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Economics

Riches at hand

Academics propose ways to put forest assets to better use

FABIO COLOMBINICupuaçu, cocoa, pupunha, tucumã and biribá: knowledge about fruit still put to poor use FABIO COLOMBINI

X-caboquinho, a sandwich often consumed in cafés and bakeries in Manaus in the afternoon, brings form and flavor to the impasse in the Amazon region. It consists of a baguette-like bread roll with slices of coalho cheese and slivers of tucumã, a fruit the size of a lime that has orange-colored pulp. A more refined version also includes slices of fried banana. The problem is that the supply of tucumã, which comes from the 20-meter high tucumã palm, is irregular. This is also the case of cupuaçu, of assai and of other forest fruit. When there is a shortage of tucumã in the city, the tradespeople have to look for it further and further afield and what they find may not be ideal for snacks, juices and ice creams. José Alberto da Costa Machado, a professor at the Federal University of Amazonas (Ufam), tells us that a team from CBA, the Amazon Region Biotechnology Center, developed tucumã clones that yield fruit after five years, whereas the current varieties are generally only productive after 10 years. The problem is that CBA, created in 2002 with the mission of turning basic knowledge into applied knowledge, is not legally recognized. Therefore, it cannot supply the seedlings that could help to maintain the supply of the ingredient for the late afternoon snacks.

“Iinstitutions in the Amazon region are rather precarious and this is a major problem,”  says Costa Machado, who is working at CBA temporarily. CBA is in a large building within a 12-thousand sq. m area at the start of the Manaus industrial district and it operates under the administration of Suframa, the Superintendency of the Manaus Free Zone. “The institutions don’t work in synch and sometimes they oppose each other.”

The possibility of making the most of forest assets, such as the tucumã fruit, drove the development of the book Um projeto para a Amazônia no século 21: desafios e contribuições [A project for the Amazon Region in the 21st century: challenges and contributions], published by CGEE, the Center of Strategic Studies in Brasilia and authored by Bertha Becker, a political geographer from the Federal University of Rio de Janeiro (UFRJ), Francisco de Assis Costa, an economist at Naea, the Center for Amazon Region Studies at the Federal University of Pará (UFPA), and Wanderley Messias da Costa, a political geographer from the University of São Paulo (USP).

The book was the result of two tasks assigned to the three authors in 2007 by the then minister of Strategic Affairs, Roberto Mangabeira Unger. The first was to turn the federal government’s strategic plan for the Amazon region into possibilities for action, taking into account two different realities, that of the east and the west of the region (what Bertha Becker calls the deforested Amazon Region and the forested Amazon Region) and the fact that the area is home to more than 20 million people and not only to a forest. The second task was to find ways of bringing together the development-oriented school, which promotes the limitless use of the land and its natural resources, and the radical environmentalist line, which sees the region as an “inviolable sanctuary”  to use the words of Messias da Costa.

The answer to the Amazon Region challenges, which the book describes in detail, may lie in applying the concept of environmental services, in which the conserved forest is seen as a source of riches that can be enjoyed with planning and without hurrying. “Environmental services not only have economic value, but also strategic value,”  ponders Bertha Becker. The strategic value of nature “qualifies the natural capital of the Amazon Region as a component of power”  for its “concentration of stock and services unequalled on the planet,”  according to her. “The protection of the forest core will result from using it innovatively and not by isolating it from production.”

High-tech extraction
The book’s three authors consider the need to go beyond the possibility of merely generating income from the intact forest by generating carbon credits to offset pollution in other countries. Bertha regards the carbon market as a commodity, with a low and virtually fixed price, “with no added value, and repeating the primitive pattern that is characteristic of our country’s history.”

Building other environmental services, however, demands innovation in terms of institutions. “The first and most urgent one is to establish a regulation framework that must be both clear and consistent with national and regional interests,” she argues. Another challenge is to extend the benefits of the environmental services to the largest possible number of people. Messias da Costa reiterates that the possibilities of economic activity in the Amazon Region go beyond extensive livestock farming and timber extraction. “We can add value to the forest with high-tech extraction and agro-forestry systems, which can be applied both to the forested and to the devastated areas.”

As he sees it, there are three systems of productivity that express the development of sustainable exploration: foods, cosmetics and phytotherapeutic products. According to him, the sector with the best performance is cosmetics – perfumes, soaps, moisturizes and shampoos. He believes that success in this area is due to cosmetics being free from the laws that regulate access to biodiversity and also because “Amazonia is a brand with global impact.”

In the cosmetics production chain in the Amazon Region, CBA is an institution that is better equipped and prepared to carry out full studies, from basic botanical research to the preparation of the end product, according to an analysis prepared by Alberto Cardoso Arruda, a professor at UFPA, and published in the July issue of the journal Parcerias Estratégicas. Embrapa Amazônia Oriental stood out as an active institution that already makes andiroba soaps and shampoos.

FABIO COLOMBINIManaus industrial complex: uncertainties FABIO COLOMBINI

Afloram, the Forests and Sustainable Business Agency, a now extinct Amazonas state enterprise, encouraged the setting up of new vegetable oil extraction plants –  the best-sellers are those of copaiba, murumuru, buriti and andiroba, used in moisturizers, sunscreens and insect repellents. Arruda noted, however, that the producers complain about companies’  irregular purchases. The firms, in turn, complain about the poor quality of the oils and the lack of health regulations.

“The local communities, organized as cooperatives, resent the lack of public policies to provide knowledge, technology and quality control for their products, not to speak of financing to aid the development of production chains,” says Arruda. According to him, research institutions and companies still find it very difficult to establish such cooperation. Still, the federal government has been attempting to promote them, by tying the release of financing to partnership agreements with firms.

“The main copaiba oil-producing communities can see that it’s a growing market, but find it difficult to meet demand,” observes Gonzalo Enriquez, a professor at UFPA who conducted another part of the study on the cosmetics chain. Technological training is a serious bottleneck. There are at least seven species of copaiba, each one yielding different oils, which vary even when they come from the same plant. These differences are not always considered. In the state of Acre, producers that are harvesting copaiba differentiate the species, without mixing them up. “It’s progress,” he concluded.

For the time being, the science and technology programs focus on widely consumed products, such as guaraná and dendê palm oil, as well as fruit such as assai, pupunha and cupuaçu. However, the production of knowledge accrued over decades might lead to higher expectations. Messias takes from his bookshelf books by experts from the region describing plants that, in his view, should be more wdely used. The fact that this is not happening has nothing to do with any excess of legal restrictions or the weak integration between research institutions, government bodies and companies. “Instead of having imported energy drinks, youngsters could have guaraná extract,” he imagines. “The Amazon Region needs short-term actions firmly grounded in reality that can get us to win over new consumer markets and to open some space for other firms interested in the region’s opportunities.”

Dendê
Messias da Costa believes that this state of affairs will only change once three forces, or groups, start acting together. The first comprises the local communities of producers or extractors, which need to be “organized in a modern way, as cooperatives, and run like formal companies.” The second consists of small, medium or large businesses near consumption centers such as the cities of Manaus or Belém. The third, which would have the role of linking communities and companies, concerns the researchers from government institutions such as Embrapa, Inpa (the National Institute of Amazon Region Research), the Paranaense Emilio Goeldi Museum, the federal technical schools and the universities –  or even CBA, which Messias da Costa helped to create and which lost its direction after the failure of an agreement for bio-prospection in the region with Novartis, the multinational pharmaceutical enterprise.

Even without any fine-tuning of these connections, the forest assets are starting to be put to better use. In one chapter of the book, Messias da Costa tells us that in 2007, for the first time ever, global production of dendê palm oil, thanks to the expansion of plantations in Malaysia, Indonesia and now, the Amazon Region, superseded that of soya oil. This illustrates the potential for alliances among research institutions, community organizations and companies. “The palm trees used to take four years to start producing, but now they produce within two years and yield a larger amount of oil per plant,”  he says.

In another chapter, Francisco Costa shows that the economic activity already surrounding natural Amazon Region products is far greater and more dynamic that had been supposed. Out of the six technological, rural-based paths he uses to describe the rural evolution of the Amazon Region in the last 16 years, one, agricultural extraction based on small family properties, accounts for 21% of the production value and for 26% of jobs in the North Region’s rural sector. “The rural-based technological path is almost as important economically speaking as that based on cattle raising by farmers and by companies, which accounts for no more than 25% of the value and 10.5% of  jobs.”

Costa found that the agricultural extraction path represents 3.5% of the degraded area and 2.6% of the net carbon balance, whereas livestock farming accounts for 70% in both cases. Both have a strategic significance when it comes to a sustainable development policy. “The entire analysis of the six paths, with their different movements and relative autonomy, is an emphatic appeal to public policy to consider the diversity of structures and circumstances that form the Amazon Region today,” he states. “I value quantification in order to determine, as precisely as possible, the diversity of the actors that are solving their production problems and forming institutions in stronger or weaker positions. The public policy decision-makers should pay more attention to these differences, without making linear decisions that put all the players on the same level.”

The book emphasizes the institutional aspects of formulating and implanting public policies in the Amazon Region, in particular those connected with government organizations. The three authors of the book are familiar with the inner workings of the federal government. For decades, Bertha Becker has been invited as a consultant for the projects of various ministries, while the other two were not merely consultants. Messias da Costa has been in and out of the federal government’s service since 1991 – his latest position was director of programs and projects in the Amazon Region Bureau for five years (1995-2000).  “I am familiar with the limits of government action, as I have had the opportunity to develop and apply public policies,”  he says. Francisco Costa, from 2003 to 2005, was the general coordinator of planning of ADA, the Amazon Region Development Agency, which succeeded Sudam, the Amazon Region Development Superintendence Bureau.

Fruit
At ADA, Francisco Costa brought together producers, distributors, salespeople, researchers and other participants in the fruit complex or APL (local production arrangement) for fruits from Pará, northeast. This APL represents the links among fruit producers and the pulp, juice and vegetable oil industry that has been growing, until now having become one of the chief items of trade with other states and countries, after mining, livestock farming and timber.

Meeting every month, the 22 representatives of companies, NGOs and government organizations that have accepted the ADA invitation “learnt what was going on with the others, voiced their problems, many of which were common, and tried to find solutions capable of helping everyone,” reports Costa. He was in charge of ensuring that the “planning and actions of the state were as close as possible to those of the other players. This experience showed that one can do things differently and provide instruments for regional development policies without changing operating structures already in place,” he observed.

At the end of March, Costa Machado completed the CBA business plan and master plan. He felt it was necessary to debate them as soon as possible with those federal government employees who might be able to help the center to start working effectively, but he knows this will not be simple. “There is a sort of refusal to industrialize the Amazon Region, which is disguised to a greater or lesser extent,” he says. “It’s the idea that business and the Amazon Region don’t go together; but it’s the opposite, without business, without generating income, there is no Amazon Region.”  He sees signs of exhaustion in the Manaus industrial complex, which accounts for 75% of the region’s federal taxes and for 100 thousand jobs, and “there’s still nothing to replace it.” “The only competitive resource for the industrial center are tax rebates, which the state government wants to increase and the federal government always tries to restrict.”

“I find the lack of a strategic policy for the region very worrying,”  Machado comments. “In the last few years, the science and technology efforts had no unity or synergy; they weren’t committed to a development project.”  At present, however, he sees little room for debating the possibility of producing other goods on an industrial scale in the Amazon Region. In Manaus, traffic jams will tend to get worse as a result of the construction work needed for the city to host some of the 2014 Soccer World Cup matches.

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