Ministry of Agriculture & Rural Development 025/05VIE Capacity Building in Applied Natural Resource Economics and Management for Vietnam MS & 8: Technical Reports and April 2010 Table of Contents Institute Information Project Abstract Executive Summary Introduction Workshop Training Materials 5.2 Training materials Training Course, Hanoi, 12-16 July 2006 Training Course, Can Tho, 17-21 July 2006 Extension Course, Hanoi, 22-26 January 2007 Extension Course, Can Tho, 29 Jan – Feb 2007 Extension Course, Hanoi, 16-20 July 2007 10 Extension Course, Soc Trang, 23-27 July 2007 11 Pilot Farmer Workshop Program, 16-17 January 2008 12 Pilot Farmer Workshop Program, Soc Trang, 23-24 January 2008 13 Pilot Farmer Workshop Program, Vinh, Hung Nguyen, Nghe An, 14-15 July 200814 Pilot Farmer Workshop Program, Van Giang, Hung Yen, 18-19 July 2008 15 Pilot Farmer Workshop Program, Soc Trang, 21-22 July 2008 16 Roundtable on Resource Management Issues in Vietnam, 17 July 2008 17 Workshop evaluations 18 Natural Resource Economics Network 19 Policy Briefs 19 7.1 The Efficiency of prawn production in the Mekong Delta 20 7.2 Alternative systems of shrimp culture in the Lagoon area of Thua Thien, Vietnam 22 7.3 Benefits from variable rate nitrogen application in rice production 24 7.4 Optimal investment decisions in shrimp farming in Vietnam 26 7.5 Environmental compliance under uncertain enforcement in Vietnam 28 7.6 Knowledge of farmers on natural resource management 31 Research Scholar Reports 34 8.1 Technical Efficiency of prawn farms in the Mekong Delta, Vietnam 35 8.2 An Inquiry into Four Alternative Systems of Shrimp Culture in the Lagoon Area of Thua Thien, Hue, Vietnam 46 8.3 Evaluating the Benefits of Site-Specific Crop Management of Nitrogen Application to Rice Production 60 8.4 Farmers’ Decisions Under Market Uncertainty: A Real Options Analysis of Shrimp Farming in Vietnam 67 Decision Support Modules 76 9.1 Decision Support for Water Quality Management in a River 77 9.2 Shrimp Feeding and Water Pollution 91 9.3 Optimal Length of Production Period 94 10 Report Authorisation 97 1 Institute Information Project Name Vietnamese Institution Vietnamese Project Team Leader Australian Organisation Australian Personnel Date commenced Completion date (original) Completion date (revised) Reporting period Capacity Building in Applied Natural Resource Economics and Management for Vietnam Faculty of Economics and Rural Development, Hanoi Agricultural University Gialam, Hanoi, Vietnam Mr Tran Dinh Thao Faculty of Agriculture, Food and Natural Resources University of Sydney, NSW, 2006, Australia Emeritus Professor Thomas Gordon MacAulay January 1, 2006 June 30, 2008 December 31, 2008 Months Contact Officer(s) In Australia: Team Leader Emeritus Prof T Gordon MacAulay Name: Position: Emeritus Professor Organisation Faculty of Agriculture, Food and Natural Resources University of Sydney, NSW 2006, Australia In Australia: Administrative contact Name: Ms Luda Kuchieva Position: Administration officer Organisation Research Grants University of Sydney, NSW 2006, Australia In Vietnam Name: Position: Organisation Mr Tran Dinh Thao Senior Lecturer, Vice Dean Faculty of Economics and Rural Development Hanoi Agricultural University Gialam, Hanoi, Vietnam Telephone: Fax: Email: 61 9888 9600 61 9888 5821 g.macaulay@usyd.edu.au a.vervoort@usyd.edu.au Telephone: Fax: Email: 61 9351 7903 61 9351 3256 Telephone: Fax: Email: 84 48 769 770 84 48 276 554 Luda.kuchieva@usyd.edu.au thaoktl@hau1.edu.vn Or pvhung@hau.edu.vn 2 Project Abstract With very rapid growth and development in Vietnam, there is a danger of overuse and mismanagement of natural resources, thus compromising sustainable development The level of knowledge, understanding and use of the principles of natural resource economics (NRE) and management is limited in Vietnamese agriculture The designed outcome of the project is to begin to have resource management concepts used in various institutions in Vietnam (Universities, MARD, and the extension system) and to strengthen the ability to deliver knowledge, set policies and advise farmers in this area This outcome is being approached through a participatory approach using workshops in Vietnam on natural resource economics held by the University of Sydney staff and the staff of the participating organizations One training workshop each in Hanoi and Can Tho, four extension workshops, two each in Hanoi and Can Tho, Vietnam have been conducted at the provincial level by Vietnamese staff with participation of the University of Sydney team members, thus transferring the acquired knowledge to extension specialists and thereby eventually to smallholder farmers Two Vietnamese scholars had three-month visits to the University of Sydney in 2006 and two more visited Sydney from August to October 2007 so as to broaden their understanding of natural resource economics and to undertake research projects under the guidance of academics at the University of Sydney Five pilot workshops with farmers have been conducted in January and July 2008 to demonstrate the use and practical knowledge and skills in resource management with the training largely provided by participants in the extension workshops Discussions on curriculum development and revisions with appropriate staff at Hanoi University of Agriculture and CanTho University have been held Executive Summary The project is aimed at strengthening the teaching and research capacity in the field of natural resource economics in several key Vietnamese Institutions (a number of Universities, MARD and provincial and regional extension systems) and encouraging the transfer of knowledge from the University teaching and research staff to extension staff and farmers The project is also designed to strengthen the use of resource management concepts in Vietnam through a participatory approach using training workshops in Vietnam on natural resource economics in three stages First Six Monthly Report—Stage (dated 11 December 2006) First Technical Report (dated 12 April 2007 revised 30 November 2007 Second Six Monthly Report—part of Stage (dated 16 April 2007) Third Six Monthly Report—Extension Workshops July 2007 (dated 28 April 2008) Fourth Six Monthly Report—Stage Pilot Workshops January 2008 (dated March 2010) Fifth Six Monthly Report—Final Farmer Workshops July 2008 (dated April 2010) Second and Third (combined) Technical Report (dated April 2010) As a part of the third stage of the project, pilot extension workshops for farmers were conducted in Vinh, Van Giang (2) and Soc Trang (2) with a focus on economically efficient natural resource management, where practical knowledge and skills in resource management were demonstrated and discussed The participants of the previously held extension workshops led most of the presentations for these workshops Some had never used PowerPoint presentations previously and were supported and encouraged in their preparation by the academic staff at Hanoi University of Agriculture and Can Tho University Introduction This report has been prepared as milestones and and includes: Extension workshop training material, decision support modules, extension packages and extension aids Establishment of the Natural Resource Economics Network, delivery of policy advice and action plan for sustainability of network Policy briefs (4) Research Scholar Reports (4) Decision support model documentation Workshop and Training Materials This project was designed to strengthen the capacity building in natural resource economics in Vietnam in a layered framework In the first layer, The University of Sydney staff provided research, teaching and policy analysis training to Vietnamese academics, policy analysts and extension specialists at a national level through two training workshops held in July 2006 in Hanoi and Can Tho (details of the Training Workshop, July 2007 were reported in milestone in the Second Six-Monthly Report) In the second layer, those trained in the first layer trained the extension specialists and policy analysts at the provincial level The training was designed to impact the advice and information provided to farmers on the use of natural resources demonstrated through a series of district level workshops This was implemented through conducting four extension workshops, of which two were conducted in January 2007 (Hanoi with 25 participants; Can Tho with 26 participants) and two in July 2007 (Hanoi 26 participants; Soc Trang 20 participants) Details of these workshops were provided in the Third Six Monthly Report Following the Extension workshops a set of five pilot workshops for farmers were presented with the training carried out by selected people trained in the Extension Workshops Details are reported in the Fourth and Fifth Six-Monthly Reports The workshops were held at Vinh, Van Giang and Soc Trang in January 2008 and July 2008 with a total of 151 participants For all workshops the total number of participants was 251 5.1 Training materials The available collection of workshop presentations and selected other materials are provided in the form of a CD The full list of workshops in which the presentations were made is included in the following text for reference The details of the decision support models and documentation are given in section of this document Also, provide in the package of material is a pdf file version of the 161 page Training Handbook entitled Applied Natural Resource Economics and Management which contains a detailed development of much of the material presented in the Training workshops At the beginning of each workshop and at the end, short questionnaires were given to participants The first questionnaire was designed to gain some understanding of the participants’ level of knowledge and background The questionnaire given in the final session was designed to assess participant levels of satisfaction with the program and their suggestions for improvement as well as in the academic Training and Extension workshops to assess levels of understanding of the material given The detailed questionnaires and all the results have been tabulated in the Six-Monthly Reports and are not repeated in this report The decision models and the documentation associated with them is available for use by extension specialists as are the policy briefs and the Powerpoint presentations These are all available on the CD and website.1 Some of the Powerpoint presentations have been developed on a Mac OS X platform and therefore some of the pictures are not in a format that can be read by Windows based machines These pictures (photos) will not appear when shown on Windows operating systems Training Course, Hanoi, 12-16 July 2006 Wed 12th July 8.30 – 10.00 am Morning break 10.15 – 11.30 am Lunch 1.30 – 3.00 pm Afternoon break 3.15 – 4.30 pm Thu 13th July Sat 15th July Sun 16th July 9.00 am Welcome and official opening by Rector of HAU and Dean Competency evaluation Prof Gordon MacAulay Resource management principles Dr Michael Harris Natural resource economics in a dynamic setting, renewable and non-renewable resources, constrained optimisation over time Prof MacAulay Economics of asset replacement Fri 14th July Prof Gordon MacAulay Public policy processes in natural resource economics Prof Gordon MacAulay and Dr Pham Van Hung Basic land economics and land use Dr Michael Harris Key principles and methods in resource and environmental economics Prof Gordon MacAulay and Dr Michael Harris Compounding, discounting and present values of assets Dr Tiho Ancev Renewable resources: Forestry economics and optimal rotations Dr Tiho Ancev and Dr Michael Harris Public policy instruments in the natural resource sectors (Pesticide tax case study) Dr Tiho Ancev and Mr Tran Dinh Thao Economics of soil conservation (Soil conservation case study) Dr Michael Harris Property rights, market failure and policy responses Dr Michael Harris and Dr Tiho Ancev Dynamic optimisation and the use of MS Excel Dr Tiho Ancev and Ms Sally Marsh Economics of water use and water quality Ms Sally Marsh The role of extension in addressing natural resource problems Prof G MacAulay Renewable resources: Fisheries economics and aquaculture (Case study discussion) Ms Sally Marsh Extension work and environmental economics Prof Gordon MacAulay, Dr Michael Harris Mini-workshop with static and dynamic problems (mining and optimal control) Dr Tiho Ancev Mini-workshop on water use and water quality (river pollution model) Ms Sally Marsh Mini-workshop on the practical aspects of extension in natural resource management Resource Economics debate Discussion of the program (4.15-4.30pm) Course Evaluation and Review Competency evaluation Date revised: 12 July 2006 Training Course, Can Tho, 17-21 July 2006 Mon 17th July Thur 20th July Fri 21st July Dr Michael Harris Natural resource economics in a dynamic setting, renewable and non-renewable resources, constrained optimisation over time Prof MacAulay Economics of asset replacement Prof Gordon MacAulay Public policy processes in natural resource economics Prof Gordon MacAulay Basic land economics and land use Prof Gordon MacAulay Resource management principles 8.00 – 9.45 am Dr Michael Harris Key principles and methods in resource and environmental economics Prof Gordon MacAulay and Dr Michael Harris Compounding, discounting and present values of assets Dr Tiho Ancev Renewable resources: Forestry economics and optimal rotations Dr Tiho Ancev and Dr Michael Harris Public policy instruments in the natural resource sectors (Pesticide tax case study) Dr Nguyen Phu Son Deforestation of the Melaleuca in Long Xuyen area in the Mekong Delta Dr Michael Harris Property rights, market failure and policy responses Prof G MacAulay Renewable resources: Fisheries economics and aquaculture (Case study discussion) Dr Tiho Ancev and Ms Sally Marsh Economics of water use and water quality Ms Sally Marsh The role of extension in addressing natural resource problems Dr Michael Harris and Dr Tiho Ancev Dynamic optimisation and the use of MS Excel Ms Sally Marsh Extension work and environmental economics Prof Gordon MacAulay, Dr Michael Harris Mini-workshop with static and dynamic problems (mining and fisheries) Dr Tiho Ancev Mini-workshop on water use and water quality (river pollution model) Ms Sally Marsh Mini-workshop on the practical aspects of extension in natural resource management Resource Economics debate 9.00 am Welcome and official opening Competency evaluation Morning break 10.10 – 11.30 am Lunch 1.30 – 3.15 pm Afternoon break 3.30 – 5.00 pm Tue 18th July Wed 19th July Discussion of the program (4.15-4.30pm) Competency evaluation Course Evaluation and Review Date revised: 12 July 2006 Extension Course, Hanoi, 22-26 January 2007 Mon 22nd Jan 8.30 – 10.00 am Tues 23rd Jan Wed 24th Jan Thurs 25th Jan Dr Nguyen Nghia Bien Ass Prof Ngo Thi Thuan Dr Pham Van Hung Basic extension methods and tools including measures of extension performance in knowledge dissemination Sustainable development, land use management and land markets (value of land) Dr Michael Harris Ass Prof Ngo Thi Thuan Key principles and methods in resource and environmental economics for extension specialists Skills in extension and applications Dr Nguyen Thi Minh Hien Gender roles in extension and gender in natural resource management Field trip in Luong Son district Hoa Binh province Dr Nguyen Nghia Bien Basic forestry economics and spreadsheet analysis of harvesting and replacement Dr Michael Harris Dr Pham Van Hung Dr Nguyen Van Song Mr Tran Dinh Thao Update on the use of MS Excel spreadsheets Exploitation, management and use of water (resource economics perspectives) Field trip in Luong Son district Hoa Binh province 9.00 am Welcome and official opening by Rector or Vice-Rector of HAU and Dean/Vice Dean òf FERD Competency evaluation Prof Gordon MacAulay Resource management principles for Extension specialists Morning break 10.15–11.30 am Lunch 1.30 – 3.00 pm Property rights, market failure and policy responses am, departure from the Guess House (HAU) Fri 26th Jan Field trip in Luong Son district Hoa Binh province Economics of small-scale forestry and harvesting models (spreadsheet analysis) Economics of soil conservation (Soil conservation case study) Basic compounding and discounting Spreadsheet exercises Afternoon break 3.15 – 4.30 pm Professor Gordon MacAulay Extension work, resource management and environmental economics, eg trading permits Dr Pham Van Hung Dr Nguyen Duong Nga Workshop on a simple LP Mini-workshop on water use and water quality (river pollution model and interpretation model, Spreadsheet exercises) of results Workshop held in the Faculty of Economics and Rural Development, Hanoi Agricultural University No Field trip in Luong Son district Hoa Binh province Debate Competency evaluation Course Evaluation and Review Extension Course, Can Tho, 29 Jan – Feb 2007 Mon 29th Jan 8.00 – 9.45 am Morning break 10.00 – 11.30 am Lunch 13.30 – 15.00 pm Afternoon break 15.15 – 17.00 pm Tues 30th Jan Wed 31st Jan Welcome and official opening by Director of MDI Competency evaluation Prof Gordon MacAulay Resource management principles for Extension specialists Dr Vo Thi Thanh Loc Dr Michael Harris Key principles and methods in resource and environmental economics for extension specialists Dr Vo Thi Thanh Loc Discuss about Renewable Resources Management: Fisheries Mr Duong Tri Dung Economics of water quality - Analysis of collective water use and water quality - Water management in a community Dr Michael Harris Property rights, market failure and policy responses Dr Tran Thanh Be Dr Tran Kim Tinh Basic extension methods and tools including measures of extension performance in knowledge dissemination Land use management, cropping patterns, soil conservation and land markets (value of land) Professor Gordon MacAulay Extension work, resource management and environmental economics, eg trading permits Dr Tran Thanh Be Economics of soil conservation Fri 2nd Feb Mrs Vo Thi Lang New methods in extension and applications to natural resource management including games and budgeting exercises Thurs 1st Feb Renewable Resources Management: Fisheries Mr Duong Tri Dung Introduction to water Economic - Importance of water quality - Today’s lecture objectives - Some important water quality parameters am, departure from the Dormitory (MDI) Field trips - study tour Field trips in An Giang province Field trips - study tour Field trips in An Giang province Mrs Tran Thuy Ai Dong Basic compounding and discounting Mrs Tran Thuy Ai Dong Spreadsheet exercises Update on the use of MS Excel spreadsheets Spreadsheet exercises Dr Tran Thanh Be Field trips - study tour Field trips in An Giang province Field trips - study tour Field trips in An Giang province Debate Discussion Debate (continued) Discussion (continued) Competency evaluation Course Evaluation and Review Record the required information on the attached answer sheet for the uniform charge Repeat the process and determine the minimum emission charge necessary to generate the minimum water quality for use levels C, B, and A Record the results in the answer sheet for the uniform charge Policy 3: Permit based efficient emissions reduction Emissions reduction through the use of a permit system is known to be economically efficient and is illustrated in worksheet “Permit system” The first step uses a nonlinear programming approach to determine the minimum of the sum of costs of abatement and damage associated with the desired minimum water quality The second step makes use of the Lagrangian multipliers (shadow values) to simulate the value of ambient permit prices that will deliver an abatement outcome consistent with the minimum abatement and damage cost The purpose of the programming model is to find the least-cost combination of abatement by the three sources that will meet water quality limits at each of the four points of measurement Conceptually this involves solving the following problem with four water quality constraints (6) Minimise Z = TAC1(A1) + TAC2(A2) + TAC3(A3) + WTP(DO) = 69.4 A12 + 207 A22 + 307 A32 + 5,334,839 - 1,090,830 DO + 54,099 DO2 Subject to (7) A1 + BOD1 = 47.4 (8) A2 + BOD2 = 123.0 (9) A3 + BOD3 = 92.4 (10) DO + 0.0461*BOD1