Project on Market-Oriented Agro-forestry to Reduce Poverty in Quang Nam Province, Vietnam “Improving gardens and support systems to reduce poverty” By: ES Guiang Presented during the TPR on 25 February 2011, Tam Ky City, Quang Nam Province, Viet Nam. ©FAO: http://www.fao.org

1. Project on Market-Oriented Agro-forestry to
Reduce Poverty in Quang Nam Province,
Vietnam
“Improving gardens and support systems
to reduce poverty”
By: ES Guiang
Presented during the TPR on 25 February
2011, Tam Ky City, Quang Nam Province, Viet
Nam

2. The Sites in Quang Nam Province: Six out of more
than 200 communes in two out of 16 districts
Six communes in two districts,
Quang Nam Province
Phu Ninh Dist
•Tam Loc
Tien Phuoc Dist
•TienHa,Tien Cam •
Tien Son
•Tien Phong
• Tien Tho

3. Project Objectives
Development objectives (vision)
1. Contribute to Quang Nam’s efforts to reduce
poverty
2. Help conserve natural resources by supporting
sustainable and high quality Market-Oriented
Agro-Forestry (MOAF) Systems
Specific objectives
With 6 communes:
Improve and/or develop 1,500 ha of market-driven
gardens
Strengthen enterprise-oriented coops and groups
Pilot viable micro-finance with village groups
With province and 2 districts:
• Strengthen extension delivery system
•Develop market research information system

4. Implementation Strategy: Collaborative Approach
OUTPUTS
Garden
owners,
1,500 ha gardens
entrepreneurs
Rural enterprises
Microfinance
Model
PROJECT
Strengthenedwith
extension delivery
6 communes,
system
2 Districts,
Provincial DARD Market Research
Information System

5. Accomplishments as of 15 February 2011
Outputs 3-Year Targets Achieved as of 15 Feb 2011 % of Targets & Remarks
1. Developed or
improved home
and forest
gardens in ha
1,500 1,916
125% - mostly improvement
of home gardens with 20-50
high value and market-
oriented seedlings
2.
Strengthened
coop and group
enterprises
Target coop and
similar groups
strengthened
Strengthened the informal grouping of
nursery cooperators and six
commune savings groups but not Cam
Ha, Women’s and Farmers Groups
Did not meet target to
strengthen Cam Ha &
Women’s Group after initial
efforts failed
3. Piloted micro-
finance with
groups
Microfinance
piloted
Organized six savings-oriented
microfinance groups; two are linked
with repayments of 4 enterprise loans
Microfinance approach
piloted but needs more time
to strengthen capacities
4.
Strengthened
extension
delivery system
Extension
delivery system
strengthened
Decentralized implementation of
agroforestry plans with downloaded
funds strengthened communes’
delivery system and highlighted the
need for district ag office client-
oriented support
Adopted a decentralized
approach with downloaded
funds to strengthen
communes’ implementation
to respond to their garden
owner constituents
5. Developed
MRIS with the
province
MRIS prototype
developed
Prototype developed and under
review for piloting with six communes,
districts, and province
Needs more time for piloting
and determining next steps
before provincial adoption

6. What have we learned with the
Italian Government’s grant
of US $ 2.8 million?
What have we learned from the
processes and approaches to
achieve the targets and outputs?

7. Key Lessons
1. With support and guidance, most forest and home garden
owners will develop or improve their gardens in response
to market opportunities. Relevant training, cross visits,
and initial inputs of high quality and market-oriented
planting materials are the key.
2. With downloaded funds and technical guidance to
implement jointly prepared and approved agroforestry
plans, communes are better positioned to respond to
their garden owner-constituents.
3. The cost center approach with downloaded funds
provides flexibility for communes to adjust
implementation activities to fit reality. A good model for
the government’s ongoing Tam Nong Program

8. Key Lessons
4. About 60-80% of the communes’ downloaded funds for
agroforestry implementation was spent for initial inputs of
high value seedlings and fertilizer. The project simply
responded to the great need to improve value chain at the
production stage of agroforestry system. There was less
interest for improving agroforestry value chain at the
support or post harvest stages.
5. Investments for improving support enterprises and
systems for agroforestry development – nurseries,
microfinance to improve HH financial assets, and delivery of
market information and extension- take intentional,
coordinated, and considerable efforts. Projects like GCP
027 & 035 could only point the way and test some
approaches but not establish such support systems.

9. Key Lessons
6. Agroforestry could reduce poverty in Quang Nam by
assisting garden owners reduce the number of species
from 10-15/ha to 4-5/ha of market-oriented species
or apply thinning/pruning and enrichment planting.
200 banana plants inter-planted with jackfruits and citrus (which
yield in 3-4 years) could generate a gross revenue of least VND 15
million in nine months even at farm gate price of VND 50,000 per
bunch and suckers sold at VND 7-10,000 each
A six year old Acacia hybrid planted at 1.5 by 2 m can be harvested
in six years (in Tien Ha) could generate a gross revenue of at least
VND 40-45 million per ha. This could be more if sold as saw timber
in year 10 or 12.
Gardens with well-managed black pepper vines inter-planted with
green tea and other species or a Lansium-based home garden inter-
planted with other fruit trees and combined with raising livestock
could generate enough income for households.

10. Lessons Learned
7. Just like other projects, the ultimate value of a six-year
“piloting’ efforts depends on local initiatives to move
towards replication and scaling up with some of the
best practices generated especially under current or
planned government’s programs i.e. Tam Nong.
8. Despite the limited opportunities to “transfer” cash to
farmer-participants, a mechanism for setting up
savings-oriented microfinance groups worked
because savings were linked with 50% project
matching fund and tied up the repayments of
enterprise loans as part of the saving group’s capital
build up amount.

11. Opportunities and Challenges
A. Moving ahead with replicating or scaling up
market-oriented agroforestry systems at the
production stage and linking this with Quang
Nam’s advancing tourism industry, increasing
urbanization and industrialization, and
expanding local economies as a result of
spillovers of Danang City as a growing
metropolis.

12. Opportunities and Challenges
B. Focusing on moving up the value chain of market-
oriented agroforestry especially in consolidating
small producers for commune-level raw material
sorting and quality control, organized transporting
system, high value processing, and marketing of
selected products that are considered to be Quang
Nam’s competitive products – black pepper, lumber
from mini-sawmills, other products from small
diameter pulpwood, cinnamon, banana, and meat
products from native chicken and cattle.
C. Planning and implementing a district-level
decentralized system for assisting garden owners to
improve the marker-orientation of their gardens with
responsive and strengthened extension and market
information service delivery system.

13. Opportunities and Challenges
D. A province or a district-led initiative in
partnership with the private sector and donors
to further strengthen support enterprises for
market-oriented agroforestry system in Quang
Nam especially for:
Pump-priming privately-owned nursery enterprises
that will raise high value planting materials for garden
owners
Savings-oriented (not credit-oriented) microfinance at
the village and commune levels to help build up
household financial assets and reduce their
vulnerabilities to disasters and market failures

14. Recommendations: Moving Forward with 6-month
extension (July-Dec 2010)
1. Help the communes complete the implementation of
their agroforestry plans up to June 2011.
2. After June 2011, strengthen capacities of six savings
groups to manage their savings/relending operations and
leveraging other funds (public and private) to expand
their relending program for household enterprises and for
financing garden improvements.
3. Move up the value chain of agroforestry by:
 Linking the savings group with the establishment of enterprises
(setting up buying station of H/F garden products in Tien Cam;
household processing of banana fruits and doing consolidated
quality control and marketing)
 Consolidated commune-level trading, quality control, initial
processing, branding, and marketing of Tien Phuoc black pepper.

15. Recommendations ...
• Support Tien Phuoc and/or Phu Ninh with the province
to plan, finance, and initially implement the replication
and scaling up of market-oriented home and forest
gardens under the Tam Nong Program. Activities may
include piloting the MRIS with the province and training
of extension workers, partnership with Agribank/Policy
Bank to help align lending towards home and forest
gardens improvement to increase local demand for high
value planting materials.
• Support Tien Phuoc’s initiative to organize and facilitate
the mini-sawmill operators’ efforts to re-tool, improve
quality and efficiency, diversify product mix that meets
furniture makers needs

16. Recommendation: Re-Align Remaining Funds
with Additional Support
GCP/VIE/035/ITA Project - Revised 3-Year Total Project Budget up to 30 June 2011
Budget Item
Original
Project Total
Revised
Total Project
Budget after
Re-
Alignment in
July 2010
Budget
Status as of
31 Dec 2010
Proposed
Budget up to
30 June 2011
Increase (+) or
decrease (-) in
budget item
Revised Total
Project with
Proposed Jan
2011 Re-
alignment
1. Salaries Professional
(Parent)
459,999 464,368 116,227 15,165 101,062 363,306
2. Salaries General
Services (Parent)
99,999 149,297 38,486 24,000 14,486 134,811
3. Consultants (Parent) 54,000 15,500 15,500 42,000 -26,500 42,000
4. Contracts (Parent) 250,000 186,313 117,575 112,998 4,577 181,736
5. Locally contracted
labour (parent)
0 43,810 11,714 8,410 3,304 40,506
6. Travel (parent) 58,251 51,039 8,111 35,500 -27,389 78,428
7. Training (parent) 39,999 62,005 3,787 15,256 -11,469 73,474
8. Expendable
Procurement (parent)
0 2,113 -692 0 -692 2,805
9. Non-expendable
procurement (parent)
20,000 17,073 -6,171 0 -6,171 23,244
10. Technical services
support (parent)
36,999 29,826 24,666 24,666 0 29,826
11. General operating
expenses (parent)
42,699 40,603 -28,977 22,231 -51,208 91,811
12. Support cost (parent) 138,054 138,052 39,028 39,028 0 138,052
Total 1,200,000 1,199,999 339,254 339,254 0 1,199,999

17. XIN CAM ON