Commodity Chain Analysis and the Design of Water Pollution Management

Policies in a Paper Recycling Village in Vietnam

Supervised Research Project (ANTH8036) for

Master of Applied Anthropology and Participatory Development

Nanda Gasparini

March 2010

Resource Management in Asia-Pacific Program

Crawford School of Economics and Government

ANU

The Red River Delta in the north of Vietnam is an agricultural region that supports a number

of craft villages producing food, textiles, wood processing, handicrafts and paper (Nguyen

Van Ha 2005). Since the Vietnamese economic reforms of the mid-1980s known as Doi

Moi—which transformed the economy from centrally-planned to market-oriented—the

country experienced rapid growth and modernization, and new economic opportunities arose,

including the development of small-scale local industries (Dang 2009; O’Rourke 2004). This

rapid urbanization and industrialization has had major impacts on land use patterns, resource

depletion and water, air, and soil pollution (Dang 2009).

Some of the environmental impacts of this rapid industrialization can be found in craft

villages in the Red River Delta, including in the outskirts of the Vietnamese capital of Hanoi.

Phong Khe, in Bac Ninh Province and 30 kilometres from Hanoi, is a paper recycling

commune experiencing high levels of water pollution (Nguyen K.Q. et al. 2003; Dang &

Hoang 2005). The water pollution is mainly a result of untreated wastewater being released

from the paper recycling enterprises, which are impacting the local area (Dang 2009).

Moreover, areas downstream of the Ngu Huyen Khe River, which travels through various

villages in Bac Ninh province, are also affected, as the contaminated water travels down the

river stream (ibid).

While the Vietnamese government has laws in place dealing with pollution issues, the

capacity of the local government and the state agency—the Ministry of Natural Resources

and Environment (MONRE)—to implement these laws, has been weak (ibid;

Konstadakopulos 2007). However, the role of community groups has been highlighted as an

important source of environmental awareness information and a significant contributor to

environmental management (Dang 2009; Korea-World Bank 2004).

This paper examines the actors, and their roles, in the production of recycled paper products,

and explores the implications for the design of water pollution management programs in

Phong Khe1. Specifically, the paper asks who are the actors, their relations and roles in the

                                                            1 This paper will contribute to a larger study—by the Australian National University (ANU) and the Vietnamese Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD)—analysing the scope for community-based approaches to contribute to water pollution management in craft villages in Vietnam.

recycled paper commodity chain and what are the implications for environmental

management? To address this question, the paper will adapt the concept of Commodity Chain

Analysis due to its ability to reveal the range of actors, and their characteristics. The findings

of this paper will focus on flagging relevant issues that have implications for water pollution

management in Phong Khe. Hence, the scope of the paper will be limited, and will not focus

on specific options for environmental management.

This paper will start out by reviewing a range of literature on water pollution in craft villages

in Vietnam and will describe specific aspects relating to paper recycling in Phong Khe

commune. A brief review of the literature on Commodity Chain Analysis will follow, as well

as a discussion on how the approach is being tailored to support the design of water pollution

management initiatives in Phong Khe. The methodology undertaken in this study will also be

discussed. Finally, this paper will discuss its three main findings. First, the paper will find

that there are a range of actors involved in the recycled paper production process that need to

be targeted when designing water pollution management programs. Second, the paper will

show that the main actors with significance to water pollution in Phong Khe are the large and

medium sized enterprises, who are also the biggest earners in the recycled paper commodity

chain, and who have the greatest control over prices. Lastly, the paper will find that there is

scope for, and existing venues for, collaboration between actors, which suggests opportunities

for community environmental management.

Craft Villages and Water Pollution in the Red River Delta

Characteristics of rural craft villages

In Vietnam, craft villages can be defined as “a rural village that has one (or some) handicraft

occupation (s) that operates independently and separately from the agricultural activities”

(Nguyen Van Ha 2005, p.19). The Red River Delta, in the northern part of Vietnam, is a

fertile agricultural region and home to nearly 70 percent of these craft villages. Craft villages

have historically included food processing, textile production and paper manufacturing,

among others. In the past, the crafts provided an additional occupation for farmers, allowing

them to produce goods in idle agricultural times (Dang 2009; Nguyen Van Ha 2005).

Households are the main unit of production in craft villages, and family members usually

work in the enterprise, with outside labour employed as needed (Dang 2009). The house plot

usually serves as the production site in craft villages.

While a number of these craft villages have been in the Red River Delta for decades, others

have sprung up more recently, as a result of the Doi Moi economic policies which facilitated

the development of small-scale local industries (Dang 2009). Available data of this growth

can be seen in Table 1. Craft villages have expanded, investment has grown, new

employment opportunities have sprung up, and craft production has become the main source

of income for most craft village households (Nguyen Van Ha 2005). One of the consequences

of this rapid growth has been a rise in environmental pollution problems in craft villages

(Dang 2009; Nguyen Van Ha et al. 2004; Nguyen K.Q. et al. 2003; Dang & Hoang 2005).

Table 1: Growth of Craft Villages in the Red River Delta

Year Number of craft villages Number of people

employed

1900 108 250,000

1995 439 --

1998 731 600,000

2004 900 --

Source: Nguyen Van Ha 2005; Nguyen K.Q. et al. 2003.

Craft villages are generally classified depending on what they produce. While there are

various classifications of craft villages, Dang (2009) considers that the most widely accepted

divides craft villages into six types: (1) food processing and animal husbandry; (2) textile,

silk and leather production; (3) construction material production and stone exploiting; (4)

waste material processing; (5) handicraft production, and (6) others. Water pollution is most

common in villages involved in food processing, textiles and waste processing (ibid).

According to Dang (2009), approximately 4 percent of craft villages are classified as

processing waste materials—such as paper—14 percent as processing food, and 10 percent as

producing textiles. Moreover, paper recycling villages are only a small portion of solid waste

processing villages in Vietnam. In 2004, there were approximately 90 waste recycling

villages in Hanoi classified into three different categories: 81 metal recycling villages, 5

plastic recycling villages, and 4 paper recycling villages (ibid). Since paper recycling villages

are not the only contributors to water pollution in craft villages, this paper’s findings may be

relevant to other craft villages with water pollution problems.

Water pollution in paper recycling villages

The growth in craft villages has had a number of positive impacts for people in Vietnam,

including increased employment and income in the Red River Delta. However, growth has

also had negative impacts, such as an increase in environmental pollution and poor health

indicators, including higher rates of cancer and lower life expectancy (Dang 2009; Nguyen

Van Ha et al. 2004; Nguyen K.Q. et al. 2003; Dang & Hoang 2005).

While, in earlier times, craft production was mostly done by hand using non-toxic materials,

after the Doi Moi reforms rural craft villages have expanded their production process,

employed machines, and now produce higher levels of waste discharge that go untreated

(Nguyen Van Ha 2005). In this way, the initially small craft enterprises have transformed into

more industrialized ventures. This rapid and largely unplanned development has outrun the

local government’s ability to provide adequate infrastructure, such as drainage and

wastewater treatment facilities, or to provide adequate rules and regulations regarding the

scale of craft production. As of August 2009, 90 percent of craft villages in Vietnam had

pollution levels beyond the permissible limits set by the national government (Dang 2009).

The release of wastewater has become a considerable environmental problem. As Dang and

Hoang (2005) explain, wastewater from recycled paper production contains chemicals, pulp,

and high organic contents which heavily pollute the water. Thus, the highest levels of

pollution in the recycled paper commodity chain occur in the process of converting old paper

into new paper. In other words, the paper making enterprises are responsible for most of the

water pollution in paper recycling craft villages.

The nature of craft villages also increases their polluting potential. By utilizing the house as

the production site, paper recycling villages pollute in a small-scale and dispersed manner

which is difficult to monitor and manage (Dang 2009; interview with government staff). In

order to address this, since the mid-1990s the Vietnamese government has advocated for

“industrial” or “concentration” zones within paper recycling villages such as Phong Khe.

This approach is aimed at clustering enterprises in one place, in order to concentrate the

pollution and make it easier to treat. However, as informants in this study explained, the

industrial zones are yet to show any significant improvements in managing pollution levels

because wastewater is still not properly treated. Moreover, instead of moving enterprises

from the residential areas to the industrial zones, as was envisioned by the government

initiative, paper producers have used it as an opportunity to expand their production, setting

up their enterprise in two locations: the residential and the industrial area.

Recycled paper enterprises release untreated wastewater into ditches and river

streams, highly contaminating the water.

From interviews conducted during the course of this study the lack of success, thus far, in

treating water pollution in industrial zones stems from the fact that wastewater facilities were

not built at the same pace as the new enterprises. Thus, managing water pollution is currently

difficult at the household level, due to its dispersed nature, and in the industrial zones due to

inadequate planning. In both scenarios, a lack of adequate wastewater treatment facilities is a

hindrance to improved water pollution management. While this paper will not explore the

efficiency of the industrial zones, it is useful to understand some of the strategies that have

been implemented to address water pollution problems in Phong Khe.

As laid out by Dang (2009), additional challenges and contributors to pollutions in craft

villages include old technology (which tends to be more polluting), high population density,

lack of space, shortage of capital, lack of waste-management infrastructure, and low

awareness of environmental issues. In addition, the main source of energy for many

enterprises, such as the paper recycling commune of Phong Khe, is coal or firewood – both

highly polluting.

Moreover, weaknesses in Vietnam’s regulatory framework and the low capacity of the

Vietnamese Environmental Protection Agency (EPA) are also factors contributing to

pollution in craft villages. Some of these regulatory weaknesses stem from a lack of clear and

appropriate regulations for craft villages, no clear definition of responsibility for

environmental protection, a lack of standards in water treatment, weak enforcement of laws

and regulations and low information dissemination (Dang 2009).

With these water pollution management challenges in mind, this paper utilizes a commodity

chain approach to understand the actors involved, and their roles in paper production, and the

implications for environmental management. While potential solutions for the management

of water pollution in Phong Khe are outside the scope of this paper, the paper will highlight

the issues that need to be taken into account in the design of environmental management

programs.

Recycled paper production in Phong Khe commune

Phong Khe commune is located in Yen Phong District, Bac Ninh Province. Phong Khe has a

population of 8,546 people and 1,964 households, and is made up of four villages. While the

village of Duong O, located in Phong Khe commune, has been traditionally making paper for

centuries, paper production in Phong Khe has developed rapidly since the adoption of

machinery, starting in the mid 1990s (Dang 2009). According to Nguyen Van Ha et al.

(2004), in 1992 there were six paper mills with six production lines in Duong O. Ten years

later, there were 75 paper mills with more than 100 production lines (ibid; Nguyen Van Ha

2005). By 2005, 171 medium and large enterprises in Phong Khe owned 220 paper recycling

machines (Dang 2009). As a result, while in the past paper production was mostly small-

scale, currently 80 percent of these enterprises are involved in medium or large-scale

production. By 2005, villages such as Duong O were producing approximately 200 tons of

finished paper per day (ibid; Nguyen Van Ha et al. 2004; Nguyen Van Ha 2005).

Paper production in Phong Khe is a profitable business, with revenue earned in 2006

estimated at 502 billion Vietnamese Dong (VND) or (with a 2010 exchange rate)2, US$27

million (Nguyen Van Ha et al. 2004). This contributed more than 9 billion VND, or nearly

US$500,000, to the State budget (ibid). However, villagers in Phong Khe routinely complain

of water pollution, and highlight wastewater discharge from the enterprises as the main cause.

None of the villagers interviewed in Phong Khe in this study drank water directly from their

                                                            2 Calculating 1USD=18,500 VND. Exchange rate as of January 2010.

well, using filters instead to treat the water that they otherwise found unsafe to drink.

Villagers and government representatives also mentioned routine water checks conducted by

the Bac Ninh Department of Natural Resources and Environment (DONRE), which found the

pollution index to be 13 to 15 times higher than the country standard. Interviews with

government officials, conducted for this study, also revealed that over 5,000 cubic metres of

(mostly untreated) wastewater is released daily in Phong Khe.

Six types of paper are mainly produced in Phong Khe: (1) offering paper; (2) toilet paper; (3)

tissue paper; (4) office paper; (5) cardboard, and (6) newspaper. This classification raises

questions on whether all types of paper are equally polluting, an area that needs further

research. There are also three different scales of production in Phong Khe: 20 percent of

recycled paper enterprises are large, 60 percent are medium and 20 percent are small. Having

different scales of production, and different scales of wastewater release, raises questions on

whether all enterprises should be equally responsible for environmental management. This

will need to be considered by policy makers implementing water pollution programs.

Utilizing a Commodity Chain Analysis Approach

Commodity Chain Analysis focuses on the linkages that exist in the production process of a

commodity, particularly in the way which companies and countries are globally integrated

(Gereffi 1999; Kaplinsky & Morris 2000). This framework of analysis has been utilized since

the 1980s and has been helpful in trying to understand the dynamic forces of globalization, in

particular the inter-linkages between actors involved in the production process (Kaplinsky &

Morris 2000; DFID 2008).

A commodity chain refers to the “network of labour and production processes whose end

result is a finished commodity” (Hopkins & Wallerstein 1986, cited in Raikes et al. 2000,

p.3). Commodity Chain Analysis seeks to understand the range of activities involved, as well

as the linkages in all parts of the chain. One of the defining characteristics of Commodity

Chain Analysis is that it can be used to explore backward and forward linkages in the

production of a commodity (Gereffi 1994). Gereffi et al. (1994) explain that specific

processes in a commodity chain can be identified in boxes, each involving specific inputs

such as raw materials, labour, transportation, distribution and consumption. For these authors,

the analysis of a commodity chain shows how production, distribution, and consumption are

shaped by the social relations and organizations that make up each step of the processing of a

given commodity.

Understanding social relations between actors in the recycled paper commodity chain is of

particular importance to this study, as it is fundamental for successful environmental

management. Without a good understanding of the actors involved, pollution programs may

not be appropriately targeted, and may not reflect the needs and situation of those involved.

Moreover, social relations provide information about the scope for collaboration between

actors in this study, which has considerable implications for environmental management

programs.

There are various ways to approach Commodity Chain Analysis. Gereffi (1999), for example,

focuses on the differences between “producer-driven” and “buyer-driven” global commodity

chains in order to understand global industries and, specifically, who plays the coordinating

role within them. Other approaches to Commodity Chain Analysis include the Filière

approach, used by French agriculturalists, to “thread” or map the flow of commodities in

order to identify actors and production activities, as well as value-added (DFID 2008; Raikes

et al. 2000). More recently, authors such as Ribot (1998) have tailored the Commodity Chain

Analysis framework in order to understand issues of access and benefits in the charcoal

production process in Senegal. Development agencies, meanwhile, have been utilizing

commodity chains as a participatory mechanism to enable local stakeholders to be involved

in the collection and analysis of information (Mayoux 2003). Similarly, DFID (2008)

suggests using Commodity Chain Analysis to improve outcomes for the poor by providing

them with better incomes and employment security.

Thus, one can see that the concept of commodity chains can be utilized in a number of

different ways: to analyse power issues in global chains; to understand the flow of materials;

to empower stakeholders; to analyse the distribution of benefits; to highlight issues of access;

to show linkages between firms, regions and countries; to map actors; to examine the role of

upgrading in the chain, and to highlight the role of governance, among others (ibid; Mayoux

2003; Raikes et al. 2000; Gereffi 1999; Ribot 1998; Kaplinsky & Morris 2000).

Commodity Chain Analysis is particularly useful when examining issues relating to water

pollution management of craft villages, as it uncovers the range of actors involved in the

production process that need to be targeted when designing water pollution management

programs. This approach also helps to examine the linkages between actors, how benefits

flow through the chain and, ultimately, the implications for water pollution management in

craft villages. While other methods, such as stakeholder analysis, could be used to uncover

some of this information, Commodity Chain Analysis allows for a more thorough and graphic

understanding of the chain and the number of actors that are involved in the paper recycling

process. This allows for an exploration of the relations between all of the actors, and a more

detailed understanding of how benefits flow through all the actors in the chain.

Moreover, Commodity Chain Analysis is able to map out the process first, and then the actors

involved become clear. This process seemed to work well in Phong Khe, as actors in the

chain were much more aware of the production processes than of the extent of other actors

involved. On the other hand, stakeholder analysis, for example, would have focused on

finding the actors first, and from that deriving the processes. From my experience in Phong

Khe this would have proved difficult, as some of the actors would not have been fully

identified and thus the whole recycled paper process would have been incomplete.

As a result, Commodity Chain Analysis proved essential in mapping out the actors in the

chain, as it uncovered the multiple processes involved in the recycled paper production

process. So while the most polluting actors in the chain, enterprises, were already known

prior to this research, an analysis of the recycled paper commodity chain allowed for an

understanding of the characteristics of these and other actors, opportunities for engagement,

and a realization of how benefit flows throughout the chain. Without this crucial information,

the implications for environmental management would have not been fully appreciated.

This paper utilizes the analysis of social relations in the commodity chain process, the

backward and forward linkages, actor mapping, costs and benefits, issues of access and

control, as well as a participatory process to map the chain, in order to have a tailored

approach to Commodity Chain Analysis. This approach can be used to understand the actors,

and their roles and relations in the recycled paper commodity chain, as well as the

implications for environmental management.

In addition, the tailored approach used in this paper explores the scope for cooperation

between actors in the chain, an aspect not usually covered in Commodity Chain Analysis.

Cooperation is not generally analysed in most commodity chain approaches, as the focus

tends to be on the actors controlling the chain and not on the scope for cooperation between

them. However, in the case of this paper the focus is not on the product of the chain, and

issues of competition or control of the product, but on what the chain reveals about the actors,

their relations, and the implications for water pollution management programs in Phong Khe.

In this context, it is possible to explore collaboration among actors in the commodity chain.

Similarly, this paper will utilize the concept of commodity chains at a much smaller scale

than that outlined by Gereffi (1994, 1999). It will not focus on whether the chain is producer

or buyer-driven, and will depart from the analysis of global competition favoured by Gereffi

and other authors. Moreover, the approach laid out in this paper will not have an economic

focus. Once again, the rationale here is that the focus of this paper is not on the actual

production of the commodity and the profits involved (although this will be explored to some

degree) but on what the commodity chain reveals about the actors, and the implications for

water pollution management.

Methodology

The research for this paper was done as part of a broader research study conducted by the

Australian National University (ANU) and the Vietnamese Institute of Policy and Strategy

for Agriculture and Rural Development (IPSARD) in the Red River Delta in northern

Vietnam. Phong Khe, the paper recycling commune studied in this paper, was one of the four

case study locations3 the broader ANU-IPSARD project had chosen and, due to reasons of

timing, it was the one chosen for this commodity chain study. The focus of this paper is

mainly at the village and household level, with a few interviews with provincial authorities.

Given the focus of this paper and of the broader study, the methodology chosen was a

qualitative one, based on semi-structured interviews, a participatory exercise, observation,

and a focus group discussion. As defined by Neuman (2006), qualitative research involves

the study of empirical materials such as case studies, interviews, personal experience, and

observations. Given that my main research focus was to map out the recycled paper process

and the stakeholders involved, understand the relationship between these different actors, and

the implications for water pollution management, a qualitative focus was the most

                                                            3 The main aim of the ANU-IPSARD case study approach is to get a rich understanding of the context for water pollution in each location, while exploring wider economic, social and political factors that influence environmental management (Mahanty 2009).

appropriate. The qualitative approach allowed participants to be interviewed in a semi-

structured manner, and allowed for scope to probe for further details when necessary.

Interviews lasted approximately one to one and a half hours4. All interviews were conducted

ethically and with informant’s consent.

Access to the research site was granted thanks to the collaboration between ANU-IPSARD

and the local authorities. At the village level, efforts were made to build trust with the local

authorities who were in essence gatekeepers, approving our access to the research site and to

participants (Neuman 2006)5. The sampling selection for this study was purposive. The

selection criteria included enterprise managers, enterprise workers, household members (male

or female) working in recycled paper production (but not in an enterprise), households not

involved in paper production, and government officials (commune, district, provincial,

national)6. In total, I interviewed twenty people for this study7: three government officials, six

paper recycling enterprise owners, six heads of households (male or female) involved at some

stage of the recycled paper process8, four paper shop owners in Hanoi and one trader in

Hanoi9. The characteristics and number of people interviewed can be found in Table 2.

Table 2: Characteristics of People Interviewed10

Type

paper

Sma

Ent

Med

Ent

Large

Ent

Buys

paper

Sorts

paper

Prints

paper

Weighs

paper

Buys

paper

Provincial

Govt

Local

Govt

Shop

owner

Trader

in

                                                            4 One of the limitations of this research was that in most interviews one local government representative would be present. However, this is not unusual in Vietnam. Fortunately the local government representative did not stay in all the interviews, often remaining on site but sitting away from the interview or chatting with other people in the enterprise. 5 In total, three ANU-IPSARD researchers were involved in gathering data for the broader study, while I was involved in gathering data for the Commodity Chain Analysis presented here Both data gathering exercises were done together and involved the same methodology. The questions complemented each other, and data gathering repetition was avoided. 6 A selection criteria was given to the local government officials (gatekeepers), who suggested who would be the best person to talk to. 7 Two people, a shop owner involved in the paper process in Phong Khe, and a villager not involved in the production process, refused to be interviewed. 8 For some households paper production was a secondary employment, while for others it was their main source of income. 9 The Hanoi participants were chosen at random in the Old Quarter of Hanoi. 10 The six enterprises interviewed were roughly proportional to the classification in Phong Khe where 20 percent of enterprises are small, 60percent are medium and 20 percent are large.

and

sells

to ent

and

sells

to ent

and

sells

in

Hanoi

or

other

city

in

Hanoi

Hanoi

Waste - - - 2 0 - 1 - - - - 0

Cardboard 0 1 2 - - 0 - 0 - - 0 1

Tissue or

Toilet 0 0 0 - - 0 - 1 - - 2 0

Offering 0 2 0 - - 1 - 1 - - 2 0

Do11 and/or

by hand 1 0 0 - - 0 - 0 - - 0 0

Total

interviewed 1 3 2 2 0 1 1 2 2 1 4 1

In addition, a participatory exercise was carried out on the last day of the study12 with ten

participants. Participants included men and women who were either involved in one of the

stages of the paper production process, or owned a small or medium-sized enterprise13. The

participatory exercise helped to clarify the paper recycling commodity chain as I understood

it. Moreover, a focus group discussion was also carried out with the three women present in

the participatory exercise. This focus group was aimed at understanding collaboration within

the commodity chain, and information flows. My research was also complimented by my

own observations. This, together with the participatory exercise, focus group discussion,

semi-structured interviews and my own research on the paper recycling production process,

helped to triangulate the data obtained.

Findings and Discussion

The recycled paper commodity chain

While previous research (DiGregorio 1994) had shed light on the recycled paper process, the

semi-structured interviews and the participatory exercise that I carried out were fundamental

in fully mapping out the chain. The main processes in the recycled paper production chain

involve the soaking, grinding, and drying of paper, but in reality it is much more complex

than that (see Figure 1). As DiGregorio (ibid) explains, the paper recycling commodity chain

                                                            11 Do paper is a traditional off-white paper made by hand produced from the bark of the Do tree (Van Ha 2005). 12 In total, five days were spent at the research site in December 2009. 13 Some of these participants had also been interviewed as part of my data gathering process.

starts in Hanoi when households, restaurants, shops and businesses discard paper14. This

waste paper is collected either directly at these locations or sent to landfills, dumpsites,

rubbish bins or even the streets. Collectors, who include itinerant junk buyers, dumpsite

scavengers, and itinerant scavengers, collect the paper and sell it to dumpsite depot operators,

sidewalk depot operators, or other receivers who then sell it to dealers and agents (ibid).

While most collectors are Hanoi residents or residents from nearby villages, DiGregorio

notes that rural peasants also migrate to Hanoi to get involved in the paper recycling trade, in

order to supplement farm incomes in the off-season. Paper recycling is, thus, an important

livelihood source for a large number of people in Hanoi, as well as rural migrants.

While the interviews I conducted did not focus on the early stages of the production process

(as I did not interview scavengers or junk buyers), the two waste paper traders/agents that I

interviewed in Phong Khe did talk about buying paper from collectors “around places,”

mostly in Hanoi. One of the participants was more specific, saying that she bought directly

from the Yamaha motorcycle factory in Hanoi. This participant also mentioned getting calls

from a collector to pick up waste paper in a given location in Hanoi. Thus, the information

gathered in the interviews, together with the clarifications and additional information

obtained during the participatory exercise, can be triangulated with that of DiGregorio (ibid).

In this way, a clearer picture emerges of the stages of the recycled paper production process.

The next step, is taking the collected paper to Phong Khe where it gets weighed at one of the

ten weighing stations in the commune. Through interviews, I learned that most of the paper

gets weighed before and after it goes to the factory (in order to get the weight of the waste

paper and of the finished paper). Sometimes the customer may have a big load of paper and

bring it in a truck, or sometimes it may be smaller amounts. Some collectors in Phong Khe

transport the paper on their bicycles. The weighing of the paper may also happen in the

factory itself, as some large enterprises, for example, have their own weighing station, as was

the case in one of the enterprises I interviewed.

The differences between the amount of paper weighed, and whether enterprises have their

own weighing stations or not, points to the size, the scale, of different stages in the                                                             14 It is worth noting that not all waste paper comes from Hanoi, some of it is imported from other countries. From my interviews, it seems that most small and medium enterprises in Phong Khe get their paper from Hanoi waste. However, the large enterprise I interviewed got its waste paper from the United States and China. Due to the scope of this study, I am assuming that the waste paper is coming from Hanoi.

production process. For example, the person transporting the paper on a bicycle is a small

trader, while the one transporting the paper in a truck is a much larger trader. This highlights

the scale of trading in the recycled paper commodity chain, as it shows that big and small

traders have the same roles, but in different scales. The scale of involvement in the recycled

paper commodity chain, and, consequently, the scale of involvement in water pollution, is a

key issue that needs to be considered in the design of environmental programs in Phong Khe.

Once the paper is weighed, it is then sorted. This may be done by the same trader, by the

enterprise, or by an intermediary. After this stage is completed, the production process in the

enterprise—where pollution is concentrated—starts. This paper processing stage involves a

number of external inputs such as coal or firewood for energy, machines, and chemicals. This

is also the stage of production that utilizes the most water, and that releases the most

untreated water into the ditches and river streams. Other stages of production such as sorting,

for example, do not use water at all (printing, however, does involve the use of water but

needs smaller quantities than paper production). The fact that pollution is concentrated in one

part of the chain is highly relevant for environmental management, as it shows the main

actors that need to be targeted. Moreover, the mapping of the commodity chain allows for an

understanding of who these actors are connected to, giving a fuller picture of the direct and

indirect links to pollution in the recycled paper commodity chain. This information will be

helpful for policy makers as it raises questions on whether actors with indirect links to

pollution should bear the costs for its management as well.

Figure 1: Paper Recycling Commodity Chain15

                                                            15 The first part of the commodity chain, detailing the paper collection process, is both gathered from interviews and from DiGregorio (1994). The rest of the information comes from interviews and the participatory exercise carried out in this study. It is important to note that this commodity map assumes all paper comes from Hanoi, and excludes recycled paper that is imported from other countries.  

Regardless of the type of paper, the next step is to mix it with water and chemicals to make it

soft (or hard in the case of cardboard), clean, and white (thereby de-inking it). Some types of

paper may require more chemicals than others, but more research is needed to further

understand this. Afterwards, the mix gets put into a grinder to make the pulp and then into hot

rollers to make the paper. Once the new paper is ready it can be weighted and packaged

(either in the same enterprise or in a different one). Afterwards, it is sold to a trader (the same

one or a different one than before), who sells the paper either directly to a shop in Hanoi or in

Bac Ninh city, for example, or even to another trader who then sells it to a shop. Paper sold to

shops in Bac Ninh City can also be sold to other traders, who then sell it to shops in Hanoi.

Once in Hanoi, interviews revealed that one shop would buy the paper, keep some of it, and

sell the rest to other shops in the same street. This seemed to happen since shops in the Old

Quarter in Hanoi are set up in clusters, with all offering paper, for example, sold on the same

street. Thus, only one shop in the street liaises with the trader, and then it distributes the paper

to other shops in the street. The paper recycling commodity chain is, of course, cyclical, and

once people discard the paper purchased, it starts again.

The mapping of the recycled paper commodity chain reveals a number of characteristics

about the paper recycling process, and identifies the most polluting actors in the chain. The

chain also reveals its fairly dispersed nature, with a number of people involved in the

different stages of production, but with specific clusters in the industrial production and retail

sectors. Hence the sorting, weighing or collecting of paper can be done by a number of

different providers, located in or outside the village. This is an important consideration, as it

shows the dispersion and/or concentration of actors in the chain. Understanding this will be

helpful when designing water pollution management policies, as it will help to target actors.

One aspect that became apparent through this study is the different scales of production in the

recycled paper commodity chain. For instance, small enterprises face intensive labour

production, since they do not employ machines but have to undertake the process by hand.

The small paper producer, who I interviewed, explained that it would take her a long time to

make one piece of paper. In fact, she said she produced approximately 30,000 small pieces of

paper in a month; medium or large enterprises can produce upwards of 1,000 tonnes of paper

per month.

So while small, medium and large enterprises have the same commodity chain, their scale of

production is different. Furthermore, their release of wastewater is different, as bigger

enterprises release more wastewater than smaller ones, and therefore pollute more. Although

further research may be necessary to confirm this, it is clear that the main actors with

significance to water pollution in Phong Khe are the large and medium sized enterprises,

since they are the ones releasing the most untreated wastewater. This finding has significant

implications, as it suggests that large and medium enterprises should bear a considerable part

of environmental costs. However, not all enterprises necessarily pollute in the same manner.

An enterprise producing offering paper—as suggested by one informant—could be more

polluting than a cardboard enterprise. Going forward, policy makers will need further

research to understand the levels of pollution in different types of paper enterprises.

The range of actors involved in the recycled paper chain

The extent of the recycled paper commodity chain shows that there are many people involved

in its production process, who are geographically situated in different areas. By only focusing

on the enterprise managers, as a study without a commodity chain focus might have done, the

full extent of the chain—the full extent of actors in the chain—would have not been revealed.

Understanding this range of actors has significant implications, as it highlights the range of

stakeholders that need to be targeted when designing water pollution management programs

in Phong Khe. In addition, it will help policy makers to evaluate the implications of water

pollution management programs, as they will be able to track impacts throughout the

stakeholders in the chain.

Policy makers will need to consider, for example, whether all the stakeholders need to be

targeted, how they should be targeted and, fundamentally, how they should share water

pollution responsibility given their direct and indirect links to pollution. It will also be

important to understand the geographical location of these actors, as it may help to evaluate

how certain environmental policies or programs could be implemented. For instance, policy

makers thinking about the feasibility of community environmental management may have to

look beyond the community of enterprises and think about the range of people involved in the

paper production process, both in and outside of Phong Khe.

Moreover, the full range of actors sheds lights on the significant number of people that are

employed through the recycled paper commodity chain and, hence, the importance of this

craft as a livelihood. This is an important issue for policy makers to keep in mind, as impacts

on costs throughout the chain would impact people’s livelihoods. As such, policy makers will

need to consider how to minimize the impacts of water pollution management programs,

particularly on the poorest actors in the chain (Figure 2).

Actors in the recycled paper commodity chain in Phong Khe include printers (in this

case of offering paper), like the one pictured here.

This man, another actor in the chain, owns a paper weighing station.

In Hanoi, this trader sells toilet paper to a shop in the Old Quarter.

Scale of production and costs and benefits throughout the recycled paper chain

An analysis of the recycled paper commodity chain was able to help reveal information on

costs and benefits throughout the chain. This can be very useful information as it gives an

idea of how benefits are shared, one of the focuses of Ribot’s (1998) discussion on the

Senegalese charcoal commodity chain. It also highlights information about who is earning the

least and most in the chain and could prove useful in the analysis of how specific

environmental initiatives, such as imposing further fees16, could affect the people in the

chain.

While it proved difficult to obtain all the data for profits and costs along the chain, enough

information was gathered to allow for some basic analysis17. Figure 2 shows the estimated

costs and profits in the recycled toilet paper chain in Phong Khe. The information gathered

reveals that the lower costs are usually borne by the traders and merchants, who usually only

have to cover transportation fees (usually fuel, although small traders may travel in bicycles).

While enterprises make the most profit, they usually have the highest operation costs

(electricity, salaries, coal, machines, etc.).

This was also apparent in a study conducted by Nguyen Van Ha et al. (2004), who found that

the average income per capita of enterprise households was 18 times higher than that of

general households (general households were those that may have been involved in paper

production but that were not enterprise owners). This study also found that enterprise

households had expenditures four times greater than the general households. Nonetheless,

Nguyen Van Ha et al. found that the enterprise household savings were much greater than the

general household: approximately 72 million VND per year (US$4,645 in 200418) for the

enterprise household, versus 2 million VND (US$129 in 2004) for the general household.

Thus, while the traders (usually general household members) have lower costs, they also have

lower profits as they might trade less quantity than what the enterprises produce. The

enterprises, in turn, have high costs but they also have high returns given the large volume of

paper that they produce. A single large or medium enterprise can produce anywhere between

500 and 20,000 tonnes of paper per year.

                                                            16 There are already some wastewater discharge fees in Phong Khe. Enterprises said they paid their monthly fees, however a provincial government official said that only 20 percent of businesses paid them. This same official mentioned not having enough capacity to collect fees. According to him, the collected fees are not enough to contribute to wastewater treatment facilities and do not properly tackle the water pollution problems facing Phong Khe. 17 Some of the challenges gathering the data including informants not wanting to share the information, only sharing some information, or information proved to be inconsistent. This may have been a misunderstanding between the informant, the translator and the interviewee, or the interviewee recalled the information inaccurately. 18 Using an exchange rate of 1US$=15,500 VND, as used in Nguyen Van Ha et al. 2004.

This data points to the differences in the earnings of actors throughout the chain. In general,

enterprise managers have larger earnings than paper traders. Shop owners in Hanoi and large

traders make fewer profits than enterprises, but still more than recycling paper collectors, or

small traders. The biggest shop owners in Hanoi are also some of the biggest earners, as they

not only make money from selling to other shops in the streets, but also from selling to

customers. In all, the people making the least money are the recycled paper collectors and

small traders. This finding should be taken into account in the design of environmental

management programs in order to ensure that the poorest actors in the chain are not

disproportionally impacted by new policies. In addition, it is clear from this analysis that

large and medium enterprise owners are not only the biggest polluters, but also the biggest

earners in the recycled paper commodity chain. This is relevant for the design of pollution

management programs in Phong Khe, as it shows that the concentration of pollution and the

concentration of benefits are located in the same place in the chain.

Figure 2: Estimated costs and profits in the recycled toilet paper commodity chain19

                                                            19 While exact costs were not known, I did know the indicative costs that were borne throughout the chain as most were described by various informants

However, not all enterprise managers earn the same profits. As has been noted earlier, there

are different scales of production in Phong Khe: 20 percent of enterprises are small, 60

percent are medium, and 20 percent are large. There are also small and large traders. While in

Figure 2 some estimates of costs and profits can be made, this is only indicative as in reality

it all depends on the quantity; the scale at which paper products are being bought or sold for.

For instance, one of the small traders interviewed travelled in her bicycle to sell toilet rolls,

while a trader interviewed in Hanoi travelled in a motorbike but was an employee of a bigger

trader in Bac Ninh City. Other traders in Phong Khe travelled in large trucks. Similarly, the

small enterprise had no machinery, did everything by hand and employed four family

members when needed. In contrast, medium enterprises had roughly 15 to 20 workers, large

machineries and plots of about 1,000 square metres. Large enterprises had up to 70 workers,

significantly larger and more modern machinery and, visually, much larger plots.

This shows, then, vast differences between the amount of costs and profits the different

enterprises have. Larger enterprises naturally have bigger costs, as they have to buy and

maintain machinery and pay for a greater number of staff. Smaller enterprises, on the other

hand, have smaller costs but also much smaller profits. A small enterprise like the one I

interviewed produced 30,000 pieces of handmade paper per month, which she sold for 200

VND a piece; an earnings of 6 million VND per month (or, roughly US$324)20. To this, one

would need, of course, to deduct the cost of the recycled paper, workers, and the materials

she uses to make the paper by hand.

In contrast, large enterprises can produce 20,000 tonnes of paper per year, or nearly 1,700

tonnes a month. If one calculates an average earning of 4,000 VND per kilo, as one informant

suggested, then monthly earnings would amount to 6.8 billion VND (or US$370,000)21. Even

with large costs, representing 45 percent of earnings according to one informant (to maintain

or buy machineries, pay staff, electricity, etc.), the difference in earnings is considerable.

Medium enterprises, in turn, can produce anywhere between 50 and 1,000 tonnes of paper per

month. Using the above figures, this would give earnings of approximately 200 million VND

                                                            20 Calculating 1USD=18,500 VND. Exchange rate as of January 2010. 21 To me, these figures seem exaggerated, and they are not supported by Nguyen Van Ha et al.’s (2004) figures, noted earlier in this paper, of a profit of US$27 million for 200 craft villages (which even when taking into account the different scales of production, adds to fewer profits for businesses than the information relayed to me). Nonetheless, while indicative, I believe that the figures are still worth using in this study to highlight the different scales of production of the enterprises. However, more research is needed to verify these figures.

(or US$10,800) to 4 billion VND (US$215,000) per month, respectively, before deducting 45

percent for costs.

These differences in earnings point to the different production scales and modes of

production in Phong Khe. This has significant implications for the design of water pollution

programs as it shows that large and medium enterprises have a higher scale of production and

earnings than smaller enterprises. This suggests that since the biggest polluters are also the

highest earners in Phong Khe, they should bear the highest costs for pollution management

vis a vis other actors.

Producing paper by hand is an intensive process, and it takes a long

time to produce one piece of paper. This woman makes 30,000 pieces of paper per month.

Medium-sized enterprises utilize machines—usually one or two—and

can produce more than 1,000 tonnes of paper per month.

Large enterprises utilize a number of machines, and can produce up to

20,000 tonnes of paper a year.

The analysis of costs and benefits throughout the chain also brings forth the issue of who is

controlling prices in the chain. While more research will be needed to confirm this, this study

was able to find that the greatest control in price setting in the chain belongs to the large and

medium enterprise managers. These enterprise managers are the ones making the most profit,

which shows that they are already exerting their control in the chain and ensuring bigger

earnings for themselves. While speculative, it is possible that these actors may have more

access to policy makers, and more ability to influence policies that would adversely affect

them. However not enough information was gathered on this, so further research will be

needed in this area.

Meanwhile, smaller actors such as small traders or paper recycling collectors can have a

disadvantaged position since they have fewer opportunities to affect the chain. For instance,

one small trader explained that she would like to raise her prices to make a higher profit, but

she did not have scope to negotiate since enterprises set the price. This finding is relevant for

pollution management programs, as the actors exerting the most and least control in the chain

are identified. The fact that large and medium enterprise managers exert the most control in

the chain, while making the highest profits and being the main contributors to pollution,

shows that they are the main actors that need to be targeted by policy makers in the design of

environment programs. Moreover, this information suggests that these enterprises should bear

most of the costs for pollution management. In all, efforts should be made to ensure that any

water pollution management policies that are designed in Phong Khe take into account the

distribution of costs and benefits in the recycled paper commodity chain.

Linkages between actors in the chain

The Commodity Chain Analysis framework allows this study to explore the linkages that

exist between actors in the chain. As Figure 3 shows, these linkages are not top-down linear.

In reality, actors are connected to each other in a number of different ways, with finished

paper traders, for example, having linkages with printers, shops, the weighing station, and

enterprises. Some actors only have a relationship with one or two other actors—such as

itinerant junk buyers or scavengers—while others having multiple linkages, like the finished

paper traders.

Interviews highlighted longstanding, relationships between actors in the chain, for instance

between traders, producers and suppliers. For example, one manager of an offering paper

enterprise had a relationship of over ten years with the traders that come to purchase his

paper. In his view, most paper collectors had longstanding relations with traders as well. The

owner of a printing enterprise also mentioned having a longstanding relationship with the

traders that buy her products, working with the same ones since her enterprise started.

Likewise, the owner of the paper weighing station said that the people that came to use his

services were also long time customers. Craft villagers who buy recycled paper from

collectors also mentioned longstanding relations, such as the woman who buys the paper

from the Yamaha factory in Hanoi.

These longstanding relations have significant implications for water pollution management,

as they may present opportunities for information sharing and collaboration. Firstly, the

longstanding relations point to the static role of actors in the chain—meaning that while there

are a range of actors involved in recycled paper production, they seem to stay in their role for

a long period of time (excluding, of course, the arrival of new actors in the chain as a result of

the expansion of craft villages, as earlier noted in this paper). This static role may make it

easier when disseminating information about water pollution management programs in Phong

Khe, as specific actors can be identified and followed up with. It may also make it easier to

implement water pollution management programs, as actors remain in their same role and

there are fewer challenges associated with an influx of people coming in and out (which

would make it harder to continually disseminate information, for example).

Secondly, the longstanding relations could be used as a basis for collaboration. This may

make it easier for actors to work together towards common goals such as water pollution

management. Since many of the actors in the chain have known each other for a long time,

they may be able to more readily come together towards a particular initiative—particularly

given that they all depend on each other to earn their livelihoods. On the other hand,

longstanding relations could lead to collusion against environmental management, which may

present challenges for policy makers. In either case, the importance of understanding the

linkages between actors is clear, as it can help to maximize opportunities and minimize

challenges. This opportunity to build on the linkages between actors is one of the benefits of

using a Commodity Chain Analysis approach, as it explores the forward and backward

connections in the chain (Gereffi 1994).

Figure 3: Actors and linkages in the recycled paper commodity chain

The existence of associations and cooperation among actors in the chain

Closely linked to the discussion on linkages, an analysis of the actors in the Commodity

Chain helped to reveal interesting information about cooperation. As mentioned earlier,

Commodity Chain Analysis is not usually used to reveal information about cooperation

between actors; rather which actor exerts more control in the chain (Gereffi 1994; Ribot

1998). However, in the case of this analysis, cooperation is viewed not in terms of the

production of the actual commodity, but on the scope for community cooperation on

environmental management programs. In this context, the degree of cooperation between

actors in the chain can be explored.

Through further analysis of the actors and their relations in the commodity chain, the first

aspect that is revealed is that although actors may have an incentive to work together, as

shown in the previous discussion, there is also a degree of competition among the same actors

in the chain (for instance, enterprise managers). Hence, actors that work in different aspects

of paper production may have more incentives to work together than those who work in the

same aspects of production, as these latter ones may compete against each other. For

example, while traders and sorters have an incentive to work together—as their livelihoods

are interdependent—enterprise managers may not, as they compete against each other to sell

their products. However, interviews revealed that there was scope for collaboration between

actors involved in the same production aspect of the commodity chain.

In total, out of the six enterprise managers and the six households involved in a stage of paper

production that were interviewed, 41 percent said there was cooperation between actors

working in the same aspect of production in the commodity chain, and 33 percent said there

was no cooperation22. For these respondents, cooperation meant that actors involved in the

same production aspect of the chain were part of an association—for instance the enterprise

association, or the trader association. The role of these associations is to help members set the

price of their products, and agree on common rules, or quality measures that may help them

improve their production. The people I interviewed see cooperation through the existing

structure of these associations. More research will be needed to understand why some people

in Phong Khe are part of an association and others are excluded. The implications of the

current trends of cooperative relations and inclusion and exclusion of associations are laid out

below.

First, let us explore issues of competition and a lack of cooperation. While some enterprises

spoke of cooperative relations between them, others did not. From an analysis of my data, it

                                                            22 The remaining 25 percent did not give sufficient information due to shorter interviews (time pressures) or my failure to sufficiently probe.

seems that those people who were part of an association spoke positively of cooperation,

while those that were not part of an association, did not. People who were not part of an

association believed there was no incentive for enterprises to cooperate with one another. For

these respondents, other enterprises were mere competitors, not people they wanted to have

any type of cooperative relation with. While these same enterprise managers had

longstanding relations with traders, they were reluctant to have any relation with other

enterprises. Furthermore, these enterprise managers were reluctant to share information

regarding their technology (even if it was more environmentally efficient), or their prices

with other enterprise managers.

This lack of cooperation between some enterprises, poses challenges for future water

pollution management initiatives in Phong Khe. These enterprise managers may be reluctant

to work together, and may see no incentive in treating their wastewater as it would add to

their costs and make them less competitive.

Box 1: To cooperate or not?

In one of my interviews, one respondent told me that people were reluctant to share

information with each other. He said he understood the fact that people did not want to

share information about how to improve the quality of their products, as he did not want to

share this information himself. However, he thought it was important to share information

about how to save water or how to treat water. So interestingly, while this respondent did

not believe cooperation was possible between enterprises, he thought that the idea of

cooperation on water pollution management was important.

Nevertheless, more respondents spoke of cooperative relations and of the existence of

associations, than those that did not. These interviewees explained that the role of

associations was to establish the price they would pay for products, and to help find new

markets. One enterprise manager, for example, told me that enterprises needed to be part of

an association so that they could successfully set prices with their buyers and suppliers. For

him, it was important that enterprises work together to achieve common goals.

Associations, and cooperation, also exist between craft villagers working in other stages of

the production chain, such as the weighing station, as seen in Figure 423. The owner of the

weighing station explained having bi-annual meetings with other weighing station owners to

agree on a price for their services. Women traders also spoke of cooperative relations, but

mentioned that not everyone joined their association. They found the association a helpful

venue for traders, as they could borrow money for their businesses when needed. There was

also a discussion of cooperative activities between community members, specifically

community groups that cleared rubbish, drainages and roads. This group was organized by

the People’s Committee—a government body usually responsible for implementing policies

at the national, regional and local level—and the Youth and Women’s Association.

The existence of cooperative relations presents an opportunity for water pollution programs

in Phong Khe as these relations can be built on to achieve common pollution management

goals. Moreover, the existence of the associations, the venue for cooperation, suggests they

could be one of the best entry-points for pollution management initiatives in Phong Khe.

Existing associations could be built on by policy makers, used to disseminate information

about water pollution, and to implement water pollution management programs. Associations

could also be used to enhance dialogue, to get the views of different members, and to agree

on measures to tackle water pollution. However, as discussed in the previous section,

cooperation between enterprises could also lead to collusion against environmental

initiatives. This is an important consideration that will need to be kept in mind by policy

makers when working with associations in water pollution management. In order to

overcome this challenge, policy makers may need to engage all stakeholders and associations

throughout the design and implementation of water pollution programs, to build credibility

and support for new policies.

Information flows and channels of information

Information flows, specifically the existing and missing channels of information that were

found in this study are shown in Figure 4. As can be seen, information on pollution

awareness, for example, is transmitted from external sources (such as government bodies), to

enterprise managers, paper craft workers, and youth groups. Information is shared within the

                                                            23 It is worth clarifying that I was not able to get information as to whether sorters, printers, or packagers were involved in any associations, as I did not interview these people (except for one printer who said she did not belong to any association).

different associations, particularly information about prices and markets. Moreover,

information is also shared through the existing linkages in the chain (Figure 3), as previously

discussed. In this way, information can flow from paper traders to enterprise managers, or

vice versa.

Figure 4: Associations and information flows in the recycled paper commodity chain

Understanding the existing channels of information in Phong Khe presents an opportunity for

water pollution management programs in the commune. By tapping into existing channels of

information, such as associations, policy makers can more readily distribute materials about

new environmental management initiatives. However, those villagers that are not part of any

association would also need to be targeted, as there seems to be some degree of exclusion

from associations as noted in the previous discussion. These villagers would need to be

reached through other established channels of information, or new channels may need to be

created.

Furthermore, from Figure 4 one can see information flow arrows pointed in almost every

single direction, except between associations. Further research is needed to understand

whether information flows between associations could be helpful for water pollution

management. In addition, further research is needed to clarify whether information flows

from external sources to actors in the chain, are one-way (as I understood it), or two-way.

Some informants interviewed, however, felt that there was no information being shared by

government officials about pollution. This supports a discussion that took place in the

participatory exercise, where low environmental awareness was raised as key factor in

deteriorating water quality. However, the women interviewed in the focus group discussion

mentioned an initiative by the Women’s Association which disseminates environmental

information over the radio. This group also mentioned a new community initiative,

implemented by government bodies, to promote the “three cleans”: house, kitchen and road.

So while it seems some environmental information is being disseminated, its efficacy in

reaching people and raising awareness remains in question. It may be that information is only

being disseminated through one or two channels, instead of taking advantage of the multiple

channels available, as seen in Figure 4. While the efficacy of environmental information will

need to be evaluated by policy makers, this paper identifies the various channels that could be

used or created to disseminate environmental information.

Conclusions

While Commodity Chain Analysis was originally used by authors such as Gereffi to analyse

global industries, other authors such as Ribot (1998), DFID (2008) and Mayoux (2003) have

broadened its use to include issues of access and benefit distribution, poverty alleviation and

stakeholder participation, respectively. My approach has been to further the use of

Commodity Chain Analysis by utilizing a blend of approaches, and showing how it can be a

helpful tool to inform the design of water pollution management policies in the commune of

Phong Khe. Specifically, Commodity Chain Analysis has proved a valuable method to

explore opportunities for water pollution programs thanks to its ability to explore backward

and forward linkages, to reveal information about the range of actors, the scope for

cooperation, and how costs and benefits are distributed throughout the chain.

Through an analysis of the recycled paper commodity chain, this study was able to reveal

three main findings that have implications for the design of water pollution management in

Phong Khe. First, this study was able to map out the full extent of the production chain and

the stakeholders involved. This highlighted the range of actors that are part of the recycled

paper process, who need to be targeted in the design of water pollution programs in Phong

Khe. As this paper argued, other approaches would have not been able to uncover as much

detail about the production process, and the actors involved, in the recycled paper chain.

Second, an analysis of the chain, and its costs and benefits, showed that not only are the large

and medium enterprises the most polluting actors in the chain, they are also the biggest

earners. Moreover, this study suggests that these same actors have the greatest control over

prices, meaning that they disproportionally have control of the benefits of the chain and are

the biggest pollution source. This finding suggests that the large and medium enterprises need

to bear the highest costs for pollution management vis a vis other actors. Moreover, this

shows that the concentration of pollution and the concentration of benefits are located in the

same place in the chain.

Third, this study found that there is scope for collaboration between actors in the recycled

paper chain. The existing, longstanding, relations between actors in the chain and the

existence of associations signal a basis for collaboration that needs to be further explored by

environment policy makers. For example, policy makers could build on the existing linkages

and associations to achieve common pollution goals. Moreover, this study suggests that

associations may be the best entry point for pollution management, particularly since there is

an existing enterprise association which could be built on to tackle pollution issues. However,

more research is needed as to why some enterprises are not part of an association, and how to

overcome this challenge. Similarly, this paper pointed to the existing channels of information

that exist in Phong Khe. These channels are an opportunity for environmental programs, as

they can be built on and maximized to disseminate needed information.

Finally, this paper pointed to a number of challenges for environmental management. In

particular, longstanding linkages between actors and the cooperative relations found in the

associations could lead to collusion against water pollution programs. Policy makers will

need to take steps to minimize these challenges, for example ensuring actors are engaged

throughout the design and implementation of environmental initiatives, which may enhance

their support of programs.

Going forward, there are a number of additional issues that will need to be taken into account

by policy makers. First, more information is necessary on whether all enterprises pollute in

the same manner, or whether some paper production is more polluting than others. This may

have implications on which enterprises are allotted more responsibility for pollution. In

addition, the responsibility of all actors in the chain needs to be considered by policy makers.

While the enterprises are the main polluting agent in the chain, all the other actors are directly

or indirectly linked to this process as they derive earnings from paper processing, which is

causing the pollution.

Thus, it could be argued that all actors should have responsibility for water pollution

management. Actors living in Phong Khe will arguably have an interest in managing

pollution, since they are suffering the effects of bad water quality. For actors upstream in

Hanoi, however, the interest in pollution management is arguably less as they do not suffer

the impacts. Yet by being indirectly connected to the pollution, their share of responsibility

should also be considered. The Commodity Chain Analysis undertaken in this study will be

helpful for policy makers as they evaluate these considerations, as it will allow them to

explore the linkages between actors in the chain and how benefits are distributed, and thus the

impacts that various policy options could have. Commodity Chain Analysis will also be

useful to explore issues of access, particularly which actors have access to policy makers and

to influence policies in the chain. This will be an important aspect to consider, as some actors

may not have an interest in undertaking pollution programs that add to their costs.

Moreover, it will be essential to have an understanding of the situation in other paper

recycling villages in order to implement similar pollution programs throughout Vietnam. In

addition, any policies that are implemented in Phong Khe will need to be implemented in

other paper recycling villages, to not offset prices and competition in the chain. For instance,

if higher fees were implemented in Phong Khe but not in other paper recycling villages,

Phong Khe enterprises would be less competitive, which would have significant impacts to

people’s livelihoods. These broader issues will need to be considered by policy makers as

they explore options for pollution management in craft villages.

In closing, through the use of Commodity Chain Analysis, this paper was able to reveal the

actors, their roles, and their relations, as well as the implications for environmental

management in Phong Khe. The findings discussed in this paper will help policy makers to

target actors, and to design water pollution programs that address their needs and

characteristics. Overall, efforts should be made to ensure that water pollution management

policies take into account the scale of production and the distribution of costs and benefits in

the recycled paper commodity chain.

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