"Circular economy" has become one of the most cited phrases in global sustainability discourse — and one of the least demonstrated in the field.

Vietnam is no exception. Despite ambitious national targets and a rapidly growing body of regulation, the real-world transition remains slow. The missing ingredients are not policy, awareness or goodwill. It is proof: working models that smallholder farmers and enterprises can see, touch and replicate with confidence.

Since 2022, the European Union-funded "Circular Economy Cocoa: From Bean to Bar" project, implemented by Helvetas, has served as a living laboratory for exactly that kind of proof. To date, the initiative has empowered over 4,000 smallholder farmers and 21 micro, small and medium enterprises (MSMEs) and cooperatives to adopt circular economy practices — demonstrating over 20 agricultural solutions and leveraging $6 million USD in private sector co-investment in the process.

Below are three lessons the project has captured so far.

Lesson 1: Prioritize Economic Resilience and Income Diversification

While financial incentives are necessary to spark initial interest, long-term commitment from smallholders and the private sector only happens when circularity is framed as a tool for economic resilience and income diversification. In times of market volatility, a circular ecosystem protects farmers by reducing input costs and unlocking entirely new revenue streams from what was once considered "waste."

A prime example of this agency is the Nhat Tam Agricultural Services Cooperative, a prominent cocoa producer in Vietnam’s Central Highlands.

Nguyen Hong Thuong, the Director of Nhat Tam, faced a severe operational bottleneck: “Annually, we need to dry about 600 tons of agricultural products. I once scouted an imported gasifier dryer that utilized agricultural sub-products as clean fuel. I was impressed by its efficiency, but the price of nearly $50,000 USD was prohibitive for a local cooperative. Helvetas stepped in not with a handout, but with technical co-creation — contributing over $13,000 USD to support us in engineering a localized, scalable gasifier technology at just one-third of the import cost, with the remaining balance co-funded by Nhat Tam through mobilizing local resources.”

Today, this local innovation has completely reshaped the cooperative’s economics. Nhat Tam rents the dryer to its members and neighboring farmers at just 20% of the market service rate, slashing post-harvest costs for the community while securing a steady institutional revenue stream.

Lesson 2: Choose Depth Over Breadth in Partner Selection

Helvetas' 30-year history in Vietnam's cocoa sector was put to the test right before this project's inception, when the local industry hit a historic low. Crushed by plunging global prices, farmers across the Central Highlands and the Mekong Delta were mass-clearing cocoa trees to shift to higher-value crops like durian. Those who stayed were often working degraded lands, and local MSMEs had little appetite for risk.

In this environment, we made a deliberate choice: depth over breadth. Rather than chasing participant numbers, we started from the ground up — focusing on the real business survival needs of our partner MSMEs. By designing interventions that solved their actual problems, we earned their trust. When setbacks arose, partners didn't walk away; they co-created solutions, because they had genuine ownership of the process.

The gasifier story illustrates the economic case. But what followed at Nhat Tam shows something equally important: what becomes possible when trust runs deep. The cooperative went on to apply biochar production from agricultural residues, transform cocoa husks and pulp into animal feed and fermented beverages, and transition from monoculture to diverse agroforestry — building climate resilience alongside new income streams.

The result is a partner that no longer needs convincing. Nhat Tam is now a trusted supplier to Puratos and Marou Chocolate, the award-winning Vietnamese brand recognized globally for its single-origin fine-flavor chocolate. "Circularity has completely redefined our relationship with the market," says Thuong. "We are no longer just selling raw beans; we are managing a zero-waste, climate-resilient enterprise."

Lesson 3: Tap into Rigorous Research and Deep Expertise, Both Near and Far

True sustainability requires intervention logic that bridges elite science with grassroots execution. By embedding leading agronomists and technologists from national research institutes and international consultancies directly into farms and processing factories, Helvetas demystified the benefits of the circular economy for everyday practitioners.

In practice, this meant mobilizing the best expertise available — wherever it lived.

For Vietnam's most stubborn cocoa challenges, that required going deep into the country's own research institutions. Leading plant protection specialists developed bio-based treatments for black pod rot and mosquito bugs — the two diseases that have long defeated conventional pesticides.

A soil scientist recognized as one of Vietnam's youngest associate professors led the formulation of biochar compounds that remediate heavy-metal-contaminated soils and measurably improve yields. Biochar production kilns were commissioned from a national agricultural environment research institute and engineered specifically for Vietnamese conditions. The gasifier dryers — which convert agricultural residues into clean fuel for drying — were developed entirely in-house by a Vietnamese technology company, making them among the first locally manufactured units of their kind in the country, at one-third the cost of imported equivalents.

Vietnam's foremost cocoa agronomist — a former university lecturer and ex-deputy coordinator of the National Cocoa Program who left academia to transform 13 hectares of eroded, rocky hillside into a thriving ecological farm — led farmer training on circular cultivation and agroforestry practices he has spent over two decades developing.

When the challenge required a different kind of expertise, the project looked further. CocoaLab, a leading Belgian specialist in cocoa processing and chocolate manufacturing was brought in to work directly with a Vietnamese processor — helping elevate product quality in a market long dominated by international brands.

The principle was the same in every case: Match the problem to the best available knowledge, then bring that knowledge as close to the farm gate — or the factory floor — as possible. When the solutions are this well-fitted, demonstrations don't need to convince. The results speak first.

Scaling proven successes

It's clear that the private sector's momentum for green transformation is expanding — and the project's final phase is designed to match that ambition. Helvetas is now focused on scaling proven successes, while introducing the systemic enablers that will make circular practices truly self-sustaining.

This means helping partner companies build traceability systems and EU Deforestation Regulation compliance to secure their European market footprint. It means co-designing green credit products with Agribank and local authorities — financial instruments built specifically for MSMEs who have historically been priced out of green financing. It means upgrading post-harvest processing technologies to capture more domestic value from every bean. Beyond cocoa, the highest-impact solutions — biochar production, waste-to-fuel gasifier dryers, and solar-powered irrigation — are already being replicated across Vietnam's coffee, coconut and cashew sectors.

The cocoa value chain has proven that rigorous circular economy practices and global market competitiveness are not in tension; they reinforce each other. The goal now is to ensure that lesson travels far beyond the farm gate.

About the Author

Dinh Kim Quynh DIEP is a Project Officer for the EU Circular Economy Cocoa project at Helvetas Vietnam.

Additional Reading

Case Study: Circular Economy in Action – Pioneering Sustainable Cocoa Value Chains in Vietnam