Community development of medicinal plants under natural forest canopy in Tuong Duong - Part 4: Effectiveness of 'Revolving Fund'

Met Ms. Lo Thi Hoi - President of the Women's Union of Yen Hoa commune (Tuong Duong) on ​​a day at the end of October, when she was busy preparing documents and papers to summarize information and results of the implementation of the "Revolving Fund".

The “revolving fund” is a fund source within the Project “Supporting communities in buffer zone communes to develop medicinal plants under forest canopy to increase income and conserve biodiversity in the Western Nghe An World Biosphere Reserve”.

The Fund is funded by the Small Grants Program (SGP) - Global Environment Facility (GEF) coordinated implementation within the framework of the Project on Integrating Natural Resource Management and Biodiversity Conservation Goals into Socio-Economic Development Planning and Management of Biosphere Reserves in Vietnam (BR Project), implemented by the Ministry of Natural Resources and Environment and funded by GEF through the United Nations Development Program (UNDP) in Vietnam.

The President of the Women's Union of Yen Hoa commune said that the "Revolving Fund" was deployed in Yen Hoa commune from December 2023. By October 2024, the total outstanding loan had reached 250 million VND for 8 households in Xieng Lip (5 households), Canh Khin (1 household), Yen Tan (2 households) to borrow, each household 30 million VND. Particularly, 1 household in Xieng Lip village borrowed 40 million VND. This is a source of money in the project, households can borrow at low interest rates within 2-3 years, used to buy and propagate medicinal plant seedlings, buy materials to make protective fences to implement the medicinal plant growing model under the forest canopy.

The operation of the "Revolving Fund" is managed by the Commune Women's Union, and is carried out seriously and systematically, including the Fund Management Board headed by the Commune People's Committee Chairman and the Women's Union Chairman as the Deputy Head; there is a specific operating mechanism and monthly financial reporting regime.

Mr. Mong Van Vien - Vice Chairman of Yen Hoa Commune People's Committee said that the "Revolving Fund" is a sustainable and reliable source of loan capital, which has the effect of motivating and encouraging households to invest in production and growing medicinal herbs under the forest canopy. Each borrower is guided to develop a production plan suitable for the loan capital, which is assessed by local authorities and experts.

After borrowing, the process of households using the loan capital for production is monitored, supervised and supported by the fund management board as well as project experts to ensure that the loan capital is effective. After households have fully paid off the loan capital, the fund will continue to be rotated and transferred to new households in need of loans.

By doing this, the fund will be sustainable, meaning that more and more households will benefit from preferential loans along with different “services”, from planning the use of capital to the entire production, business and economic development process. Also from this “Revolving Fund”, economic development by growing medicinal herbs under the forest canopy will be maintained for a long time and increasingly spread.

Households that borrowed capital from the "Revolving Fund" such as Vi Thi Cam and Vi Thi Nhan in Xieng Lip village, after investing in buying seedlings and establishing nurseries, have so far sold thousands of seedlings to households in need inside and outside Tuong Duong district. Each nursery that households borrowed capital to build has a scale of about 15,000 seedlings. After being propagated at the nursery, the seedlings of the Morinda officinalis plant can be sold for 3 - 5 thousand VND/tree; the seedlings of the purple velvet antler plant cost 10 - 15 thousand VND/tree depending on age. In 2023, nurseries established with the project's support in Yen Hoa commune sold more than 6,000 seedlings to facilities outside Tuong Duong district.

The leader of the Department of Agriculture and Rural Development of Tuong Duong district said that up to now, the project "Supporting communities in buffer zone communes to develop medicinal plants under forest canopy to increase income and conserve biodiversity in the Western Nghe An World Biosphere Reserve" has funded a total loan of 612 million VND for 2 "Revolving Fund" models in Yen Hoa and Nga My communes.

Households that borrowed capital from the "Revolving Fund" have combined other resources to invest in nurseries, directly grow medicinal herbs, and have begun to sell products to the market. In Yen Hoa commune, purple velvet antler gardens planted under the forest canopy have been harvested, and families participating in growing medicinal herbs are working with the government and women's associations to develop products that aim to meet OCOP standards from this precious medicinal plant.