Lam Dong Aligns and Ensures Transparency in Forest Environmental Service Payment Policies

Lam Dong has the largest area of natural forests in Vietnam, covering nearly 1.113 million hectares. This vast management scale calls for renewed approaches to managing and organizing forest environmental service payments (PFES) in a more consistent, open and transparent manner.

In this context, the Lam Dong Forest Protection and Development Fund (the Fund) has executed various coordinated strategies, including digitalizing data, standardizing maps, and updating payment processes. These initiatives help protect individuals' rights and enhance the efficiency of forest conservation.

One of the primary responsibilities of the Fund is to determine the planned payment rate for forest environmental services (PFES) for 2026. The estimated rate per hectare of converted forest area is announced to PFES providers and users at the beginning of the year, serving as the basis for advance and subsequent payments during the year in accordance with regulations.

Establishing the payment rate in advance allows forest owners to actively develop plans for forest management and protection, as well as to estimate the funds they are expected to receive during the year. At the same time, they can anticipate their financial obligations and make full and timely payments, thereby improving transparency and accountability in the administration and utilization of PFES funds.

The payment rate is set based on the PFES revenue collection plan approved by the provincial People's Committee, the area of the forest providing PFES after K coefficient adjustments, and the specific characteristics of each watershed.

Lam Dong is currently home to 117 watersheds that provide Payments for Forest Ecosystem Services (PFES), encompassing a total forest area exceeding 692,000 hectares. Of this area, over 491,000 hectares are overseen by State forest managers, while nearly 167,000 hectares are directly contracted to households, individuals, and local communities.

The Fund has successfully standardized the watershed boundary mapping system throughout the province, enhancing the management, monitoring, and updating of forest areas that offer PFES, as well as facilitating the payment of PFES funds.

Based on this foundation, the Fund has established and completed a digital forest database that organizes and standardises information for every category of forest owners. Standardized data aids in accurately identifying forest areas eligible for PFES and reduces mistakes in payment processing.

Alongside the digitalization of data, the Fund consistently updates information on changes in forest area and quality. Each forest plot contains detailed information, including the K coefficients utilized for determining payment rates.

PFES payments are still being distributed by the Fund in compliance with regulations, in a transparent and timely manner. In 2025, the Fund allocated over VND 473 billion in PFES payments, which covered more than 715,000 hectares and achieved 99.4% of the planned funding.

Additionally, the Fund provided over VND 79 billion in advance payments for PFES to service providers under the plan approved by the provincial People's Committee.

At present, all forest owners are receiving PFES payments via bank accounts. This outcome demonstrates considerable progress in streamlining the payment process, especially the shift from cash to bank transfers.

Prompt payments ensure consistent financial support for forest monitoring and safeguarding, leading to enhanced forest stewardship and better living conditions for around 14,400 contracted households and individuals.

Dieu Phen of the Bu N'dơr B Community Forest Management Board in Tuy Duc Commune said that the PFES payment policy was introduced in 2013. Thanks to the policy, each quarter, members of the community forest management board receive between VND 3 million and more than VND 4 million.

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PFES payments are transferred directly to each member's personal bank account. This is a great source of encouragement, helping everyone stay committed to forest protection

Dieu Phen, Bu N'dơr B Community Forest Management Board, Tuy Duc Commune

While PFES payments may not be significant, their clear and timely distribution has enabled many families to better manage their living costs, invest in production, and support their children's education. More importantly, this policy has enhanced the link between the interests of local communities and the conservation of forests.

Annually, Bidoup-Nui Ba National Park collaborates with the Fund to establish and publicly announce the payment strategy for the entire forest area that provides PFES. All technical details regarding forest compartments, conditions, and K coefficients are thoroughly and promptly made available, ensuring adherence to the principle of “better forests – higher income.”

Nguyen Luong Minh, the Deputy Director of Bidoup-Nui Ba National Park, stated that to equip local residents with resources for their livelihoods and to actively monitor and safeguard the forests, PFES payments are always disbursed by the Fund timely.

“Complete transparency regarding payment rates and schedules strengthens public confidence in the Party and State’s policies. Numerous families, especially those from ethnic minorities, have found additional job opportunities and a reliable income stream from forest conservation,” Nguyen Luong Minh remarked.

To ensure effective use of the funds, the Fund has advised on reallocating PFES payments among watersheds, ensuring a balance of interests among forest owners and improving the effectiveness of resource use. The allocation of funds is based entirely on standardized, publicly disclosed databases and is closely monitored in accordance with regulations.

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The Fund has stepped up the application of information technology throughout its management processes, from developing forest databases and digital maps and determining eligible payment areas to making payments through bank accounts.

Nguyen Thi Hai, Director of the Lam Dong Forest Protection and Development Fund

Nguyen Thi Hai, Director of the provincial Forest Protection and Development Fund said that the organization is tasked with overseeing the entrusted payments between PFES users and providers. Consequently, ensuring transparency and openness is among the Fund's main priorities in executing its functions.

The Fund has made it a point to publicly and promptly release all details regarding forest areas, K coefficients, payment rates, and PFES advance payment schedules to forest owners, households, individuals, and local communities. The full and timely collection of PFES revenues has established a stable financial base for compensating forest owners and contracted forest guardians.