Deforestation and Property Rights in Viet Nam: The Role of Fuelwood Harvesting A Role Playing Exercise in Economic Analysis

Forest cover in Viet Nam decreased by more than 35% since the 1950s. As much as 75% of the forest cover has been removed in some northern areas. Despite government sponsored reforestation programs, deforestation continues, especially when property rights to the forest are not secure and where the inhabitants are poor. The prime cause of deforestation is fuelwood collection, accounting for 60% of the loss in forest cover. Historically, the government owned the forests, but due to the difficulty of monitoring and enforcing property rights, households have often viewed the forest as an open access resource. More recently, the Forest Inspectorate (FI) has allocated use rights to some forest land to households. With these use rights comes specific managerial responsibilities that have an impact on the costs of harvesting the fuelwood. The managerial responsibilities include protecting their lands from unlawful use and investing in their continued supply of forest products. On these lands, forest cover is beginning to rise again. However, the FI has been unable to allocate all forest land. The remaining tracts of land continue to be treated as an open access resource with deforestation continuing. A major problem in Viet Nam is that while households control access to specific forest lands and can presumably manage them efficiently, no community control over the open access forest exists. Moreover, in many regions, the open access forests, while accessible to everyone in the community for harvesting, generate insufficient value to warrant the management or protection of any investment in the lands by households or the community. Households are reluctant to supply labor for resource protection because even though a contract with the FI provides some compensation, it is too small an amount to provide an effective economic incentive to engage in sustainable forestry management. There may be a number of reasons why this is the case. For example, the open access lands may be farther from the community and prices of fuelwood too low to make it desirable for households to request use rights. From society's point of view it is inefficient to leave forest lands as open access. The forest lands yield not only fuelwood and other timber products, but also provide a number of nontimber benefits in the form of ecosystem protection (e.g., erosion control, water purification, ecosystem diversity, wildlife habitat, other fruit and vegetable products). A second issue concerns income distribution. If poor households are dependent on open access forest lands for their livelihood, the government will want to ensure the forest resource is protected to help sustain these households.