Viet Nam Launches US$102.5m Climate-Smart Coffee and Forest Protection Project

The new RECAF project will target the Central Highlands and South Central Coast, regions where rising greenhouse gas emissions, forest loss and climate pressures increasingly threaten rural incomes.

The Government of Viet Nam, the International Fund for Agricultural Development (IFAD) and the Green Climate Fund (GCF) have launched a major US$102.5 million climate and forestry initiative aimed at cutting emissions, protecting forests and securing livelihoods for hundreds of thousands of coffee-growing households.

The new RECAF project will target the Central Highlands and South Central Coast, regions where rising greenhouse gas emissions, forest loss and climate pressures increasingly threaten rural incomes. The project focuses on climate-smart agroforestry, deforestation-free value chains and strengthened forest protection, aligning closely with Viet Nam’s national climate and REDD+ commitments.

Implemented by the Ministry of Agriculture and Environment in partnership with provincial authorities in Dak Lak, Gia Lai, Lam Dong and Khanh Hoa, the project is backed by a blended financing model combining government funding, a US$32.4 million IFAD loan, a US$35 million GCF grant, and US$35 million in domestic co-financing.

Officials say the financing structure ensures long-term affordability while maximising impact in hard-to-reach rural areas. Over its six-year lifespan, RECAF is expected to reduce 6.68 million tonnes of greenhouse gas emissions, restore and improve 145,000 hectares of agroforestry land, and protect 500,000 hectares of high-value natural forest.

Provincial leaders say the project represents a critical opportunity to balance environmental protection with economic development in Viet Nam’s key coffee-producing regions. By integrating forest conservation with sustainable farming practices, RECAF aims to increase farmer incomes while safeguarding ecosystems for future generations.

The programme is expected to directly reach around 420,000 people and indirectly improve the livelihoods of more than one million rural residents, strengthening food security and climate resilience across the region.

RECAF places farmers at the centre of its approach, promoting partnerships between smallholders, local authorities and the private sector. It will support access to markets, improved rural infrastructure and adoption of sustainable production practices, with a strong focus on inclusion of women, youth and ethnic minority communities.

IFAD and GCF say the project demonstrates how climate finance can deliver tangible, on-the-ground benefits when aligned with national priorities and local leadership. The initiative is also being positioned as a scalable model for other coffee-growing and forest-dependent regions facing similar climate and land-use challenges.

With implementation now underway, officials are encouraging early adopters across the coffee sector—including cooperatives, agribusinesses and local partners—to engage with RECAF, accelerate uptake of climate-smart practices and help build deforestation-free supply chains that support long-term growth.