Investing in a green future

Viet Nam’s wood processing industry is more and more reliant on sustainably produced timber. Furniture exports to the EU and USA, for example, are increasingly expected to include official certification and evidence of timber traceability.

However, these stricter specifications are creating major problems for Viet Nam, as only a fraction of its plantations and natural forests are officially certified. As a result, Viet Nam has to import raw timber at high cost, seriously undermining its capacity to compete internationally.

‘Monoculture is the norm here,’ explains Burkhard Gutzmann from ForestFinance Service GmbH, ‘and plantations are operated using the clear-cutting method. Trees are grown for five to seven years and then felled – or, worse, burned down – to be replaced by inferior-quality seedlings. The objective is simply to generate biomass.’

ForestFinance offers a range of forest-based direct investment products for large- and small-budget international investors. The main focus is on sustainability: all the company’s forests are certified by the Forest Stewardship Council (FSC), and ForestFinance is committed to promoting extensive reforestation activities around the globe. In Viet Nam, too, ForestFinance aims to change things for the better – true to its motto: ‘We create forests’.

It all started with the Ben Hai Forestry Company in Quang Tri Province in central Viet Nam. As Gutzmann explains, ‘We decided to invest in this company because, of all the timber-growing businesses in the region, this one offered the best framework for implementing our quality and sustainability standards. But there was still a lot to do. People did not know much about forest management, and we weren’t happy with the trees growing in the plantations.’

It quickly became clear that Ben Hai’s staff would need to undergo training. ‘But right from the start, we thought “Wouldn’t it be great if we got not just this company but the entire region to embrace sustainable forest management?”’ says Gutzmann.

It is really hard for a single company to implement a broad-based training programme on its own, so ForestFinance decided to embark on a development partnership. The partnership was facilitated by the run by Germany’s Federal Ministry for Economic Cooperation and Development (BMZ).

The aim of ForestFinance is to promote sustainable forest management in Quang Tri Province by raising awareness and providing practical training. To ensure the activities are inclusive, the project also got members of Quang Tri’s Department of Agriculture and Rural Development (DARD) on board.

‘We need to train two target groups if we want to achieve long-term success, the managers and the employees,’ says Gutzmann. ForestFinance’s first initiative to develop a curriculum and training materials for an FSC-based train-the-trainer programme to be conducted on Ben Hai’s company premises, part of which was converted into a training centre with seminar rooms, an office and accommodation for external lecturers.

Some 18 management-level staff members have since undergone training in sustainable forest management, including practical training in the forest with instruction in the use of tools. Participants included managers from Ben Hai and other firms and two DARD representatives.

The next stage saw the focus shift to the plantation workers. The partners planned a course for skilled workers consisting of 13 separate modules, each lasting two to three days. Over an eight-month period, some 45 workers were trained in all aspects of sustainable forest management, from afforestation through to chain saw usage.

Gutzmann speaks from experience when he stresses the particular importance of mastering the basics: ‘We had some harvesting teams who couldn’t follow simple instructions like cutting timber into lengths of 2.6 metres. As a result, we ended up with planks measuring between 1.8 metres and 3.2 metres, which meant we couldn’t use them. We can now employ trained seasonal workers without having to train new people every year. And we can pay them more, too, because the work they do is of higher quality.’

‘Besides learning how to handle a chainsaw properly, the workers have learned to use special software that we’ve provided,’ adds Dang Mai Dung, Senior Representative of ForestFinance Viet Nam. ‘This enables us to monitor the growth of individual trees and the plantation as a whole much more efficiently.’

A local NGO – the Consultative and Research Center on Natural Resource Management (CORENARM) – supported the partners with translating the materials and implementing the courses. As a non-profit organisation committed to sustainable resource management, CORENARM was recruited to take training forward once the project ends.

The courses differentiated between technical training and awareness-raising. ‘Teaching someone a new logging technique is much easier than changing their attitude,’ says Phan Van Phuoc, Deputy Managing Director of the Ben Hai Forestry Company.

In addition to practical skills, the participants learned about the importance of sustainability in the timber industry. For example, they learned why, in the long term, mixed cropping promises higher yields than monocultures and discovered the advantages of longer harvest cycles. ‘That’s what really impressed me about the project – the fact that our people are now more knowledgeable about environmental protection and think for themselves,’ says Phan.

With support from ForestFinance, the Ben Hai Forestry Company thus had laid the foundations for a successful future. But the project had another key aim: to strengthen sustainable forest management practices by other actors outside Ben Hai’s ambit.

Based on the experience gained in manager and worker training, the partners therefore devised a detailed set of guidelines for sustainable forest management that was translated into both Vietnamese and English. Establishing contact with the local Department of Agriculture and Rural Development (DARD) proved successful: on 26 September 2013, the Quang Tri Provincial People’s Committee (PPC) officially adopted the guidelines as the basis for future practice-based basic and further training across the province.

As part of an awareness-raising campaign, ForestFinance attended a number of workshops and media events in the region and recommended the guidelines to representatives of neighbouring provinces. By all criteria, the project was a success.

But then a devastating storm hit the region, destroying half of Ben Hai’s stock of trees and dealing a major blow to all concerned. However, instead of giving up, everyone rallied round quickly and professionally. The damage was used as an opportunity for training in hands-on crisis management, not least because of the similarities between clean-up work after a storm and regular thinning measures. As a result, everyone is now prepared for the worst-case scenario.

‘We hadn’t planned for this, of course,’ says Olaf van Meegen, Project Manager with ForestFinance, ‘so an extension of the project was very helpful, enabling us to complete the clean-up work without time pressure. And clearly, we would not have been able to afford it without financial support from’

As far as van Meegen is concerned, it’s been win-win for the Bonn-based company: ‘Our forests are now better managed than before, which is also in our investors' interest. True to the motto “Do good and talk about it”, we’ve publicised the fact that we are implementing a project in Viet Nam. And our clients are all for it.’

Timber produced by the Ben Hai Forestry Company is now FSC-certified, and there are genuinely visible changes. ‘You can really see that the forests are better structured now,’ says Gutzmann: ‘There are trees of all ages and there’s deadwood, too. That’s much better than in most forests in Viet Nam. But we will continue to work on improving the situation throughout the country in future.’

With Ben Hai as a successful role model for other forestry companies and CORENARM continuing to provide training after the end of the project, as well as support from the provincial authorities, ForestFinance has created excellent enabling conditions.

Facts | Figures

people trained.

Working Standards

Much safer working conditions for forestry workers following the introduction of comprehensive occupational safety measures.


Train-the-trainer courses have been conducted for 124 people.


Foundation of the Sustainable Forest Association Viet Nam, a regional NGO.