Vietnam: Green Production and Trade to Increase Income and Employment Opportunities for the Rural Poor

Despite an almost 80 % drop in its poverty rate over the last 15 years, Vietnam continues to struggle with significant inequalities, particularly in rural areas. This Joint Programme's goal was to increase incomes and work opportunities for producers of handicrafts and growers and collectors of raw materials for craft production. It targeted 4,000 poor farming and crafts producing households in the four northern provinces of Vietnam, including families from ethnic minorities such as the Thai, Muong and H’mong.

The programme's approach was to develop better integrated, pro-poor, and environmentally sustainable “green” value chains, enabling poor growers, collectors and producers to improve their products. It also sought to link these individuals to more profitable markets.

Specifically, the programme aimed for:

1. An improved understanding of the handicrafts and furniture value chains;
2. Sustainable increases in income for crafts and furniture raw materials growers and collectors;
3. Sustainable increases in income for rural crafts and furniture producing households and enterprises; and,
4. Improved policies and regulatory frameworks at the provincial and national levels for the pro-poor promotion of handicrafts and furniture production.

To this end, farming households received support to increase their yield from the planting, cultivation and harvesting of raw materials, while craft producing families received technical skills training to boost their productivity. The programme worked to create safer and more comfortable working conditions, provide basic business skills and make more efficient use of raw materials. The programme also created linkages with companies in the provinces and Hanoi, and assisted these to clean up production, strengthen their entrepreneurial behaviour, find new buyers -- including through trade fair participation -- and improve working conditions and compliance with labour and trade standards. It also introduced improved "green" technologies and sustainable designs. 

Main achievements included:

• The programme worked on five value chains (sericulture/silk, rattan and bamboo, sea grass, laquer and handmade paper), benefiting over 4,500 participants.  Some 65-80 % of craft-workers were women. Craft producers were assisted in developing new products, linking to exporting companies and participating in domestic trade fairs to expand their client base. Similarly, export-oriented companies expanded their product range with new sustainable product designs to meet global market trends and were supported to attract new buyers by participating in national and international trade fairs.  
• The programme also supported LifeStyle Vietnam, an annual trade fair that attracted 1,500 visitors from key international markets in 2012. Companies supported by the programme that participated in the fair reported orders with a combined value of close to USD 200,000. Some 422 contracts were signed directly at the Fair with a value to USD 19 mln.
• Local Economic Dialogue Forums were established in four provinces. The forums fostered local dialogue and ownership on Value Chain upgrading and identified constraints in the business environment.
• An endline survey indicated:
• The average annual household income of programme beneficiaries increased from 27.7 million VND in 2009 to 58.4 million VND in 2012, which is equivalent to an inflation-adjusted increase of 52.4%.
• The number of beneficiary households living below the national poverty line decreased from 88 households in 2009 to 65 households in 2012. The percentage of households claiming to apply “environmental regulations” went up from 1% to 52%.
• The 21 surveyed SMEs that participated in capacity building activities reported an average annual turnover of 36.9 billion VND in 2012, more than doubling their 18 billion VND turnover in 2009.
• The average number of jobs in the programme-supported SMEs more than doubled from 41.2 full-time jobs per company in 2009 to 87.2 full-time jobs per company in 2012.  The companies created a total of 966 new full-time jobs, of which 665 were for women, and 5,857 part-time jobs.
• In the sericulture value chain, the average area cultivated per household doubled from 0.55 ha/household to 1.13 ha/household. Sericulture, sea grass and handmade paper producers planted a large number of high-quality and new hybrid variety seedlings as well.

Click for more detailed results from the Joint Programmes in Vietnam.