Over recent years, the research system in the state has been growing and diversifying itself swiftly, which, to a great extent, is due to the vigorous and innovating work of FAPESP. As a consequence, the Foundation’s level of investment is, today, at the ideal state of equilibrium, in relation to its income – money handed down by the State and earnings on assets. In this situation, any harsh and considerable change in items of expenditure imposes a need for immediate measures to protect this financial balance, and hence to preserve the capacity for supporting the research system in the state of São Paulo in the medium and long term.
As it is widely known by the research community in the state, a considerable fraction of FAPESP’s investments is intended to finance the acquisition of imported goods – permanent items, consumables and third party services. On the other hand, the Foundation’s sources of income – not least because of restrictions of a legal nature – cannot be pegged to exchange rates. Accordingly, the giddy appreciation of the dollar against the real over the last six months – and in particular the worsening of the currency crisis in the last few weeks – have led FAPESP’s Board of Trustees to adopt a set of precautions, for which we count on your understanding.
In first place, it was decided, as an emergency and temporary measure, to suspend the release – for projects in force – and the granting – for new projects – of funds intended for the import of goods and services. For the same reasons, including goods to be acquired in Brazil, FAPESP may not carry out any correction of the real value of the benefits already granted by it, which may be affected by the devaluation of the currency. However, the researcher will be able to use the funds in the project’s Technical Reserves to cover these differences. The period for which these measures remain in force will depend on how the exchange rate develops. The moment that the rate steadies, FAPESP will reassess the matter, in the light of its budgetary capabilities.
With a view to softening the impact that the exchange rate has already had on FAPESP’s budget, the Board of Trustees has also decided to lay down new directives for the use of the funds in the Technical Reserves associated with Research Benefits. For new grants, the fraction of the funds in the Technical Reserves associated with items to be imported – permanent items, consumables or third party services – should be used exclusively to cover import costs, as well as any exchange rate variations that take place after the signing of the contract. These rules, which restrict the financing of the indirect costs of carrying out research projects, are in conformity with the policy traditionally followed by FAPESP of giving priority to providing direct support to these projects.
With a view to rationalizing import procedures and minimizing the fixed costs, the rules have been consolidated and formalized; they are to be found in ordinance CS 19/2002, available on the www.fapesp.br website. Also in this regard, at the end of the process for acquiring goods or services from abroad and permanent items in Brazil, the use of any existing balances will depend on prior and explicit authorization from FAPESP.
Finally, in order to make it possible to make forecasts on budgetary expenditure in each period, in the various modalities of research benefits, FAPESP will now ask for a timetable showing the disbursements of the funds granted. With the adoption of these measures, FAPESP will be able to continue to guarantee its support to all applications in excellence that are forwarded to it.
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