An economic analysis of reforestation with a native tree species: the case of Vietnamese farmers

Abstract

The area of degraded forests in Vietnam is substantial, currently about 3.1 million ha of which about 1.7 million ha (55 %) were granted to individual farms for reforestation. However, the result of farmers’ reforestation efforts is limited. We aimed to examine the financial return, technical efficiency, and factors determining reforestation with a native tree species (Canarium album) by farms. Our results showed that reforestation with C. album is less financially profitable than that with an exotic tree species (Acacia mangium) as the alternative land use option. The subsidy from the government is found insufficient to compensate for the income losses of farmers participating in reforestation with the native tree species. Reforestation with C. album could be more successful if participating farmers were equipped to be more technically efficient. Finally, our findings clearly showed that the security of forest land property rights and the provision of forest extension services are among the determinants of participation in, and the subsequent success of reforestation with C. album.