Growing the Wealth of the Poor - World Resources Institute

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W O R L D R E S O U R C E S 2 0 0 8138timber operations, and they have struggled to make a profit(Nittler and Tschinkel 2005).Under these circumstances, community commitment tosustainable forestry management has been lacking, withpredictable consequences. Corruption has flourished in anumber of the smaller concessions, including San Miguel (7,039ha), La Pasadita (18,817 ha), La Colorada (22,067 ha), andCruce a La Colorada (20,469 ha). In these concessions, powerfullocal figures illegally sell parcels of concession land to settlers andencourage farmers to encroach into forest earmarked for sustainableharvest (Nittler 2008; Carrera 2008). In 2004, SmartWoodsuspended the FSC certification status of San Miguel and LaPasadita, further harming their business outlook and producinga stalemate that has yet to be resolved (Chemonics and IRG2000:A-IV-24; Carrera 2007).Poor organization and governance have also continued tohold back some enterprises from thriving as independent smallbusinesses. In 2005, for example, observers noted that thecontinued insistence by many enterprises on a yearly turnover ofboard members entrenched “a guaranteed recipe for perpetualincompetence” (Nittler and Tschinkel 2005:8). In the past threeyears, however, these problems have lessened significantly asEFCs have been required to professionalize their managementunder conditions specified by the SmartWood sustainable certificationinspections. At least one manager with proven forestryexperience must be hired, for example, and EFC governingboards are required to retain at least one or two members formore than one term of office to ensure continuity of experience(Carrera 2007). Long-term planning has also improved EFCs’business performance. With help from Chemonics, seven enterpriseshave produced comprehensive five-year plans enablingthem to forecast timber supply, improve sales forecasts, and avoidpoor investment decisions (Chemonics 2006:26).In its 2006 completion report, Chemonics Internationalfocused on the growing economic and social resilience of theconcession communities, describing how villagers had developedinto effective entrepreneurs: “Unlike the mindset in 2001,today most [enterprise] members understand the importanceof managing their organizations for profit. Board members andmanagers are more aware of production costs, they have builtin administrative and production controls, and are betterprepared to negotiate more profitable forest-harvestingcontracts” (Chemonics 2006:38). By December 2007, accordingto José Roman Carrera, regional manager for theRainforest Alliance’s sustainable forestry division, eight enterpriseswere profitable, operationally self-sufficient, and wellplaced to prosper once USAID funding to develop newproducts and markets ceases in August 2009 (Carrera 2007).
G R E E NL I V E L I H O O D SLEARNING FROM GUATEMALA’SCOMMUNITY FOREST ENTERPRISESCare must be taken at start-up. In the understandable rush toestablish concessions in the early 1990s, little thought was given to theimplications of long-term forest stewardship. Territories were carvedout with little consideration of what was appropriate and necessary toprovide economic opportunities and incentives. The first few concessionswere too small, unable to support profitable enterprises undersustainable management. Today, those concessions are rife withcorruption, and the forests are degraded by illegal logging and clearingfor agriculture.There is a difference between stewardship and enterprise. Initialskill training for the concession managers focused on forest management.Only after government agencies and NGOs both saw that theexpected economic impact was not materializing—and that sustainablepractices were suffering as a result—did it become clear thatcommunities also needed skills to manage the business side of theconcession: sales, marketing, and certification. This oversight set backthe development of profitable community concessions by several years.Government has an ongoing role that must be exercised. One ofthe goals of the government’s establishment of the Maya Reserve wasthe preservation of one of the last great swaths of virgin forest inCentral America. The track record of the certified concessions showsconsiderable improvement in the health of the areas under theircontrol. But the National Parks in the reserve itself, ostensibly off-limitsto all extractive uses, are losing acreage at an alarming pace becauseof poaching and illegal farming. The lack of any enforcement undercutsthe government’s goals and may ultimately jeopardize the achievementsof the concessions.Long-term commitment is needed. This applies in every case. Thefirst concession contract was signed in 1994. Nine years later, NGOsand aid agencies were putting the finishing touches on FORESCOM, theorganization formed by nine of the concession communities to providemarketing services and training for concession members and to coordinatesustainable certification of their timber. Twelve years after thefirst concession, a phaseout plan for USAID is in place, now that nineconcessions are well established and profitable.There is strength in numbers. The forest concessions in Guatemalawere thrust from the start into an international market; that is thenature of the high-value timber they were able to harvest. These concessionscould never, individually, hope to have all the contacts and skillsnecessary to successfully navigate that trade. Their willingness to fundthe creation of FORESCOM has paid significant dividends. In addition tothe services mentioned already, FORESCOM markets the combinedharvests of the members to command better prices and encourages theproduction of additional products. Delegating certain critical managementdecisions to FORESCOM is one key factor that has made eight ofthe Petén concessions self-sufficient and profitable today.Carrera warned, however, that this encouraging prospectdepended on the absence of “adverse external developments,”particularly the threat of uncontrolled immigration andagricultural encroachment spilling over into community forests(Carrera 2007). Due to rising birth rates and economic migrationfrom the south, illegal settlements and forest clearance byfarmers continue to plague the Maya Biosphere Reserve’ssupposedly protected national parks. By 2006, for example,about 40 percent of Laguna del Tigre National Park along thereserve’s western border had been destroyed by illegal loggingand wildfires (compared with only 4 percent in the neighboringUaxactun concession) (Rainforest Alliance 2007c:2).One problem is that communities in the buffer zonealongside the national parks have not been given the alternativelivelihood opportunities enjoyed by the concession communitiesand therefore lack any incentive to respect park rules.Another is the weakness of CONAP, which remains chronicallyshort of staff and resources and which lacks political supportfrom other government agencies (Chemonics 2006:45). “Thegovernment supports the development of the forestry enterprises,”says Carrera, “but to protect the concessions it needs toassign enough resources to enforce the protected area lawsthroughout the Maya Biosphere Reserve” (Carrera 2008).Scaling Up Community Forest EnterprisesOrganizational Scale-UpThe creation of second-tier agencies has been critical in puttingGuatemala’s community enterprises on a viable businessfooting. In the early years, ACOFOP lobbied for more andlarger concessions to be allocated and it provided fragmentedcommunities with a collective voice (Chemonics 2003:10). Since2003, the forest products company FORESCOM has enablednine enterprises to add value to their basic product, timber, andto expand markets (Chemonics 2006:27).By providing technical assistance in meeting Smart-Wood’s sustainable timber certification conditions,FORESCOM has allowed enterprises to cut compliance costsby up to 80 percent and to end reliance on donor subsidies(Chemonics 2006:13–14; Nittler and Tschinkel 2005:16). Withassistance from the internationally networked RainforestAlliance, the company has also successfully identified nationaland overseas markets, particularly for lesser-known woodspecies that FORESCOM sells on its members’ behalf. Byrepresenting the combined output of nine concessions (withthe other three due to join by 2009), FORESCOM is winningbig contracts beyond the reach of individual enterprises, suchas an annual contract to supply 1 million board feet of timbera year to a Guatemalan building company.139
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2008WORLDRESOURCESRoots ofResilienc
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W O R L D R E S O U R C E S 2 0 0 8
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Roots ofResilie
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Scaling up nature-based enterprises
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Examples of such economic and socia
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BOX 1.2 WHAT IS SCALING UP?10In gen
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S C A L I N G U P E C O S Y S T E M
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PERCENTAGE OF POPULATION LIVING UND
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Investing in the social capital of
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UPDATE: SCALING UP NAMIBIA’SCOMMU
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UPDATE: NAMIBIAincluding a limited
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UPDATE: NAMIBIAGROWTH IN COMMUNAL C
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UPDATE: NAMIBIATorra Conservancy su
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UPDATE: SCALING UP LOCAL MANAGEMENT
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UPDATE: FIJIextensively with the co
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UPDATE: FIJI42of the iqoliqoli comm
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UPDATE: FIJI2007a:iv). A separate s
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Scaling up environmental enterprise
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OWNERSHIPW O R L D R E S O U R C E
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OWNERSHIP54W O R L D R E S O U R C
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BOX 2.1 LESSONS FROM THE EQUATOR IN
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OWNERSHIP62W O R L D R E S O U R C
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OWNERSHIP66give marginalized groups
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Box 2.2 LESSONS FROM THE FIELD:GENE
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Box 2.2 LESSONS FROM THE FIELD70It
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CAPACITYW O R L D R E S O U R C E S
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Box 2.3 WOMEN ON THE MOVE: SCALING
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BOX 2.4 WATERSHED ORGANISATION TRUS
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CAPACITY80W O R L D R E S O U R C E
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BOX 2.5LOCAL EMPOWERMENT, UPWARD IN
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CAPACITY86W O R L D R E S O U R C E
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Page 110 and 111: BOX 2.6CURING POVERTY?TAKING ADVANT
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Page 118 and 119: CONNECTION106W O R L D R E S O U R
Page 121 and 122: B U I L D I N G O W N E R S H I P,
Page 123 and 124: ROUTESTORESILIENCEIN THIS REPORT WE
Page 125 and 126: F I S H E R I E S F O R T H E F U T
Page 127 and 128: Creating Institutions, Empowering C
Page 139 and 140: G R E E NL I V E L I H O O D Sregio
Page 141 and 142: G R E E NL I V E L I H O O D SThe C
Page 143 and 144: Intermediaries Help Build Necessary
Page 145 and 146: G R E E NL I V E L I H O O D SENTER
Page 147 and 148: G R E E NL I V E L I H O O D Sit to
Page 149: Chemonics and IRG 2000:A-V-2). Hist
Page 153 and 154: G R E E NL I V E L I H O O D SAcros
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Page 161 and 162: Demi-lunesAdding Value: Reclaiming
Page 163 and 164: Storing milletNationally, figures f
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RECOMMENDATIONS:ADVANCINGENTERPRISE
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R E C O M M E N D A T I O N S : A D
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PROJECTED CHANGES IN AGRICULTURE IN
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2. Provide Financial Support for Ne
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IIP A R T1Population and Human Well
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abroad. In order to capture a count
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Adult Literacy Rate: The availabili
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Nations Children’s Fund (UNICEF)
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DATA RELIABILITY AND CAUTIONARY NOT
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The Corruption Perceptions Index (C
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A C K N O W L E D G E M E N T SWorl
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and Environmental Management; Austr
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R E F E R E N C E Shttp://www.water
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R E F E R E N C E S■■■■■
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R E F E R E N C E S■ Subedi, B.,
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R E F E R E N C E S■■CARE Inter
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R E F E R E N C E SChapter 3Banglad
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R E F E R E N C E SIn Mission (SIM)
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R E F E R E N C E S■■■■■
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Box 4.2■■■Larson, A., and J.
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IndexItalic page numbers refer to f
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I N D E Xcross-cutting lessons from
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I N D E XDemandconservancies as dem
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I N D E XGThe Gambiacommunity fores
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I N D E XInterAmerican Development
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I N D E XMaya Biosphere Carbon Proj
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I N D E XOrganizational scaling up,
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I N D E XScaling up, 3-45, 189-201c
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I N D E XUnited Nations Development
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UNITED NATIONS DEVELOPMENT PROGRAMM
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WORLDRESOURCES200WORLDRESOURCES2008
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