of biodiversity, increase of protection value, improvement of people's living standards, the forestry sector's contributions to the process of socio-economic development at various levels;

- Evaluating the coordination between the implementation of the Strategy and local socio-economic development plans;

- Evaluating changes in the policy environment and impacts of policy measures;

- Evaluating impacts of forestry on hunger eradication and poverty alleviation;

- Evaluating environmental impacts, including contributions to the global environment such as carbon absorption;

- Quantifying the forestry sector's contributions to the national economy, local economy, international trade and employment generation;

- Evaluating the materialization of international commitments.

Periodical evaluations shall be conducted at the end of each five-year plan. The first evaluation will be conducted in 2009, and its findings will be used as inputs for the formulation of the 2011-2015 five-year plan.

The total funding need for the Strategy in the entire period of 2006-2020 is VND 106,759.06 billion, of which the funding need for the 2006-2010 period is VND 33,885.34 billion and the funding need for the 2011-2020 period is 72,873.72 billion (see details in enclosed Tables 5, 6 and 7).-