Linking watershed protection and water consumption: WTP by domestic water users in Ho Chi Minh City

In many watersheds of Asia, the demand for water is increasing while the supply of water is challenging due to on-going deforestation and watershed degradation. To ensure a stable supply of water for satisfying this growing demand, the protection of watershed is critical. Vietnam also faces similar situation, particularly in the Dong Nai watershed where high population growth, rapid industrialization, agricultural production, and economic growth are putting tremendous pressure on this watershed. Policy makers have explored various mechanisms to address sustainable watershed management and poverty alleviation. Payment for Environmental Services (PES) is currently being considered as a promising mechanism to address both of these goals. One of the challenges in PES is how to ensure a sustainable financing for watershed protection services. In a response to this problem, a new study from Vietnam has looked into the potential for a sustainable financing for a sustainable management of the Dong Nai watershed. It found that majority of urban residents in Ho Chi Minh City would be willing to pay more for water protection service that would help to ensure the provision of a reliable water supply for their households. Payments in form of a watershed protection fee added to their monthly water bill would generate a significant fund to support upstream communities to protect the watershed supplying the city's drinking water.