The Central Highlands region has a population of 5.46 million and is home to approximately 45 different ethnic groups. It covers an area of 5740 ha, accounting for a significant (16,3%) portion of Vietnam. More than half of this area is covered in forest, making it the most densely populated part of the country. Moreover, the highly fertile land, a quarter of which is basalt, is ideal for growing perennial crops and the area is rich in minerals such as coal, bauxite, iron, zinc and rock crystals. The Central Highlands is thus vital for the production of some of the country’s key agricultural and forestry commodities including coffee, pepper, rubber, cashew, tea and cocoa

The agricultural development in the Central Highlands has contributed greatly to boosting economic growth in Vietnam. Through economic liberalization and government leadership, Vietnam has become the world’s second largest exporter of coffee and top producer of pepper globally.  However, the intensive agricultural development is exacerbating ecosystem degradation and mounting pressure on the services the Central Highlands provide to the economy and the communities in the landscape. The main challenges include diminishing water supply, deforestation, land degradation and improper use of agro-chemicals.

Economic Rationale

The Central Highlands accounts for more than 95% of the coffee growing area in Vietnam. Additionally, the region is a major producer of other agricultural and forestry commodities such as pepper, rubber, cashew, tea, cocoa and dairy products. Therefore, international commodity traders and processors with consumer brands (such as the coffee roasters) have an interest in securing long-term supply of coffee and other agri-commodities. The interest of ensuring continued access to markets is an important driver for companies to address unsustainable practices, such as excessive water and fertilizer use. General trends towards lowered product quality have impacted prices. Farm level certification schemes alone are not able to address Vietnam’s most pressing sustainability challenges effectively. Sustainable solutions can only be achieved through effective policies and regulations, providing incentives for sustainable behavior across sectors, and forming innovative partnerships between the public and the private sectors.  Farmers who currently view over-fertilizing and over-irrigation as a way of hedging a high yield will benefit from reduced costs and more sustainable income in the long term. 
Key Challenges

  • Water supply and demand diverge towards an unsustainable balance

Different factors are contributing to decreasing surface water availability, which has made farmers shift toward groundwater usage for agricultural production at very low costs. At present ground water makes up more than 55 percent of irrigated water in the region and the area is under extreme over-irrigation, leading to severe declines in the ground water table, fundamental to the sustainability of key crops such as coffee.

  • Deforestation and forest degradation

Rapid population growth due to migration, favorable natural conditions and high coffee prices creates additional demand for land in the Central Highlands – a demand that has partly been met by clearing forests. The reduced forest cover leads, among others, to increased soil erosion.

  • Land degradation

Unsustainable farming practices have degraded and polluted the soil. Land erosion due to deforestation is another problem, which causes low agricultural yield and low product quality and will hurt farmer incomes.

  • Improper use of agrochemical

Improper use of agrochemicals, especially pesticides, degrades the soil, pollutes water, harms human health and leads to high production cost and lower competitiveness of agricultural sector. Therefore, this needs to be tackled at national level and translated into the landscape. 

Progress to Date

The four issues of water, deforestation, land degradation and improper use of agrochemicals are strongly interlinked. ISLA plays an important role in clarifying these relationships in a systematic way. In order to address these issues effectively, ISLA recognizes that:

  • Cross-sectoral and public-private cooperation are requisites to address issues systematically and effectively.
  • Addressing the behavior of agri- commodity producers needs to be complemented by effective public policies that are equally steering and incentivizing sustainable practices.

Chi Tran Quynh

Program Manager, Vietnam

phone+84 (0) 913547712

e-mailemail me

Daan Wensing

Program Director ISLA

phone+31 (0) 302305677

e-mailemail me

Manizha Korodiva

Communication Officer, ISLA

phone+31 (0) 302307179

e-mailemail me

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Sectors: Apparel, Aquaculture, Coffee, Spices, Tea

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