The collection and processing of natural raw material from forested areas and the production of handicrafts (usually during times when there is little farm work) constitute the most important sources of additional locally realized income for farmers. In fact, it is primarily the additional income generated from handicraft production or the collection of raw materials that decides whether or not the smallholder farmer can lead a life below or above the national poverty line.

Being mainly export-oriented, the Vietnamese handicrafts sector is internationally recognized by suppliers as one of the most competitive among developing countries. In general, handicrafts are produced at the household level, whereas raw material supply, product finishing and packaging are mostly undertaken by small and medium enterprises (SMEs). Several hundred crafts exporters and some international corporations sourcing in Viet Nam work with large producer networks throughout the country and are providing employment for 1.35 million people in 2,000 villages.

The three-year Joint Programme Green production and trade to increase income and employment opportunities for the rural poor was established and financed by the Spanish MDG Achievement Fund and in-kind contributions from VIETRADE and VIETCRAFT, government institutions under the Ministry of Trade and Industry. The programme aims to increase income and employment opportunities for raw material growers and collectors, and grassroots producers of handicrafts and small furniture, targeting 4 450 poor households in four northern provinces of Viet Nam, namely Thanh Hoa, Nghe An, Hoa Binh and Phu Tho. The approach is to develop better integrated, pro-poor, and environmentally sustainable green value chains, enabling poor growers, collectors and producers to improve their products and to link them to more profitable markets. The project produces attractive and modern prototypes of traditional crafts, including lacquer, bamboo and wood-based products.