Amazon Fund

INDEX

2.1 What it is

2.2 Historical context

2.3 Actual situation

2.4 Project contribution to the reduction of emissions from deforestation and forest degradation

2.5 Expected results

2.6 Lessons learned

3. Transparency

4. Addittion

5. Resources application

6. Context

7. About the Amazon Fund

1. OBJECTIVES

The partnership with the Amazon Fund has as its main objective to curb deforestation and improve the quality of life of traditional populations dwelling at theConservation Units in the State of Amazonas, through financing actions of components such as Association and Income of the Bolsa Floresta (Forest Allowance) Program. Between the fourth quarter of 2009 and the third quarter of 2014, the actions of the Bolsa Floresta Program will be expanded with special emphasis to Bolsa Floresta Income and Bolsa Floresta Association.

As a counterpart to the proposed project, FAS is committed to investing, out of its own resources, the equivalent of 50% of the Amazon Fund’s asset in support of the Forest Sponsorship Program. 

The necessary amount to finance the actions proposed by the Bolsa Floresta Program Association, Income and Supporting Programs from the fourth quarter of 2009 to the third quarter of 2014 is R$ 29.934.645. Considering the capital asset by the Amazon Fund of R$ 19.169.087 and the financial application revenues in that period of time, which estimates R$1.181.014, the value to be disbursed by FAS adds up to R$ 9.584.544.

2. The Bolsa Floresta (Forest Allowance) Program

2.1 What it is:

The Bolsa Floresta (Forest Allowance) Program is the first project in Brazil that is internationally certified so as to reward and improve the quality of life of traditional populations by maintaining environmental services rendered by the tropical forests, thus reducing deforestation and esteeming the standing forest. The program is composed of four components :

The first type of incentive is the Bolsa Floresta – Income (BFI). It encourages the sustainable production of forest products such as: oils, nuts, woods, fruit and honey. For this mechanism, R$ 350.00 is destined per year per family, being considered the actions for investment in the community.

The second mechanism is the Bolsa Floresta Social (BFS), worth R$ 350.00 per family per year. This component is destined to the support of education, health, communication  and transportation improvement – basic components for the construction of citizenship of the forest guardians. The actions are develop in partnership with governmental agencies and collaborating institutions.

The third component, it is the Bolsa Floresta Association (BFA), destined to associations of dwellers of the Conservation Units of the state and equivalent to 10% of the sum of the amount destined to the registered families of Bolsa Floresta Family of the Conservation Unit in case. Its role is to strengthen the organization and social control of the program. This is one of the most important programs in the history of Amazon in terms of empowerment of organizations at the community base. The BFA stimulates the social control of the BFP aiming at fulfilling its rules and terms of commitment.

The fourth mechanism, the Bolsa Floresta Family (BFF), includes the payment of a monthly reward of  R$ 50 (US$ 30), paid to the mothers of families who reside in the Conservation Units who are willing to make a commitment of environmental preservation and sustainable development. It is an important mechanism to involve the population in activities that curb deforestation, although it does not intend to be the families’ main source of income. It is an income completer paid as a reward for forest conservation. 

Contrary to welfare programs, the Bolsa Floresta (Forest Allowance) Program includes clear and objective counterparts. Among these we can point out : a commitment to zero deforestation, participation in dwellers’ associations and support for implementation at the Conservation Units. Geared in this direction, the program establishes a direct counterpart in terms of basic forest environmental services.

Bolsa Floresta (Forest Allowance) Program Implementation timeline at the Conservation Units in the state of Amazonas is shown in graph 1.

2.2 Historical Context

The Bolsa Floresta Program became a reality in the scope of the State of Amazonas Policy for Climate Changes (PEMC-AM – Law 3.135 and completer 53, both of June 2007). Laws have a strong innovation character and seek the consolidation of a basic legal environment in the state legislation so as to structure the economy of environmental services and products with forest origin, obtaining as a result, social justice and environmental preservation.  

During the elaboration steps of the Bolsa Floresta Program, an intense consultation process has been done in all relevant judicial and legal instances in the scope of the project such as legal departments of the Environment and Sustainable Development Secretariat of Amazonas and the State Planning Secretariat, State Attorney’s  Office and other instances in the Government of the State of Amazonas. Besides these consultations, an independent legal analysis was conducted to verify eventual conflicts with other norms and legislations of other states of the federation. It was concluded that there was not any legal conflict to develop the projects for the payment of environmental services in the state of Amazonas.  

The BFP implementation follows all legal foreseen requirements, including the ones related to the operation of the mechanisms of financial compensation for environmental services based on the reduction of green house effect emission originated from deforestation and degradation (REDD).

As of April 2008, FAS has become responsible for the management and implementation of the Bolsa Floresta Program at the Conservation Units in the state of Amazonas.

The Bolsa Floresta Program is the first Brazilian initiative of payment for environmental services done directly to the communities who dwell at the Conservation Units in Amazonas. It has as its goal to reduce the emission of carbon originated from the deforestation. The program construction was wholly participative with broad discussions in the communities and governmental institutions in Amazonas.

2.3 Actual Situation

The Amazonas Sustainable Foundation is undergoing a solidification phase of its institutional activities based on the strategic planning made by Bain&Company. Graph 2 demonstrates in a didactic form the stages by which the Foundation has gone through since its creation.

GRAPH 2. PHASES OF THE BOLSA FLORESTA PROGRAM IMPLEMENTATION

For the year 2009, FAS has as its objective to augment the number of registered families in the Bolsa Floresta Family. The goal is to reach 6 thousand families until June 30th and 7 thousand families until December 2009. At the same time, to implement the other components of the program (Association, Income and Social) as well as support the Environment and Sustainable Development State of Amazonas Secretariat in the implementation process of the Conservation Units.

In order to achieve the proposed objectives, FAS has as a strategy the amplification of financing sources and the development of new projects articulated to the Bolsa Floresta Program at the Conservation Units.

The timeline with its main institutional goals for 2009 can be seen on graph 3. 

GRAPH 3. AMAZONAS SUSTAINABLE FOUNDATION GOALS TIMELINE 2009

2.4 Project contribution for the reduction of emission generated by deforestation and forest degradation

The Bolsa Floresta Program  is a project that recognizes, esteem and rewards the traditional populations of the state – who take up a formal commitment of zero deforestation – assuring the maintenance of environmental services, which are the indirect benefits rendered by the preserved forests such as climate stability, maintenance of rain, carbon storage by the trees plants and animals (biodiversity) preservation. The maintenance of these benefits is important for the communities, for Amazonas, for Brazil, for the world and the next generations. 

In this context, the implementation of the components of the Bolsa Floresta Program and its supporting programs is of extreme importance for the strengthening of conservationist activities. In order to materialize its objectives, the Bolsa Floresta Program established the Commitment Agreement for Zero Deforestation with the families in the Conservation Units.

In the Commitment Agreement for Zero Deforestation, the Conservation Unit community dweller commits not to deforest areas of primary forests. This does not have any impact on the remainder of his/her land used for subsistence plantation. FAS is committed to implant the Bolsa Floresta Family, thus enabling the families to receive the Bolsa Floresta Association, Social and Income.

In this context, the Bolsa Floresta Program presents, through a system of payments to environmental services, an alternative for the families dwelling in the Conservation Units of Amazonas, those of which will be rewarded for not cutting down the trees. They will be aided to implement sustainable production systems at the same time that a dialogue is initiated with institutions interested in intensifying conservation efforts.

The monitoring of deforestation inside the reserve is annually performed by satellite images and analyzed by partnering institutions. The field monitoring is performed in partnership among FAS, Environment and Sustainable Development Secretariat of Amazonas, State Center for Units Conservation, State Center for Climate Changes, SIPAM/SIVAM.

The map of pics 4 and 5 demonstrate the areas previously deforested in the CU´s  attended to by the Bolsa Floresta Program and the projection of deforestation for the next years in the absence of conservationist activities. It is observed that initiatives such as proposed by the program are essential to curb deforestation in the region, once, besides benefiting conservationist actions, they also give alternatives to land usage for thecommunities and, thus avoiding deforestation at the Conservation Units.

PIC 4. AREAS PREVIOUSLY DEFORESTED IN THE CONSERVATION UNITS ATTENDED TO BY THE BOLSA FLORESTA PROGRAM. SOURCE: PRODES (2007).

PIC 5. DEFORESTATION FORESEEN IN THE CONSERVATION UNITS ATTENDED TO BY THE BOLSA FLORESTA PROGRAM AS PER THE SCENERY “BUSINESS AS ALWAYS” OF SIMAMAZONIA MODEL.. SOURCE: SOARES-FILHO ET AL. (2006); FAS (2008)

2.5 Expected results:

FAS has the challenge to go on constantly improving the quality of its activities, investing, on team training and expanding the partnerships with governmental organizations, including the institutions of teaching and research.

The below graph presents the evolution of families who benefit from the Forest Sponsorship Program from April 2008 to September 2009.

GRAPH 4. EVOLUTION OF FAMILIES ATTENDED TO BY THE BOLSA FLORESTA PROGRAM Source: FAS, 2009

2.6 Lessons learned in 2 years of FAS’ acting with the Bolsa Floresta Program:

1) So important as developing scientific methodologies related to the validation of the projects is the inclusion process of communities in the project.

2) Communities must define their priorities.

3) It is fundamental to be agile and work in the timing and urgencies of the community.

4) It is possible to pass on the content of climate changes and environmental services to the communities, but that requires a special language adapted to their reality.

3. Transparency

FAS has as strategic orientation the search of excellence in efficiency, ethics and transparency of financial resources management. Accounting, fiscal documentation  and payments are accomplished by Deloitte ToucheTohmatsu and Board of Trustess´ accounting report and financial demonstrations are audited by PricewaterhouseCoopers. The demonstrations are submitted to the fiscal Council and then to the Board Trustees for evaluation. After the Council’s approval, the accounting report is forwarded to the State Attorney for analysis in accordance with valid legislation. The rigor of this process reveals our vision that FAS must be a national and international reference for managing resources destined to social-environmental programs in tropical regions.

4. Additional

Every additional resource has an equivalent response in the capacity of deforestation reduction. The trend of this curve increase is the result of a synergy effect that combines the activities developed and the administrative cost reduction of FAS.

5. Resource Application

FAS understands as fundamental and strategic the strengthening of productive chains of forest products originating from thestate Conservation Units. These technical and financial investments will represent a significant increase in local economy, taking into account the socio-economic benefits tied up to sustainable development of traditional populations, once this local production increase will result in more income in a more competitive market.

The investments are decided in a participative way together with the community and associations that are presently in the reserve, counting on the technical and financial support of FAS.

The aptitude for sustainable exploit is also a fruit of this process of community envolvement and participative planning. The productive chains with more emergent potentials in the areas in question are presented in the below table.

The partnership resources will be allocated in the different components of the  Bolsa Floresta Program as per below:

Click here and see the testimonies of the community leaders about the Forest Sponsorship Program

Click here to know about more information over the Bolsa Floresta (Forest Allowance) Program

Destination of Resources and their Sources

The above graph presents the destination of resources between the programmatic lines of the project. In it, we observe that more than half of the resources (58%) will be applied in activities that will generate income through sustainable activities, 10% will be applied for the strengthening of associations and 32% of the resources will be applied in aiding programs of monitoring, education, health, productive chains, management and scientific development.

6. Context

The deforestation of the Amazon is the greatest cause of Brazilian emissions, and for this reason Brazil is the fourth world emitter of green house effect gases.

The Simamazonia models (Soares et al, 2006) indicates a strong trend for deforestation in the near future, which can result in the loss of 30% of forest coverage until 2050. If nothing is done, this will result in the emission of3,5 billion tons of CO2 in the atmosphere.

“Deforestation is not the fruit of stupidity or ignorance. It is a rational decision mainly moved by an economic logic. To alter that economic logic, the forest must be worthier while standing than felled. Virgilio Viana – General Director of FAS 

The average income at the CU´s is inferior to the municipalities in which they are inserted.

7. About the Amazon Fund

As a way to obtain resources to encourage forest preservation it was created on August 1st 2008 the Amazon Fund. The core objective is to promote projects for the prevention and combat deforestation as well as to preserve the sustainable use of the forests in the Amazon biome. 

The Fund management is done by the National Bank of Social and Economical Development (BNDES). The resources of the Amazon Fund will be applied under non-reimbursement funds. For more information please access http://www.amazonfund.gov.br/