the progamma zona franca verde

8/8/2019 The Progamma Zona Franca Verde

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Abstract

This paper analyzes Amazonas’ Programma Zona Franca Verde as a model

for sustainable development in the Amazon River Basin. By providing a guiding

hand that enables and encourages people to live and work in a sustainable way, the

state government has induced drastic reductions in deforestation and significant

increases in quality of life. There are kinks to be worked out, however, in terms of

commercial transportation and the incorporation of indigenous peoples before the

program is fit to be adapted wholesale to other regions.

Introduction

Human development of the Amazon River Basin has become a divisive issue

the past fifty years, as human beings have become increasingly aware of both their

ability to transform nature and their duty to protect it. A conservation movement

has arisen from consciousness of the fact that human beings are themselves nature,

and so to alter nature is to alter oneself. Indeed, to destroy nature is to destroy

oneself. Human beings have for thousands of years, however, lived outside of

nature. Technological development has allowed our population to smash through

the S‐curve on a continuous quest for resources and social advancement. We are at

once confronted with the long‐term necessity of conservation and the short‐term

needs of human development. We cannot long ignore either issue. Torn between

these poles, we have often, over the past fifty years, had to choose either‐or—to take

on but one at a time. This has made for disappointment upon disappointment.

A third path exists, however, and it comes with the realization that there are

no opposing poles of human development and environmental conservation. Rather,

they are one and the same. Sustainable development bonds them in a marriage

common to both nature and the built environment. The work of Governor EduardoBraga and Secretary for Environment and Sustainable Development Virgilio Viana in

the Brazilian state of Amazonas is a model for this. Beginning in 2003, they

pioneered the Zona Franca Verde, a “Green Free‐Trade Zone,” that has since meant

shared progress for the humans and ecosystems within Amazonas’ borders. The

idea is simple: to “make the forests worth more standing than cut,“ to develop in



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such a way that people have no need to degrade their environment (Viana 2010:

20).

Amazonas and Its Inhabitants

Amazonas sits on the eastern border of Brazil and, like its name suggests,

occupies the core of the Amazon River Basin. It has an equatorial climate and is

home to millions of species of flora and fauna (London and Kelly 2007: 24). One of

those faunae, Homo sapiens, numbers at around three million individuals (Viana

2010: 13). Many of them live in cities, creeping metropolises like Manaus, the

industrial heart of urban Amazonas and home to half of its population. Others live

in the forest, some in harmony with nature, most in combat with it. Subsistence

farmers and desperate miners carve out a fragile existence among the remnants of

hundreds of indigenous groups, Brazilians and natives locked in conflict, as well. As

for all creatures in the Amazon, human existence is a struggle—it’s when life is easy

that you know something is out of whack. More and more, however, things for

people have been getting easy, and the environment has been more and more out of

whack. Amazonas is a soaring environmental cathedral—a monument to the gods

of nature—but one from in which you can hear the jackhammers outside.

Our Crisis and Their Crises

That easiness is not a bad thing; it is not a sin to want a better quality of life

for oneself. An important perspective to keep is that these individuals are people,

too, and that they have just as much right to modernity as any Westerner. Still, those

in developed countries cringe at their progress because, at least until this point, that

“progress” has meant environmental destruction. Considering the situation in

Amazonas, four key crises come to light:

Deforestation: Deforestation is “our” crisis, the reason Westerners pay

special attention to Amazonia over other developing regions in the world.

Deforestation means environmental degradation and biodiversity loss—

vandalism upon the great environmental cathedral.



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Poor Quality of Life: Poor quality of life is the first of the Brazilians’ crises.

The workingman’s poor quality of life in Brazil, the world’s eleventh most

economically inequitable country, is the reason people are inclined to live

shortsightedly. Most people do not want to be corrupt bureaucrats, starving

subsistence farmers, poisoned gold miners, or paranoid drug traffickers, but,

when one lives in a slum without basic social services, these dark paths are

the brightest opportunities available.

Lack of Institutions and Infrastructure: Lack of institutions and

infrastructure goes hand in hand with Brazil’s poor quality of life in that, if

people are to have economic opportunity and social services, they are going

to need the institutions and infrastructure to back it up—things like agencies

to manage social programs, roads to keep commerce moving, and sewers to

keep cities clean. All too often, however, the creation of such institutions

allows for bureaucratic corruption and the development of such

infrastructure enables higher rates of deforestation (Da Silva 2010).

Loss of Sociodiversity: Loss of sociodiversity is an inevitable outcome if

Brazil’s indigenous peoples remain under assault. Their rich and valuable

cultures, parallel to our own, will be forever lost if Brazil continues to look

the other way, allowing racism and economic expedience to wipe natives out

or drive them into urban slums.



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An Ese Eja shaman explains h is art to visitors. Indigenous knowledge and sociodiversity is valuable

to the rest of mankind.

Questions Facing Amazonas, Brazil, and the World

In consideration of the difficulties above, five critical questions stand to be

asked in response: How can outsiders protect the rainforest without restricting the

human rights of those living within it? How can Brazil generate enough economic

prosperity to go around? How can Brazil create institutions without losing them to

corruption? How can Brazil develop the infrastructure it needs without altering the

surrounding environment? How can Brazil incorporate its indigenous peoples in a

way that will not simultaneously destroy their irreplaceable cultures? The answers

to these questions, perhaps, lie at the convergence of conservation and human

development, in a system where “forests are worth more standing than cut,” asystem of sustainable development. Amazonas’ Zona Franca Verde attempts to make

such a system reality.



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Precedent: The Programma Zona Franca de Manus

Success of the Zona Franca Verde would not be the first time

economic development has served to reduce rainforest development. An analog has

existed for decades in the Zona Franca de Manaus, though it was born under entirely

different circumstances. The year was 1967 and Brazil was ruled by a military

dictatorship. The federal government saw the Amazon as a defensive liability and an

economic resource, and so sought to tame its vast, writhing expanse. The Zona

Franca de Manaus (ZFM), an economic free‐trade zone around the port of Manaus,

was development for development’s sake, and it succeeded, growing to today

employ hundreds of thousands of people in high tech industries drawing $2 billion

of foreign revenue each year. Industries in Manaus enjoy tax‐free imports and

exports and reduced domestic taxes (<http://www.suframa.gov.br/>).

Inadvertently, the ZFM’s maturation coincided with a reduction in deforestation—it

created just the economic and social opportunity necessary to draw tens of

thousands of people away from degrading lives on the frontier (London and Kelly

2007: 24). Admittedly, this urban development cannot go on forever; the entire

state of Amazonas cannot be made into one giant Zona Franca de Manaus. What the

Zona Franca Verde seeks to do, however, is get around this impracticality. It aims to

take the ZFM to the people in the rainforest without having to bring them to the

ZFM. In approaching the Zona Franca Verde program, the question exists: Can there

be economic prosperity outside the urban environment?



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A stand in Puerto Maldonado, one of Peru’s rapidly developing rainforest frontier towns.

Programma Zona Franca Verde

Virgilio Viana, the brain behind the Zona Franca Verde, thinks so. His

perception of the crises in Amazonas is that they stem from “bottlenecks in the value

chains for forestry and fisheries products.” The Zona Franca Verde, he reasons, has

to eliminate these bottlenecks, clearing the way for sustainable commerce in

Amazonas. He identifies these chokepoints as:

• Poor land tenure regularization

• Bureaucratic environmental licensing

• Poor access to credit

• Poor access to markets

• Low prices paid to producers in comparison to middlemen

• Deficient or absent technical assistance

• Poor management

• Low technological level of production systems

• Low level of education

• Poor transport infrastructure and high transportation costs

• Poor and expensive energy supply



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• Poor management of protected areas

• Poor communication

• Low level of local value adding

(Viana 2010: 24)

Rainforest product value chain bottlenecks make cattle ranching a more economically viable activity.

Implementing policy instruments over a series of phases will knock out these

barriers along the product path of primary production, storage/transportation,

industrialization, and commercialization. These policies are to be enabling, not

policing—“’carrots’ rather than ‘sticks’” (Viana 2010: 29). They are to be cross‐

sectoral, creating vested interests for many stakeholders at all levels of government

and drawing from their diverse experiences (De Araújo 2006). Communities are to

be heavily involved in policy evolution with common citizens serving on committees

custom tailoring program spending to fit their community’s needs (Programa DeDesenvolvimento Regional 2006). Policies implemented to date include:

• Creating the Amazonas Land Tenure Institute, a governmental body to

regularize land tenure

• Legalizing new sustainable practices in forestry and fisheries



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• Expanding the microfinance activities of the State Agency for Economic

Development

• Creating the Amazonas Foundation for the Advancement of Science to

perform sustainability R&D

• Creating the Institute for Agroforestry Development, an agency providing

agricultural extension services

• Reducing taxes on non‐timber forest products

• Creating the Agency for Sustainable Development to make government

purchases of local sustainable small‐scale agriculture.

• Facilitating market access by arranging deals between small producers and

large buyers

• Creating the Center for Conservation Areas to institutionalize new protected

areas

• Creating the Center for Climate Change to direct Amazonas’ new climate

change policy

• Creating the Amazonas Sustainability Foundation to manage payments for

environmental services, including the Bolsa Floresta Program, a system by

which land owners are compensated with personal income, community

services, and sustainable business investment in exchange for refraining

from all deforestation

• Initiating social programs in education and health

• Providing for the education of indigenous peoples at the Secretary of

Education and the State University of Amazonas

(Araújo 2009; Botelho 2004; Braga PPT; Da Silva 2010; De Almeida 2010; De Araújo

Macedo 2006; Do Nascimento Araújo 2008; Do Nascimento Pereira; Dos Santos

2010; Magalhães 2007; Programa De Desenvolvimento 2006; Programa ZonaFranca Verde 2003; Viana 2010: 31‐51)

The Zona Franca Verde is a government approach to indirectly stimulating

conservation. Unlike conventional conservation schemes, it does not outright

police anti‐deforestation regulations. The government, recognizing its inability

to do so effectively, instead attempts to eliminate people’s need for deforestation



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with a series of programs that help people to help them themselves, including

with their direct participation in policymaking. It is a radical experiment, not

only for Brazil, but also for an entire planet looking to sustainability enable

future growth.

Success Metrics

The Zona Franca Verde is relatively new program, but significant data, both

statistical and anecdotal, has been collected about it. Seven years in, a pretty

clear picture has developed as to whether or not Braga and Viana have made

progress on the frontier. Before presenting data, however, it must be established

within the context of what the Zona Franca Verde needs to do in order to work.

Returning to the four crises identified above—deforestation, poor quality of

life, lack of institutions and infrastructure, and loss of sociodiversity—six

corrective steps can be identified:

• To reduce deforestation, the Zona Franca Verde must create long‐term

sustainable jobs for those who were previously miners, subsistence

farmers, and slum dwellers. It must also educate citizens, instilling an

understanding of why the forest is so invaluable.

• To improve people’s poor quality of life, it must provide infrastructure

and social services.

• To reverse the lack of institutions and infrastructure, it must attract

foreign investment , so that the state can afford the costs of the program.

Additionally, it must employ sustainable environmental, social, and

bureaucratic practices so that the program doesn’t run out of the nature,

public support, and honest public officials it needs to continue

indefinitely.• To protect sociodiversity, the Zona Franca Verde must integrate and

protect indigenous peoples so that they can work with the government

from a position of safety, both materially and culturally.

Reported Program Results



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While most of these processes themselves cannot be quantified, some of their

impacts can. Government data is available on deforestation, area preservation,

market pricing, public support, and program cost for the Zona Franca Verde:

• From 2003 to 2010, Amazonas had a 74% reduction in the rate of

deforestation as the Zona Franca Verde’s policies came in to effect.

• Similarly, the period from 2002 to 2010 saw a 160% increase in state

protected areas in Amazonas.

• Prices for producer’s goods have doubled, tripled, and even

quadrupled for various products.

• Statistic show that the overwhelming majority of people in Amazonas

have developed a positive view of the Bolsa Floresta program.

• Program costs range in the tens of millions of dollars across the Zona

Franca Verde’s various policy instruments.

(Viana 2010: 22, 38‐39)

Reduced deforestation data ties back to itself, increased area preservation

connects to institution creation, higher market pricing for produced goods improves

workers’ quality of life, public support for Bolsa Floresta lends credence to

sustainable social practices, and low program cost for the state supports its ability

to afford infrastructure and working bureaucracies.

A rainforest guide demonstrates the sustainable harvesting of Brazil nuts.



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Review of the Issues Addressed

Admittedly, however, there are so many moving parts to the state of

Amazonas that there can be no definitive causation for any possible correlation.

Additionally, there are some anecdotal impacts that unfortunately cannot be

measured within the scope of this paper. Still, some trends emerge within the

context of success metrics:

Create long‐term sustainable jobs for those who were previously miners,

subsistence farmers, and slum dwellers: If the Zona Franca de Manaus is any

indication, the 74% reduction in the rate of deforestation comes from the

state creating opportunity for those people to go to work. Unlike the Zona

Franca de Manaus, however, the Zona Franca Verde has created employment

opportunities in sustainable industries within the rainforest itself. For such

industries, it actually makes greater economic sense to use the rainforest in a

sustainable way so that the products behind one’s revenue stream are not

destroyed. With the forests worth more standing than cut, people can afford

to choose not to cut them down.

Educate citizens: The Zona Franca Verde’s new Center for Conservation

Areas has managed to add 11.7 million hectares to Amazonas’ protected

areas, a 160% increase. Public support legitimizing such measures has been

hard to come by in Brazilian history (London and Kelly 2007: 246). Perhaps

the newly sustainable and educated populous of rural Amazonas has grown

warm to rainforest protection, now better understanding the preciousness of

the biodiversity around them.

Provide Infrastructure and Social Services: The implicit success at job

creation suggested by reductions in deforestation and the expansion of state

protected areas suggest that the Amazonas government has developed the

foundations of effective governmental agencies, as well as the infrastructure

to further their effectiveness. Furthermore, the increase in value for



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producer’s goods suggests that rural industries have climbed to a higher

position up the value chain, likely facilitated by improved transportation

infrastructure.

Attract Foreign Investment: The relatively low program costs paid by the

Amazonas government to support its sustainable development programs

suggest that the rainforest’s free trade zone, like Manaus’ before it, is

attracting significant enough foreign investment that the government is not

having to step in to prop up businesses beyond the initial point of providing

enabling social services. This will help the program stay affordable as the

state scales it forward.

Employ Sustainable Environmental, Social, and Bureaucratic Practices: The

Zona Franca Verde’s various experiments and innovations have made it a

pioneer of environmental sustainability. Support for Bolsa Floresta suggests

a wider societal support for the Zona Franca Verde as a whole, and a

continued effectiveness of the program should maintain this political

mandate. Where the program’s sustainability falters, however, is with its

reliance on foreign investment and it’s need for diffuse transportation

infrastructure. Foreign investment is necessary to keep the program cost

down, but it is fickle, especially in today’s world economy. Brazil needs to

develop a domestic commercial mechanism to supplement fluctuations in

foreign investment. In 2006, Viana proposed an international investment

fund for financing conservation, but it is yet to be fully realized (Flor 2006).

Diffuse transportation is necessary, as well, in order to facilitate the

movement of people and sustainable products from their far‐flung origins inthe rainforest. This often comes in the form of roads and railways (in

addition to the natural waterways), the development of which is quite

environmentally destructive and has traditionally served to enable fishbone

environmental degradation alongside. Amazonas ought to centralize it’s rural

population and industrial centers so that less infrastructure is needed.



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Additionally, it must maintain the institutional integrity to prevent

deforestation alongside its roads and railways.

Road building is a development paradox that both deforests and creates the prosperity

necessary to prevent deforestation.

Integrate and Protect Indigenous Peoples: Aside from programs for

indigenous education at the Secretary of Education and the State University

of Amazonas, the Zona Franca Verde has failed to adequately address the

existence of indigenous people within the Brazilian system. It expects them

to approach and work within Brazil’s Western‐style legal and political

systems (De Araújo Macedo 2006). This is problematic, however, in that it

requires them to accustom themselves to these systems, in the process

putting their traditional cultures at risk. Pristine sociodiversity is a fragile

thing, and the Brazilian government should work with natives in a more

accommodating way that does not require them to restructure their entire

social systems for compatibility with the Zona Franca Verde. On a more

practical level, as much as the Zona Franca Verde program secures landtenure for Brazilians, it has no mechanism for arbitrating land conflicts

between natives and Brazilians (Araújo 2009). People on both sides die as

worlds collide, and the government has a duty to be there building honest

bridges between them.



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What’s Next

In many ways, Amazonas’ Zona Franca Verde is a first‐of‐its‐kind pioneering

model for how to pull off sustainable development in the Amazon River Basin. Its

implementation has coincided with drastic reductions in deforestation and

significant improvements in the local economy. Questions exist regarding the

program’s long‐term financial viability, and infrastructure development paradoxes

betray the initiative’s environmental goals. Perhaps most glaringly, there is little

provision for incorporating indigenous peoples into the Zona Franca Verde; it is

designed for Brazilians, and the natives must become Brazilians to fully take

advantage of it.

Concerns aside, the Zona Franca Verde has set remarkable precedents for the

wider region. It’s macro‐ideals of cross‐sectoral collaboration and clearing value

chain bottlenecks can be exported and adapted to countries like Peru where a

similar green free trade zone could take on the country’s location‐specific reasons

for human poverty and environmental degradation. Coupled with an enlightened

government and an overseas market for sustainable goods, such a program could

reach a level of success comparable to that of the current Zona Franca Verde.

As the Zona Franca Verde continues to expand and evolve to the needs of

Amazonas, its ability to keep innovating while remaining politically palatable will

ultimately decide what the green free trade zone becomes.



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Works Cited

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