United Nations Development Programme
Country: PARAGUAY
PROJECT DOCUMENT
Project Title: Mainstreaming Biodiversity Conservation and Sustainable Land Management into Production Practices in all
Bioregions and Biomes in Paraguay
UNDAF Outcome(s): National capacities strengthened for integrated environmental management and for promotions and
management of sustainable and equitable development
UNDP Strategic PlanPrimary Outcome:1: Inclusive and sustainable growth and development
UNDP Strategic Plan Secondary Outcome: 2: Stronger Democratic Governance to meet citizen expectations
Expected CP Outcome(s):3.2: Policies and programs for conservation and sustainable use of biological and cultural resources /
3.3: Sustainable and equitable development model
Expected CPAP Output (s)3.2.1: Strengthened environmental institutions for decentralized environmental management;;3.2.3:
Interinstitutional and intersectoral coordination supported for conservation and sustainable use of biological and cultural
resources; 3.3.1: Economic incentives for sustainable production; 3.3.2: Systems and technologies for production of
environmentally sustainable goods and services developed;3.3.3: Interinstitutional and intersectoral coordination strengthened to
integrate sustainable development actions
Executing Entity/Implementing Partner: UNDP
Implementing Entity/Responsible Partners: Environment Secretariat (SEAM)
Brief Description
The project´s objective is to protect biodiversity and ecosystem functions of the Upper Parana Atlantic Forest eco-region from
existing and emerging threats from multi-sectoral production practices and is a model for replication across the country’s
ecoregions. The project will deliver global benefits by ensuring future expansion of production does not compromise
biodiversity and ecosystem function. The Project will advance a package of measures that includes long term institutional
support through strengthening of the regulatory framework; strengthening of the capacities of the national and local government
institutions, and the private sector for planning, land use, monitoring deforestation, surveillance and enforcement; improving
stakeholder coordination and dialogue for agreements and consensus on land use and management; generating incentives so
that markets and financial sectors prize sustainable production practices principally of soy and beef, within the target multiple
use landscape. The project´s key focus is the work with medium and large-scale producers of soy and livestock seeking
transformational changes that will ensure that producers comply with the GoPs zero deforestation policy and regulations and
encourage them to adopt SLM and SFM practices that favor the conservation of ecosystem functions including biodiversity, to
ensure long-term sustainability of production. This will contribute to the establishment of deforestation free supply chains that
provide sustainable products to the markets. This set of interventions will create an enabling framework for effective
governance managing conflicting land uses and optimizing for sustainable land and forest management and biodiversity
conservation, as well as the conditions for piloting interventions at departmental level and promoting replication, thereby
achieving the GoP´s objective of zero deforestation in the Eastern Region. This will be achieved through three Outcomes: 1)
Effective governance framework for biodiversity conservation and SLM in multiple use landscapes; 2) Financial and market
incentives framework to promote biodiversity and sustainable land management within the target multiple-use landscape; and
3) Strengthened implementation of land set aside system and sustainable production practices.
Programme Period:
Award No.
Project No.
GEF Project ID:
PIMS #
Start date:
End Date
Management Arrangements
PAC Meeting Date
2014-2018
00077229
00088150
4860
4836
January 2014
January 2019
DIM
XXX, 2013
Agreed by (Government):
Agreed by (Executing Entity/Implementing Partner):
Agreed by (UNDP):
Total resources required
29,298,847
Total allocated resources:

Regular

Other:
o GEF
6,861,817
o Government 14,462,473
o Non-Profit 3,485,259
o UNDP
4,489,298
TABLE OF CONTENTS
PART I: Situation Analysis ............................................................................................................................ 5
PART I.A. Context ......................................................................................................................................... 5
Environmental context and global significance ............................................................................................. 5
Socio-economic context ................................................................................................................................. 7
Institutional, policy and legal context .......................................................................................................... 11
Part 1.B Baseline Analysis ........................................................................................................................... 15
Threats to globally significant biodiversity and determinants of land degradation...................................... 15
Long term solution – the GEF entry point.................................................................................................... 18
Stakeholder analysis ..................................................................................................................................... 31
Part II: Strategy ............................................................................................................................................ 33
Project Rationale and Policy Conformity ..................................................................................................... 33
Project Objective, Components/Outcomes and Outputs .............................................................................. 40
Project Indicators, Risks and Assumptions .................................................................................................. 69
Incremental reasoning and expected global, national and local benefits...................................................... 73
Linkages with other GEF and non-GEF interventions ................................................................................. 80
PART III: Management Arrangements ........................................................................................................ 82
Implementation Agency ............................................................................................................................... 82
PART IV: Monitoring and Evaluation Plan ................................................................................................. 86
M&E Workplan ............................................................................................................................................ 91
PART V: Legal Context ............................................................................................................................... 91
Annex A: Project Logical Framework ......................................................................................................... 93
Annex B: Incremental Cost Matrix .............................................................................................................. 99
SECTION III: TOTAL BUDGET AND WORKPLAN............................................................................. 104
PART I. Total Budget and Work Plan........................................................................................................ 104
SECTION IV: ADDITIONAL INFORMATION ...................................................................................... 122
PART I: Other agreements. Please refer to separate file .......................................................................... 122
PART II: Terms of References for key project staff (Project Management Unit) ..................................... 122
PART III: Stakeholder Involvement Plan .................................................................................................. 122
PART IV: Annexes .................................................................................................................................... 122
Annex 1: Risk Log Matrix.......................................................................................................................... 122
Annex 2: Description of priority areas ....................................................................................................... 122
Annex 3: Maps ........................................................................................................................................... 130
Annex 4: Description of Soy and Beef Supply Chains .............................................................................. 133
Annex 5: Characterization of international soy certification schemes used in Paraguay ........................... 153
Annex 6: GEF Tracking Tools (See separate file) ..................................................................................... 154
Annex 7: Safeguards (See separate file) ..................................................................................................... 154
Annex 8: CoFinancing Letters (See separate file) ...................................................................................... 154
Annex 9: Capacity Scorecards: SEAM and INFONA................................................................................ 155
Annex 10: Letter of Agreement – Spanish version (LoA) ......................................................................... 160
List of References....................................................................................................................................... 164
2
LIST OF ACRONYMS
AF
Atlantic Forest
AFD
Financial Agency for Development
ANDE
National Electricity Administration
APS
Association of Producers of Soy, Grains and Oilseeds of Paraguay
A/R
Afforestation/Reforestation
APR
Annual Project Report
ARP
Rural Association of Paraguay
AWP
Annual Work Plan
BCP
Central Bank of Paraguay
BNF
National Development Bank
CAH
Agricultural Credit
CAP
Paraguay Agricultural Coordinator
CAPECO
Paraguayan Chamber of Exporters of Grains and Oilseeds
CAPPRO
Paraguayan Chamber of Processors and Exporters of Oilseeds and Grains
CBO
Community-based Organization
CPC
Paraguayan Chamber of Meat
CO
UNDP Country Office
CONADERNA National Commission for the Defense of Natural Resources
CPAP
Country Programme Action Plan
DIM
Direct Implementation Modality
CONAM
National Environmental Council
DGEEC
Directorate General of Statistics, Surveys and Census
EIA
Environmental Impact Assessment
EU
European Union
FAO
UN Food and Agriculture Organization
FECOPROD Federation of Production Cooperatives
FG
Livestock Fund
FI
Financial Institution
FMD
Foot and Mouth Disease
GEB
Global Environmental Benefit
GEF
Global Environment Facility
GoP
Government of Paraguay
GDP
Gross Domestic Product
GM
Genetically Modified
ILO
International Labor Organization
INDERT
National Institute for Rural Development and Lands
INDI
Paraguayan Institute for Indigenous Peoples
INFONA
National Forest Institute
IPS
Social Welfare Institute
IR
Project Inception Report
ISCC
International Sustainability and Carbon Certification
IW
Inception Workshop
M&E
Monitoring and Evaluation
MAG
Ministry of Agriculture and Livestock
MIC
Ministry of Industry and Commerce
MUL
Multiple Use Landscape
NIM
National Implementation Modality
NGO
Non-governmental Organization
O&M
Organization & Methods
PA
Protected Area
PB
Project Board
3
PIR
PM
PMU
RBM
ROAR
RTRS
SEAM
SENACSA
SENAVE
SFM
SLM
STP
TC
UNDAF
UGP
UNEP
UNDP
UNFPA
UN-REDD+
UPAF
WB
WWF
Project Implementation Review
Public Ministry
Project Management Unit
Results-Based Management
Results-Oriented Annual Report
Round Table for Responsible Soy
Environment Secretariat
National Animal Quality and Health Service
National Plant Health Service
Sustainable Forest Management
Sustainable Land Management
National Planning Secretariat
Technical Committee
United Nations Development Assistance Framework
Union of Production Organizations
United Nations Environment Programme
United Nations Development Programme
United Nations Fund for Population Activities
United Nations REDD+ National Joint Programme
Upper Parana Atlantic Forest
World Bank
World Wide Fund
4
SECTION I: Elaboration of the Narrative
PART I: Situation Analysis
PART I.A. Context
2.1
Environmental context and global significance
1. The Upper Parana Atlantic Forest (UPAF) is part of the regional Atlantic Forest (AF) complex, and
includes the South-western part of Brazil, North of Argentina and a great portion of Paraguay´s Eastern
Region; it is estimated that this complex had an original extension between 1 million and 1.5 million Km2,
of which less tan 6% remains today at regional level.
2. The Eastern half of the Eastern Region has been classified under different designations. Holdridge
(1947) classified the area as Temperate Moist Forest and Hygrophilous Forest; Cabrera and Willink
(1973) designated it as Forest District of the Phytogeographic Province of Parana, Amazonian Domain;
and the Paraguay Conservation Data Center included this area within three Ecoregions: Central Forest,
Alto Parana and Amambay. This diversity of designations is explained by the diversity of habitats that
converge in the area. In 1995, Dinersteinet al. designated the Eastern half of the Eastern Region as
Interior Atlantic Forest and characterized it as Tropical Moist Broadleaf Forest. In 2002 the World Wide
Fund (WWF) included the Atlantic Forest and its extension in Paraguay within the 238 ecoregions of
global priority for conservation.
3. The UPAF in Paraguay originally covered a significant portion of the Eastern Region, stretching over
the whole of the Departments of Alto Parana, Canindeyu, Itapua and Caaguazu, a large share of the
Departments of Amambay, San Pedro, Guairá and Caazapa, and parts of the Departments of Concepcion
and Paraguari (map in Annex 2). The original coverage has been estimated at 94,000 km2 or 58.8% of the
region´s surface area. Today the forest remnants are estimated at 26% of the original cover, most
significantly in the departments of Alto Paraná, Amambay and Canindeyú, where an important diversity
of habitats with a high degree of threats converge, and constitute the project´s intervention area.
Diversity, endemic and threatened species
4. The UPAF constitutes a globally important storehouse of biodiversity. Despite its high level of
degradation, most of the original species in Paraguay’s UPAF still exist, although in small isolated
pockets, and the remaining forest forms the last stronghold for several species which have all but
disappeared from the rest of their range. It hosts 70 threatened plant species and nearly 50 vulnerable.
Endemic plant species that have commercial value include Aspidospermapolyneuron,
Astroniumfraxinifolium, Tabebuiaheptaphylla, and Cedrelafisilis. The fauna includes 403 species of birds,
of which 13 threatened and 20 near-threatened forest-dependent species have been reported, among them
theBrazilian Merganser (Mergusoctosetaceus), Black-fronted Pipin Guan (Pipilejacutinga), Vinaceous
Amazon (Amazonavinacea), Red-spectacled Amazon (Amazonapetrei) and Helmeted Woodpecker
(Dryocopusgaleatus). Threatened and near-threatened mammals include the Giant Armadillo
(Priodontesmaximus),Jaguar (Pantheraonca), Pygmy Brocket (Mazamanana), Bush Dog
(Speothosvenaticus,)Azara’s Agouti (Dasyproctaazarae),Oncilla (Felistigrina), Tapir (Tapirusterrestris),
and Short-tailed Opossum (Monodelphissorex).
5. Although Paraguay hosts only 1 or 2 mammal species that are restricted to the country, there are 11
endemic AF species sensustrictu; these include marsupials, rodents and bats. Among the approximately
100 reptile species known in Paraguay, 4 are apparently endemic and one of them is believed to be
endemic of the region. A total of 80 bird species endemic to the AF have been registered in Eastern
Paraguay. There is little information on the country´s aquatic ecosystems; nevertheless the upper basin of
the Parana River has been classified as a freshwater ecoregion of global significance. This significance
5
increases when taking into account the Paraguay-Parana complex, is a conservation priority due to the
diversity of fish species and certain large invertebrates such as river crabs and mollusks. The exact
number of endemic species in the country, and specifically in the UPAF is not known. The estimated
number of endemic or possibly endemic plant species is 136, of which 40 species would be restricted to
the UPAF.
Genetic resources and species of economic importance
6. Paraguay is part of the Brazilian-Paraguayan Minor Center of Origin, a center of origin for a number of
cultivated plant species of Latin America. The UPAF is an important source of genetic material for
species of economic importance such as anonas (Annona), guava (Psidium), manioc (Manihot), papaya
(Carica), peanut (Arachishipogaea), peppers (Capsicum), pineapple (Ananuscomosus), potato, rice and
tomatoes. The Department of Amambay is internationally recognized as center of origin of several species
of cultivated plants. For instance, the gender Annona comprises 7 wild species endemic to Paraguay and
mostly restricted to the Northeast of the Eastern Region. There a number of wild relatives of domesticated
plants believed to be endangered at national level.
7. Among the species of considerable economic importance that have a natural distribution in the UPAF
are yerba mate (Ilex paraguariensis), palm (Euterpeedulis) and stevia (Stevia rebaudiana). Yerba mate
leaves are produced and commercialized in Paraguay and the region since colonial times and are exported
to a number of markets in Latin America, North America, Europe and Asia. Palm hearts were originally
harvested from natural populations with little or no replenishment, which has contributed to diminish the
abundance of the species. Stevia rebaudiana is one of the 154 species of the gender and one of the two
species reported as producing the steviol glycoside used as sweetener. Of the known species of this gender,
16 have been reported as endemic to Paraguay. The economic significance of the Stevia rebaudiana has
notably increased both in Paraguay and abroad, and in 2006 it was declared by Presidential Decree as a
species of agricultural interest and a crop for diversification of agricultural production.
Protected Areas
8. The Government of Paraguay (GoP) has made important efforts to establish Protected Areas (PA)
within the UPAF. There are 24 public and private PAs covering a total surface area of 285,099 ha.
Seventeen PAs (67%) are located in the Departments of Alto Parana, Amambay and Canindeyu (Table 1)
covering 145,796 ha, as well as a Biosphere Reserve declared as such in 2000 by UNESCO.
Table 1. Protected Areas in the Departments of Alto Parana, Amambay and Canindeyu
Protected Area
Kuri´y National Reserve
Ñacunday National Park
MoisésBertoni Scientific Monument
TatíYupí Biological Refuge
Pikyry Biological Refuge
Mbaracayú Biological Refuge
Itabo Biological Reserve
Carapá Biological Refuge
Limo´y Biological Reserve
Tabucai Natural Reserve
Maharishi Natural Reserve
Maharishi II Natural Reserve
Surface (ha)
2,000
2,000
200
1,915
900
1,436
17,879
2,575
13,396
559
343
77
Department
Alto Paraná
Alto Paraná
Alto Paraná
Alto Paraná
Alto Paraná
Alto Paraná
Alto Paraná
Canindeyú
Alto Paraná
Alto Paraná
Alto Paraná
Alto Paraná
Management
Public
Public
Public
Itaipu1
Itaipu
Itaipu
Itaipu
Itaipu
Itaipu
Private
Private
Private
1
The Itaipu Bi-national Entity is the supra-national entity in charge of managing the Paraguayan-BrazilianItaipu Dam; it is in
charge of managing several protected areas located in the areaof influence of the dam.
6
Cerro Corá National Park
Arroyo Blanco Natural Reserve
Kai Ragüe Natural Reserve
Morombi Natural Reserve
Mbaracayú Forest Natural Reserve
5,538
5,714
1,859
25,000
64,405
Amambay
Amambay
Amambay/Concepción
Caaguazú/Canindeyú
Canindeyú
Public
Private
Private
Private
Private
9. Nevertheless, the majority of the forest remnants, estimated at over 2 million ha, are located in private
properties in the productive landscape and indigenous peoples´ lands.
2.1
Socio-economic context
National context
10. Paraguay is a country with medium human development with a Human Development Index of 0.669
in 2012. The population of Paraguay is 6,561,785 mostly young, with 66% under the age of 30. The
percentage of rural population in the country is still important with 43% of the total or more than 2.5
million inhabitants. The indigenous peoples represent 1.7% of the total population with slightly more than
112,000 individuals. Poverty currently affects 32.4% of the total population (2 million people).
11. The Paraguayan economy is small and highly dependent on the primary sector (agriculture, livestock,
forestry and fisheries). This sector is characterized by two very different production systems – family
agriculture and entrepreneurial farming - that co-exist throughout the country and more notoriously in the
Eastern Region. Family agriculture operates in reduced areas of land between 1 and 50 ha and is
characterized by the use of family labor, traditional production technologies, degraded soils and production
of mainly staple crops (i.e. maize, manioc, beans) and a limited number of cash crops (i.e. cotton, sesame,
sugar cane, tobacco). On the other hand, entrepreneurial agriculture (individual producers and private
enterprises) is mechanized and extensive, with a high level of technology, capital investment, availability
of diversified financial services, and commercialization based on supply chains that interact to generate a
significant level of exportable surplus (soy, maize, wheat, rice and to a lesser degree sunflower and
canola).The first three crops are normally produced in the same lands under a rotation system.
12. Favorable international markets for commodities have contributed to a widespread development of
entrepreneurial farming thereby contributing to an important growth of the Gross Domestic Product
(GDP), which passed from US$6.3 billion in 2003 to an estimated US$32.9 billion in 2013. The primary
sector accounts for 20% of the GDP, employs 26.4% of the economically active population and
contributes to 65% of the exports. Within the primary sector, agriculture represents 60% of the sectorial
GDP. Furthermore,both the secondary and tertiary sectors are highly dependent on the primary sector (i.e.
manufacturing of vegetable oil represents 15% of the industry sector and 60% of transportation services
revolve around agriculture); therefore around two thirds of the GDP is in practice related to the primary
sector. Soy and beef are the two leading commodities in terms of production and exports. In fact, within
the agricultural GDP, the share of soy ranges from 34% (in years with adverse climate) to 49% (years with
favorable climate). The share of beef varies between 14% and 21% depending on climatic factors.
Soy
13. Production: Soy was introduced in the 1960´s and cultivation began growing rapidly since the 1990s,
acquiring its greatest growth rates in the last 10 years due to the increasing international demand and
favorable prices. The cultivated area practically tripled between 1997 and 2012 passing from 1 million
hectares (ha) to 3.2 million ha2, and occupying 60% of the total agricultural area of the country. More than
70% of the cultivated area and 81% of farms that grow soy are located in Alto Paraná, Itapúa, Canindeyú
and Amambay.
2
Estimated by CAPECO (Paraguayan Chamber of Exporters of Cereals and Oilseeds) for the 2012/13 campaign.
7
14. The total volume of grains produced in the 2012 amounted to 14.4 million tons, with soybean
accounting for 9.4 million tons (65%), followed by maize and wheat, which together accounted for 5
million tons (34%). Paraguay ranks 6th among the first worldwide producers of soy. Production is
concentrated in medium and large-scale operations. According to the 2008 Agricultural Census, around
90% of the soy is grown in farms over 100 ha; 41% of the cultivated area corresponds to farms between
100 and 1,000 ha with an average of 224 ha, while another 41% corresponds to farms between 1,000 and
10,000 ha with an average of 1,511 ha. Cooperatives account for 15% of the total cultivated area 3, whilst
individual producers and private enterprises account for 85%.
15. Production is characterized by the use of large expanses of land, the high degree of mechanization and
intensive use of inputs and capital investment. Soy crops are planted from September to early February
and the harvest season depends on the variety; early-maturing varieties take 130 days to mature while latematuring varieties are harvested in 150 days. Around 90% of all soy is grown under a direct sowing
scheme that includes rotation with wheat and maize. Ninety percent of the soy is RR (Round-up Ready),
that is, genetically modified soy that is resistant to glyphosate. The combination of direct sowing and RR
technology implies an intensive use of agro-chemicals (fertilizers, insecticides, fungicides and herbicides).
Yields depend on climatic factors; the national averages range from 1,500 kg/ha/yr with unfavorable
climate to nearly 3,000 kg/ha/yr with favorable climate. Production cost in 2012 was US$700/ha with
estimated net incomes of nearly US$500/ha.
16. Financing: In 2012, the loan portfolio balance for soy amounted to US$245 million. This amount
represented 50% of the total agricultural portfolio (US$490 million). The private sector provided 95.7% of
the financial resources, whilst the public sector participated with only 4.3%.
17. Commercialization: Commercialization follows a simple circuit that originates in the producer, who
in general (90%), sells the grains to multinational commodity buyers and in a lesser degree to
cooperatives. In average, over 70% of production is sold as grain (3.2 million tons in 2012), between 2024% is industrialized (123,000 tons of oil) and 7% is used for seed4. Paraguay ranks 4th among the world
leading exporters with 5% of the worldwide export volume. Incomes from soy exports have ranged
between US$1.5 billion and US$3 billion between 2008 and 2012 depending on climatic factors.European
countries were the main buyers in 2012 absorbing 56% of exports (Germany: 28%; Russia: 13%; Spain:
8% Italy: 7%). It is estimated that important volumes of the exports to Argentina, Brazil and EU are reexported mainly to China (Paraguay does not export directly since it does not maintain official relations
with China). By-products such as oil and pellets are exported to other countries in South America and to
Asia.
Of the 40 exporting companies, five of them (ADM PARAGUAY S.A., CARGILL
AGROPECUARIA SACI; LDC PARAGUAY S.A.; NOBLE PARAGUAY S.A. and BUNGE
PARAGUAY S.A) are responsible for 90% of the exports.
Beef
18. Production: Cattle raising is a very traditional activity in Paraguay and has assumed an important role
within the national economy in the last decade. Between 2008 and 2012 the cattle stock increased 27%
passing from 10.5 million heads to 13.3 million heads with an annual average growth of 500,000 heads;
60% of the stock is located in the Eastern Region and 40% in the Western Region or Chaco. The 2008
Agricultural Census registered an increase of over 5 million ha of cultivated pastures compared to the 1991
Census. The highest growth rates both in number of heads and surface area of pastures in recent years
have been registered in Paraguay´s Western Region or Chaco. Expansion of soy in the Eastern Region,
which has displaced cattle raising in certain areas of this region, coupled with low land prices and absence
of social conflicts (squatting and rustling) have been key drivers of such growth. The greatest growth rates
in number of heads have varied between 50-70% in the Chaco compared to 28-33% in the Eastern Region.
3Federación
de Cooperativas de Producción (FECOPROD), Centro de información.
Cámara Paraguaya de Exportadores y Comercializadores de Cereales y Oleaginosas (CAPECO).
4www.capeco.org.py.
8
19. Livestock production is largely based on grazing systems (natural and cultivated pastures). Production
is carried out under three types of farming systems: i) small farms (less than 100 heads) with low use of
technology, where cattle are raised mainly for domestic consumption and occasional local sales; ii)
medium farms (100-500 head) with greater application of technology and access to assistance with
production being sold in local or regional markets, and iii) large ranches (over 500 head) specialized in
producing better quality animals for the local and international markets. This group of producers is well
integrated to the supply chains for domestic and international markets, have access to credit from private
and public banks and are responsible for the modernization of production through selection of breeds,
cattle management practices (health, nutrition) and the use of machinery and technology (ie. artificial
insemination, embryo transfer).Cattle are raised in 122,229 ranches and farms throughout the country.
Large-scaleproductioncomprises 2,411 ranches (2%) that concentrate 55% of the total number of heads.
Small-scale operations comprise 77,162 farms (58%), which raise only 5% of the total number of heads in
the country.
20. Financing of production: Between 2006 and 2013 (April) the balance of the loan portfolio for the
livestock sector in the financial system increased from US$166 million to US$1.1 billion. This represents
an increase of 581%. The livestock sector represents 12% of the total loan portfolio. The private sector
provides 92% of the financial resources, whilst the public sector is responsible for the remaining 8%.
21. Commercialization: The meat industry in recent years has been strongly geared toward export
production. Paraguay has exported an average of 190,831 tons in the last 5 years. In 2012 a total of
197,068 tons were exported for an amount of US$802 million, which places Paraguay as the 8th major
exporter in the world. The exported volume represented 97% of the total production; the remaining 3%
was destined to the domestic market. The Eastern Region participated with 42% of the exported volume
and the Chaco with 58%. Meat processing plants are responsible for supplying the international market
and commercialize surpluses domestically, whilst slaughterhouses solely supply the domestic market.
22. Export destinations are strongly dependent on sanitary issues; the presence or absence of Foot and
Mouth Disease (FMD) decides the destination and type of meat exported. The main markets for chilled
meat are Chile and Brazil. In 2010 the Chilean market represented 89% of the total exports and fell to only
0.3% in 2012 due to an outbreak of FMD. The Brazilian market in 2012 reached a share of 93% whilst in
2010 it represented 6%. The main destination of frozen meat is Russia, which purchased 80% of the total
exports in 2012.
23. Annex 3 includes more detailed information on the soy and beef supply chains.
Socio-economics of the Project Intervention Area
24. The project intervention area comprises the Departments of Alto Paraná, Amambay and
Canindeyu, located to the East and Northeast of the Eastern Region, bordering with Brazil and Argentina
(map in Annex 2). Their total surface area of 42,495 km2 represents 26.5% of the Eastern Region´s surface
and 10% of the country.
25. The Department of Alto Paraná is divided in 22 Districts and concentrates 10.8% of the country´s
population, with 67% living in urban areas. The population is mainly young with 70% having less than 30
years. The population affected by poverty in Alto Parana is below the national average, with 21% being
poor. The Department of Amambay is divided in 3 districts, and as in Alto Paraná, the majority of its
population is urban (67%). The department of Canindeyu is divided in 12 districts with 75% of its
population living in rural areas. Most of the population (70.2%) is under 30 years. Both Amambay and
Canindeyu have high indices of Unmet Basic Needs, among the highest in the Eastern Region. Table 2
below includes basic data on the three departments.
9
Table 2. Basic data of the Departments of Alto Parana, Amambay and Canindeyu
Department
Surface
Population
Unmet basic needs
area
Total
Men
Women
Access to
Sanitary
(Km2)
education
infrastructure
Alto Paraná
14,895
769,691
394,160
375,531
23%
27.6%
Amambay
12,933
125,474
63,289
62,185
33%
35.7%
Canindeyú
14,667
187,525
98,364
89,161
34%
29.7%
Source: DGEEC. 2002. Unmet Basic Needs: Population and Households Census
Housing
quality
18.5%
24.4%
31.3%
26. Major land uses: According to the 2008 Agricultural Census, agriculture and livestock production are
the two main land uses in the three Departments, covering 69% of their total surface area, although the
importance of each varies in each one (Table 3). Agriculture is the main land use in Alto Parana
accounting for 53% of the surface area, whilst livestock production accounts for 8%. Agriculture and
livestock are both equally important in Canindeyu with 39.6% of the land dedicated to agriculture and
34.6% to livestock production. Finally, livestock production is the main land use in Amambay covering
62% whilst agriculture represents 10% of land usage.
Table 3. Land uses in the Departments of Alto Parana, Amambay and Canindeyu
Department
Total
surface
area*
(ha)
Alto
1,489,500
Paraná
Amambay
1,293,300
Canindeyú
1,466,700
*DGEEC
** 2008 Agricultural Census
Agriculture
(annual,
perennial crops)
**
(ha)
791,494
134,925
581,266
Pastures**
(ha)
Native?
Forests
(ha)
Protected
Areas (ha)
Fallow
land**
(ha)
Other**
121,280
164,789
40,705
19,833
64,009
806,876
508,312
224,785
221,126
13,111
66,980
28,567
45,499
21,942
30,543
27. The surface area occupied by soy in the three Departments (1.3 million ha) accounted for 53% of the
total surface area grown in the country, according to the 2008 Agricultural Census. At departmental level,
soy represented 94% of the agricultural land use in Alto Parana, 76% in Amambay and 80% in Canindeyu,
that is, entrepreneurial farming is responsible for most of the agricultural land use in these departments.
Between 2008 and 2011 the cultivated area increased 11% (142,134 ha), reaching a total cultivated area in
2011 of 1,5 million ha. Moreover, the three Departments account for 38% of the total number of soy
producers in the country, or 10,641.
Table 4. Increase in surface area of soy – 2008/11
Department
Total
area *
(ha)
surface
Soy ** 2008
Agricultural
Census
(ha)
Alto Paraná
1,489,500
741,842
Amambay
1,293,300
102,789
Canindeyú
1,466,700
469,864
*Total surface area covered by the Census
** 2008 Agricultural Census
**DGEEC based on data provided by the MAG
Soy***
2011
(ha)
794,132
128,414
534,083
Increase
(ha)
52,290
25,625
64,219
Number of
producers **
7,,11
290
2,778
28. The total number of heads of cattle in the three Departments represents 16% of the country´s total
(2012). The stock augmented 23% between 2007 and 2012 passing from 1.68 million heads to 2 million
heads, with the most significant increases in Amambay and Canindeyu.
10
Table 5: Increase in heads of cattle – 2007/12
Department
Heads of cattle
2007*
Alto Paraná
Amambay
Canindeyú
* SENACSA.2012
Heads of cattle
2012*
229,535
804,966
650,099
Increase
258,748
995,391
818,793
Number
producers *
2012
29,213
190,425
168,694
of
3,545
2,077
6,671
29. Land tenure: Over 90% of the lands in Paraguay are privately owned. Land tenure differs when
analyzing family agriculture and medium/large producers; only 50% of the former category has a
definitive land title, whilst 80% of the latter have a title to the land. Medium and large scale farmers
number 5,649 in Alto Parana, Amambay and Canindeyu (14%), but own 90% of the lands (3.8 million ha),
whilst small producers number 34,897 (86%) and own 10% of the lands (424,950 ha). The three
departments are characterized by the presence of non-Paraguayan landowners. In the Department of Alto
Parana, 19.2% of individual producers are of Brazilian origin, 16% in Canindeyu and 6% in Amambay.
30. Indigenous Peoples: Several ethnic groups (Mbya, Ache, Paitavytera, Ava guarani and Maka) live in
the Departments of Alto Parana, Amambay and Canindeyu. Population is estimated in 32,378 individuals
distributed in 177 communities throughout the three departments, mainly Canindeyu.
Table 6. Indigenous peoples and number of communities.
Department
Total
Canindeyú
Alto Paraná
Amambay
13,484
7,042
11,852
Population
Men
Women
7,039
3,706
6,075
6,445
3,336
5,777
Total
Mbya
Communities
Ache PaiTavytera
106
33
38
20
13
0
4
1
0
4
0
35
Ava
Guaraní
78
18
3
Maka
0
1
0
31. Indigenous communities in general have very poor living conditions: illiteracy rates of 38.9%; only
1.4% have access to State water supply services; and the wages they receive are 35% lower than those of
the non-indigenous population. The main problems faced by indigenous communities are land access and
poor natural resources management. Economic activities combine hunting, fishing, and gathering with
subsistence agriculture and seasonal wage labor. Certain communities are successfully carrying out
agricultural production and are being integrated into markets. For instance, the Ache community of
KueTuvy in Canindeyu produce certified organic yerba mate in their forests, which is exported to the
USA5; whilst the Ache community of Puerto Barra in Alto Parana grow soy, maize and raise farm animals
that produce incomes for the community6.
2.1
Institutional, policy and legal context
Institutional context
32. Government: Governmental institutions with mandate over the environmental and productive sectors
include national and local level institutions directly related to the project. At national level, the National
Environmental System (SISNAM) comprises the governmental institutions (national, departmental and
municipal) and private bodies with mandates regarding the environment and provides an organizational
framework comprising two levels. The National Environmental Council (CONAM) provides the
5http://archivo.abc.com.py/2009-06-07/articulos/528936/indigenas-ache-inician-exportacion-de-yerba-mate-a-estados-unidos
6http://www.abc.com.py/edicion-impresa/economia/indigenas-ganan-us-277000-con-produccion-record-de-soja-y-maiz-
536981.html
11
platform for consultation, debate and definition of the national environmental policy, and the
Environment Secretariat (SEAM) which main purpose is to regulate functioning of the institutions in
charge of elaboration, normalization, coordination, execution and control of the environment. SEAM is
charged with conservation and sustainable use of the country´s natural resources; it is responsible for the
National Environmental Policy and a number of environmental laws. Specific responsibilities in regards to
conservation and production include the approval of environmental impact assessments and environmental
licensing, and environmental oversight and control of the measures included in each EIA. The Ministry of
Agriculture and Livestock (MAG) is responsible for promoting sustainable agrarian development; it
implements several programmes and projects, namely: the nationally financed National Programme for
Management, Conservation and Recovery of Soils and the National Programme to Support Family
Agriculture; the World Bank supported Sustainable Agriculture and Rural Development Project, and the
IFAD supported project Inclusion of Family Agriculture in Supply Chains. The MAG´s 2009-2018
Agrarian Strategic Framework has incorporated an environmental objective to promote environmentally
sustainable practices within the agrarian productive processes. The National Forestry Institute
(INFONA) is responsible for the National Forest Policy and its mandate covers the conservation of forest
resources. Specific responsibilities include the national forest inventory, the approval of forest
management and land use plans within the framework of the Forest Law 422/73, and oversight and control
of management plans. The Public Ministry(PM) is the body of independent public prosecutors in charge
of upholding justice. In regards to environmental issues the PM is responsible for investigating
denouncements and prosecuting violations to the Environmental Crimes Law 716/96; in 2009 it
established a Specialized Unit for Environmental Crimes. The Ministry of Industry and Commerce
(MIC) is responsible for the development of industry, commerce and services; it promotes national and
international investments and exports. One of the key initiatives of the MIC is the Investments and
Exports Network, through which the government and private sector work together to promote investments
and exports. The network comprises several sectoral programmes, among them forestry and meat.
33. Local level governments comprise Departments and Municipalities. Among the main responsibilities
of the Governmental Departments (Gobernaciones) are to coordinate with the national institutions and
the Municipalities the activities to be implemented within their territories; and to elaborate the
Departmental Development Plan. Gobernaciones are organized in Secretariats, among them
Environmental and Development Secretariats with responsibilities to promote environmental and
productive policies. Gobernaciones depend on funds transferred from the national budget. The
Municipalities are charged with responsibilities pertaining the environment and productive sectors,
namely the elaboration of sustainable development and land zoning plans; conservation and restoration of
natural resources; and the enforcement of national regulations (through agreements with the national
authorities). The degree of strengthening of Municipalities is directly related with its capacity to collect
taxes; hence in general they are stronger in areas where agricultural production is highly developed.
34. Private sector: The private sector involved in the soy and beef supply chains comprises a numerous
and diverse range of stakeholders, including producer organizations, cooperatives, industry-related
chambers, commodity exporters, and financial institutions. Key national level producer organizations are
the Association of Producers of Soy, Grains and Oilseeds of Paraguay (APS), the Paraguay
Agricultural Coordinator (CAP), and the Rural Association of Paraguay (ARP). The first two
comprise small, medium and large-scale agricultural producers, whilst the ARP represents cattle ranchers.
All of these organizations represent the interests of their respective sectors and pursue the well-being of
their members.
35. Cooperatives have a longstanding tradition in Paraguay, with currently 935 cooperatives nationwide
with over 1.2 million members (20% of the country´s population); of this total over 200 are production
cooperatives. These are organized at national level in the Federation of Production Cooperatives
(FECOPROD), which has the objective to promote the development and strengthening of its member
cooperatives. Production cooperatives offer a number of services to their members: financial and technical
12
assistance, grain storage, commercialization, and sales of inputs, equipment and machinery. Cooperatives
are responsible for 15% of the area cultivated with soy. Within the project intervention area cooperative
members grow soy, wheat, sunflower, canola, and raise dairy cattle, pork and poultry. Moreover,
cooperatives have an important share in financing of production (US$40 million in 2012).
36. The Paraguayan Chamber of Exporters of Grains and Oilseeds (CAPECO) and the Paraguayan
Chamber of Processors and Exporters of Oilseeds and Grains (CAPPRO) are the reference
organizations in regards to processing and exporting of grains and oilseeds. The Paraguayan Chamber
of Meat (CPC) on its part represents the meat packing industries and pursues the development and
strengthening of markets for meat produced in Paraguay. The Union of Production Organizations
(UGP) is an inter-organizational association comprised by 13 organizations (among them the abovementioned APS, CAP, ARP and FECOPROD), chambers and federations of the productive sector; it seeks
to represent the common interests of the members, to contribute to the sustainable development of
Paraguay; and to foster relationships with the public sector. Moreover, several of the above organizations
are members of the Agricultural Biotechnology Institute (InBIO), which has the objectives of promoting
research development in biotechnology and access to agricultural biotechnology-derived products.
37. Commodity exporting companies comprise an important number of grain exporting companies and
meat packers. However, five multi-national companies are responsible for 90% of the total soy exports:
ADM Paraguay S.A., CARGILL Agropecuaria S.A.C.I.; LDC Paraguay S.A.; NOBLE Paraguay
S.A. and BUNGE Paraguay S.A. These companies also provide financing to producers. The leading meat
exporting companies are Frigorifico Concepcion S.A., JBS Paraguay S.A., FRIASA S.A., Agrofrio
S.A., Carpediem S.A., Cooperativa Chortitzer Ltda.
38. Financial institutions: Banks, finance companies and cooperatives compose the financial system. The
public financial sector comprises the Financial Agency for Development (AFD), the National
Development Bank (BNF), the Livestock Fund (FG) and the Agricultural Credit (CAH). The AFD is a
second tier bank which channels a number of financial products to promote investments through both the
public and private financial institutions; in 2011 it enabled a credit line for afforestation/reforestation and
silvopastoral systems that are channeled through the BNF and FG. The BNF finances projects promoting
agricultural and livestock production, processing and commercialization; its main beneficiaries are
medium sized producers. The CAH on its part finances small producers that do not the meet the
requirements of the private banks and pursues the objective of enabling them to access loans by these
banks. The FG has traditionally financed investments and working capital for cattle production (mainly
large producers) although in recent years it has included minor farm animals in its loan portfolio.
Together, these institutions account for 10% of the global sectoral funding; in 2012 the balance of the loan
portfolio amounted to US$74 million. The private banks and finance companies are responsible for 90% of
the loans granted to the productive sector (balance of the loan portfolio of US$672 million in 2012). There
are some 20 banks and finance companies that provide loans to the productive sector, with the banks
Continental, Regional, Itau and BBVA having the larger share (>70%).
39. Non-governmental Organizations: Several NGOs are very active in promoting the conservation of
biodiversity and forest restoration in the UPAF. WWF Paraguay supports initiatives that address the
conservation and sustainable use of the UPAF through environmental education and awareness raising; it
implements forest restoration programs and monitors deforestation in the Eastern Region within the
framework of the zero deforestation law. Fundacion Moises Bertoni pursues the improvement of
livelihoods through conservation of biodiversity and sustainable development; it is well-known for
managing the Mbaracayu Natural Reserve as well as the Tapyta Reserve, both located in the UPAF. A
Todo Pulmon – Paraguay Respira was established in 2009 with the original goal of planting 14 million
trees, goal that was not only accomplished but also surpassed with over 40 million trees planted
13
throughout the country7. Its current goal is to recover 1 million ha of forests and has established a number
of agreements with public and private institutions. Guyra Paraguay´s mission is to conserve and promote
sustainable use of biodiversity; it is well known for its conservation efforts addressing the identification
and promotion of Important Bird Areas. The organization has acquired 4,000 ha in the UPAF for
conservation purposes, where it has established the GuyraReta Natural Reserve. The Paraguayan
Network for Conservation in Private Lands fosters the establishment of natural reserves by private
landowners for protection and sustainable use of biodiversity.There are several national level NGO
networks which members develop initiatives in the environmental and social fields within the UPAF. Key
networks include the Network of Environmental NGOS, the Rural Network of Private Development
Organizations.
40. Community-based Organizations: Indigenous communities in the three Departments are organized in
18 organizations, 11 of which represent communities in the Department of Canindeyu, 2 of them in
Amambay and 5 in Alto Parana. These organizations in turn are members of two national level
organizations: the Federation for Self Determination of the Indigenous Peoplesand the Federation of
Associations of the Guarani People of Paraguay. Small family farmers are organized in several types of
organizations being the most relevant in terms of number of members and geographical scope the
Associations and Cooperatives, which number 36 in Alto Parana, Amambay and Canindeyu. The
associations in turn are generally members of national level organizations such as the National
Federation of Small Farmers.
Policy and legal context
41. The National Constitution is the highest in the hierarchic level of the country’s code of laws; it
recognizes the right of the inhabitants of Paraguay to life in a healthy and ecologically balanced
environment. In addition, the National Constitution declares as of “social interest” the preservation,
conservation and improvement of the environment, and its reconciliation with human development.
42. Key policy developments regarding the environment comprise the National Environmental Policy, the
National Forest Policy and the Policy and Program for Agricultural and Forestry Biotechnology. The
National Environmental Policy (2005) seeks to conserve and manage the use of Paraguay´s natural and
cultural heritage in order to guarantee the sustainability of development, equal benefit-sharing,
environmental justice and livelihoods of the population. The policy also establishes its operational
instruments: strategic environmental assessment, environmental audit, quality norms, control and
surveillance system, citizenship, and economic-financial and promotion instruments.
43. The National Forest Policy (2009) has the overall goal of improving the contribution of the forestry
sector to the sustainable economic growth of Paraguay through institutional strengthening, improvement of
the legal framework, sustainable forest management, afforestation and reforestation, financing and
incentives, industry competitiveness, control, research, capacity building and awareness raising. The
Policy and Program for Agricultural and Forestry Biotechnology (2011) was developed with the
objective of promoting access to, and facilitating availability of knowledge and production technologies
that benefit the society as a whole. Key strategic developments include SEAM´s National Biodiversity
Strategy and Action Plan (2003), the MAG´s 2009-2018 Agrarian Strategic Framework and the
INFONA´s 2009-2015 Strategic Plan and National Afforestation/Reforestation Plan.
44. There are a number of laws that set the legal framework for environmental protection and
management in the productive landscape and have a direct relation with forests. The Forest Law Nº422
(1973) is one of the first legal instruments passed with the objective to protect, conserve, increase, restore
and sustainably use the forest resources of the country, as well as the ecosystem services provided by the
7
http://www.atodopulmon.org/
14
forests. The Environmental Impact Assessment Law Nº294 (1993) regulates the impact assessment
procedure for projects that may have significant impact on the environment, including – among others agricultural, livestock production and forestry activities. The Reforestation Law Nº536 (1996) established
State-funded economic incentives for afforestation/reforestation. The Environmental Crimes Law Nº 716
(1996) has the purpose of protecting the environment and livelihoods against activities that threaten
ecosystem balance, sustainability of natural resources and life quality. The Agrarian Statute Law Nº1863
(2002) guarantees the private property, identifies the social, economic and environmental function of the
land, and sets land use criteria for the agrarian reform.
45. Given the significant rates of deforestation in the Eastern Region and especially in the UPAF since
the 1960´s, the so-called Zero Deforestation Law Nº2524 was passed in 2004 establishing a moratorium
on the conversion of forested lands to other uses (agriculture and pastures). The law was successively
extended in 2006, 2008 and 2013and is currently in force until 2018. As a means to incentivize
conservation of forest remnants, the Valuation and Retribution of Environmental Services Law
Nº3001(2006) was passed with the objective of promoting conservation, protection, recovery and
sustainable development of the country´s biodiversity and natural resources through payments for
ecosystem services. More recently, the Fire Prevention and Control Law Nº4014 and the Restoration of
Watercourses Protective Forests8 within the National Territory Nº4241 were passed in 2010. The
former establishes regulations for managing and controlling the use of fire in productive activities whilst
the latter seeks to conserve and restore protective forests in the Eastern Region and the compliance of
measures for environmental protection of water resources in the Western Region (Chaco). The recent
Forest Land Real Property Rights Law Nº4890 (2013) seeks to incentivize reforestation by providing
legal guarantees to forestry investments including in third party properties not owned by the investor.
46. These laws are of administrative nature with the SEAM and INFONA as the enforcement authorities
except for the Agrarian Statute, which falls within the authority of the National Institute for Rural
Development and Lands (INDERT). The Ecological Crimes Law is the only penal law and falls under the
mandate of the Public Ministry. Two additional laws to be taken into account at territorial level are the
Departmental Government Law Nº426 (1994) and the Municipal Government Law Nº3966 (2010).
Both of these laws establish the roles and responsibilities of Departmental and Municipal governments,
including in the environment and productive sectors.
Part 1.B Baseline Analysis
2.1 Threats to globally significant biodiversity and determinants of land degradation
47. Paraguay has taken steps to bring under protection core areas for biodiversity conservation and
implement sustainable land and forest management throughout the country. However, as mentioned
previously the majority of the remnants of the UPAFare in production landscapes. The integrity of these
ecosystems in the productive landscape and their ecosystem services are being threatened mainly by land
use changes, fragmentation and degradation of forests, and unsustainable agricultural practices.
Land use changes
48. There are several threats to biodiversity in the UPAF, driven by combined social, political and
economic factors. Conversion of habitat due to the expansion of the agricultural frontier has historically
represented the main threat. The deforestation rates over time provide a clear picture of the magnitude of
these land use change processes in the region.
49. The original forest cover of the Eastern Region was estimated at 9.4 million ha before 1940.The
Eastern Region and especially the UPAF traditionally bore the pressure of development. Until 1940,
8
The Forest Law stipulates that a 100-meter strip of forest must be left at each side of streams and rivers for protection purposes.
These forest strips are called protective forests.
15
deforestation in the UPAF was the result of selective logging and harvesting of yerba mate. The
establishment of settlements and clear-cutting for agriculture began increasing after 1940. By 1945 the
forest cover had been reduced to an estimated 8.8 million ha. The development model promoted by
successive governments since the 1960s privileged agriculture and livestock production and therefore land
use policies and programmes have been biased toward such production without considering the value of
forests, hence leading to increasing rates of deforestation. Moreover, technical assistance and credit
programmes promoted land clearing for agriculture and livestock production, therefore constituting
“perverse” incentives.
50. The agrarian reform policy of 1967was inadequately implemented addressing only land tenure; it was
limited to the distribution of forestlands to campesino farmers. Without technical and financial assistance
for agricultural production most of the campesino farmers deforested their lands; sold the timber and then
the property rights to larger owners with purchasing power. This, together with the inadequate distribution
of lands lead to a process of squatting of private properties by land-less campesinos as a means of claiming
their rights to lands, especially in the 1980s and 1990s. Due to squatting large landowners deforested their
lands as a means to protect their property rights. By the 1990s the forest cover had been reduced to 3.5
million hectares (40%). The rate of deforestation between the 1990s and the 2000s was of 38.9%. The
estimated coverage in 2011 amounted to 2.6million hectares or 26% of the original surface area. Of the
remaining UPAF forest cover, between 0.8 and 1.2 million hectares are considered to be productive
forests9.
51. Moreover, indigenous communities, out of necessity and being compelled by pressure from wood
demand have deforested portions of their forests to sell wood. In recent years, some communities have
leased their lands to soy growers, thusprobably contributing to the further removal of forest cover.The socalled Zero Deforestation Law passed in 2004 in force for the EasternRegion has contributed to slow down
the rates of deforestation by 85%. (20,000 hectares in 2005, 6,400 hectares in 2006, 5,600 hectares in
2007, 9,503 hectares in 2008, 6.230 ha in 2010 and 12.017 ha in 2011); but has not halted it completely
(see barriers section for further information).Table 7 below includes the forest cover, the historical
deforestation rates for the project intervention area during the 1984-1991 period and the coverage for each
department in 2011, as per preliminary data from the ongoing National Forest Inventory10.
Table7. Deforestation and Forest Cover in Alto Parana, Amambay and Canindeyu
Department
Alto Paraná
Amambay
Canindeyú
Deforestation*
1984-1991
(Km2)
4,637.17
1,454.00
3,015.38
Forest Cover *
1991
(Km2)
3,902.26
4,423.90
6,699.64
Forest Cover **
2011
Km2
2,318.95
3,044.94
3,703.07
*Huespe Fatecha et al. 1994. ** INFONA. Preliminary Data of the National Forest Inventory. 2012.
Fragmentation and degradation of forests
52. Besides habitat loss directly related to deforestation, fragmentation of remaining natural forests and
ecosystems is another threat to the conservation of biological diversity. Fragmentation results in isolation
of the remnants and the alteration of forest microclimates, reducing the presence of certain species and
favoring others.
53. While there are no detailed studies on the rate of fragmentation of the remaining forests in the Eastern
Region, preliminary data from the National Forest Inventory show a difference of about 1 million ha of
9Forest
10
land that is capable of producing a merchantable stand within a defined period of time.
INFONA/SEAM. Preliminary map of forest cover. 2011
16
forest cover in this region depending on the minimum sampling areas used; 2.6 million ha for sample areas
of 1 ha and 1.6 million ha for sample areas of 200 ha (map in Annex 2) The simple observation of these
remnants and minimum areas provides an idea of the high fragmentation of forests. The analysis of the
number of forest fragments with areas greater than 10,000 ha shows that there are only 3 fragments in the
Department of Canindeyú, 2 in Amambay and none in Alto Parana.
54. Forest degradation is closely related to fragmentation. The direct drivers of degradation include
overgrazing in forests and extraction of timber for firewood. In terms of overgrazing in many cattle
ranches the forest remnants are used as livestock shelter, which reduces the natural regeneration of forest
species and in some cases completely eliminates certain understory species. Overgrazing in forested areas
also favors the invasion of exotic grasses, many of which are considered invasive. In the case of timber,
degradation occurs as a result of unsustainable forestry management practices. Requirement to submit
management plans for forestry began only in the 1990s and even now is not fully implemented because the
administrative structure and lack of staff in the former National Forest Service and the current National
Forest Institute (INFONA) have turned the plans into bureaucratic tools that do not facilitate the promotion
of forest management. Selective logging for firewood is without doubt one of the most visible causes of
degradation and in some cases of punctual deforestation. In Paraguay, the energy matrix clearly shows a
dependency on biomass (wood and charcoal mainly), which together represents 48% of the final energy
consumption in the country. The percentage increases to 51% when adding the energy produced by other
vegetable residues. Although 96.3% of the rural population has access to electricity, 64.1% of rural
households use firewood for cooking.
Unsustainable agricultural practices
55. Forests and natural ecosystems are critical to maintaining water quality and control erosion. In the last
thirty years, the advance of the agricultural frontier on forests has greatly impacted on the water quality in
the region. For instance, in the area of influence of the Itaipu Dam reservoir, very low transparency values
of less than 0.5 m have been reported for some tributaries of the Parana River (i.e. Piratiy and Carapa
rivers), while studies in forested areas such as Itabó and Limoy mentioned transparency values above 2 m.
56. According to studies, in 1997, Paraguay lost almost 10.6 million tons of soil through conventional
agriculture on medium to large sized mechanized farms, while areas under conservation agriculture only
lost around 254,000 tons of soil as a result of erosion. Although the country has made progress in
upscaling conservation agriculture practices and, as aforementioned, around 90% of soy is currently
cultivated through direct sowing, the cost of soil erosion is still not widely known, nor are the substantial
benefits of conservation agriculture appreciated. More recent studies indicate that degradation processes
affect 16% of the national territory, affecting 66% of the country´s population.
57. In addition to soil loss, the large-scale mechanized farming has been associated, in many cases, with
the indiscriminate use of agro-chemicals (pesticides and herbicides). Over 30 million kg of pesticides and
herbicides are imported in Paraguay every year. As approximately 90% of the soy produced in Paraguay is
transgenic Roundup Ready (RR), most fields of RR soy are fumigated with herbicides (2 liters/Ha of
Glyphosate), killing all the weeds. Agro-chemical runoffs contaminate water bodies. Tributaries of the
Paraná River such as the Pirapo, Tembey and Ñacunday rivers that cross the areas where this type of
farming is predominant, present maximum levels of chlorinated products. Moreover, high values of heavy
metals such as soluble lead, soluble chromium and soluble mercury have been recorded in the Pirapo
River.
58. Fire is commonly used in livestock production as a tool for pasture renovation, and its misuse may be
highly destructive and potentially dangerous to maintain the diversity of the remaining forests.
Uncontrolled fires have caused numerous forest fires and in some cases loss of lives. For instance, during
the 2007 drought, more than 1 million ha were affected by the fires in Paraguay, including large areas of
17
forests in the East of the country. Studies conducted after these fires concluded that the fires had a higher
degree of severity in forest areas with high levels of disturbance, which in turn affects the recovery of
these areas by damaging the seed bank. In the North and Northeast of the Eastern Region, including the
Departments of Amambay and Canindeyu, fire is also used to clear patches in forest areas to grow illegal
crops (Cannabis sativa).
59. These threats pose risks to ecosystem services provided by the UPAF such as fresh water. The
Paraguayan portion of the Guarani Aquifer, the largest underground freshwater reserve in the world is
located in the East of the country coinciding with the area of the UPAF, where over 2 million inhabitants
reside and make use of the aquifer´s water supply. Other ecosystem services affected include soil
formation; nutrient cycling processes essential for soil fertility; maintenance of the hydrological cycle;
control of flooding and carbon storage.
2.1
Long term solution – the GEF entry point
60. The increasing food deficit worldwide linked to the growing world population and persistence of a
growing demand of food by countries of high economic growth, such as China and India sets a promising
scenario for agricultural producing countries. Paraguay is an important player in the worldwide commodity
market; it is the 6th most important producer and the 4th largest exporter of soy; and the 8th largest meat
exporter. Moreover, the country is expected to become in 2013 the 6th largest maize exporter.
61. According to a 2010 UGP study, agricultural lands currently under use cover 4.9 million ha and there
is potential for expansion in an additional 2.8 million ha (mainly soils with agricultural aptitude under
other uses, i.e. pastures and fallow land). The additional land, combined with a favorable climate and
biotechnology, would allow increasing production and improving the country´s position as a worldwide
food producer and exporter. Representatives of the soy supply chain have estimated that expansion will
continue on the basis of recovery of degraded soils, displacement of livestock production toward the
Chaco as well as the exploration of agricultural lands in the Chaco. Also it is estimated that Paraguay will
increase its meat production capacity by 46% and will increase its exports by 52% in the next ten years.
By 2015 the cattle stock is expected to increase to 15 million head and exports would reach 400,000 tons.
Expansion of cattle production will mainly occur in the Chaco.
62. However, the expansion of production has been historically associated with the depletion of natural
resources. Projected potential increases in the surface areas of soy and pastures without mainstreaming
sustainable use practices pose further risks to biodiversity and ecosystem functions. Moreover, the
expansion of the surface of soy is criticized by the public opinion as a driver of deforestation,
environmental impacts, health hazards, displacement of small farmers and indigenous communities whose
lands are purchased or leased by soy growers, and increase in land prices. Moreover, relations between
medium and large-scale farmers, and vulnerable populations (family agriculture and indigenous peoples)
are fragile and conflictive due to prejudices regarding production models; entrepreneurial agriculture is
seen as a driver of poverty and decreasing food security and sovereignty. Livestock production in the
Eastern Region is being negatively impacted by the increasing degradation of soils and pastures and loss of
productivity, and competition for lands with agriculture is increasing with the concomitant risk
displacement to marginal areas of the UPAF and to the Chaco11, hence increasing the deforestation rates in
this region.
63. Expansion of soy and livestock production may represent either an opportunity or a threat to
biodiversity conservation and sustainable land management. On one side, it could represent an opportunity
to generate wealth and reduce poverty through adequate policy decisions, sustainable production systems
11
During the 2010-12 period 786,826 ha were deforested in the Chaco (average of 262,265 ha/yr) according to monitoring data by
the NGO Guyra Paraguay
18
and integration of family farmers into the supply chains (i.e. use of soy and other grains in pork and
poultry productionand incorporating cattle and minor farm animals into the meat supply chain). On the
other side, it could represent a threat if expansion of these activities continues to be carried out without due
consideration of the environmental costs involved and the potential socio-economic effects of the
marginalization of small-scale farming.
Long term solution
64. While there are several initiatives seeking to reduce threats to the UPAF, most of these are not
adequately coordinated and focused to address the multiple and conflicting land uses across the landscape
and to reduce pressures on biological diversity and address land degradation. The country lacks a robust
planning and management framework that specifically integrates sustainable forest management (SFM)
biodiversity conservation and sustainable land management (SLM) needs into the land use planning and
management systems and product supply chains that determine the use of forest landscapes. The proposed
long-term solution is thus to put in place a collaborative governance mechanism combined with market
based incentives and build the know-how for appropriate management of the landscape to effectively
mainstream biodiversity and sustainable land management into production sector operations. This
strengthened governance system combined with the model practices in the UPAF will be instrumental in
assisting the Government of Paraguay (GoP)to apply such land use practices across the other biomes and
bioregions of Paraguay, especially the Chaco.
65. Both the GoP and key stakeholders (private sector and NGOs) are making important efforts to
advance this long-term solution that provide a basis on which GEF support can build. This includes a
significant advances in the environmental laws regulating land uses and forestry (see Context) as well as
specific programs and investments planned for the project lifetimes. The baseline investment is valued at
US$46,291,175 over 5 year and is described below grouped under the main lines of interventions of the
project..
Governance framework for managing multiple use landscapes (MUL)
66. Sustainable land zoning and reduction of pressures on biodiversity within the UPAF is one of
SEAM´s key priorities through the Directorate General for Control of Environmental Quality and Natural
Resources and the Directorate General for Protection and Conservation of Biodiversity. These directorates
implement the Program for Control of Environmental Quality and Natural Resources and the Program for
Protection and Conservation of Natural Resources, with an estimated budget of US$3,285,762 for the
targeted departments over a five-year period12. These programs are related with implementation and
enforcement of a number of laws, among them the Forest, Environmental Impact Assessment, Protected
Areas and Wildlife laws and deal with approval of environmental impact assessments; issuance of permits;
control, oversight and monitoring; establishment of protected areas; and conservation and sustainable use
of biodiversity. The project will build on these programs to strengthen SEAM´s capacities for planning,
monitoring, surveillance and enforcement of regulations.
67. SEAM is implementing the project Forest Preservation, with the financial support of the Government
of Japan. This project supports the strengthening of capacities of SEAM, INFONA and the University of
Asuncion for measuring carbon benefits in protected areas through laboratory infrastructure, equipment
and supplies with a budget of US$5,285,651. The infrastructure and equipment will be integrated into the
monitoring system to be developed by the GEF project. Both projects will coordinate measurement of
carbon benefits in GEF project intervention areas.
18% of total allocated amount (3 departments out of 17) based on Annex 2 – Law 4848 National Expenditure budget. Fiscal
year 2013.
12
19
68. INFONA´s key priority is sustainable forest management and to this effect it implements several
programs related to the Forest Law and the Reforestation/Afforestation Law: Forest Resources
Management; Forest Plantations; Forest Education and Extension; and National Operational Services.
These programs include a number of related activities such as approving management plans for native
forests and reforestation/afforestation; implementing the National Forest Inventory; control and monitoring
of forestry plans; promoting reforestation/afforestation, sustainable management of native forests, agroforestry and silvo-pastoral systems, and establishment of tree nurseries through training and awarenessraising. The institution´s estimated budget over a five-year period to implement these programs amount to
US$5,510,09013. The project will build on these programs to strengthen SEAM´s capacities for planning,
monitoring, surveillance and enforcement of regulations. INFONA has several Regional Offices in the
project intervention area: two offices in Canindeyu, one in Alto Parana, and one in Amambay; as well as a
Forestry Training Center in Alto Parana. These offices will participate in the monitoring and surveillance
schemes to be developed by the project and piloted in the field. In 2012, INFONA elaborated the National
Reforestation Plan14 with the objective to promote 450,000 ha of multiple-use forest plantations. The plan
includes reforestation/afforestation under Law Nº536/96, institutional strengthening, public-private
partnerships and simplification of procedures. INFONA is working in the identification of sources of
financing for the plan. INFONA is also developing a Strategic Plan to improve the Competitiveness of the
Forestry Sector. This 15-year plan has the objectives of promoting 450,000 ha of high productivity
industrial forest plantations; sustainable management of 1-2 million ha of native forests; and the
establishment of timber processing industries. The project will prepare guidelines for restoration of forest
set-asides and river banks with mixes of native species appropriate to different localities within the UPAF
that these programs may upscale to other areas of the region.
69. In 2009 the MAG established the Commission for Good Agricultural, Livestock and Forestry
Practices. This Commission is set up as an inter-institutional body to promote adoption of best practice in
these sectors and it is composed by MAG, SENAVE, SENACSA, INFONA, the National Institute of
Technology, Standardization and Metrology (INTN), MIC, the National Food and Nutrition Institute
(INAN), private sector and IICA. The Commission provides technical support to international trade
related negotiations on agricultural production and best practices and has promoted the development of
best practice manuals by SENAVE. The Commission will integrate the national platform to be established
under the project. The project will build upon work by the Commission on best practices to develop soy
and livestock best practices manuals.
Financial and market incentives framework to protect biodiversity and promote sustainable land
management within MUL
70. The GoP has established a suite of direct or indirect incentives for biodiversity conservation and
sustainable land management with the enactment of laws that incorporate tax breaks, refunds for
afforestation and reforestation programs, and quotas for wildlife utilization. Furthermore, it is considering
measures to promote carbon sequestration, forest certification, conservation easements and the production
of organic crops. The main laws incorporating incentives for conservation and sustainable use are:
Protected Areas Law No. 352/94; Promotion of Reforestation/Afforestation Law No. 536/95; Wildlife Law
No. 96/92; Agrarian Code No. 1863/01; Environmental Services Law Nº3001/06; Law 3703/09 which
allows deductions of costs from establishment and management of forests; and the Forest Land Real
Property Rights Law Nº4890/13. The project will support strengthening and updating of several of these
laws, namely the Environmental Services Law and the Promotion of Reforestation/Afforestation Law.
71. There are several ongoing traceability and certification initiatives within the soy and meat supply
chains. Two companies Desarrollo Agricola del Paraguay (DAP) and Colonizacion y Transformacion
13
14
Annex 2 – Law 4848 National Expenditure budget. Fiscal year 2013.
Decree 10174/2012 declares of national interest the National Reforestation Plan.
20
Agraria S.A. (CYTASA) have been implementing soybean certification under the Round Table for
Responsible Soy (RTRS) scheme, with some 23,000 ha certified annually. Although these initiatives are
not located in the UPAF their experience and lessons learned will be useful to the GEF project.
Commodity buyers have promoted certification under the ISCC scheme in around 65,000 ha. Certification
costs for these areas under certification amount to an estimated US$44,000 for a 5-year period. In the
livestock sector the Paraguay Traceability System (SITRAP) was established in 2004 to provide
safeguards to international markets of meat that require traceability to ensure compliance of sanitary
measures. Ranches participating in SITRAP in the departments of intervention represent 7% of the total
participating ranches in the country (10 in Alto Parana, 21 in Amambay and 21 in Canindeyu).Commodity
buyers have begun to implement corporate sustainability programs that include certification (ISCC
scheme). These programs comprise an initial diagnosis following sustainability requirements as per
European Union regulations and elaboration of an action plan by the producers. The action plan usually
contains improvements in infrastructure for production and the enterprises provide training in health,
safeguards and environment as well as assistance in best practices. Estimated investments during project
lifetime will amount to US$750,000.The project will build upon these experiences to develop training and
outreach to upscale certification schemes of soy and increasing the supply of certified products for the
international market.
72. The financial sector has granted priority to the productive sector in the last years with increasing
disbursements of loans as afore-mentioned in the description of the soy and beef supply chains. The main
private banks financing the sector are Regional, Continental, BBVA and Itau, which are responsible for
providing more than 70% of the loans. Lending involves an administrative workload of transactions and
analysis that represent costs for the financial institutions. These procedures currently do not involve
environmental standards.Sudameris Bank, VisiónBanco, Continental and Regional have launched a
Paraguayan Roundtable for Sustainable Finance. The objective of the initiative is to promote best
environmental and social practices in the financial sector. The Roundtable is envisioned as a platform of
collaboration, where the members, beyond risk management, will reach out to their clients to stimulate and
finance investments with positive environmental and social impact and thus contribute actively to the
sustainable development of the country. The project will build upon this incipient initiative andhelp the
Roundtable members and other financial institutions to mainstream environmental criteria into their
lending procedures and increasing funding for sustainable production.The administrative costs constitute
the baseline that the project will build upon and have been estimated in US$5,250,000 for loans to be
disbursed to the three Departments of intervention.
73. WWF implements the Paraguay Land Use Project in Alto Parana (2012-2015) to support REDD+
initiatives and payment for environmental services under the Environmental Services Law Nº3001/06. The
budget for the period coinciding with the GEF project is US$840,000. The project will share experiences
and methodologies with this project.
Implementation of land set asides and sustainable production practices
74. The MAG implements the National Program for Management, Conservation and Recovery of Soils,
which has the objective of promoting recovery and maintenance of soil fertility; it seeks to promote
conservation agriculture through training of technicians and small farmers as well as partnerships with
medium and large size farmers. The estimated budget of the program is US$2.3 million15. The National
Program to Support Family Agriculture Food Production is a 10-year program (2010-20) targeting small
family farmers; it promotes diversification of staple and cash crops, and the improvement of nutrition,
local economies and livelihoods. The budget of the program for the intervention area amounts to
15
Annex 2 – Law 4848 National Expenditure budget. Fiscal year 2013
21
US$10,135,67216. The MAG has developed the National Strategy for Promotion of Organic and Agroecological Production in Paraguay, with the objective of improving environmental management in the
productive sector; its goal is to increase organic and agro-ecological production hence increasing
competitiveness and access to national and international markets. Within the framework of this strategy,
the National Plan for Promotion of Organic and Agro-ecological Production was launched in 2012. The
project will develop best practices for natural resources management and sustainable production of soy and
livestock that will be mainstreamed into these programs, thereby ensuring that they take into account
biodiversity considerations.
75. The Departments of Alto Parana and Canindeyu fall within the area of influence of the Itaipu Dam.
Itaipu is responsible for managing a number of protected areas (6 covering 43,084 ha) as well as protective
forests in the buffer zone of the reservoir (31,226 ha). It implements a soil conservation program to reduce
the risk of sedimentation of the reservoir as well as reforestation and restoration programs of water springs,
protective forests of watercourses and the buffer zone of the reservoir with an estimated budget for 5 years
of US$9 million. The project will coordinate with these programs so that they engage in replication of
best practices for soil conservation, and restoration of forest set-asides and protective forests of
watercourses.
76. The producer associations carry out several types of initiatives to support their members. For instance
the APS, which has some 2,500 members, has recently begun to implement the Project Restoration of
Degraded Areas to promote the restoration of protective forests in the lands owned by members.
Moreover, the APS has elaborated a Best Practice Manual for soybean. CAPECO jointly carries out
punctual training activities on direct sowing with the MAG´s National Soil Program, targeting medium
and large producers. The Paraguayan Federation of Direct Sowing is currently being re-activated; its
objective being to promote direct sowing as a best practice to ensure proper soil conservation and
management. FECOPROD provides a number of services to its members, including digital cartography
for location of clients, properties and plots, mapping of land uses (calculation of surface areas, thematic
maps and land use maps); it also provides assistance in soil recovery and fertility through a pilot Project
Maintenance of Degraded Soils, under implementation since 2012 with a budget of US$100,000 and a
goal of reaching 12 cooperatives and 5,000 ha. FECOPROD has elaborated a Forestry Strategic Plan and
has established a Forest Board with the key objective of promoting reforestation for energy to ensure
supply of fuel wood among member cooperatives. Nine of FECOPROD member cooperatives are located
in the Departments of Alto Parana, Amambay and Canindeyu: i) Coop. de Producción Agropecuaria e
Industrial Raúl Peña; ii) Coop. de Producción Agropecuaria e Industrial Unión Curupayty; iii) Coop. de
Producción Agropecuaria Naranjal; iv) Coop. de Producción Agroindustrial Santa María; v) Coop.
Multiactiva de Producción Agropecuaria e Industrial Naranjito; vi) Coop. de Producción Agropecuaria
Pindó; vii) Coop. Yguazú; viii) Cooperalba; ix) Coop. Zacatecas. Cooperatives provide their members
with technical and financial assistance for production. Among the relevant initiatives implemented by
these cooperatives in regards to conservation and management of natural resources is the Association for
Sustainable Agriculture of the Naranjal Production Cooperative. This association is comprised by a group
of professionals and members of the cooperative that promotes conservation agriculture, including crop
rotation, reforestation, direct sowing and soil conservation. The Santa Maria Cooperative has established a
tree nursery to promote tree planting among its members and inhabitants of the cooperative´s area of
influence. The project will develop training and outreach for these stakeholders so that they mainstream
best practices and biodiversity conservation considerations in their technical assistance programs and
promote adoption of sound environmental practices within the target landscapes.
77. NGOs have traditionally worked in conservation and restoration of the UPAF and have in recent years
promoted the involvement of landowners in the establishment of private reserves and restoration.
16
Annex 2 – Law 4848 National Expenditure budget. Fiscal year 2013
22
Fundacion Moises Bertoni manages the Mbaracayu Natural Reserve in the Department of Canindeyu and
implements a sustainable development program targeting small farmers and indigenous communities in the
area of influence of the Reserve, with an estimated budget of US$2.5 million during project lifetime.
ATodoPulmón – Paraguay Respira has been successful in raising awareness of Civil Society on the need
to recover forests; it implements the Project Reforesting the Monda-y with financial support of USAID and
the Sudameris Bank (2012-2015) with a budget of US$1.2 million. The project supports family farmers,
indigenous communities, medium and large producers pursuing to restore at least 10,000 ha of forests in
the Monda-y River basin by 2015. Guyra Paraguay implements a research project in Alto Parana and
Canindeyu to promote the conservation of the Vinaceous Amazon parrot (Amazonavinacea).Alter Vida
implemented the project to study the impact and environmental damages of soy crops in Alto Parana and
Canindeyu. This project has ended but it could provide useful baseline information regarding the use of
agro-chemicals and their impact on soil, vegetation and water, as well as the degree of compliance of
regulations and possible gaps in the legal framework on the subject. The Paraguayan Network for
Conservation on Private Lands include several NGOs (Fundacion Moises Bertoni, Guyra Paraguay,
IDEA and 25 landowners (farmers and ranchers) in Alto Parana, Amambay and Canindeyu. Landowners
have established 6 private reserves in these departments (33,552 ha). The organization´s estimated budget
to provide specific support to maintenance of reserves amount to US$90,000; the landowners cover the
remaining costs. The project will share experiences and methodologies that can be replicated by these
stakeholders within their programs and projects.
Gaps in Biodiversity Conservation and Natural Resources Management
78. Through these baseline initiatives, the GOP has demonstrated commitment to conservation of
biodiversity and natural resources management. However, gaps and inconsistencies remain. Barriers need
to be overcome before biodiversity conservation; SLM and SFM can be adopted in Paraguay at scales that
could generate significant national and global benefits. These barriers include: (i) Overall governance,
policy and regulatory frameworks are ineffective in limiting natural habitat conversion into farmlands; (ii)
Insufficient economic incentives to incorporate sustainable environmental management practices into
economic activity; and (iii) Limited institutional and individual capacity to enforce land set-asides
regulations, or adoption of sustainable practice standards.
Barriers to long-term solution
Barrier #1: Overall governance, policy and regulatory frameworks are ineffective in limiting natural
habitat conversion into farmlands.
79. Weak capacity for implementation and enforcement of the legal framework: Although the legal
framework is profuse, there are contradictions and gaps that affect the proper implementation and
enforcement of environmental laws that seek the sustainable management of natural resources to conserve
biodiversity and ecosystem functions in multiple use landscapes. These past and present inconsistencies
are:
 The Forestry Law 422/73, establishes the obligation to maintain a legal reserve of natural forests –
commonly referred to as set asides, and riverine forests (called protective forests in the law).Until
recently, there were serious problems regarding the correct interpretation of this law, largely due to the
unclear wording of its Article 42. The article states that "all rural properties over twenty hectares in
forest areas shall maintain twenty-five percent of its natural forest area. In case of not complying with
this minimum percentage, the owner must reforest an area equivalent to five percent of the surface of
the property”. This has allowed the most varied and harmful interpretations on the scope of the article.
Some interpreted that all native forests could be eliminated and in case the authority required their
restoration, only 5% had to be reforested. Moreover, the subdivision of properties into smaller ones to
continue clearing the land to the detriment of legal reserves was a common practice due to the
incorrect interpretation of Article 42.Thisinterpretation that impeded full implementation of the Forest
Law has recently been removed through the issuance of the SEAM Resolution Nº531 in 2008, one of
23
the first provisions of the Environmental Services Law 3001/06.This resolution clarifies that Article 42
states the obligation to maintain 25% of what there had been of natural forests at the time of entry into
force of the law and that those owners who had eliminated all forests before its entry into force have to
reforest 5% of their property. Moreover, owners that have not fulfilled with those obligations must
compensate that liability by reforesting with native species or by acquiring certificates of
environmental services under the Environmental Services Law. As for the subdivision of properties,
the correct interpretation is that if the portion sold was already deforested but at the time of entry into
force of the law it had forests, it must be reforested up to 25% of the original forests in the property.
This reasonable interpretation of the provisions of Article 42 coupled with the opportunities provided
by the Law 3001/06 of certifying areas that are additional to the legal reserve for the purpose of
providing ecosystem services have created the legal conditions for those owners who have not
complied with the forest law to economically compensate those owners who still have additional forest
areas. At the same time it opens the way to investing in reforestation with native species, with the
purpose of certifying and profiting through the environmental services regime. However, the correct
implementation will be difficult without an adequate capacity to enforce the law and manage the
environmental services regime (see barrier #2 below).

The interpretation of the former Agrarian Statute (1967) was essentially a perverse incentive to
deforestation. The areas of natural forest other than legal set-asides and protective forests (those areas
not covered by the Arts. 6 and 42 of the Forest Law) could be expropriated for the agrarian reformif
they were not converted to agricultural use as it was considered to be an unproductive, property. This
situation changed after the entry into force of the new Agrarian Statute Law No. 1863/02, which
excludes legal reserves, private reserves, areas for conservation and use of natural forests, and areas
providing ecosystem services when calculating the percentage that must be rationally used for a
property to not be considered as unproductive.

Law 2524/04, popularly known as "Zero Deforestation Law established a temporary moratorium
on land use change in forested lands. The law has helped to reduce deforestation rates in the region but
concerns remain; it does not have a strict monitoring and enforcement, sanctions are weak and the law
itself is not permanent. The productive sectors have made strong calls to supplement or replace the law
with incentives for sustainable use.

The Environmental Impact Assessment Law 294/93 is SEAM´s main instrument to exercise
authority in forestry matters. In principle, the law defines that virtually any work or activity is subject
to the law. However, the provisions for this article have not been enacted and, therefore, the law has a
very wide scope. This undermines its effectiveness since it is not possible to carry out in-depth
environmental impact assessments, and much less monitor the proper implementation of the
environmental management plans under the environmental permits issued. At the same time the PPG
phase was being carried out, SEAM issued new provisions for the EIA law that replaced the original
ones that dated from 1996. Among these, producers with less than 500 ha under use for agricultural
and livestock production will no longer be required to submit EIAs (as long as they do not carry out
other types of activities that may have significant environmental impacts). In this case SEAM has the
responsibility of elaborating a Generic Environmental Management Plan for each biome to provide
landowners with the guidelines for adequate land use and management. Producers with more than 500
ha under use for agricultural and livestock production are required to prepare preliminary EIAs. These
preliminary assessments will have the purpose of allowing SEAM to define if a full EIA is needed. In
this case SEAM must prepare the Terms of Reference for the preliminary EIAs (the procedures for a
full EIA are already established).
80. Implementation and enforcement of the legal framework is also hindered by the low level of
24
knowledge of the technical staffs of the institutions, decision-makers and society in general in regards to
the contents and scope of the different regulations. Moreover, thereare no manuals and guidelines that
identify the roles and responsibilities of the concerned institutions(SEAM, INFONA, Public Ministry and
Municipalities) as well as procedures for enforcement of the regulatory framework. The staffs of the
relevant institutions have insufficient skills to interact with a wide and diverse range of stakeholders
covered by the different environmental regulations. An information and communication strategy is needed
to inform the relevant stakeholders of the roles and responsibilities of the institutions involved in law
enforcement.
81. Furthermore, there is limited institutional capacity for monitoring and control. The SEAM, due to
institutional funding problems (see par.86 below on financing), has less than 15 staff dedicated to
enforcement across the country and for all types of initiatives that have an effect on the environment;
moreover it does not have adequate infrastructure (eg. monitoring systems, and local offices). Since its
inception, the INFONA has been strengthened in terms of budget and infrastructure; however it has not
increased its ability to control due to lack of operational capacity and human resources to perform the tasks
in priority areas; lack of capacity of regional offices to operate remote sensing based monitoring systems;
the location of offices and checkpoints do not reflect current control needs; the control system is focused
on transportation instead of focusing on the properties where forestry activities are carried out under the
authorized forest management plans; and lack of an updated database of forest industries and sawmills.
82. Although the different institutions have data bases and information systems, these do not serve the
purpose of monitoring and control. Effective monitoring and control is based on the timely availability of
information on ecosystems, land uses and management, and ownership. Currently, this information is
scattered among the above-mentioned institutions and procedures to access it are lengthy and time
consuming. This greatly hinders monitoring, control becomes inefficient and impedes the adequate
enforcement of laws and environmental management at national and local levels. A monitoring system
shared by SEAM, INFONA, Municipalities, Public Ministry, the National Cadaster Service and the
Directorate for the Public Registry of Properties and linking the existing Geographical Information
Systems (GIS) and data bases is needed to facilitate cross-referencing of sites where violations are detected
through remote sensing and their cadastral information.
83. Insufficient interinstitutional coordination: The SEAM and INFONA have shared responsibilities
under several laws17. Hence, management and restoration of forests, as well as the determination of the
non-compliance with environmental provisions in the forest legislation are a shared competence and
require effective coordination between the two institutions to ensure sustainable management of the
remaining forests and restoration of degraded areas. However, the lack of clearly articulated roles and
responsibilities between the two institutions has resulted in a lack of coordination in the implementation of
procedures such as environmental licensing by the SEAM and approval of forest management plans by the
INFONA. This results in very long and complex bureaucratic processes that involve an expenditure of
time and financial resources not only for the State but also for the landowners; moreover they affect the
credibility of the institutions.
84. There is also a lack of coordination between national and local levels. For instance, Law No. 1561/00
designates the SEAM as the entity responsible for environmental planning and land use, whilst the
Municipal Law No. 3966/10 stipulates that municipal governments have the power to regulate land use
within their territories. Very few Municipalities have land-zoning plans and, where they exist, their
implementation is far from optimal. Municipalities have clear responsibilities in environmental matters
and under the Municipal Law they may enter into agreements with national institutions (ie. SEAM,
INFONA, others) by which they receive a delegation of authority to act as local law enforcement
17Ley
Forestal 422/73 y Ley de Creación del INFONA 3808/04 (INFONA), Ley de Evaluación de Impacto Ambiental 294/93 y
Ley de Creación de la SEAM 1561/00 (SEAM)
25
authorities. The law also enables the Municipalities to establish a fee to be charged to landowners to
finance the establishment of a local environmental authority with the responsibility for executing the
delegated function and to ensure financial sustainability. No such agreement has been implemented
yet.Moreover, Municipalities lack instruments and capacities for monitoring their territories.
85. There are a number of coordination initiatives related to the environmental, forestry and productive
sectors (i.eAgricultural and Rural Development Integrated System-SIGEST, Commission for Agricultural,
Livestock and Forestry Best Practices, and the sectoral roundtables of the Network for Investments and
Exports - REDIEX). However, these multiple initiatives are generally restricted to treating specific issues
and do not necessarily ensure representativity of all sectors. For example, SIGEST comprises only the
public institutions related to agricultural development and concentrates its efforts in small scale
agriculture; the Commission for best practices comprises mainly public institutions but not necessarily all
the institutions related to the subject, as is the case of SEAM. REDIEX roundtables comprise both public
and private institutions but dealing only with exports and international markets and do not include all
commodities produced in Paraguay (ie. soy).Local governments and community-based organizations are
seldom included in these coordination bodies.Sometimes these initiatives experience duplication or
overlap in their scopes of work, and hence are not operational to promote solutions that could help remove
the existing barriers.
86. Insufficient funding: The limited funding of the environmental authorities is chronic. This affects their
ability to enforce the law with a minimum degree of effectiveness. Indeed, the National Budget for 2013
allocates to the SEAM only 0.06% of the total approved, a mere US$8.5 million18. With this budget the
SEAM has to address the enforcement of the legal framework for protected areas, wildlife, environmental
impact assessment, water resources, environmental services and international conventions such as CITES,
Biodiversity and Climate Change. Moreover, the SEAM´s ability to collect fines for noncompliance with
environmental laws is limited. The environmental impact assessment law does not provide for fines. This
sanction is set through a resolution (SEAM Resolution Nº 363/04), which generates strong doubts
regarding its constitutionality as it would violate the principle of legality enshrined in the Constitution.
This has resulted in the SEAM setting fines of small amounts so that offenders would prefer to pay the
fines than hiring a lawyer to promote the unconstitutionality. SEAM lacks a specific law to enable it to
collect fees and fines. Moreover, when a violation of the forest regulations (mainly maintenance of
protective forests and legal reserves) has been determined, the fines can only be applied by the INFONA.
There is no legal mechanism to allow that at least a percentage of those fines be channeled to the SEAM,
even though this institution may have detected the violation. This imbalance, in the case of the SEAM,
between roles and duties of supervision and the ability to finance them, even partially through the fines,
greatly limits the SEAM´s efficiency in fulfilling its responsibilities. INFONA on its part has a reduced
and decreasing funding capacity and needs to optimize management and administration of its budget as
well as re-design its financing scheme. Municipalities are not aware that the law enables them to establish
fees to finance environmental monitoring and surveillance; moreover they do not have the structures and
organization to carry out these activities.
87. As a result of the above, there have been no limits to expansion of land use for agricultural activities
in the productive landscape, which led to significant transformation of forest cover for agricultural use and
major deforestations have remained without sanction and without restoration.
18
Law 4848/13 “That approves the General Budget of the Nation for the 2013 Fiscal Year”. Of the total Gs.58,173,898,534
(US$14.5 million) approved as expenditure allocation (Art.2), Gs.34,631,297,872 correspond to the SEAM (US$8.5 million).
Exchange rate: US$1 = Gs4000. http://www.leyes.com.py/todas_disposiciones/2013/leyes/ley_4848_13.pdf [May 2013].
26
Barrier #2: Insufficient economic incentives to incorporate sustainable environmental management
practices into economic activity.
88. Incentives: Although the GoP has established incentives for biodiversity conservation and sustainable
land management, these have either failed or, in most cases, have not been implemented. The
Reforestation/Afforestation Law Nº536/96 established a State funded incentive to promote
reforestation/afforestation; it was implemented during the 1990s but failed due to the lack of funding and
adequate monitoring of beneficiaries. The Wildlife Law Nº96/92 promotes the sustainable use of
biodiversity through quotas, the Protected Areas Law Nº352/94 promotes incentives for private
landowners to establish private protected areas and the Water Resources Law Nº3239/07 seeks to regulate
the sustainable use and management of water resources. SEAM is undertaking the elaboration of
provisions for each of these laws although at a slow pace. In the case of the Environmental Services Law
Nº3001/06 provisions for forest ecosystems have been recently issued. These provisions (Resolutions
503/12 and 199/13) foresee that landholders who own forest areas that are additional to the 25% set-aside
stipulated by the Forest Law Nº422/73 may certify these additional areas as suppliers of environmental
services. To achieve SEAM set-aside certification the landholders must fulfill the following requirements:
1) provide proof of the additional forest areas in the property through satellite imagery and a technical
report prepared by a forestry professional; 2) Sworn statement committing to maintain the forest during the
certification period; 3) Fire prevention and control plan; and a 4) Biological monitoring plan. These setaside certificates can be negotiated in the market with landowners who did not comply with the set-aside
regulations and are obliged to compensate their environmental liability. Nevertheless, there are constraints
for adequate implementation of this law, among them the lack of an inventory of producers with
environmental assets or liabilities, hence making it difficult to determine who should be prized and who
should be punished, and the lack of a mechanism to trade the set-aside certificates in the market.
89. Furthermore, the GoP is considering measures to promote carbon sequestration and forest
certification; however this is compounded by a lack of institutional structure for implementation (i.e no
national forest and carbon stock inventory per ecoregion, no carbon monitoring and accounting system) to
facilitate certification of emissions reductions and avoided deforestation (to be tackled by the UN-REDD+
National Programme). The Forest Land Real Property Rights Law Nº4890/13 has been recently issued
and will be a key instrument to incentivize reforestation. Several attempts to regulate tax breaks to promote
reforestation/afforestation have been made but have not been implemented since the main interest of the
Ministry of Finance relies in the collection of taxes rather than granting exemptions. The country lacks a
legal framework for tax breaks to incentivize best practices in environmental management. Furthermore,
there is a general lack of knowledge by relevant stakeholders and society in general on the different
incentives and their scope.
90. Credits: Neither public nor private credits are tied to any stimulus or punishment related to
compliance or not of environmental regulations, whether it be conservation, protection, recovery,
restoration, best practice or sustainability programs. Not all banks, cooperatives and financial companies
require borrowers to present the environmental impact study and environmental license. Loans do not
include environmental sustainability criteria and there are no credit incentives (i.e lower interest rates) for
those producers who implement sustainable practices. On the other hand, banks respond to the Bank
Superintendency of the Central Bank (BCP) and not to the SEAM, so they are only careful to abide by the
resolutions of the BCP, and as such the EIA is not adequately enforced.
91. The banking system in general is poorly mobilized to finance investments in the forestry and
environmental sectors. The credits for afforestation/reforestation are scarce and not suited to the term of
the biological cycle of a forest plantation, which requires a long-term credit until it generates the first
incomes. No matter how profitable a forestry project can be, funding is often not available to the investor
since it produces a state of liquidity in the financial system due to the long period elapsed until incomes
are generated. The AFD has made available a credit for reforestation (US$10 million available) channeled
27
by public banks; but only few credits have been requested due to a lack of information to raise awareness
and interest potential investors. Only exceptionally private banks have funds to finance long-term projects
as required by the forestry sector. Cooperatives do not have or have only few funds of their own. There are
some cooperatives that fund reforestation with exotic species to meet their energy needs (drying of grains
and yerba mate, mainly). The main causes are related to short-term deposits (checking, savings) of bank
customers and the limited equity for allocation to long-term loans. The liabilities of the banks are mainly
demand deposits; therefore it is not possible for them to grant long-term loans. Moreover, financing of
commercial activities and consumption is more attractive to banks given the faster recovery rate.
92. There is a lack of interest of potential institutional financiers to invest their money in the capital
market. A number of public institutions that manage pension funds, such as the Social Welfare Institute
(IPS), the National Electricity Administration (ANDE) and Itaipu have a high availability of financial
resources coming from the contributions of their members, which are currently maintained in banks. The
banks use these resources to finance consumption (credit cards) through short-term loans. These funds
could be channeled through private banks to finance long-term loans for investments in the forestry sector.
As in other existing credit lines, the loans could be co-financed by the banks, and should prove attractive
to all parties (financiers, banks and clients) to ensure successful operations.However, studies are needed to
assess the full feasibility and demonstrate the profitability of the investmentsand to engage the potential
financiers and banks, and implementation mechanisms (rules and procedures) developed.
93. Market: The growing global demand for food encourages the expansion of agricultural and livestock
production. A dual system in terms of demand for certain goods such as soy and meat coexist in the
international commodities market. Purchasers that do not grant much relevance to environmental or health
issues (i.e China in soy and Russia in beef) and those purchasers that do grant greater relevance to quality
and responsibility of products, such as the European Union in both commodities (i.e. Round Table for
Responsible Soy -RTRS certified soy or Hilton beef Quota). However, there are insufficient incentives to
encourage a more widespread adoption of certification schemes by producers in high biodiversity
landscapes. Moreover, purchasing policies of companies that acquire Paraguayan commodities have, in
general, remained focused on the volume and supply, without taking into account environmental
management performance.
94. Experience in soy certification is incipient; the first experiences began in 2005 and are based on the
RTRS scheme. These experiences have been described as successful by the companies from the
commercial standpoint, having obtained two types of benefits: some buyers have paid an additional US$23/ton above the international market prices and, others have given priority in shipping which resulted in
cost savings. However, the certification has not spread to a greater extent. The main constraints are related
to: i) the costs of certification since producers have not yet identified in the international market
differentiated prices for certified products that could encourage product differentiation; ii) little
information available about best practices and certification schemes, mainly in terms of criteria, costs and
benefits for its implementation; iii) producers do not have sufficient administrative skills to keep detailed
records (i.e activities, use of inputs, others) hence making the traceability process difficult. Finally, another
shortfall identified in the certification process is related to the compliance of requirements regarding labor
and health conditions, due to the absence of specific legislation on social insurance for agricultural
activities.
95. Another yet unexplored path to help stop deforestation is the dissemination of environmental
regulations of the destination markets of the Paraguayan agricultural production. In fact, the main
destination of soy is the European Union where the 2009/28/C Renewable Energy Directive is in force.
This regulation bans the production of biofuels from raw material obtained from lands with high
biodiversity value, which as of January 2008 belonged to primary forests and forests designated for
conservation purposes. Once soy enters the European market it could be used in the production of biofuels,
in practice exporters are requiring producers to present documents (affidavit) that prove compliance with
28
the obligations of the directive; however there are no effective mechanisms for monitoring and verification
of compliance (traceability, etc.).
96. The livestock sector employs conventional production practices (ie, extensive pastures) and faces land
degradation problems, but neither the State institutions nor the financial sector are stimulating the
increased revenues that could potentially be generated through alternative practices, such as silvopastoral
systems. Nevertheless, producers have much interest in carrying out production under sustainable criteria
and in accordance with the legal framework. In this sense, best practices are applicable throughout the
supply chain to ensure that productive activities are environmentally, economically and socially
sustainable. There are some initiatives in this regard; the National Plant Health Service (SENAVE) has
prepared a Manual of Best Practice mainly for fruits and vegetables; the producer association APS has
developed a guideline to best practices for soy cultivation, but to date it has not yet been implemented
because the APS does not have a technical structure for implementation; and the ARP has developed a
handbook for producers. The livestock sector is implementing a traceability system to facilitate access to
the most demanding markets. However, use is still limited by the uncertainty of the private sector in regard
to the capacity of the public sector to implement adequate monitoring and control, and institutional
constraints to provide technical assistance mainly to small and medium producers.
Barrier 3: Limited local level institutional and individual capacity to enforce land set-asides regulations, or
adoption of sustainable practice standards.
97. Institutional capacities in the field: Institutions have a very low ability to enforce environmental laws
in the field, namely the Forest Law and the Environmental Impact Assessment Law. In general, farms have
environmental permits, but the ability of SEAM for overseeing compliance of mitigation and
compensation measures under the environmental management plans is certainly limited. Generally,
violations are detected when the owners request the renewal of environmental permits. There are no
systematic monitoring programs or anonymous denouncement channels, and neither logistical nor human
resources to respond appropriately to the violations detected. Often the reaction only occurs when the
media reports violations.
98. Another significant constraint regarding enforcement of the Forest Law is the lack of knowledge and
skills of landowners to establish new land set-asides, reforest or restore forests in the productive landscape
as the staff of SEAM, MAG and INFONA do not work with them to this purpose. Landowners decide
which land should be conserved on the basis of their production strategy and goals, and not on the basis of
structural and functional connectivity of the landscape. While in previous years the deforestation rates in
the country were significantly reduced, there have been no significant efforts to rehabilitate secondary
forests. Although the law for restoration of protective forests was issued in 2010, no restoration plans have
yet been elaborated.
99. Both SEAM and INFONA need to build their technical capacities to provide viable alternatives to
producers interested in implementing more sustainable practices. This is limited by several constraints: (i)
lack of harmonization of cadaster systems for identification of the properties and owners taking into
account the environmental context of their properties, (ii) lack of updated technical knowledge of the staff
to allow them to offer viable alternatives to producers, especially to those with limited financial resources;
and (iii) lack of common technical working protocols between SEAM and INFONA that ensure the
maximization of human and financial resources. SEAM, INFONA and MAG technicians need to increase
their knowledge in the following issues: biodiversity, reforestation/afforestation, sustainable management
of forests, and best practices (direct sowing, live fences, management of agro-chemicals, management of
water resources, management of watersheds, connectivity). MAG technicians have knowledge and skills in
agricultural practices, but focusing mainly on sustainable soil management; they need to incorporate
29
knowledge related to ecosystem management and structural and functional connectivity of productive
landscapes.
100. Capacities of producers: There are difficulties in ensuring environmental sustainability of the
agricultural and livestock production. The expansion of the agricultural frontier at the expense of native
forests is not planned within the framework of land-zoning plans. Producers are unaware of or do not
recognize the benefits of forests and the services they provide to sustainable food production. Most of
them do not know the laws and their scope. Many land users, out of ignorance, are not aware of the causes
and effects of the different activities undertaken on the landscape and their impact on the environment.
They lack land use planning tools that mainstream environmental criteria; hence they are not aware of the
potential functional connectivity of natural resources of their property and do not manage their lands on
the basis of this criteria. Additionally, producers do not have the capacities to draft sustainable business
plans. Producers have limited knowledge in implementation of sustainable production practices. Soil
conservation and management practices are the most commonly used by farmers. As per the 2008
Agricultural Census, 74% of farms in Alto Parana and 73% in Canindeyu implement some type of
practice, while in Amambay the percentage drops to 36%. Table 8 below includes the types of practices
applied in the three departments in farms of 50 ha and more.
Table 8. Soil conservation practices implemented in Alto Parana, Amambay and Canindeyu (farms
Departments
Alto Parana
Nº of farms
w/soil
manageme
nt
practices
Contour
lines
2,467
%
1,611 65%
Crop
rotation
%
Green
fertilizer
%
Direct
sowing
%
1,909
77%
128
5%
2,210
90%
Amambay
474
216
46%
206
43%
7
1%
257
54%
Canindeyu
1,653
852
52%
1,207
73%
133
8%
1,257
76%
Source: 2008 Agricultural Census
101. Although Paraguay is a worldwide leader in direct sowing, there is concern that many producers
implement this practice influenced more by information coming from other countries and by
recommendations from the agricultural input suppliers than by actual knowledge and training on the
subject, hence they may not be correctly implementing this practice. There is limited use of practices such
as live fences, windbreaks, management of microbasins and runoffs, forest management, agroforestry and
silvopastoral systems.
102. Despite the extensive use of agrochemicals, producers do not have sufficient knowledge to manage
them correctly during all stages of use until final disposal. They do not know and therefore do not make
use of the protocols for final disposal of containers. There is a low level of training in regard to safety and
health in the use of agrochemicals as well as heavy machinery. The knowledge gap on the risks involved in
working with these products and equipment is significant. With regard to technical assistance there is a
limited availability of technicians specialized in management of restored or reforested areas for the
purpose of increasing biodiversity in productive systems. Finally, as there are not enough tree nurseries,
there is a low supply of seedlings, especially of those forest species suitable for restoration of degraded
areas.
30
2.1 Stakeholder analysis
103. Table 9 summarizes the key stakeholders in Paraguay and their roles and responsibilities regarding
biodiversity conservation and sustainable land management. These stakeholders will be involved in
project implementation through the Stakeholder Involvement Plan included in Section IV, Part III, below.
Table 9: Key stakeholders in project implementation
Stakeholders
Government
SEAM
MAG
INFONA
Public Ministry
SENAVE
SENACSA
INDI
INDERT
National Cadaster Service
Directorate of the Public
Registry
Departmental
Governments
(Alto
Parana,
Amambay,
Canindeyu)
Interests/roles in the project
National mandate over natural resource conservation and sustainable managed.
Enforcement authority of the EIA and Environmental Services laws. Will serve as
Lead National Institution of the project within the Project Board. Member of
Technical Committee and the national platform. Provide office space for project
teams, a technical liaison officer the project team. Provide office space and
equipment in three departmental offices of SEAM in Amambay. Participates in the
development of the monitoring System.
National mandate over agricultural production. Will participate as a member of Cofinancers roundtable, convening of institutions and Companies. Member of Technical
Committee and the national platform and departmental platforms. Provide a technical
liaison officer the project team. Coordination with ongoing programs and projects in
the intervention areas.
National mandate over conservation and use of forest resources. Enforcement
authority of the Forest Law and the Restoration of Protective Forests Law. Will
participate as a member of Co-financers roundtable. Member of Technical
Committee and the national and departmental platforms. Participates in the
development of the monitoring System.
In charge of upholding justice and prosecuting infringement of environmental
regulations. Will designate a Focal point for the project. Will participate in the
development of the monitoring and control system and field piloting of the system.
Provide guidance on control and prosecuting procedures. Participates in the
development of the monitoring System.
Institution responsible for developing guidelines for quality control of agricultural
products; it will ensure institutionalization of the updated manuals and toolkits
developed by the project. Technical staff to update manuals and toolkits developed
by the project. Appoint focal point to participate in all project platform meetings and
workshops and who has the responsibility and time allocation to ensure internal
follow up and compliance with agreements.
Responsible for developing guidelines for quality control of livestock products.
Technical staff to update manuals and toolkits developed by the project. Appoint
focal point to participate in all project platform meetings and workshops and who has
the responsibility and time allocation to ensure internal follow up and compliance
with agreements.
Responsible for Indigenous Peoples policies. Provide guidance on Free, Prior and
Informed Consent procedures in regard to potential project activities with indigenous
communities in project intervention areas.
Responsible for facilitating small farmers´ access to lands, investments and technical
assistance. Provide guidance and assistance in planning and implementing activities
targeting small farmers in project intervention areas. Replication of project results
Responsible for the cadaster of properties. Will participate in the development of the
Monitoring System. Uploading of information on properties.
Responsible for keeping records of land ownership. Will participate in the
development of the Monitoring System. Uploading of information on properties.
Uploading of information on properties.
Implement public policies at departmental level. Will convene and lead the
departmental platforms. Will appoint a representative in the Project Board.
31
Stakeholders
Municipalities
Municipalities
priority areas)
in
(20
3
Private Sector
Producer Associations
- ARP
- APS
- CAP
- UGP
FECOPROD
Cooperatives
Chambers
- CAPECO
- CAPPRO
- CPC
- CAP
Commodity Buyers
- ADM
- Cargill
- Bunge
- Noble
NGOs / CBOs
- Solidaridad
Interests/roles in the project
Implement public policies at municipal level. Appoint focal point to participate in all
project platform meetings and workshops and who has the responsibility and time
allocation to ensure internal follow up and compliance with agreements. 4 pilot
Municipalities will implement Delegation Agreements for local level monitoring and
enforcement of environmental regulations.(San Cristobal and Cedrales, in the
Department of Alto Paraná, Villa Ygatimi in the Department of Canindeyú and Pedro
Juan Caballero in the Department of Amambay) and will participate in the
development of the Monitoring System.
Main producer associations will play a central role in convening companies and
producers and facilitating dialogue. Appoint focal point to participate in all project
platform meetings and workshops and who has the responsibility and time allocation
to ensure internal follow up and compliance with agreements. Dissemination of
project results among members.
Promotes strengthening of production cooperatives. Project partner. Convene
member cooperatives in the project area (9), facilitating dialogue and coordination
with the project. Dissemination of project results among members.
Provide services to associates (technical assistance, loans, commercialization of
production, supply of inputs). Project partners. Convene associates; facilitate
dialogue and coordination with the project. Provide technical assistance to associates
for adoption of best practices and restoration of forests.
Ensuring full engagement of soy and livestock sectors in the project. Provide
Technical staff to update manuals and toolkits developed by the project. Appoint
focal point to participate in all project platform meetings and workshops and who has
the responsibility and time allocation to ensure internal follow up and compliance
with agreements. Convene member companies and associations and facilitate
dialogue and coordination with the project. Dissemination of project results among
members.
Send market signals to stimulate adoption of best practice among producers. Modify
purchasing policies within target MUL to stimulate adoption of best practice among
producers. Provide technical assistance to producers to promote environmental
standards and certification schemes.
Will participate as a member of Co-financers roundtable, convening of institutions
and Companies. Member of Technical Committee and the national platform and
departmental platforms. Provide a technical liaison officer the project team.
-
WWF
A todoPulmón
Paraguayan Network
of Conservation in
Private Reserves
Project partners. Appoint focal point to participate in all project platform meetings
and workshops and who has the responsibility and time allocation to ensure internal
follow up and compliance with agreements. Share and/or replicate successful project
methodologies and approaches.
-
Federation for the
Self-Determination of
Indigenous Peoples
(FAPI)
Federation of
Associations of the
Guarani Peoples
National level organizations representing indigenous peoples. Provide guidance on
Free, Prior and Informed Consent procedures in regard to potential project activities
with indigenous communities in project intervention areas.
-
32
Part II: Strategy
2.1
Project Rationale and Policy Conformity
Rationale and summary of GEF Alternative
104. The project will deliver global benefits by ensuring that the future expansion of production does
not compromise biodiversity and ecosystem function. Despite the high degree of forest fragmentation,
there are still good opportunities for the conservation and management of the remaining large forest
fragments in the ecoregion, thereby conserving ecological processes that sustain biodiversity. The project
will advance an integrated package of measures, targeting the Multiple Use Landscape (MUL) framed by
the Departments of Amambay, Canindeyú and Alto Paraná in Eastern Paraguay that will remove the
identified barriers. These three Departments were chosen for intervention given that the landscape harbors
numerous important forest habitat blocks of various sizes on production lands.
105. This package of measures will include complementary interventions at both national and
departmental levels. At national level, the project will provide long term institutional support through
strengthening of the regulatory framework; strengthening of the capacities of the national and local
government institutions, and the private sector for planning, land use, monitoring deforestation,
surveillance and enforcement; improving stakeholder coordination and dialogue for agreements and
consensus on land use and management; generating incentives so that markets and financial sectors prize
sustainable production practices principally of soy and beef, within the target multiple use landscape. The
project´s key focus is the work with medium and large-scale producers of soy and livestock seeking
transformational changes that will ensure that producers comply with the GoPs zero deforestation policy
and regulations and encourage them to adopt a suite of best practices that favor the conservation of
ecosystem functions including biodiversity, to ensure long-term sustainability of production. This will
contribute to the establishment of deforestation free supply chains that provide sustainable products to the
markets. This set of interventions will create an enabling framework for effective governance managing
conflicting land uses and optimizing for sustainable land and forest management and biodiversity
conservation, as well as the conditions for piloting interventions at departmental level and promoting
replication, thereby achieving the GoP´s objective of zero deforestation in the Eastern Region.
106. Within each Department, a priority area has been selected for field actions. The three areas
provide different scenarios for developing experiences and lessons learned that could later be replicated at
a broader landscape level. The Alto Parana area focuses on soy production, has few forest remnants but a
high connectivity potential along rivers. The Amambay area has important forest remnants within private
properties and indigenous communities, with main production being livestock and potential for
connectivity through set-asides and silvopastoral systems. The Canindeyu area contains the largest
protected forest in the UPAF, agriculture is the main production combining medium and large scale soy
producers and small scale family agriculture, important presence of indigenous communities and potential
for connectivity through set-asides, reforestation and agrosilvopastoral systems. Interventions at
departmental level will be directed to improving the knowhow for sustainable land management amongst
producer groups and landholders for compliance with the improved and updated regulatory framework;
and for upscaling of environmental standards and best practices for restoration of land set-asides and
protective forests of watercourses, andproduction of soy and livestock. Within these priority areas, 4
Municipalities have been selected to pilot the optimized surveillance and enforcement procedures and
methods. Selection of pilot Municipalities took into account forest cover, connectivity potential through
watercourses, and capacity to implement project actions. The Municipalities of San Cristobal and
Cedrales in Alto Parana have a high potential for connectivity along the Monda-y River, Villa Ygatimi in
Canindeyu with the largest forest cover and containing the core area of the Mbaracayu Biosphere Reserve,
and Pedro Juan Caballero in Amambay with important forest cover and containing the Cerro Cora
National Park.
33
107. The vision is to create a mosaic of conservation compatible land uses, with large habitat patches
and connectivity, through the conservation of small forest patches and by fostering forest rehabilitation.
This is designed to enhance functional connectivity across the landscape. The project will center efforts on
areas in the landscape where threats to large habitat blocks and critical connecting forests are most acute,
focusing on forest clearance, forest degradation and fire. In doing so, the project will reduce deforestation
and enhance restoration of natural habitats and biodiversity conservation. This will help secure the flow of
ecosystem services from productive landscapes and remaining natural habitats. Table 11 below includes
details on the project´s intervention - national, departmental and priority area – levels.
108. On this basis, SEAM and key stakeholders, including the WB/GEF Paraguay Biodiversity Project
were consulted to select the priority areas within the three Departments. Selection criteria included: 1)
Degree of conservation of forests: presence of forest remnants, especially those that for their
characteristics could be refuges for biodiversity; 2) Connectivity potential: presence of forest remnants and
watercourses (streams and rivers) that can favor restoration processes; 3) Key stakeholders and potential
synergies: coordination of activities with institutions and ongoing or planned initiatives, projects and
programs; experiences in best practices in agricultural and livestock production, and forest management
(certification, organic production, agroforestry systems) which uptake may be promoted through the
project; 4) Potential for optimizing socio-economic benefits: existence of organizations (farmer
associations, cooperatives), potential for poverty reduction through the inclusion of small producers in
supply chains and synergies with other programs and projects, and gender equality. Annex 1 includes the
detailed characterization of the priorityareas. These collectively cover 1,421,595 ha and 27,545 producers.
109. Three priority areas meeting the above criteria have been selected, one in each Department. The
Alto Parana priority area stretches across the area of influence of the Monday and Ñacunday rivers (see
map in Annex 2); it has an extension of 549,160 ha with 16% forest cover (87,000 ha, including 5,312 ha
of protected areas). The area spans across 13 Municipalities (Juan E. O’leary, Juan León Mallorquín,
Yguazu, MingaGuazu, Santa Rosa del Monday, Santa Rita, San Cristóbal, Presidente Franco, Cedrales,
Domingo Martínez de Irala, Ñacunday, Iruña and Naranjal) and has a rural population of 48,687.
Indigenous communities of the Mbya, Ava Guarania and Ache are located within the area. The main land
use is mechanized agriculture largely for the production of commodities (soy, maize, wheat) covering 78%
of the area´s surface area (430,945 ha). The area´s potential lies in the possibility of increasing
connectivity through restoration of protective forests of watercourses and the presence of strengthened
institutions such as cooperatives, which in recent years have shown an increasing interest in complying
with the environmental regulations. Another key aspect in selecting this area is that the single FSC
certified native forest in the Eastern Region is located in the western limit of the area, thereby reinforcing
the connectivity potential with this area. The main threats to forests and their biodiversity identified in this
area are: 1) Indiscriminate use of agrochemicals; 2) Deforestation of protective forests and legal reserves;
and 3) Unsustainable agricultural practices that cause soil erosion and contamination of streams/rivers.
110. The Amambay priority area is located in the area of influence of the Cerro Cora National Park
(see map in Annex 2). The area stretches across 582,927 ha and 2 districts (Pedro Juan Caballero and
Capitan Bado); its rural population is 12,928. The forest cover of the area amounts to 171,846 ha or 30%
of its surface area. Key criteria for selection of this area were the richness of its flora, cultural
significance, and the need to strengthen SEAM´s presence in the region. The main land use is livestock
production covering 358,208 ha or 61% of the area´s surface area. Indigenous communities in the region
include Mbya, Ava Guarani and Pai Tavytera. The main threats to biodiversity and ecosystem integrity
include: 1) contamination and sedimentation of watercourses; 2) burning of pastures; 4) soil erosion; 5)
invasion of exotic species (pastures) and 6) expansion of illegal crops.
111. The Canindeyu priority area is located within the area of influence of the Mbaracayu Forest
Biosphere Reserve, which has a surface area of 289,506 ha. The Mbaracayu Forest Reserve is located
34
within the area and is the largest protected forest remnant in the East of Paraguay (64,000 ha). The area
stretches across most of the district of Villa Ygatimi and partially over the districts of Ypehu, Corpus
Christi, Curuguaty and Katuete (see map in Annex 2). The rural population of these districts is 41,305.
Forests within the area (outside of protected areas) cover 65,122 ha or 22% of the surface area. Although
livestock production is the main land use in the Department of Canindeyu, within the area the main land
use is agriculture due to the high presence of small farmers; 67% of the properties are larger than 100 ha
while 33% are smaller. Agriculture covers 105,855 ha or 37% of the area´s surface area. Indigenous
peoples include Ache, Ava Guarani, PaiTavytera and Mbya, some of them conserving important forest
areas, such as the Ache community of ChupaPou, who own some 8,000 ha of forests. The main threats to
biodiversity and ecosystem integrity in this area are: 1) Unsustainable agricultural and livestock practices;
2) Unsustainable forestry; 3) Settlements established without adequate planning; 4) expansion of illegal
crops.
Table 10: Summary of main characteristics of the selected priorityareas
Surface of the
areas
Municipalities
Alto Paraná
549,162 ha
Amambay
582,927 ha
Canindeyú
289,506 ha
13
2
5
Main land uses
Agriculture: 430,945 ha
Livestock: 3,814 ha
Forests: 81.719ha
Agriculture: 34,450 ha
Livestock: 358,208 ha
Forests: 157.320 ha
Agriculture: 105,855 ha
Livestock: 39,899 ha
Forests: 65.122 ha
Main Threats to
biodiversity and
ecosystem
integrity
1.
1.
1) Unsustainable agricultural
and livestock practices
2) Unsustainable forestry
3) Settlements established
without planning
4) Illegal crops
Number of farms
and types of
producers19
Presence
of
Protected Areas
and Indigenous
Communities
Connectivity
Potential
Potential
for
optimizing socioeconomic
benefits
Potential
for
upscaling
Main
Environmental
Indiscriminate use of
agrochemicals
2. Deforestation of
protective forests and
legal reserves
3. Unsustainable
agricultural practices
that cause soil erosion
and contamination of
streams/rivers
13,069 farms
Medium and large
producers
Protected Areas: 5,321 ha
Indigenous communities:
13
1.
2.
3.
4.
5.
Contamination and
sedimentation of water
courses
Burning of pastures
Invasion of exotic
species
Soil erosion
Illegal crops
4.279 farms
Small, medium and large
producers
Protected Areas: 14,526 ha
Indigenous communities: 33
10,197 farms
Small, medium and large
producers
Protected Areas: 65,133 ha
Indigenous communities: 103
High
High
High
High
High
High
High
High
High
Increase in forest
cover through
1. Decrease in the impacts
of fire on biodiversity
1.
Increase in forest cover
through restoration
19
The geographical limits of the sites do not necessarily coincide with the limits of the Municipalities; hence in some cases the
sites do not cover their whole surface area. The number of farms indicated in the table corresponds to the total surface area of the
Municipalities as per the 2008 Agricultural Census. The actual number of farms within each site is lower.
35
Benefits
2.
3.
Alto Paraná
restoration processes
Decrease in erosion,
sedimentation and
contamination of
water courses
Increase in diversity
of tree species in
restoration areas
Amambay
2. Decrease
in
forest
degradation
due
to
logging for firewood
3. Increase in the diversity
of species in managed
forests
2.
3.
4.
Canindeyú
processes
Decrease in pressure over
forests
Decrease in erosion and
sedimentation of
watercourses
Increase in the diversity
of tree species in
restoration areas
112. At field level in these priority areas the project will implement a differentiated intervention
strategy considering the presence of a diverse range of stakeholders in the three priority areas that includes
small family farmers who produce mainly staple crops and to a certain extent cash crops, medium and
large producers of soy and livestock, and indigenous peoples. For medium and large farmersthis will
include developing best practices for sustainable production of soy and livestock, training and outreach
programs and providing technical assistance to producers for widespread adoption of best practices,
increasing forest set-asides and protective forests of watercourses; as well as linking them with the
financial and market incentives to sustainable production through work at the national level. For small
family farmers, especially in the Canindeyu priority area, the project will work by combining conservation
of forests through marketing of forest set-aside certificates under the Environmental Services law,
sustainable production of staple and cash crops and integration into supply chains seeking to generate
incomes and improving the livelihoods of small family farmers. The project will build upon ongoing
experiences to pilot an innovative model for environmental and socio-economic inclusion that will deliver
environmental and socio-economic benefits.
Gender equality
113. Special attention will be given to gender issues in the different segments of beneficiaries.The
project´s gender strategy is based on the following considerations:
i)
Gender and poverty: In medium and large-scale agriculture, women like men have better living
conditions in relation to women and men in small scale agriculture. This confirms that the most
vulnerable are the poor, and among them women are the poorest.
ii)
Access to productive factors: Although women in medium and large-scale agriculture have better
living conditions, this does not mean they have a more equal access to training and technical
assistance.
iii)
Roles in family farms: Within the soy supply chain, the role of women is geared mostly toward the
following activities: resource management, the responsibility of feeding hired labor, joint
responsibility with their husbands in acquiring loans (she is usually the guarantor of the loans), in
addition to the traditional organizational roles and home management.
iv)
Gender and natural resources: There is an intrinsic relationship of women with natural resources
that should be considered as a great opportunity for the project as it seeks to set up SLM and SFM
practices .
v)
Diversity: In project intervention areas, there is a high level of multiculturalism, including: a) rural
women in family farming; ii) indigenous women; ii) rural women in medium and large scale
farming (Paraguayan and of foreign origin). The first two are going through a situation of marked
exclusion and marginalization. Women in the third group are not valued or their roles in
production are not visible. In all cases, they do not receive any payment for their work, so their
contribution is neither visible nor valued.
114. The project´s gender strategy will have the objectives of: a) ensuring mainstreaming of gender in
all activities of the Project in order to reduce inequalities between men and women; b) visualizing and
assessing the participation and contribution of women in supply chains and their relationship with the
36
environment; c) strengthening groups of women and youths that are members of cooperative and other
production associations through environmental education campaigns and implementation of community
tree nurseries. Gender equality will cross-cut project interventions and will follow the guidelines
described herewith:
i)
ii)
iii)
iv)
v)
Elaboration of a participatory field-level diagnosis with gender and intercultural approach to
identify roles according to gender, within the medium and large scale agriculture, in terms of
access to land, soybean production and livestock, natural resources management, and access to
membership and leadership levels of organizations (cooperatives, producer organizations,
associations).
Design and implementation of a training program on gender issues to all stakeholders in the
project.
Promotion of the participation of women in all training and technical assistance activities
(extension, credit, research), both as institutional stakeholders or beneficiaries. This means
developing inclusive language and messages in the presentation and implementation of the project,
and consider appropriate times more suitable within their day-to-day activities.
Promotion of the participation of women and youth in environmental education campaigns, and
promotion of the best practices generated by the Project.
Inclusion in the project´s detailed M&E system the disaggregation of data by sex and gender
analysis- to ensure full ownership of these indicators in priority areas.These will be finalized in the
Inception phase of the project.
Indigenous Peoples
115. At areas prioritized by the project there are 86 indigenous communities (14 communities in Alto
Parana, 10 in Amambay, 62 in Canindeyú) including near targeted wooded areas. In general, soy crops
border in some cases indigenous communities without complying with regulations regarding the use of
live fences, proper handling of chemicals, and pollution of watercourses, and so endangering the health of
families. Deforestation also impacts indigenous communities surrounded by soy crops and livestock with
concomitant environmental damages and directly affecting the food security of these communities that rely
on forests for the supply of several products (fruits, wild animals, etc.)The project will focus its activities
in medium and large producers of soy and livestock in the three priority areas, raising awareness of their
obligations with regard to compliance of environmental regulations and the need to incorporate sustainable
agricultural practices thus contributing to strengthen biodiversity. Achieving these results will positively
affect the lives of indigenous communities in these areas.
116. In this context, the project strategy regarding indigenous people will be to develop specific
approaches for actions involving indigenous communities located near or within the largest remaining
forest reserves in the department of Canindeyú, considering the valuable contribution their lands are for
conservation and forest connectivity. Project interventions that are identified as viable for indigenous
communities will ensure that key stakeholders (SEAM, INFONA, MAG, MIC and other partners) follow
and respect their organizational ways and cultural norms, and show respect for their dignity and human
rights.
117. Work will be carried out with an intercultural approach, from the worldview of each ethnic
group´s culture, and fundamentally respecting their collective and individual rights protected by
international and national regulations. Likewise, safeguarding that the activities promoted in the area of
influence does not negatively affect the livelihoods of indigenous communities. The step-by-step process –
to support the strategy and agreed upon with indigenous organization isthe following:
37
i)
ii)
iii)
iv)
v)
vi)
vii)
Socializationof the initiative with the INDI, national level indigenous peoples organizations (FAPI
and Guarani Federation) and the local organizations present in the Canindeyu priority area;
Coordination of actions with indigenous peoples at three levels: a) community level respecting
their own ways of organization (first level); b) 2nd level (local) organizations in the priority areas,
and c) representative organizations of national character (FAPI, Guarani Federation).
Implementation of Free Prior and Informed Consent consultation process with the targeted
communities in forest remnants of Canindeyú, according to the suggestions and guidance provided
by the INDI and 2nd and 3rd floor organizations. It will ensure that local communities are properly
informed about the proposed initiative, so as to promote active and effective participation in the
process of formulating measures of community interest, planning and execution.
Participatory planning activities with the consulted communities, if they voluntarily give their
consent to work with them. Likewise, the mechanisms for representation, participation and
management to access project benefits will be defined. Representatives of the organizations should
be invited to integrate and participate in the national platforms, if they choose voluntarily to do so.
Implementation of agreed community plans through partnerships with institutional stakeholders
(NGOs with experience in intercultural work in the area, as is the case of Fundacion Moises
Bertoni) and/or the Department of Technical Assistance to Indigenous Communities of the
MAG/DEAg (ATCI), encompassing a comprehensive support that covers: i) food security based
on recovering of their traditional practices, and synergizing with Western practices that do not
affect their livelihoods; ii) sustainable forest management including conservation activities,
installation of native tree nurseries, and food gardens; iii) community social organization
In this context, the project will also carry out studies on differentiated and complementary
knowledge of indigenous men and women in relation to the use and management of natural
resources and wildlife. In the process, special attention will be given to the rescue and
implementation of ancestral knowledge and technologies of food production, forestry, fruit and
handcrafts, in accordance with to their cultural norms.
One of the interventions that could be developed with indigenous peoples is the design of Payment
for Environmental Services (PES) – in this case SEAM-certified forest set asides -as per the
Environmental Services law, adjusting its implementation according to cultural patterns and the
indigenous view. In this context, UN REDD+ will co-finance the completion of the
consultation/socialization process of the proposed Payment for Environmental Services to
indigenous communities with FAPI and other national organizations.
118. Finally, the project will develop and implement an outreach strategy with the purpose of raising
awareness of all stakeholders on the project and disseminating information on project progress, on the
ground activities, results and lessons learned to a wide range of target audiences (public institutions,
private companies, cooperatives, producers, community based organizations and indigenous peoples).This
outreach strategy will also include a grievance mechanism through which the population in general, and
local communities in particular, will be able to channel any concerns derived from project implementation
and receive the corresponding feedback.
Fit with the GEF Focal Area Strategy and Strategic Program
119. This project will conserve globally significant biodiversity and secure the ecological functions and
resilience of the Paraguayan UPAF. The GoP is committed to the long-term mainstreaming of biodiversity
conservation and sustainable land management in productive practices across the country. The GoP views
this project as an important step in this process. The project will contribute to this long-term vision of the
GoP by developing sound and replicable models for mainstreaming sustainable practices within the UPAF
-targeting the Multiple Use Landscape (MUL) framed by the Departments of Amambay, Canindeyú and
Alto Paraná in Paraguay´s Eastern Region. This landscape harbors important forest habitat blocks of
various sizes on production lands. The project will adapt the different production practices occurring
within this area to ensure they are more compatible with biodiversity conservation and sustainable land
38
management. Interventions have been designed to reduce pressures on the ecosystem from land clearance,
agrochemical runoff into water sources, and logging for firewood, which are leading to forest clearance
and fragmentation and causing pollution.
120. In doing this, the project will synergistically address two GEF-5 focal areas. It advances BDStrategic Objective 2: Mainstream Biodiversity Conservation and Sustainable Use into Production
Landscapes, Seascapes and Sectors, and two of its expected outcomes. Expected Outcome 2.1 Increase in
sustainably managed landscapes and seascapes that integrate biodiversity conservation will be addressed
through the establishment of multi-stakeholder platforms that will convene key supply chain players and
institutions across the public and private sectors to improve management of the landscape. The project will
also address GEF BD outcome 2.2: Measures to conserve and sustainably use biodiversity incorporated in
policy and regulatory frameworks, as it will improve and update the planning, land use, and monitoring
and control regulations; and develop environmental management plans for effective conservation of
biodiversity and sustainable land management. It will address GEF BD SO2 expected Output 2.3 by
increasing the number of hectares of production land that is certified under a recognized sustainability or
best production practice standard. The project will further strengthen the capabilities of the SEAM,
INFONA, Public Ministry and Municipalities to enforce the regulations in force (i.e Forest Law, EIA Law)
to ensure that landowners leave at least 25% of rural premises as land set-asides for conservation and
ecological rehabilitation and initiate restoration processes of set-asides and protective forests of
watercourses to increase connectivity between forest remnants.
121. The strengthened enforcement of the land set-aside and related regulations will also contribute to
GEF LD Objective 3: Reduce pressures on natural resources from competing land uses in the wider
landscape and in particular with outcome 3.1Enhanced cross-sector enabling environment for integrated
landscape management. The planned project interventions will encourage the systematic uptake of good
land management practices and technologies by producers within the MUL, to reduce land degradation and
rehabilitate forest blocks where this is necessary. The project will seek to ensure connectivity between
compulsory land set-asides and larger habitat blocks as needed to maintain functional connectivity within
the landscape. Finally, the project will foster know-how and willingness amongst producers to take part in
land use and biodiversity management processes, using access to markets and financial services as an
incentive to trigger behavioral change. In doing so, the project will address LD SO 3,
outcome3.2Integrated landscape management practices adopted by local communities. The project will
foster an enabling framework for sustainable forest management by landowners, hence contributing to
GEF SFM/REDD+ Objective 1: Reduce pressures on forest resources and generate sustainable flows of
forest ecosystem services. The incentives to be put in place by the project (ie. marketing of environmental
services certificates, long term loans) will ensure connectivity by allowing and incentivizing set-asides to
be connected in the landscape; restoration of set-asides and protective forests of watercourses; as well as
afforestation and reforestation that promote sustainable management of soils and reduce pressures on
native forest, thereby contributing to Outcome 1.2 Good management practices applied in existing forests.
122.
The project will thus contribute to the following GEF-5 SO outcomes and indicators.
GEF
SO/SP
BD-SO2
LD-SO3
Expected Direct Outcomes
Indicators
2.1: Increase in sustainably managed landscapes
and seascapes that integrate biodiversity
conservation
Landscapes and seascapes certified by internationally or
nationally recognized environmental standards that
incorporate biodiversity considerations (e.g. FSC, MSC)
measured in hectares and recorded by GEF tracking tool
Polices and regulations governing sectoral activities that
integrate biodiversity conservation as recorded by the GEF
tracking tool as a score.
Demonstration results strengthening enabling environment
between sectors (incl. agriculture, forestry)
Area under effective land use management with vegetative
2.2: Measures to conserve and sustainably use
biodiversity incorporated in policy and regulatory
frameworks.
3.1: Enhanced cross-sector enabling environment
for integrated landscape management.
3.2: Integrated landscape management practices
39
GEF
SO/SP
SFM
REDD+SO1
2.1
Expected Direct Outcomes
adopted by local communities.
1.2: Good management practices applied in
existing forests.
Indicators
cover maintained or increased
1: Forest area under FSC certification measured in hectares.
2: Enhanced carbon sinks from reduced forest degradation
Project Objective, Components/Outcomes and Outputs
Project objective
123. The GoP is committed to the long-term mainstreaming of biodiversity conservation and
sustainable land management in productive practices across the country and views this project as an
important step in this process. To contribute to this long-term vision of the GoP, the project´s objective is
to protect biodiversity and ecosystem functions of the Atlantic Forest eco-region from existing and
emerging threats from multi-sectoral production practices and is a model for replication across the
country’s bioregions and biomes. The project will overcome the identified barriers to achieve the stated
objective by putting in place a collaborative governance mechanism combined with market based
incentives and build the know-how for appropriate management of the landscape to effectively mainstream
biodiversity and sustainable land management into production sector operations. This strengthened
governance system combined with the model practices in the UPAF will be instrumental in assisting the
Government apply such land use practices across the other biomes and bioregions of Paraguay.
124. The project will achieve this through three Outcomes: 1) Effective governance framework for
biodiversity conservation and SLM in multiple use landscapes; 2) Financial and market incentives
framework to promote biodiversity and sustainable land management within the target multiple-use
landscape; and 3) Strengthened implementation of land set aside system and sustainable production
practices.Table 11 below shows how the different project outcomes and outputs fit into the three levels of
project intervention (national, departmental and priorityarea levels).
Table 11: Summary of project intervention levels (outcomes and outputs)
Outcomes/Outputs
Scope of Interventions
Sub-National
Priority Area
(Departments)
Outcome 1:Effective governance framework for biodiversity conservation and SLM in multiple use landscapes
Output 1.1: A package of modifications in regulations, policies and standards
X
at national level to improve protection of the Upper Parana Atlantic Forest
Output 1.2: Institutional strengthening of SEAM, INFONA, Public Ministry,
X
Alto Parana
4 pilot
and Municipalities for improved monitoring and surveillance of deforestation
Amambay
municipalities
and enforcement of environmental and forest regulations in production
Canindeyu
landscapes
Output 1.3: One national and three departmental platforms for interX
Alto Parana
institutional and multi-stakeholder dialogue on land use planning regulations,
Amambay
enforcement, and incentives for best practice adoption within production
Canindeyu
landscapes, involving all land use managers and supply chains
Outcome 2: Financial and market incentives framework to promote biodiversity and sustainable land management
within the target multiple-use landscape
Output 2.1 Increased and diversified funding complying to environmental
X
20
standards promotes the integration of biodiversity and sustainable land
municipalities
management for MUL through financing opportunities, incentives and
REDD+
Output 2.2: Differentiated markets for sustainable soy and livestock
X
20
production stimulate adoption of sound environmental practices,
municipalities
conservation of biodiversity, and compliance with sustainable land use plans.
Outcome 3: Strengthened implementation of land set aside system and sustainable production practices
Output 3.1: Technical assistance to medium and large-scale soy and livestock
Alto Parana
Alto Parana
producers mainstreams best practices for sustainable production
Amambay
Amambay
Canindeyu
Canindeyu
National
40
Outcomes/Outputs
National
Output 3.2: Improved forest set-asides for small, medium and large scale
farms increase forest connectivity across the landscape in Canindeyú
Output 3.3: Restoration of protective forests of watercourses in the MUL of
three target landscapes increases connectivity in highly deforested areas
Output 3.4: Decentralized and joint enforcement approaches improves
surveillance of deforestation and compliance in 4 municipalities
Scope of Interventions
Sub-National
Priority Area
(Departments)
Canindeyu
5
municipalities
Alto Parana
16
Amambay
municipalities
Canindeyu
Alto Parana
4
Amambay
municipalities
Canindeyu
Project outcomes and expected results
Outcome 1:Effective governance framework for biodiversity conservation and SLM in multiple use
landscapes (GEF: US$2,226,137, Co-financing: US$7,272,438)
125. The project will lead to a change in practices on the ground by developing a series of
modifications to existing regulations which influence land management; by strengthening the institutional
capacities for monitoring and surveillance of deforestation in production landscapes; and by stimulating
inter-institutional and multi-stakeholder dialogue on land use planning regulations, enforcement, and
incentives for adoption of best practices. This outcome will create the enabling policy, regulatory and
institutional environment to advance toward deforestation free soy and beef supply chains.
The outcome comprises the following outputs: 1) A package of modifications in regulations, policies and
standards at national level to improve protection of the Upper Parana Atlantic Forest; 2) Institutional
strengthening of SEAM, INFONA, Public Ministry, and Municipalities for improved monitoring and
surveillance of deforestation and enforcement of environmental and forest regulations in production
landscapes; 3)One national and three departmental soy/beef platforms for inter-institutional and multistakeholder dialogue on land use planning regulations, enforcement, and incentives for best practice
adoption within production landscapes, involving all land use managers and supply chains. Outcomes 1, 2
and 3 are mutually reinforcing. Outcome 1 will provide the enabling framework for pilot interventions in
the field under Outcomes 2 and 3. In turn these pilot interventions will provide the ground testing for final
adjustment of the framework and set the basis for replication.
Output 1.1: A package of modifications in regulations, policies and standards at national level to
improve protection of the Upper Parana Atlantic Forest
126. The project will seek the optimization of the regulatory framework for assessment of
environmental impact, environmental services and institutional financing; as well as the reform of the
environmental penal legislation. Moreover, it will help to improve the enforcement of this package of
regulations by supporting field testing through Outcome 3 of the decentralization of environmental
responsibilities from the national government to local governments, improving on the ground performance
of monitoring and control of land use and management, and optimizing the use of resources from fees,
fines and other funds generated by the implementation and enforcement of the environmental laws.
Finally, it will lay the bases for replacing the use of firewood from native forests for firewood from
plantations for use in silos and other agricultural industries in the project area. Implementation of this
output will require close coordination between SEAM, INFONA, MAG, Public Ministry, Municipalities,
the National Commission for Defense of the Natural Resources (CONADERNA) of the National
Congress, the Environment Directorate of the Supreme Court, and organizations of the productive sector.
Development of detailed provisions for key laws
127. Environmental Impact Assessment Law: During Project Year 1 (PY1) and PY2, the project will
support SEAM in the revision and update of the Environmental Impact Assessment law (294/93), the
Environmental Services law (3001/06) and SEAM´s law (1561/00), as well as the new Fees and Fines law
41
currently being studied by the National Congress. Given thenewEIA provisions prepared by SEAM
(mentioned the barriers section) the project will provide technical support to prepare a Generic
Environmental Management Plan and Terms of Reference for preliminary EIAs for the UPAF. The project
will work to ensure that the Generic Environmental Management Plan complies with the zero deforestation
policy and includes safeguards regarding set asides and reforestation/afforestation setting national
standards that include biodiversity conservation considerations. The project will also work with SEAM to
prepare guidelines for the Terms of Reference for the preliminary EIAs to ensure safeguards related to
reforestation/afforestation particularly for energy. These will also be used to reinforce standards for credit
approval through Output 2.1. Preparation of the plan will include consultations with key stakeholders. The
project will prepare and pilot a minimum set of certification standards for soy production.(Output 1.4 and
2.2) and best practices for soy and livestock production (Output 3.1) in addition to specific guidelines for
reforestation and afforestation. It is expected that as these are developed they will be mainstreamed into
SEAM´s Environmental Plan for the UPAF, hence contributing to further improvement of the plan and
implementation throughout the ecoregion.
128. Environmental Service Law: The project will provide support to complete the current provisions of
the Environmental Services law Nº3001/06. SEAM has advanced in preparing provisions regarding forest
ecosystems by establishing a scheme for SEAM certified forest set-asides. The project will help prepare
provisions for certification of other ecosystems such as grasslands and wetlands under this output; it will
also support the development of a mechanism (brokering system) to market the SEAM-certified set-asides
in the capital markets thereby enabling SEAM to implement the law. This will be done under Output 2.1
below.
129. Law 1561/00 that creates the SEAM foresees the establishment of an environment fund for which
several proposals have been prepared but never implemented. As a means to support the long term
development of the market for SEAM-certified forest set-asides (Output 2.1) the project will review the
existing proposals and design a proposal for this fund. An environment fund that could supplement the
SEAM-certified set-asides market could constitute a key instrument to balance the costs between
conversion of ecosystems to agriculture and livestock production and their conservation and sustainable
management; costs that currently favor the conversion of ecosystems. The fund would enable the
acquisition of set-aside certificates at prices that can compete with those prices that could be obtained for a
change in land use (minus the costs of the change). Additionally, the fund would provide funding for
income generating activities from the sustainable management of forest remnants. The fund could also
purchase set-aside certificates in special cases such as small farmer communities and indigenous peoples
as a means to promote conservation and improvement of their livelihoods. Sources of capitalization of the
fund will be studied as part of project support; possible sources include State and donor funds, and a
percentage of fines for infringement of the environmental regulatory framework.
130. Fines Law: SEAM has prepared and submitted for approval by the National Congress a proposal
for a Fees Law expected to be sanctioned in parallel to Project start-up. This law is expected to improve
SEAM´s capacity for collection of fees and fines. Currently, SEAM´s income from these sources is
estimated in US$270,000/yr, which is insufficient to cover monitoring and control at national level and
this is reflected in the low staffing and resources of the institution for this purpose. The proposed law
would allow increasing SEAM´s capacity to apply fines from a current maximum of US$14,000 per
infringement to a maximum of US$140,000 per infringement, hence increasing the incomes that could be
destined to fulfill its monitoring and control responsibilities. The project will support the elaboration of
provisions for this law to ensure its effective implementation and enforcement. The goal is to increase the
current annual incomes by 60%, hence increasing the capacity of SEAM for the long term financing of the
incremental activities proposed within this project to ensure global benefits in the UPAF.
42
131. Reforestation/Afforestation Law. The project will support INFONA in the revision of the
Reforestation/Afforestation Law (Nº536/96). This will include consultation with key stakeholders such as
the ones mentioned above and the Forest Board, which is a forum comprising governmental and nongovernmental institutions to promote inter-institutional dialogue in forestry issues. Proposed modifications
of this law will take into account the identification of incentives for reforestation with appropriate native
species, and reforestation/afforestation projects for wood energy that provide environmental benefits and
reduce pressures over native forests. In this sense, the project will develop and pilot financial incentives
(credits) under the framework of this law (Output 2.1).
132. The project will closely work with SEAM, Public Ministry, the Environment Directorate of the
Supreme Court, CONADERNA and the Academia to propose the modification of the environmental penal
framework (Penal Code and the Environmental Crimes Law Nº716 establishing sanctions that penalize
with severity the grave or irreparable damages to the environment. This will improve the mandates of the
both the SEAM and the Public Ministry.
Development of agreements for decentralized enforcement
133. To promote a more effective implementation and enforcement of this package of regulations, the
project will promote piloting of Delegation Agreements between SEAM and Municipalities. As
aforementioned in the legal context and barriers sections, the Municipal Government Law provides for the
decentralization of environmental management and monitoring to Municipalities through Delegation
Agreements; however, no agreements have yet been established. Delegation Agreements have the
potential to enhance the presence of the State throughout the country and improve the performance of the
relevant environment-related institutions in terms of law enforcement. Another advantage of the
Delegation Agreements would be the cost-effectiveness given by a more efficient use of local resources
and reduction of mobilization costs by SEAM (and/or INFONA). Delegation Agreements imply the partial
decentralization of environmental management functions; SEAM and/or INFONA do not lose their
monitoring and control responsibilities and have the power to eventually withdraw the delegated functions
if judged necessary.
134. The project will pilot the design of Delegation Agreements between SEAM, INFONA and four
Municipalities (San Cristobal and Cedrales, in the Department of Alto Paraná, Villa Ygatimi in the
Department of Canindeyú and Pedro Juan Caballero in the Department of Amambay) during PY2. These
agreements will provide the framework to enhance coordination and collaboration of national and local
governments and to enable Municipalities to exercise their mandates and roles in regard to environment
and production within their territories. The project will strengthen the capacities of SEAM and the
Municipalities (and other relevant institutions) to implement the Delegation Agreements (Output 1.2) and
will pilot field monitoring and control activities in the four pilot Municipalities (Output3.4).
135. The Project will support SEAM to raise awareness and inform the Municipal authorities on the
scope of project activities in support of the Delegation Agreements, including design, capacity building
and piloting of activities in the field. The agreements will be designed through participatory workshops in
each Municipality that will serve the purpose of agreeing upon the responsibilities and tasks to be
delegated, coordination mechanisms and commitments of the parties. Lessons learned from
implementation of the Delegation Agreements in the field (Output 3.4) will be extracted to finalize the
design. Information materials will be prepared to disseminate information and raise awareness on the
Delegation Agreements and the ordinances establishing the fees. These information materials will be
distributed not only within the territories of the pilot Municipalities but also to the remaining
Municipalities of the priority areas to raise awareness of the authorities and generate their interest. During
PY4-5 the project through this output (1.1) will support the remaining 16 Municipalities in the priority
areas to design their Delegation Agreements to promote upscaling within the MULs.
43
Firewood substitution plans
136. Finally, the project will support INFONA to prepare a Plan for reduction of the use of firewood
from native forests by silos and other agricultural industries. The project will support INFONA in the
preparation of this plan with the participation of the private sector during PY1 and will have the objectives
of reducing the use of firewood coming from native forests by 50% in 4 years and full substitution with
firewood coming exclusively from plantations in the long term. INFONA will be in charge of
implementing the plan with the private sector. The project will monitor progress in reduction of the use of
firewood from native forests by agriculture-related industries in the priority areas.
Output 1.2: Institutional strengthening of SEAM, INFONA, Public Ministry, and Municipalities for
improved monitoring and surveillance of deforestation and enforcement of environmental and forest
regulations in production landscapes
137. This output will strengthen SEAM, INFONA, Public Ministry, Municipalities and other key
stakeholders to improve their planning and monitoring capacities to improve surveillance and enforcement
of the environment and forest regulations in the field. Capacities will be developed at both national and
local levels through the following strategies: 1) improving the decision support system for managing
production landscapes, facilitating control and oversight and providing access to public information; and
2) promoting inter-institutional dialogue and coordination, and developing the organizational skills that are
required to update the procedures of surveillance, intelligence gathering, policing, prosecution and
penalization of legislation infringement.
Improved and coordinated forest monitoring
138. The project´s first approach will be to strengthen coordination for monitoring between SEAM,
INFONA, Public Ministry, National Cadaster Directorate of the Ministry of Finance, Public Registry
Directorate of the Judicial Branch, and local governments (Departments and Municipalities). A
strengthened coordination will enable these institutions to implement an effective monitoring of
compliance with environmental laws, particularly those related to forest ecosystems, by landowners within
the UPAF. Monitoring of compliance with regulations regarding forest ecosystems is shared by SEAM
and INFONA under the EIA, Forest and Environmental Services laws. The Public Ministry intervenes in
cases to be prosecuted under the Environmental Crimes Law, whilst the National Cadaster Directorate and
the Public Registry Directorate are responsible for providing information on the ownership of lands where
a violation has been detected. Local Governments on their part have responsibilities regarding planning
and control of land uses under their corresponding organizational laws. The project will support
improvements to surveillance and enforcement by developing a monitoring system shared by the abovementioned institutions to monitor compliance with regulations regarding conservation, land use and land
use changes thereby enforcing the GoP´s zero deforestation policy. This system will ensure timely
availability of information at departmental, area and farm levels (ecosystems, land uses and management
and ownership), removing current constraints that hinder effective monitoring and control (ie. scattered
information, lengthy and time consuming procedures). The system will be designed under this output and
will be tested in the project´s priority areas under Outcome 3 below; the results of field piloting will in turn
serve to finalize the design of the system. Additionally access to this system by buyers will be used to
guide purchase policies (see Output 2.2)
139. The project will coordinate with the ongoing UN REDD+ National Joint Programme (NJP). This
programme has allocated funding to support SEAM and INFONA to develop the National Forest and
Environment Information System (national level). The NJP has developed a beta version of a web portal to
facilitate public access and where basic information is currently being uploaded20. It is expected that as
SEAM and INFONA continue to develop integrated databases, more comprehensive information will be
made available to the public and decision makers through this web portal. The project will design and test
20
http://paraguay-smf.org/?lang=es
44
a National Forest and Environment Monitoring System that will be integrated into the National Forest and
Environment Information System and will link the relevant institutions to facilitate information exchange,
monitoring and control. The institutions to be involved in the design and implementation of the
monitoring system and potential roles are summarized in Table 12 below.
Table 12: Institutions to be involved in the Monitoring and Control System
Institution
SEAM
INFONA
Public Ministry
Ministry of Finance
Judicial Branch
Municipalities
Offices
 Directorate General for
Environmental Quality and
Natural Resources
 Directorate for Territorial Land
Zoning (Directorate General
for Environmental
Management)
 Directorate of Forest Cadaster
Roles
 Collects information regarding environmental
licensing to be uploaded into the system






Directorate of the National
Forest Information System
Environmental Crimes Unit
National Cadaster Directorate
Public Registry Directorate
Environment Secretariats (to be
created with Project support)

Manages a GIS and collects cartographic
information. Will coordinate uploading of
information within the SEAM

Responsible for information on forest cadaster
and management plans
Coordinates work within INFONA regarding
the National Forest Monitoring System
Facilitates information on judicial processes
Facilitates information on properties
Facilitates information on properties
Will provide information on cadastral accounts
and other information pertaining to the
Municipality




145. The monitoring system will be designed during the first year of the Project (PY1). SEAM and
INFONA will agree on a joint work plan for design and implementation of the system. This work plan
will be co-funded and coordinated with the UN-REDD+ Programme and will include a diagnosis and
mapping of current information technology within the concerned institutions; the identification of
equipment that will be needed to update and/or complete the existing ones; and the commitments and
protocols to upload information into the system by each one of the participating institutions. This
diagnosis will constitute the basis for design of the architecture (informatics) of the system. Design of the
system will comprise three levels of information: a) a detailed level at the scale of four pilot Municipalities
where the monitoring system will be tested under Output 3.5; b) an intermediate level given by the 16
remaining Municipalities within the three selected priority areas; and c) at a broader scale the three
Departments (Alto Parana, Amambay and Canindeyu) of intervention.
146. The system will be able to manage spatial data such as satellite images. Free access images such as
LANDSAT and others will be used to ensure the sustainability of the system. During the design stage, the
existing digital cartography and other key data that exist in the SEAM, INFONA, Public Ministry and the
Municipalities themselves will be organized and collected in order to feed the system once the design is
completed. The system will also be able to produce reports that will function as an electronic bulletin for
dissemination of basic monitoring data and will be issued in a format that will be accessible to the public.
A key aspect of the design will be facilitating access to information as much as possible by using everyday
tools. One possible manner to achieve this could be by developing a specific application for cellular
phones where the user promptly receives the information as it is updated in the system.
147. The project will support the start-up of the monitoring system during PY2. Achieving readiness
for implementation of the system will be a part of the design stage and will include: a) procurement of
equipment; b) training; c) updating of the system; and d) reporting. The diagnosis carried out during PY1
will be the basis for supplying equipment to the relevant institutions to implement the system.
45
Procurement of equipment could include: geo-processing software or renovation of licenses, equipment for
field verification (cameras, GPS), improvement of Internet connections (for the Municipalities). Staff of
the concerned institutions will be trained to implement the system through theoretical courses and on-thejob training. Training will include functioning of the system, feeding and uploading of information,
analysis of data and production of reports. Manuals and guidelines will be prepared to facilitate training as
well as operation and maintenance of the system in a format that will enable a self-guided use.
148. Following installation of equipment and training in the use of the system, the institutions will feed
the data collected, and will test the system analyzing information and producing reports. The types of
reports, their frequency and dissemination modes will be defined during design; they will include – inter
alia – maps, monitored points, changes detected, and general information on the project areas such as
number of farms that have initiated restoration activities, and number of farms with environmental
liabilities. The maps and reports will provide national institutions, local authorities and companies land
use information at a property level on a periodical basis. Maps and reports will be shared with the multistakeholder soy/beef platforms to be established under Output 1.3 below thereby contributing to debate
and discussions on issues pertaining land use, compliance of regulations and sustainable production.
Moreover, data on linking production practices to habitat impact and conversion will be offered to
commodity buyers to assist them in their purchasing decision making (Output 2.2).Once the information is
available in the system, a cadaster of environmental assets and liabilities in the Municipalities of the
priority areas will be prepared. This activity will be the basis for the elaboration of restoration plans of
protective forests and legal set-asides, as well as piloting of the surveillance and enforcement approaches
(Outputs 3.2, 3.3 and 3.4). Monitoring per se will be carried out through remote-sensing tools (satellite
images) combined with information produced by the participating institutions, including management
plans, environmental licenses, ongoing judicial processes and authorized land uses. The system will
include a data base to differentiate landowners who comply with the environmental regulations in force
and those who do not. This information will also be useful to initiate administrative or judicial processes,
influence in the purchasing of commodity buyers or to establish incentives.
149. The monitoring system will also be capable of monitoring project progress and impact at
landscape level in the project priority areas and at a broader scale in the three Departments. Monitoring
and evaluation of the project will ensure that the proposed activities and actions are carried out and
whether the anticipated results have been achieved. Examples of key parameters to be monitored are
included in Table 13 below and detailed in the Results Framework in Annex A.
Table 13: Parameters to be monitored
Parameter
Increases
Decreases
Surface area of protective forests demarcated and under regeneration (*)
X
Surface area of legal set-asides demarcated and under regeneration (*)
X
Surface area intended for tree plantations for energy (*)
X
Surface area of production land using live fences (*)
X
Number of silos using firewood from native forest
X
Number of controls carried out based on the results of the use of the monitoring system
X
(*)
(*) Parameters easy to obtain on the basis of satellite images and reports of field controls. Monitoring frequency
could be annual or bi-annual
Strengthened institutional roles and responsibilities for monitoring and enforcement
150. The second approach will be to strengthen SEAM, INFONA, Public Ministry and Municipalities
to improve their planning and monitoring capacities. Capacities will be developed at both national and
local levels through1) reorganization of functional structures of the relevant institutions; and 2)
46
development of guidance manuals and enforcement protocols; and 3) training and capacity building
programs.
151. During PY1 an Organization and Methods (O&M) study will be carried out to analyze the
structure of SEAM, INFONA and the Public Ministry in regards to planning, monitoring and enforcement
of environmental regulations. The analysis will involve a number of bodies within the institutions. These
bodies and their current roles are summarized in the following table.
Table 14: Institutions/bodies with roles in planning, monitoring and enforcement of environmental
regulations
Institution / Bodies
SEAM
 Directorate for Control of Environmental
Quality and Natural Resources
 Directorate for Surveillance
 Directorate for Legal Advice
INFONA
 Directorate General for Forests
Summary of Current Key Roles for the project

Directorate General for Regional Offices

 Directorate for Legal Advice
 Directorate for Forest Plantations.
Public Ministry
 Specialized Units for Environmental Crimes






In charge of reviewing and approving environmental
impact assessments
Environmental control and surveillance
Legal procedures regarding the regulatory framework
Assessment of forest management plans; keeps the forest
cadaster; issues authorizations for commercialization of
timber
Coordinates and supervises activities of the Regional
Offices in charge of monitoring and control in the field
Legal procedures regarding the regulatory
frameworkAssessment and approval of AF/RF projects
Receives denouncements and prosecutes environmental
crimes (eg. deforestation)
Municipalities where decentralization will be
piloted
152. The analysis will cover the current structure and functions as well as a proposal to improve the
functional structure, including the updating of procedures, responsibilities and staff profiles, and the
reorganization of key offices (directorates, units, etc.) to ensure adequate staffing and budgets.
Reorganization will be based upon a work plan with agreed milestones that will take into account the
national budgeting procedures to ensure the proper allocation of funding that may be necessary to secure
new and additional staff salaries and operational expenses during the project lifetime and beyond. Specific
training plans will be developed in accordance with the new roles and responsibilities and training will be
developed throughout PY2-4 to ensure coverage of current staff and future staff that may be incorporated
as per the new functional structures. Both the O&M study and the training under this output will
coordinate with the activities undertaken in Output 1.1 for adjustment of the legal framework and for
implementation of the monitoring system.
153. At municipal level, the O&M study will focus on the needs and requirements to implement the
Delegation Agreements (designed under Output 1.1) in the four pilot Municipalities. Given that the
Municipalities currently have no structure and organization to carry out surveillance and enforcement, the
project will support the establishment of Environment Secretariats in each one of the Municipalities during
PY2. The Environment Secretariat will constitute the law enforcement authority within the Municipality
to implement the delegated responsibilities. This will include defining organization charts, staff profiles
and roles and responsibilities, as well as a proposal for financial sustainability. The financial sustainability
study will help calculate the Municipal feeto be charged to the taxpayers within the municipal territory21. During
21
The fee should cover the costs of salaries of the staff necessary to implement monitoring and control as well as costs of
maintaining premises and equipment. A theoretical calculation for example purposes would be: a) 15 inspectors at approximately
47
PY2-3 the project will support the start-up of the Secretariats by supplying minimum equipment
(computers, printers, GPS) to allow the Municipality appointed staff to carry out surveillance in the field
and uploading information into the Monitoring System. Staff will be trained throughout PY3-4 in the
following subjects: a) roles and responsibilities of the Environment Secretariats; b) Inter-institutional
Guide for Enforcement of Forest and Environmental Legal Framework; c) use of information and
communication technology; d) Municipal and environmental legal framework; d) Municipal funding
sources and budgeting.
154. The project will support SEAM, INFONA, Public Ministry and Municipalities to jointly agree and
develop an Inter-institutional Manual for Enforcement of the Forest and Environmental Legal Framework
as well as a training and outreach program to disseminate the use of the guide. The purpose of this manual
will be to clarify the roles and responsibilities of each institution in regards to enforcement of the different
laws and to define the mechanisms to ensure adequate cooperation and collaboration among the concerned
institutions in monitoring and surveillance. The manual will be prepared during PY2 and will be tested in
the four pilot Municipalities throughout the project´s lifetime (Output 3.4). Staff of the concerned
institutions will be trained in the use of the manual during PY3-4. During PY4-5 the project will support
the implementation of an outreach program targeting the authorities and staffs of the additional 16
Municipalities of the priority areas to disseminate the experience and lessons learned in the
implementation of the guide. During the project lifetime, the guide will be updated as necessary in
accordance with the progress attained in adjustments to the legal framework, the progress in the
reorganization of the institutions, and the experience gathered in the field.
155. Project support to institutional capacity building will also include the design of a 6-month
Specialization Course in Environmental Governance during PY2.This activity will be carried out through a
partnership with a University (National University or Catholic University), which will implement the
course in PY3. The course will train technical staffs providing them with knowledge and developing their
skills in: a) environmental, forest and land use legal framework; b) basic principles of environmental
governance; c) effective coordination of stakeholders involved in enforcement of the legal framework,
management of natural resources and monitoring of biodiversity. The course will target national and local
level technical staffs of public institutions (SEAM, INFONA, MAG, Public Ministry, Municipalities,
others) and private sector (commodity buyers, cooperatives, producer associations, suppliers of inputs,
NGOs), who will be proposed by their institutions. The course will adopt a training-of-trainers
methodology targeting 20 public and 5 private technicians. The training modules will follow an active and
participatory methodology; each one including practical as well as group work and case studies.
Replication of the courses by the trainees will be a requirement for accumulating credits and graduation.
The trainees from the public sector will in turn train an estimated 15 additional technicians, hence reaching
a total of 375. A criterion for selection of participants will be the counterpart contribution of the institution
to enable the trainee to carry out the replication (ie. locale, catering services, transportation of trainees,
etc.). The project will contribute to the replications with training and information materials. A preliminary
assessment of training needs was carried out during the PPG, which will serve as the basis for design of
the course, and are summarized in the table below.
Table 15: Basic design of the Specialization Course in Environmental Governance
Modules
Environmental legal
framework related to
Objective
To strengthen the capacities of the
participants in regards to legislation
Basic contents
 Legal framework: EIA, 0 Deforestation, Forest
Law, Environmental Services, Municipal
US$550/month (13 salaries - minimum wage - and social benefits) total US$99,000/yr; b) operational costs (procurement and
maintenance of equipment, office supplies and services): US$100,000/yr. The total cost is divided by the number of taxpayers; if a
district has 5,000 taxpayers, in this case the fee would be US$40/taxpayer/yr. Considering that agricultural incomes represent
some US$250/ha/yr this fee should not generate major rejections.
48
Modules
agricultural
production and
biodiversity
Objective
in force that affects agricultural
production, biodiversity and forest
management
Strengthening of
institutional
management for
enforcement of
environmental
regulations and
monitoring of
biodiversity
To strengthen the capacities of
participants in regards to mandates,
management, and coordination of
stakeholders within the environment
and productive sectors
Basic contents
Government, Fines. Scope and enforcement
authorities
 Analysis of the legal framework and
adjustments needed
 Institutional mandates; delegation of authority;
inter-institutional coordination (based on the
Inter-institutional Guide for Enforcement of
Forest and Environmental Laws)
 Management tools: surveillance records,
evidence, access to cadaster and public registry
data bases, etc.
 Measurement tools: GPS, satellite images,
equipment for measurement of springs.
 Communication and negotiation techniques
 Platforms. Advantages and functions
Output 1.3: One national and three departmentalcommodity platforms for inter-institutional and multistakeholder dialogue on land use planning regulations, enforcement, and incentives for best practice
adoption within production landscapes, involving all land use managers and supply chains.
156. In order to support the changes proposed by the project and ensure stakeholder participation and
buy in, the project will set up a national level, and three departmental level platforms for inter-institutional
and multi-stakeholder dialogue and action. The platforms will be oriented toward sustainable commodity
production in the long term but will begin operating within the framework of the project with soy and
meat. The platforms will constitute the mechanism to convene and coordinate the public and private sector
to promote sustainable production at the two levels (national and three departments) and to define the
sustainability priorities and policies for soy and meat; and reach agreement on key issues such as minimal
certification standards with environmental emphasis for soy and beef production (see output 2.1). The
project will seek to help the platform members develop a long-term space where the public and private
sectors can align, take ownership and develop joint concrete actions to mitigate the negative impacts of
commodity production and maximize productivity, hence strengthening the country's enabling
environment for sustainable commodity production. The platforms will be based on the following
principles: neutral, empowerment and social inclusion, multi-stakeholder, strong facilitation, and conflict
resolution.
157. Once minimal certification standards with environmental emphasis are agreed upon, thee
platforms will have a key role in promoting sustainable products from Paraguay at international level
through a marketing and outreach program that will help advertise and construct a “country brand” to
differentiate Paraguay from other soy producers in the region, where the country´s production will be
associated with sustainable production, hence adding value to production and making a difference with
competitors. For instance, in Europe, South American soy is associated with deforestation in the Amazon
or with contamination of the environment. The vision is to establish a difference by having Paraguay
being seen as a sustainable production country; this image of the country would provide strong support to
achieve differentiated markets for certified products. In this sense, as aforementioned, the combination of
direct sowing and RR technology implies an intensive use of agro-chemicals (fertilizers, insecticides,
fungicides and herbicides), which is causing high levels of contamination to water sources as well as
potential health impacts if used incorrectly. The project will work to reduce the use of these agrochemicals
and put in place a number of measures to safeguards against damage to natural habitat and health.
However the debate on genetically modified (GM) soy goes beyond its impact in increasing agrochemical
use. Whilst it is unlikely that the GM soy will impact biodiversity as there are no known wild relatives in
the area, worldwide the debate continues on potential impacts on health. The project will address this by
49
including within the platforms specific events and discussion on GM to inform and debate nationally and
to develop safeguards related to this as they unfold internationally.
158. Establishment of the platforms will build upon UNDP´s experience developing National
Commodity Platforms under its Green Commodities Program, providing lessons learned and guidelines to
facilitate multi-stakeholder dialogue and providing the expertise and analysis to scale up action in the 3
intervention areas for soy and meat. The national platform will build upon two ongoing government
initiatives: the MAG´s Commission for Good Agricultural, Livestock and Forestry Practices set up as an
inter-institutional body to promote adoption of best practice in these sectors; and the MIC´s Sectoral
Roundtable for Meat, which is a roundtable of the National Network for Promotion of Investments and
Exports (REDIEX) to promote exports of meat and hides22. Both initiatives will be integrated into the
national platform.
159. The platforms will be established during PY1-2. It is expected that the national platform be
adopted through a Presidential Decree and the departmental platforms through Departmental Resolutions.
Upon establishment of the platforms, the Project will support drafting of Codes of Conduct, which will be
discussed and agreed by the platform members. The Code of Conduct will define the rules of procedure
for the platforms, including objectives, protocol for meetings, record keeping, decision making and
coordination mechanisms between the national and departmental levels. The National Platform will
establish two Working Groups: 1) Sustainable Soy Working Group, and 2) Sustainable Beef Working
Group. Each working group will prepare its work plans to support the proposed interventions leading to
the preparation of a National Action Plan for Sustainable Soy and Beef. At departmental level the
platforms will act as forums to discuss and agree on issues such as minimum environmental standards to
support the enforcement of the legal framework, promoting increase in sustainable land use and
conservation of biodiversity; connecting producers with markets that demand sustainably produced
products, protect food security, ensure sustainable livelihoods for small farmer communities and
indigenous peoples affected by the supply chains, and others. These will provide inputs to the National
Platform in the process of preparing the National Action Plan. Work plans of the platforms will be
prepared annually and will identify the responsibilities of the different members, and will allow
establishing agreements and partnerships to implement activities within the framework of the project.
Each platform will hold plenary meetings where representatives of each of the involved sectors participate
will be convened throughout the project´s lifetime. All members will be invited. The plenary sessions will
consist of presentations given by different the working groups, stakeholders and institutions related to
issues identified in the work plans and that have a direct relation to defining the model for responsible
production and trade under the project. They will be an opportunity for stakeholders to voice opinions and
reach consensus on key issues.
160. The project will also support the platforms with a financial sustainability study during the first year
of operation of the platforms. Funding (public and private) for platform operation is expected for the
duration of the first 3 years of the platforms, after which the leading government agency will be expected
to take over the leadership of the national platform, whilst the departmental governments will take over the
leadership of the departmental platforms and continue the multi-stakeholder dialogue.
161. Based on the assessment carried out during the PPG the national platform will convene the
following key stakeholders:
22
The Commission comprises central government institutions: MAG, SENAVE, SENACSA, INFONA, the National Institute of
Technology, Standardization and Metrology (INTN), MIC, the National Food and Nutrition Institute (INAN), private sector and
the Inter-American Institute for Agricultural Cooperation (IICA) Country Office. It does not include SEAM and other key
stakeholders of the soy and meat supply chain. The Sectoral Roundtable for Meat comprises stakeholders involved in export of
meat and hides (Paraguayan Meat Chamber, ARP, Customs, SENACSA and others), which is main objective; it does not include
sustainable production issues.
50





Public sector: MAG, SEAM, INFONA, MIC, National Planning Secretariat (STP), SENAVE,
SENACSA, Ministry of Finance, Financial Institutions (Central Bank, AFD, BNF and Livestock
Fund)
Private sector: Exporters (CAPECO, CAPPRO23, CPC), Producer associations and cooperatives
(ARP, APS, CAP, FECOPROD, UNICOOP, UGP), Financial Institutions (Paraguayan
Roundtable for Sustainable Finance)
NGOs and CBOs: national level NGO networks, indigenous peoples organizations and small
farmers associations.
UN related Agencies in Paraguay: UNDP, FAO, WB, ILO, UNFPA.
Donors
162. The lead government agency for the national platform will be selected during the establishment of
the platform, taking into account convening power and ability to provide funding to ensure financial
sustainability of the platform. During the course of the Project, other stakeholders may be invited to
participate as deemed necessary by the platform members.
163. Establishment of the departmental platforms will take advantage of the MAG´s experience in
convening local stakeholders and constituting inter-institutional roundtables for agricultural production.
The departmental platforms will convene the following stakeholders, on the basis of a preliminary
assessment during the PPG.
 Public sector: Departmental Governments, Municipalities, MAG´s Extension Directorate (DEAg),
and local agencies of financial institutions (BNF, CAH).
 Private sector: Producer associations (Regional subsidiaries of the ARP, cooperatives,
associations), private companies, and financial institutions.
 NGOs and CBOs working at departmental/local levels
164. A detailed stakeholder mapping will be carried out in PY1 and the key institutions will be invited
to participate in the platforms. The departmental platforms will be established under the leadership of the
Departmental Governments.
Outcome 2: Financial and market incentives framework to promote biodiversity and sustainable
land management within the target multiple-use landscape (GEF: US$1,918,064, Co-financing:
US$4,595,072)
165. This outcome will develop new market and financial opportunities to stimulate adoption of sound
environmental practices, conservation of biodiversity, and compliance with sustainable land use plans, by
soy and livestock producers in the target landscape. This will be achieved through several forms of
investment, including greening of financing for soy and livestock production and increasing the
availability of financing for long term investments; promoting commercial relations between producers
and buyers of sustainable products at national and international level to stimulate offer and demand of
Paraguayan sustainable production; and developing fiscal and market-based incentives for conservation of
forest set-asides.
166. This outcome comprises the following outputs: 1) Increased and diversified funding promotes the
integration of biodiversity and sustainable land management for MUL through financing opportunities,
incentives and REDD+; 2) Output 2.2: Differentiated markets for sustainable soy and livestock production
stimulate adoption of sound environmental practices, conservation of biodiversity, and compliance with
sustainable land use plans.
23
ADM, Cargill, Bunge, Noble, Caisa
51
Output 2.1 Increased and diversified funding complying to environmental standards promotes the
integration of biodiversity and sustainable land management for MUL through financing opportunities,
incentives and REDD+
167. This output will seek to develop financial opportunities for sustainable production of soy and
livestock; it will explore and facilitate access to new sources of long term financing that incentivize
reforestation/afforestation projects that promote sustainable management of soils and adoption of
renewable energy sources, and will develop incentives to conservation of forests and their ecosystem
services through payment for environmental services and REDD+ schemes based on the SEAM certified
set aside regulations (see barrier #2 par.88 above)
Financing (credits) for sustainable soy and livestock production
168. The project will outreach to the financial institutions in Paraguay that lend to the productive
sectors in the project area. The project will closely work in an initial stage with the Paraguayan
Roundtable for Sustainable Finance, integrated by the Banks Sudameris, Vision, Continental and Regional,
and will seek to engage other public and private banks that are lending to producers. These will include
the public AFD, BNF and FG, and the private banks Itau, BBVA and BANCOOP. The afore-mentioned
banks are responsible for over 80% of the agricultural and livestock loan portfolios, therefore successful
project interventions with this group of banks will have a high degree of impact. The banks Continental,
Regional and BANCOOP have started to request the presentation of environmental licenses in mid 2013,
seeking to improve their performance in regards to environmental standards. Within the public and private
banks sector, these three banks cover 42% of the soy portfolio and 36% of the livestock portfolio.
Commodity buyers will also be included in this activity given that they too finance production.
169. Project support will have a two-fold approach. Firstly, the project will support these banks to
mainstream environmental standards into their lending procedures, in particular ensuring that clients
comply with the provisions of the EIA law (ie. presentation of environmental management plans or EIAs)
and secondly, to develop credit lines to finance best practices and certification schemes. Implementation
of this output will be closely coordinated with the development of environmental management plans under
the EIA law (Output 1.1), promotion of certification schemes (Output 2.2) and the development of best
practices (Output 3.1).
170. The project will work with the banks to foster their engagement and raise awareness on the
following issues: a) the negative social and environmental impacts of conventional agriculture and hence
the impacts of the lending portfolio to interest the banks in reducing this indirect footprint; b) obligations
of producers under the EIA law; c) the illegal activities being carried out by many producers (eg noncompliance with set-a-sides and expansion into designated forests) and the potential implications for the
bank; d) the project will connect producers producing sustainably with exporters and buyers to improve
export agreements and guarantee sales whereas producers who continue to produce unsustainably will be
at risk of not having their produce sold; hence the project will be improving commercialization of
sustainable producers and reducing markets for unsustainable production hence making it more preferable
for banks to lend to producers involved with sustainable production and guaranteed export contracts; e)
economic viability of the best practices to be promoted by the project; f) the project will outreach to other
donors, international banks and government programs to try and secure funds for partial risk guarantees to
reduce risk to banks to lend to small producers interested in converting their practices to sustainable
practices. The Central Bank of Paraguay (BCP) will also be included in this activity. The BCP establishes
the regulations for the financial sector; hence the project will in this manner seek to raise awareness of the
authorities so that regulations addressing the sector take into account environmental issues.
171. To support banks to mainstream financing of best practices into their credit lines, the project will
carry out further assessments on the economic feasibility of financing best practices and certification
schemes, including all aspects related to risk analysis (ie. business plans, guarantees for recovery, recovery
52
periods, costs, and return flows of capital). Aspects to be analyzed could include financing a set of best
practices with a recovery period that could be distributed throughout several harvests within the crop
rotation system and for a period longer than a single annual agricultural cycle. Several studies have
demonstrated the economic feasibility and costs of certain practices. For instance, increased yields from
direct sowing may increase profits by US$135/ha; contour lines have a cost ranging from US$300 –
US$800; and the use of 60-80ton/ha of pig manure has produced savings of US$130/ha in production
costs. The project will carry out further studies on other best practices to generate economic information
on a wider range of practices that can be included in the credit lines.
172. The project will then work with the banks to adjust their lending procedures by including
compliance with the environmental management plans required by the EIA law and adoption of best
practices as part of their requirements for granting loans to soy and livestock producers. The project will
also work with the banks to develop credit lines to finance certification schemes for soy. In this sense, the
project will prepare 30 credit plans to finance certification schemes that will be piloted under Output 2.2.
These plans will be prepared by professionals that have experience in certification and with the
participation of producers and commodity buyers. Plans will include the assessment of the baseline
situation in the pilot farms, the proposed investments and their costs as well as the auditing costs for
certification. The costs of developing future plans would be charged to the loans. Technicians and loan
officers will be trained in the new procedures and credit lines during PY2 and PY3 (see Table 16).
Table 16: Financial institutions that will receive training
Institutions
Central Bank of Paraguay
Financial Agency for Development (AFD)
Livestock Fund (FG)
National Development Bank (BNF)
Banks (Continental, Regional, Vision, Sudameris, Itau, BBVA,
BANCOOP)
UNICOOP and member cooperatives
Financing companies
Commodity buyers
Total
Nº of staff to
be trained
2
3
3
3
24
10
5
5
55
173. Finally, the financial institutions will disseminate information on the new procedures and credit
lines to landowners during PY2 and PY3. By the end of the project, it is expected that 80% of the soy and
livestock loan portfolios comply with the pre-requisite of presenting environmental management plans in
accordance with the EIA law, and that at least 4 banks have mainstreamed best practices in their loan
approval procedures with 50% of their loan portfolios comprising loans financing best practices.
Financing for long-term afforestation/reforestation that deliver environmental benefits.
174. The project will seek to increase the availability of resources to finance long-term investments for
afforestation and reforestation. Although these activities will preferably be oriented toward wood energy,
they will directly contribute to reduce the pressure on native forests. These long-term resources will also
be available to finance restoration of protective forests of watercourses and legal set-asides by landowners
with these environmental liabilities.
175. To this purpose, the project will work with potential institutional investors such as IPS, ANDE,
Itaipu and private pension funds to demonstrate the feasibility of channeling the financial resources, which
they currently maintain in banks, to finance afforestation/reforestation projects (ie. exotics, native species
or combinations of exotic and native species, agroforestry/silvopastoral systems) that promote connectivity
and contribute to the project objective. The main purpose would be to finance wood energy as a means to
53
reduce the pressure on native forests. The project will hold meetings with authorities and staff associations
of the above-mentioned institutions to promote buy in and raise awareness on the potential to invest
pension funds in long term credits that would have a positive impact on the environment and benefit
society as a whole. Likewise, meetings will be held with financial institutions (banks, cooperatives and
financing companies) to interest them in channeling these credits to landowners and investors and cofinancing the loans (ie. 70% financed by pension funds and 30% by financial institutions).
176. The project will carry out in PY2 an in-depth assessment on the economic feasibility taking into
account investment costs, return rates and other aspects related to the risk assessments carried out by
financial institutions. Costs of A/R differ for exotic and native species. For exotic species the cost is
US$1,264/ha whilst for native species the cost is US$1,748/ha. The study will analyze the feasibility of
each case; it will also analyze financing of restoration of protective forests. The cost of restoration has
been estimated in US$1,400/ha. Studies have analyzed the return rates of A/R projects, which are included
in the table below.
Table 17. Return rates of A/R projects in marginal lands (*)
IRR under normal conditions, eucalyptus
IRR A/R in marginal lands (class IV, V and VI soils) of low opportunity cost,
eucalyptus
IRR A/R in marginal lands (class I, II and III soils) of low opportunity cost,
eucalyptus
IRR A/R under normal conditions and marketing carbon credits, eucalyptus
IRR native forest management under normal conditions, without marketing carbon
credits
IRR native forest management under normal conditions and marketing carbon
credits
9.20%
8.90%
8.70%
10.20%
0.08%
2.50%
Source: GIZ, PMRN, 2012.
(*) Lands not used for agriculture
177. A/R in marginal class IV, V and VI soils is slightly more profitable that in better soils (I, II and III)
due to their lower opportunity cost (9.2% against 8.9%). In the event of selling carbon credits the
profitability of both native and exotic species improve (10.2% and 2.5%). A/R with native species does not
seem to be profitable due to the higher investment costs, long term and low prices paid to producers. All
these aspects will be taken into account in the feasibility study identifying the most suitable mechanisms to
promote A/R.
178. On the basis of the results of the assessment, the project will support the establishment of longterm credit lines and will support training of the staffs of financial institutions for implementation of these
lines. The project will prepare 30-40 A/R financial proposals that will be piloted in the priority areas under
the newly established credit lines. These proposals will include social, environmental and economicfinancial analyses. Economic and financial analysis will cover cash flow; financing flow; risk and
sensitivity; return rates; impacts on the region, the producer, the economy and the environment. The
environmental analysis will cover conservation/increase of biodiversity; A/R options that include native
species or combinations of exotic and native species, agroforestry and silvopastoral systems that promote
connectivity. The costs of preparing the proposals will be covered by the project on a pilot basis. The costs
of future financing proposals would be charged to the loans. The financial institutions will disseminate
information on the new procedures and credit lines to landowners during PY2 and PY3. It is expected that
producers with environmental liabilities under the Forest Law will show greater interest in making use of
these financial opportunities.
54
Brokering system for trading of SEAM-certified forest set asides
179. The project will support the development of a brokering system for trading of SEAM-certified
forest set-asides within the framework of the Environmental Services Law Nº3001/06 and to explore the
voluntary carbon market. The brokering system will pursue the objective of negotiating the best market
prices, thereby helping to optimize forest conservation. Development of the brokering system will be
based on the Habitat Banking concept24. The system will differ from a classical market based Payment for
Ecosystem Services scheme where supply and demand are voluntary. In this case, there is a compulsory
market comprised by landholders with environmental liabilities who are obliged by law to either reforest
these liabilities or buy set-aside certificates. The price of the set-aside certificates is established by SEAM
on an annual basis. In principle, these SEAM set-aside certificates may be traded in the market through
several channels: 1) direct transactions between suppliers and buyers; 2) stock market; and 3) commodity
brokers.
180. During PY1 the project will design operational procedures as well as a data base to register those
landholders whose set-asides have been certified by the SEAM. This data base will set the basis for
developing a market for the SEAM-certified set-asides, by connecting landholders with certified set-asides
and landholders who should compensate their liabilities by buying these certificates. The data base will be
of public access enabling potential buyers to contact the sellers and agreeing on the transaction. Upon
completion of the procedures to register the transaction with the SEAM, the information will be uploaded
into the data base to keep record of the transactions between buyers and sellers. The set-aside certificates
may be converted into negotiable stocks and traded in the stock market, in which case these certificates
must be guaranteed by the State. This means that specific budgetary provisions must be included every
year in the National Expenditure Budget. To this effect, the project will support SEAM throughout the
project lifetime to ensure that this budgetary item is included in the annual National Expenditure Budget.
181. Several options will be considered within the project framework to stimulate the demand for setaside certificates. The Res.503/12 stipulates that the SEAM must monitor the compliance with legal setasides and protective forests of watercourses in properties larger than 20 ha. In the event of environmental
liabilities, the landholder may either prepare a reforestation plan to recover the liabilities or acquire the setaside certificates. Within this context, it is expected that the strengthened monitoring and surveillance
under the project (Outputs 1.2 and 3.4) will be more effective in detecting the existing liabilities, hence
creating a demand from the potential buyers. A second option will be to stimulate demand by large
infrastructure projects (ie. Roads, bridges, ports, airports) as foreseen by Decree 11202/13 which stipulates
the obligation of this kind of projects to buy SEAM forest-certified certificates. The project will work to
raise awareness of the infrastructure related associations and chambers that contract with the Ministry of
Public Works (MOPC) on their obligation to buy set-aside certificates to compensate environmental
liabilities resulting from implementing infrastructure projects. The third option to be explored will be
strengthening the capacities of judges and public attorneys so that fines and monetary penalties be destined
to purchase of set-aside certificates. During PY3-4 the project will design and implement a training course
for commodity brokers to strengthen their brokering capacities to stimulate transactions. Project activities
under this output and in the field (Outputs 3.2, 3.3 and 3.4) will help stimulate supply and demand to test
the brokering system in the priority areas. The goal is to have 3,000 ha of SEAM-certified set-asides
within the priority areas and trading of set-aside certificates for 2,000 ha for an estimated price of
US$70/ha/yr.
24
Habitat/Conservation Bank:A parcel of land managed for its conservation values. In exchange for permanently protecting the
land, the bank owner is allowed to sell credits to parties who need them to satisfy legal requirements for compensating the
environmental impacts of development projects.(Habitat Banking in Latin America and Caribbean: A Feasibility Assessment.
UNDP.2010
55
182. The project will develop a REDD+ pilot project in the Canindeyu priority area to measure carbon
benefits and provide inputs to development of the brokering system, in order to seek higher prices for
SEAM-certified set-asides. This would constitute an additional income source above and beyond the price
negotiated for SEAM set-aside certificates that are based on a nominal prices fixed by SEAM. The project
will work closely with the ongoing UN REDD+ Programme and the planned REDD Readiness project to
be submitted to the Forest Carbon Partnership Facility (FCPF)25 to ensure producers that comply with best
practices and conserve and manage their forests, are considered for the Benefit Sharing distribution
mechanism. Synergies will be sought through the awareness raising and training activities that the UN
REDD+ Programme will carry out in the project intervention areas. The project and the UN-REDD+
Programme will work together to increase the knowledge and develop REDD+ capacities to forest
dependent peoples, especially indigenous peoples and other key stakeholders, including small, medium
and large scale producers. The project and the UN-REDD+ National Technical Team will design in PY1
REDD+ capacity building activities that will developed in the project´s priority areas. The activities will
include awareness raising campaigns, training and consultation with indigenous peoples and producers.
183. The REDD+ pilot project will be designed during PY2 will be implemented with funding from the
FCPF; it will seek to put in place economic incentives for landowners that conserve or sustainably manage
their forests and adopt best practices for production in the Canindeyu priority area. The REDD+ pilot
would directly contribute to reduce deforestation in approximately 6,000 ha of continuous forests or
remnants that are key to connectivity of the area´s ecosystems; hence indirectly contributing to conserve
the current mosaic of approximately 65,000 ha of forests. This would be achieved by including those
properties that currently have a high risk of deforestation within the voluntary payment scheme for avoided
deforestation and degradation. The forest area estimates will be confirmed during PY1 on the basis of the
available landowner cadaster. The information needed to design the pilot will be generated by the UNREDD+ Programme through the national studies currently being carried out whilst the area-specific
information will be produced through the FCPF.
184. The REDD+ pilot will employ the following methodology: a) Definition of the proposed REDD+
project limits (spatial, temporal, field measurements of the carbon and other GHG emissions sources)
through the UN-REDD+ Programme and the National Forest Inventory, including measurements in the
field to adjust the CO2 averages to the area; b) Analysis of the multi-temporal change in land use and
vegetative cover in the region of reference during the past 10 to 15 years and projection of the regeneration
potential of the forest. This information is being produced by the UN-REDD Programme and will serve as
the basis to analyze land use trends in the selected area. Depending on the level of detail required by
transactions, this information could be directly used or a specific analysis for the selected area could be
required; c) Analysis of the underlying agents, drivers, and causes of deforestation. The UN-REDD+
Programme will carry out the analysis, which will be adjusted to the specificities of the area, and
incorporating the area-specific pressures; d) Projection of the amount of future deforestation will be
carried out on the basis of the previous analysis and the projections of the commodity market trends (soy,
meat) in the area. This will also include other factors such as infrastructure development or specific
government plans for the area; e) Projection of future activity in the baseline (i.e., land use and change in
land cover baselines), using the results compiled from steps b) and d) above; f) Calculation of the
transaction, implementation, and opportunity costs associated with land uses in the project area. This will
provide a comprehensive idea of the economic benefits that could be accrued under this scheme taking into
account the current market prices. The results of this activity could be determinant in the level of buy in by
producers and adhesion to the scheme; g) Interpretation of remote sensing and precise and exact
estimations based on fieldwork of the expected baseline of carbon reserves and avoided CO2 emissions; h)
Estimation of the expected leakages due to changes in the carbon stocks and avoided CO2 emissions. This
is a key activity in order to ensure that implementation of the pilot does not contribute to increasing
25
Readiness Plan Idea Note (R-PIN) was submitted in 2008. The Readiness Preparation Proposal (R-PP) will be prepared and
submitted in February 2014.
56
deforestation in other areas of the mosaic and therefore achieving the objective of conserving the forest
mosaic; i) Ex ante calculation of the expected net reductions of GHG emissions of anthropogenic origin; j)
Definition of the monitoring mechanisms within the pilot area, most probably the MRV methodology to be
developed by the UN-REDD+ Programme and ensuring mainstreaming of the social and environmental
safeguards within the methodology; k) Ex post calculation of expected net reductions of GHG emissions
of anthropogenic origin for a 20-year period following commencement of the pilot project; and l)
Adjustment of the baseline for the future period of credits. Once the information has been collected and
processed, funding should be secured within the voluntary market in order to carry out the transaction.
FCPF funds will be used to establish the legal agreements with landowners, as well as payment
procedures, including time periods and other necessary requirements.
185. The project will also strengthen the development of the market for forest set-aside certificates and
REDD+ carbon credits, so that the cost of externalities from deforestation and unsustainable land use
practices are incorporated into the planning of land use by departmental authorities. In particular, the
project will use economic valuation to make the business case for adoption of sustainable production
practices versus conventional and contra-conservation beef and dairy production systems. The project will
internalize new approaches by UNDP to determine the economic value of ecosystem goods and services
provided by the sustainable environmental management of agricultural and livestock production, and
compare these with the cost of unsustainable practices (by considering externalities).
Fiscal incentives to promote conservation of forests
186. The development of Municipal tax breaks will be another new source of funding to be explored by
the project to stimulate landowners to adopt environmental standards and compliance with sustainable land
use planning. The project will support SEAM in assessing the feasibility of establishing tax incentives to
improve environmental management. The assessment will build upon a World Bank study entitled
"Paraguay. Property Tax: Key Tool for Fiscal Decentralization and Better Land Use” (2007). The study
"examines municipal finances in Paraguay and estimates the potential revenue of a more effective property
tax. The study also analyzes the economic arguments for effective property taxation and international
experience as far as this is concerned. It suggests general improvements to municipal financial
management, in particular those required to manage a modern and more effective property tax”. That is, it
is a valuable precedent in which economic feasibility has been justified on a theoretical level.In regards to
SFM and biodiversity conservation the study proposes that forest set-asides should not be burdened by the
property tax and should also generate a tax credit that reduces the final amount of the property tax if they
are subject to some kind of certification of good use or management. The logic thata higher tax will
involve more intensive use of the land to offset the tax increase, therefore there will be greater incentives
for discounts and if those incentives are linked to forest conservation they will increase the interest
landowners in conservation. As part of the assessment, the project will promote participatory processes to
reach consensus on the most viable option to increase the fiscal values of rural properties. On the basis of
the results of the assessment and consensus building, the project will support the elaboration of a law
proposal to modify the property tax. SEAM will submit this law proposal to National Congress and will
follow-up and raise awareness for its approval and sanction.
Output 2.2: Differentiated markets for sustainable soy and livestock production stimulate adoption of
sound environmental practices, conservation of biodiversity, and compliance with sustainable land use
plans.
187. This output will seek to develop market incentives for adoption of minimal certification standards
with emphasis in environmental issues and internationally certified production. The PPG has confirmed
the pre-feasibility of implementing international certification schemes of soy in Paraguay. There are
different international standards for certification that derive from provisions of the European Renewable
Energy Directive (EU-RED). This directive establishes sustainability requirements for certification of
biofuels and biomass used in the EU. The European Commission approves the certification standards,
57
among them the following: a) ISCC, a publicly funded German scheme covering all types of biofuels; b)
Bonsucro EU, an initiative on biofuels based on sugar cane, centered in Brazil; c) RTRS EU RED, derived
from the RTRS initiative that is specific for soy-based biofuels and focused on Argentina and Brazil; d)
RSB EU RED, an initiative covering all types biofuels, e) 2BSvs, which is a system introduced by the
French sector and covering all types of biofuels; f) ABRS, a scheme established by Abengoa to cover their
supply chain; and g) Greenergy, which is a scheme introduced by Greenergy and focusing on ethanol from
sugar cane in Brazil26. The RTRS, ISCC and 2BSvs standards are currently in use in Paraguay and would
therefore be the most adequate for upscaling in the country (see Annex 4 for the detailed characteristics of
these standards).
188. According to estimations by local producers that implement RTRS certification, the total cost for a
property of approximately 10,000 ha is of around US$10,000 for the first year; with fixed costs ranging
between US$4,000-6000 and the difference corresponding to logistical expenses (among others travel
expenses for the international certifying body since there are no certifying bodies in Paraguay). Costs are
reduced by 50-70% in the second year. Verification schemes include registration or certification costs
stipulated by the bodies operating in the system. In the case of RTRS these costs are €0.3/ton of soy.
189. Two types of benefits for certified soy also should be considered: i) direct benefits; and ii) indirect
benefits or positive externalities. Producers who have passed the "test" to certify their production can sell
soy under two systems: 1) Chain of Custody (segregation or mass balance) which is basically the physical
sale of the certified product at a price predetermined by the parties; and 2) Commercialization of Credits, a
mechanism that allows transfer of certificates of "responsible soy" through credits (one credit is equivalent
to one ton of soy); in this mechanism certificates are independent of the physical flow and can be traded
independently of the soy. Paraguayan producers have opted for certification of soy through the credits
mechanism because it is a simpler method in which trading of credits is carried out directly with the final
consumer, while the former mechanism is carried out through intermediation by traders. Nevertheless,
there are no significant differences in prices between both systems; in fact, the premium for certified soy in
the international market for both systems ranges between US$2-4/ton. As for the indirect benefits these
relate mainly to the fact that inclusion of the sustainability criteria required for certification of production
provides companies and producers a mechanism to improve their management and production. Other
benefits include strengthening the relations between traders and producers, acquiring of “prestige" by the
certified company. It also helps reduce the chances of social conflicts with neighboring communities. An
additional benefit would be widespread international recognition of the sustainability of domestic
production.
190. In the case of meat one of the main comparative advantages of Paraguay is that the climate is
suitable for growing livestock on pastures throughout the year, which is one of the determinants of the
interest of markets in Paraguayan livestock. Certification is related to traceability to provide markets with
sanitary assurances and more recently certification of brands of meat produced by cattle breeds that meet
market requirements. The issue of differentiated production of meat has caught the attention of producers
in recent years. One of the first initiatives in this sense belongs to the association of breeders of Braford
cattle that developed a certification system for premium beef exports on the basis of the qualities of this
breed, which complies with the requirements of certain international markets (ie. Chile). The association
certifies that the lots to be commercialized meet the standards of the market of destiny and producers
receive a bonus (around US$0.20/kg). The products are commercialized under the designation “Braford
Brand”. Other breeder associations have begun to implement the same scheme. These experiences
constitute a basis for advancing certification standards for sustainable production. Key issues to be
considered include: a) traceability; b) production systems and management; c) effects on human health of
the different production systems (advantages of meat coming from grass fed cattle); d) animal welfare,
conservation and management of the environment.
26
www.mercosoja2011.com.ar
58
191. Within this context, the first step will be the elaboration in PY2 of economic and market studies on
sustainability and certification of soy and livestock production in the country. The studies will pursue the
following objectives: a) to analyze in more detail the costs and benefits of certification systems,
identifying a detailed structure of costs and incomes, taking into account the current experience in the
country (case studies); b) to analyze the international markets of interest to Paraguay, identifying and
contacting buyers that are interested in differentiated products produced under sustainable environmental
standards and/or certification schemes; c) to prepare proposals to optimize the operational costs of the
most viable certification schemes that may be implemented for soy and meat. The studies will be carried
out in close coordination with commodity buyers (ADM, Cargill, Noble, CAISA, Bunge) and will be
discussed and validated with the national and departmental platforms and with technical expertise provided
by UNDP´s Green Commodities Programme.
192. As afore-mentioned the certification schemes currently in use in Paraguay are RTRS, ISCC and
2SBvs. RTRS is applied by 2 companies in the Department of San Pedro, while ISCC is promoted by
ADMand 2SBvs by the other commodity buyers. All three schemes state in their environmental standards
that production must not originate in areas of high value for biodiversity or carbon stocks; however each
scheme has different assessment criteria. Based on consultations with commodity buyers during the PPG,
and as an initial step to interest producers and upscale certification schemes in the target landscapes, the
project will closely work with commodity buyers to identify and agree a set of minimum standards to
prepare producers for implementation of certification schemes. The minimum standards will cover social,
economic, labor, productive and environmental (zero deforestation, compliance of legal set-asides, best
practices including reducing agro-chemicals) aspects. These standards will be identified through
participatory workshops with key stakeholders (commodity buyers, Solidaridad, producer associations and
public institutions) and agreed by the Platforms and the commodity buyers. Project partners will
disseminate and provide technical assistance for implementation of these standards. The expected target is
to have 500,000 ha implementing the minimum standards by the end of the project.
193. To upgrade the capacities of public and private sector toward the implementation of full
certification, the project will closely work with Solidaridad, commodity buyers, cooperatives and producer
associations to implement training and outreach in certification systems during PY2-3. Training and
outreach will include: a) a seminar for exchange of experiences with participation of international experts;
b) a course on sustainable production and certification systems dictated by international experts and
targeting 42 technicians of public and private institutions, see table 18(key contents will include:
certification systems; requirements; costs and benefits; market opportunities for certification.
Table 18: Institutions that will participate in course on international certification schemes for soy
Institutions
Nº of technicians
Commercialization Directorate
2
MAG
Planning Directorate – Commission of Best Practices
1
SENACSA
Regional Offices
3
MIC
Sectoral Roundtable for Meat
3
SENAVE
Regional Offices
3
Technical assistance departments of 9 cooperatives (2
18
UNICOOP cooperatives
per cooperative)
Producer associations
(UGP, CAPECO, APS, Commercial and/or environmental units
10
ARP, Others)
Commodity buyers
(ADM, Bunge, Cargill, Commercial and/or sustainability units
10
Noble, Caiasa, others)
Total
50
59
194. The project will support this transition from implementation of the minimum certification
standards to full certification by improving the skills and knowledge of producers in the priority areas to
adopt international certification schemes that can guarantee maintenance of ecosystem functions within the
target multiple use landscape. The private sector technicians (Solidaridad, commodity buyers and
cooperatives) will identify producers that have the interest and potential to implement certification
schemes and will work with them to strengthen their capacities through a two-fold approach. The first
element will be direct technical assistance and training for farm planning, implementation of investments
foreseen in the farm plans and follow-up within the framework of the selected scheme. The second
element will be to put the producers and the financial institutions in contact so that producers may access
the credit plans (Output 2.1) developed to pilot the financing of certification schemes. By implementing
this approach the project expects to reach 50% of the surface area implementing the minimum standards,
that is 250,000 ha of soy under certification.
195. Preferential purchasing agreements will be promoted between commodity buyers and producers
that comply with these minimum environmental criteria and/or implement certification. Buyers will be
able to access the Monitoring System (Output 1.2) and verify if any of their suppliers is carrying out illegal
activities (ie. expansion of production into designated forest or non-compliance with the legal set-a-side
requirements, etc.) and decide not to buy production of that specific supplier. These measures are
expected to contribute to reduce the demand for unsustainable products.
196. Finally, the project will work with the market players to connect them to sustainable products
exported from Paraguay. This includes the buyers in Europe and the United States requiring certified
products. It will also include partnering with the initiatives also promoting certified product (ie.
Roundtable for responsible soy, Solidaridad and the Dutch Sustainable Trade Initiative). UNDP has
established strong partnerships with many of the main buyers such as the supermarkets, manufacturers and
the intermediate traders through its Green Commodities Programme. The one main segment of the market
still to be tapped is for animal meal, which is a large buyer of soy. The Dutch Sustainable Trade Initiative
has already started engaging the European industry and will be a strong partner in this regard to help
connect Paraguay to this industry segment. Interestingly, one concern of companies in committing to
sustainability targets is having the assurance of sufficient supply of certified product. So with this project
supporting an increase in supply of certified product will in itself help increase demand. The project will
provide support to the national platform during PY3-4 for organization of interviews and business
conferences with international buyers of sustainable products to promote the export of sustainable soy; and
promotion of sustainable meat in international fairs.
Outcome 3: Strengthened implementation of land set aside system and sustainable production
practices (GEF: US$2,390,852 Co-financing: US$ 9,501,122)
197. This outcome will seek to: 1) increase connectivity through conservation and recovery of forest
set-asides 2) promote widespread adoption of sustainable production practices that favor biodiversity; and
3) improve surveillance and enforcement approaches to maximize the environmental benefits of the
previous actions and provide assurance that the supply chains comply with a deforestation free standard.
198. Increase in connectivity will be sought through two strategies. The first strategy will be
implemented in the Canindeyu priority area, where there are significant forest remnants that are legally
protected. Increase in connectivity will be sought by engaging small, medium and large producers;
conservation of existing set-asides by small farmers in settlements and recovery of set-asides by medium
and large producers that have not fulfilled their legal obligation in terms of set-asides and no longer have
forest on their land so are required by law to compensate their environmental liabilities. This will be done
in the buffer zone of the Mbaracayu Forest Reserve, thereby delivering biodiversity benefits with impact
on this protected area. As fragmentation is so high- particularly in the Alto Parana priority area - a second
60
strategy will be employed to increase connectivity maximizing opportunities to deliver multiple benefits
(connectivity, reduced soil erosion and protection of water courses). This will be through restoration of
riverine forests to protect watercourses by those landowners that, as afore-mentioned did not comply with
their legal obligations, no longer have forests and are required to compensate this liability. The project will
ensure safeguards are applied to avoid any negative impacts on biodiversity.
199. The project will promote the adoption of sound environmental practices in soy and livestock
production by mainstreaming environmental standards, best practices and biodiversity considerations into
ongoing technical assistance programs by key stakeholders in the landscape (MAG extension service,
cooperatives and commodity buyers) that provide assistance to producers.These stakeholders will then
encourage producers to adopt a suite of best practices to ensure long-term sustainability of production.
Improved monitoring and surveillance at site and farm level will serve to ensure compliance of legal
obligations ensuring that no further infringements are committed by landholders as well as progress in
recovery of set-asides, restoration of forests and implementation of environmental management plans.
200. Indigenous communities are present in the project intervention areas, and especially in the
Canindeyu priority area. Although the main focus of project actions is not specifically on indigenous
communities or does it directly target them, these actions will have positive impacts on indigenous
communities that have land bordering soy crops. As afore-mentioned a specific strategy has been
developed to ensure adequate project intervention if indigenous communities are in such areas. The
identification of project interventions viable for indigenous communities will follow and respect their
organizational ways and cultural norms; will ensure that key show respect for their dignity and human
rights and will be carried out with an intercultural approach, from the worldview of each ethnic group´s
culture, and fundamentally respecting their collective and individual rights protected by international and
national regulations and including safeguards to ensure action do not negatively affect the livelihoods of
indigenous communities.
201. The outcome comprises the following outputs: 1) Technical assistance to medium and large scale
soy and livestock producers mainstreams best practices for sustainable production; 2) Improved forest set
aside in small, medium and large scale farms increase forest connectivity across the landscape in
Canindeyu; 3) Restoration of protective forests of watercourses in the MUL of three target landscapes
increases connectivity in highly deforested areas; and 4) Decentralized and joint enforcement approaches
improves surveillance of deforestation and compliance in 4 municipalities.
Output 3.1: Technical assistance to medium and large-scale soy and livestock producers mainstreams
best practices for sustainable production
202. The project will work to develop strategic partnerships among key stakeholders (public and private
sector, and landowners) to promote sound environmental practices and sustainable production in the three
target landscapes. Key stakeholders to be involved in implementation of this output are MAG, SEAM,
INFONA, SENAVE, SENACSA, IDH/Solidaridad, Cooperatives, APS, ARP and other producer
associations, FECOPROD, UNICOOP, and commodity buyers.
203. Promotion of sustainable production will be achieved through a two-fold approach. The first
approach will be building the technical capacities of public and private extension services through the
development of best practice manuals and training. This project will then work with the partners to
mainstream sustainability criteria and best practices into their technical assistance programs; hence
technicians will be better prepared to integrate environmental concerns in their day-to-day work with
producers. Moreover, the offer of better-qualified public and private technicians specialized in sustainable
production and capable of disseminating the new acquired capacities will increase as a result of the
project´s capacity building interventions.
61
204. During PY2 the project will identify environmentally sound best practices that are being currently
implemented or have the potential to be promoted within the scope of the project. A preliminary list of
best practices has been identified during the PPG phase and included in Table 16 below. This list will be
expanded through reviewing the existing guidelines for best practices (ie. SENAVE´s manual for fruits
and vegetables, the APS guidelines for soy cultivation and the ARP´s livestock handbook) and carrying
out consultations within the national and regional platforms, where the key stakeholders will be
participating. The project will then propose Sustainable Best Practice Manuals for soy and livestock
production, which will be validated by the national platform to ensure stakeholder buy in. The manuals
will identify a wide range of best practices. These will take into account the best practices suggested by
international certification schemes and will provide the basis for agreeing the practices to be included in
the minimum standards to be prepared under Output 2.2 above.These manuals will constitute the
framework to strengthen the capacities of public and private technicians and landowners and foster
upscaling of best practices within the UPAF. This activity will be coordinated with the financing of
sustainable soy and livestock production plans (Output 2.1) and the development of minimum certification
standards (Output 2.2) to ensure consistency of criteria and practices to be promoted under the different
foreseen activities. The best practices (or a minimum set of these) will be mainstreamed into SEAM´s
Generic Environmental Plan for the UPAF (Output 1.1), hence ensuring that these best practices be
eventually replicated throughout the whole of the UPAF. In parallel, the project will carry out an
assessment of the role of men and women in soy and livestock production systems. This assessment will
serve as a basis to introduce gender considerations in the Sustainable Best Practice Manuals.
205. The Project will closely work with the MAG to jointly develop together with SEAM, INFONA,
SENAVE and SENACSA a capacity building program for both the public and private sectors. The
training program will include gender issues on the basis of the results of the gender assessment. The
project will train 81 public and private technicians on the best practices manuals to strengthen their
capacities and to mainstream environmental criteria and practices in the technical assistance programs of
the relevant institutions (see Table 20 below).
Table 19: Beneficiaries identified for training in environmental standards and best practices
Beneficiary institutions
MAG:
 National Soil Program
 Paraguay Inclusive
 Food Production Program
 Agricultural Extension Directorate (Agricultural Development Centers in Alto
Parana, Amambay and Canindeyu)
 Viceministry of Agriculture – Biomass Project
 Directorate General of Planning
SEAM
N° of
Technicians
3
3
3
15
1
1
3
INFONA
 Regional Offices in Alto Parana, Amambay and Canindeyu
 Forest Education and Extension Directorate
SENACSA
 Regional Offices
SENAVE
 Regional Offices
Municipalities:
 Environment Secretariats (4 pilot Municipalities)
Cooperatives
 Technical Assistance Departments (9 Cooperatives)
Producer Associations
6
2
3
3
4
18
62
Beneficiary institutions
 UGP, CAPECO, APS, ARP
Commodity buyers
 Commercial Departments (1 per company)
Seed producing companies
 Commercial Departments (1 per company)
N° of
Technicians
8
5
3
206. Training will be carried out during PY2-PY3 and will be based on a trainer-of-trainers
methodology to foster dissemination of the new knowledge and skills acquired by the trainees. Key
contents of training will include: a) farm planning with an approach to sustainable management of natural
resources and biodiversity conservation. Links with SEAM´s Environmental Management Plans; b)
biodiversity and connectivity of forest areas; c) sustainable forest management, afforestation/reforestation,
restoration of protective forests of watercourses; d) best practices for soy and livestock production,
including: i) sustainable management of soils (Green fertilizers, crop rotation, direct sowing, live fences),
ii) management of agro-chemicals, health hazards, personnel security, recycling of containers; iii)
management of water resources and watersheds; iv) pasture management and silvopastoral systems; e)
carbon sequestration and measurement. Training will also include a chapter on the relations between
natural resources, gender approach and indigenous peoples: a) gender equality; b) access and control of
resources and benefits; c) gaps and gender considerations; d) indigenous peoples and their legal
framework; e) interculturality.
207. The second approach will be to encourage producers to adopt a suite of best practices to ensure
long-term sustainability of production. The project will closely work with the key partners (MAG, SEAM,
SENAVE, SENACSA, Solidaridad, Cooperatives, producers´ associations and commodity buyers) to
develop a comprehensive training and outreach program targeting producers to disseminate the minimum
environmental standards and best practices manuals in the three priority areas and promote their uptake.
The training and outreach program will include gender considerations and specific activities on the basis of
the assessment carried out. Support will also include preparation of training and information materials.
Training and outreach under this output will coordinate with the same activities under Output 2.1
(financing of sustainable soy and livestock production plans), Output 2.2 (minimum certification
standards), to ensure a comprehensive approach as well as cost-effectiveness in implementation of the
activity. The project will support the MAG´s National Program for Soil Management and Conservation
and the Paraguayan Federation for Direct Sowing to design a program for promotion of quality in direct
sowing targeting public and private technicians, small, medium and large producers. This quality program
will be incorporated in the partners´ training and outreach program.A set of best practices identified during
the PPG is included in the table below.
Table 20: Best practices for sustainable production to be promoted by the Project
Current
unsustainable
practices / technologies
Conventional tilling systems,
insufficient use of contour lines
and/or low quality of direct
sowing lead to loss of physical,
chemical
and
biological
properties of soils
Excess
use
of
chemical
fertilizers in the long term leads
to
soil
compaction
and
degradation
Removal of vegetation cover
Alternatives to be introduced by
the project
 Improved direct sowing
 Contour lines
Expected environmental benefits

Organic fertilizers (pig manure)
Improved physical properties and
fertility of soils

Afforestation / Reforestation in
Erosion control; reduction of pressure
Control
of
erosion;
carbon
sequestration; increased biological
activity
in
the
soil;
recovery/maintenance of soil fertility;
improved conservation of water
63
Current
unsustainable
practices / technologies
and cultivation in slopes leads to
erosion and soil degradation
Complete or partial removal of
legal set-asides and protective
forests of watercourses
Alternatives to be introduced by
the project
sloped areas for protection and
commercial purposes
 Restoration of protective forests
and legal-set asides
Indiscriminate use of agrochemicals (over-use, hazardous
substances, non-controlled
spraying, cleaning of sprayers in
watercourses, inadequate
disposal of empty containers)
leads to contamination of water
courses




Conventional
livestock
production
practices
(ie.
inadequate use of fire for
renovation of pastures and
inadequate
pasture
management)
lead
to
pasture/soil degradation, loss of
productivity and wildfires

Trees are being cut down for
firewood or charcoal leading to
degradation of forests




Agro-chemical management
Enforcement of regulations that
require use of live fences as
barriers to avoid drifts
Infrastructure for independent
management of water to be used
for spraying of agro-chemicals
and cleaning of equipment
(water tanks)
Installation
of
municipal
collection centers for containers
and chemical residues27
Fire management, use of
firewalls, controlled fires
Silvopastoral systems
Use of firewood from plantations
in
silos
and
agricultural
industries
Development
of
long-term
financing
options
for
afforestation
/
reforestation
projects
Enrichment of native forests
Expected environmental benefits
on native forests for timber and
firewood; corridors for fauna
Erosion
control;
decrease
in
sedimentation
of
watercourses;
increased connectivity and habitats
for biodiversity; carbon sequestration
Reduction of negative impacts on
ecosystems (contamination) and
human health
Reduction of wildfires and their
effects on habitats and species;
reduction of
CO2
emissions;
increased tree cover provides shadow
for
livestock
and
improves
productivity, protection of soils, and
improved nutrient cycling (ie.
through nitrogen fixing tree species)
Reduction of pressure on native
forests; Increased diversity of tree
species
208. Solidaridad, cooperatives and commodity buyers will implement the training and outreach
program in the field (PY3-5). The Project will support on the ground work by these partners with field
visits; regional events for exchange of experiences among producers; farm awards to honor landowners
that integrate best production practices and reforestation with native species or extensive farms that
integrate environmental standards; national and international seminars and forums on best practices. The
project will also closely work with the national level producer associations (ARP, APS, CAP) and
cooperative associations (FECOPROD, UNICOOP) to engage them in the dissemination of the best
27
The Municipality of Santa Rita (Alto Parana) and Tecnomyl (agro-chemical supplier) have partnered and established the first
collection center for final disposal of containers and residues. The Municipality provided a plot of land. The company built a
warehouse to collect the containers, which are then transported to the company´s industrial for recycling. The recycled plastic
material of the containers is used by other industries to manufacture electrical accessories (ie. electric keyways, tubes and
pipelines,etc).
64
practice manuals and information materials to their members, hence reaching a wider audience covering
the whole of the UPAF (soy) and other ecoregions of the country (livestock production). Participation in
national and local seminars and congresses organized by these stakeholders to present the best practices
and experiences will contribute to disseminate information and raise awareness of this wider audience.
The Project will reach 4,000 medium and large-scale producers through the training and outreach
activities, adopting best practices throughout the 500,000 ha of the three priority areas28.
209. Additionally, the Project will support SEAM to develop an environmental awareness-raising
program targeting women and youths who are members of cooperatives in the priority areas (there are 9
cooperatives). This program will seek to increase environmental awareness and will be implemented
through non-formal communication methodologies. The Project will prepare educational material to
facilitate dissemination to the target audience by the technicians, women’s committees and youth groups in
each cooperative.
Output 3.2:Improved forest set aside in small, medium and large scale farmsincrease forest connectivity
across the landscape in Canindeyu
210. The Canindeyu priority area has been selected for this intervention taking into account the need to
secure connectivity in the area of influence of the Mbaracayu Natural Reserve, which is the most
significant forest remnant in the three Departments (64,000 ha) and the presence of a mix of small,
medium and large scale farmers within the area. This will have positive impacts over legally protected
areas given that work will focus on the buffer zone of the Reserve. The output will seek to increase
connectivity by piloting two differentiated strategies. The first one will target small producers and will
combine conservation of forests and sustainable production, thereby generating both environmental and
socio-economic benefits to improve the livelihoods of poor smallholders. The second strategy will address
the rehabilitation of legal set-asides in medium and large properties thereby restoring environmental
liabilities of these landholders for compliance of the set-aside regulations.
Group SEAM certified forest set-asides in campesino settlements
211. The project will support the development and piloting of a model for environmental and socioeconomic inclusion that combines conservation of forests and sustainable production to improve the
livelihoods of small campesino farmers. It will build upon two ongoing but separate initiatives. On one
side the UNDPCO supported working implementing inclusive businesses that integrate small scale
farming of staple and cash crops, micro-finance services for investment and working capital, and
integration into supply chains for income generation. On the other side it will build on the experience of
the NGO Guyra Paraguay, which has recently signed an agreement with the National Institute for Rural
Development and Lands (INDERT) to implement SEAM-certified forest set-asides in a small farmers´
settlement in the Department of Itapua (Southern UPAF).
212. The strategy will be piloted in small farmers settlements through a two-fold approach that will
deliver socio-economic benefits from collective SEAM-certified forest set-asides to be benefited from
payments under the Environmental Services Law Nº3001/06 and sustainable agricultural production. As
afore-mentioned, the Forest Law Nº422/73 obliges landowners with more than 20 ha to maintain 25% of
their forests as legal set-asides. Given that small farmer plots usually do not have more than 10 ha forest
areas within this category are considered to be additional to the requirements of the law. On the other
hand, the current provisions of the Environmental Services Law Nº3001/06 (SEAM Res.199/13) allows
certifying adjacent forest areas when it comes to small farmer settlements. If the farmers agree to certify
their forests as a group the certification procedure would be only one. In general, the farms in settlements
have between 1 and 3 ha of forests, which are maintained for firewood to satisfy household energy needs,
as shelter for the few cattle owned and to obtain a fast income when in need by cutting down a tree and
28
4,000 producers with an average farm size of 125 ha = 500,000 ha.
65
selling it to a sawmill. These forests are located in the back end of the plots and given that these are
adjacent, each plot contributes to create continuous forest areas within the settlement. Conservation and
SEAM certification of these continuous forest areas will generate income that will be destined to pay for
the titles of the farmers´ plots. In this manner the families will be able to obtain incremental resources to
improve their livelihoods and pay for their land without diverting resources from their current agricultural
activities. Certification of these set-asides will imply two other commitments by the small farmers,
namely, the establishment of a fire prevention and control plan, and a biological monitoring plan.
213. During PY3 the project will closely work with INDERT to select a pilot settlement in the priority
area ensuring that the forest areas form a continuous mass and will contribute to connectivity in the
landscape. Field visits and workshops will be carried out to inform the small farmers, raise awareness and
promote buy-in on the advantages of implementing the strategy of joint set-aside certification and use of
benefits for acquiring land titles. A key aspect of certifying the set-asides will be ensuring their
understanding of the commitments that are expected to be assumed by them: a) conservation of the forest
areas; b) group certification; c) use of payments for land titles; c) implementation of a fire prevention and
control plan; and d) implementation of a biological monitoring plan. The project will provide technical
expertise to: a) draft the agreements with the farmers ensuring that the commitments by each party are
clearly reflected and b) carry out the procedures to certify the forests. Once SEAM issues the set-aside
certificate, these will be traded in the market through the brokerage system developed under Output 2.129.
Given that only one set aside-certificate will be sold, each farmer will receive a percentage equivalent to
his contribution of forested area. The funds will not be directly channeled to the farmers in an initial phase
but will be accredited to the INDERT to settle debts for the land titles. The project will provide training to
the farmers for preparing and implementing the fire control and biological monitoring plans.
214. The second approach will consist in replicating UNDP´s strategy under the UNDP-UNEP Poverty
and Environment Initiative in the settlement. During PY4-5 the project will closely work the INDERT and
MAG to provide the small farmers with technical assistance to improve their organizational and farming
capacities, to implement agricultural best practices for an increased and sustainable production of staple
and cash crops and to strengthen their commercialization and negotiation skills. Assistance will include
linking farmers with anchor companies to develop inclusive and environmentally sustainable supply
chains; and linking the farmers and their families with micro-finance services to channel investment and
working capital for improvement of production and commercialization and start-up of micro-enterprises
that add value to production.
Rehabilitation of legal set-asides in medium and large-scale farms
215. The strategy will seek to launch processes for the rehabilitation of legal set-asides focusing in
increasing connectivity between the forest remnants located in private properties that have environmental
liabilities. SEAM and INFONA will coordinate to ensure proper implementation of this output. SEAM
will be responsible of prioritizing areas for recovery of forests on the basis of connectivity potential, whilst
INFONA will be responsible to carry out activities in the field, including training of landowners and
technical assistance for implementation of tree nurseries. Implementation of this output will closely
coordinate with Output 1.2 (monitoring system).
216. The Project will support SEAM in defining criteria for identifying priority areas for restoration.
Such criteria will take into account the optimization of environmental benefits (ie. reduction of erosion,
protection of watersheds, corridors for fauna), and will be based on the analysis of connectivity and
fragmentation indices to be developed by the project for this purpose in PY1. The assessments will be
carried out in PY1 to establish the baseline and again in PY5 to monitor the level of achievement of
29
In the Guyra Paraguay experience, the price negotiated for the certificate is US$170/ha/yr for a 20-year period.
66
project outcomes. This will ensure that existing set-asides and the ones to be restored support structural
and functional connectivity across the landscape.
217. Once the priority areas have been selected, the landowners located in those areas and having
environmental liabilities will be identified through the cadaster prepared under Output 1.2. SEAM will
then proceed to establish contact with the landowners and explain the available options. One of the options
would be to destine areas for natural regeneration, which is the activity to be promoted under this output.
A second option would be to reforest areas through the financing mechanisms and incentives developed
under Output 2.1. The third option would be for the landowner to adhere to the Environmental Services
scheme under the Environmental Services Law Nº3001/06, in which case the SEAM will provide guidance
so the landowners can certify forests and be incorporated in the payment schemes as per the provisions of
the law (the project will support under Output 2.1 the development of the brokering system to enable
implementation of the law). The project will target the demarcation of at least 60% of the priority areas for
restoration of legal set-asides beginning in PY2 and continuing throughout the project´s lifetime; it will
also prepare a post-project plan to reach 100% of the priority areas. The landowners will be responsible
for fencing30 the areas demarcated for regeneration within their properties. They will be geo-referenced
and entered into the records of SEAM and INFONA in order to facilitate monitoring.
218. INFONA will set the criteria for restoration in coordination with SEAM. Training and outreach
will be based on such criteria. The project will firstly train the staff of INFONA´s Forest Extension and
Education Directorate (DGEEF) in restoration of forest ecosystems, including the identification of areas
with high potential for natural regeneration processes given that this subject is currently not included in
INFONA´s training programs. Secondly, a training and outreach plan targeting landowners will be
prepared and implemented by INFONA/DGEEF; it will include: a) collection of native tree seeds and
production of seedlings, especially those species that are better adapted to the areas designated for
restoration; b) identification of areas with high potential to ensure natural regeneration processes; c)
enrichment with species of high value for biodiversity (ie. meliferous, nitrogen fixing and threatened
species). The project will prepare training and information materials to support training and awareness
raising. Training will directly reach 500 landowners (100 landowners per year beginning PY1) and
indirectly 2,500 landowners With the purpose of facilitating landowners the acquisition of native tree
seedlings for restoration of legal set-asides under this output as well as protective forests of watercourses
under Output 3.3 support will be foreseen for establishment of demonstration tree nurseries and/or
improvement of existing ones. Both SEAM and INFONA have previously supported the installation of
native tree nurseries and INFONA maintains a list of registered nurseries. The project will provide support
for installation of new nurseries (supply of inputs) and INFONA will provide technical support. Through
Output 1.2 the project will work to develop guidelines for replication of these pilot interventions.
Output 3.3:Restoration of protective forests of watercourses in the MUL of three target landscapes
increases connectivity in highly deforested areas
219. This output will support INFONA to establish and pilot the first restoration plans within the
framework of Law 4241/10 for Restoration of Protective Forests of Watercourses within the National
Territory, serving as model for replication to other areas within the UPAF and the rest of the Eastern
Region. INFONA will closely work with SEAM, Departmental Governments and Municipalities within
the selected priority areas to establish guidelines, provide training, prepare the restoration plans and
monitor implementation by landowners who are required by law to compensate their environmental
liabilities. Restoration plans will be prepared for the three priority areas given that they are mandatory by
law.
30
Fencing will consist in standard wire fencesused in farms (5 strands of smooth wire), which serve to contain livestock in the
paddocks (in this case away from the regeneration areas) but does not impede circulation of smaller size animals (e.g. wildlife).
67
220. INFONA and SEAM will establish in PY1 an inter-institutional technical team that will be
charged with agreeing the procedures for preparation of the restoration plans. The key tasks of this team
include prioritization of the Municipalities where the plans will be prepared and implemented, and
preparation of the guidelines for elaboration of restoration plans. The four Municipalities that will pilot
decentralized enforcement (see Output 3.4) will be the starting point for prioritization, taking into account
the location of the municipalities in regards to the most important watercourses. The INFONA/SEAM
team will prepare technical guidelines for elaboration of the restoration plans. These guidelines will
contain the internal procedures to be followed by the different participating institutions as well as all the
step-by-step information to guide the elaboration of the plans. Once agreed, INFONA, as the enforcement
authority of the law, will issue a resolution approving the guidelines. These guidelines will be prepared
during PY1 and will be the basis for training of the key government stakeholders to be involved in
implementation. The technical team will prepare and implement in PY2 a training plan targeting staff of
INFONA, SEAM, Departmental Governments and Municipalities to ensure that they internalize their
responsibilities in the process. This training will be coordinated with the training to be provided for the
Monitoring System (Output 1.2) seeking to avoid duplication of efforts and ensuring cost-effectiveness.
221. Elaboration of the restoration plans will begin in PY2 and will continue throughout PY4. The
plans will be prepared by INFONA (as foreseen by the law) with the technical support of the project. The
cadaster of environmental assets and liabilities prepared under Output 1.2will provide the basis for
preparation of the plans and identifying landowners with liabilities. Within the framework of the
Monitoring System scheme, Municipalities will collaborate by uploading data of landowners in their
respective territories. The expected target is to cover a minimum of 14 Municipalities (70% of the
Municipalities located in the three priority areas as per the following milestones: a) 4 pilot Municipalities
in PY2, and b) the remaining 10 Municipalities during PY3-4. Depending on the structure of the
watercourses the plans could cover a single Municipality or be shared by more than one. A key aspect will
be to ensure planning of restoration to support structural and functional connectivity across the landscape.
222. Landowners will be in charge of reforesting the river banks within their properties with native
species. Guidelines will be prepared to provide landowners with information on native species and the
appropriate mixes for each locality .It is expected that by project end the recovery of river banks through
reforestation will have begun, although full growth of trees will be achieved beyond the project´s lifetime.
To this purpose, the project will closely work with the WB/GEF Paraguay Biodiversity Project and the
WWF/A TodoPulmón – Paraguay Respira Reforesting the Monda-y Project. The Project will support the
development of an outreach program targeting those landowners with liabilities with the purpose of raising
awareness on their legal obligation to restore protective forests and providing them with information such
as possible financing mechanisms and available technical assistance. Monitoring and control of
compliance in the four pilot Municipalities will implemented by the Municipalities themselves in
accordance with the monitoring scheme agreed within the framework of the Delegation Agreements and to
be tested under Output 3.4; and by INFONA in the remaining Municipalities.
Output 3.4:Decentralized and joint enforcement approaches improves surveillance of deforestation and
compliance in 4 municipalities
223. The project will support the optimization of the current surveillance and enforcement by piloting
schemes that improve inter-institutional coordination and empower the local authorities. In the current
scenario, SEAM is in charge of monitoring the compliance of environmental laws, INFONA and SEAM
have shared responsibilities in regards to forest laws and both the Public Ministry and the Forest Police
may intervene in monitoring and control. However, as explained before, due to the lack of coordination
between institutions and the lack of a shared monitoring system, monitoring and control is inefficient and
therefore has not contributed to reduce the threats to the forests and their biodiversity.
224. Outcome 1 will establish the enabling framework for improving monitoring and control. The key
elements that will interact to test the optimized schemes and achieve an efficient surveillance and
68
enforcement of regulations are: the Delegation Agreements signed under Output 1.1, the Monitoring
System and the Inter-institutional Manual to Enforcement of Forest and Environmental Laws developed
under Output 1.2. Capacities of the relevant stakeholders (SEAM, INFONA, Public Ministries,
Municipalities and Forest Police) to implement this output will have been strengthened through the
training provided under Output 1.2.
225. Three surveillance schemes will be tested and evaluated to obtain lessons learned to provide
feedback on their effectiveness so that they can be updated and improved, and eventually be replicated to
the rest of the UPAF and other ecorregions of the country. The first will be a decentralized scheme
implemented in the four pilot Municipalities that will sign the Delegation Agreements. Surveillance will
be carried out by the Environment Secretariats of each Municipality in accordance with the procedures
indicated in the Manual. The second scheme will be implemented in the remaining 16 Municipalities of
the priority areas, where joint teams of SEAM, INFONA and Public Ministry will carry out surveillance
activities following the agreed procedures indicated in the Manual. The third scheme will be implemented
in the Municipalities of the three Departments not included in the priority areas. The surveillance scheme
in this case will not differ much from the current scheme since the information uploaded in the Monitoring
System at this level will still be general and without much detail. These three schemes will allow for
comparison between them as well as determining the project´s contribution and impact.
226. Monitoring and surveillance within the framework of the project will begin as soon as the
Monitoring System is operational, the Manual has been agreed and staffs of the concerned institutions
trained, and will continue throughout the project´s lifetime. A data base to record and keep track of the
surveillance activities will be developed and incorporated into the Monitoring System. This data base will
serve as a means to verify the scope and results of the surveillance activities within the project intervention
area and will include the follow-up of processes (administrative or judicial) to landholders who have
incurred in infringements and amounts of the fines. This information will be shared with the Departmental
Platforms and it is expected that the platforms could assist as a mechanism where individuals can identify
infractions/forest encroachment to the authorities. The schemes will be evaluated in PY5 to extract lessons
learned, improve the design and disseminate the experience to promote replication.
227. Supplementary monitoring activities will be carried out under this output to measure the progress
of project interventions in the field. A work plan will be developed in PY1 to include all the necessary
activities under this item, including – inter alia – monitoring of the volume of native wood used by silos in
the priority areas (in PY1 and PY5) and monitoring of compliance with the restoration plans of protective
forests (in PY1, PY3 and PY5).
2.2 Project Indicators, Risks and Assumptions
Project indicators
228. The project indicators are detailed in the Logical Framework – which is attached in Section II,
Annex A of this Project Document.
Table 21: Project Indicators
Intervention Logic
Project Objective:
The biodiversity and ecosystem
functions of the Atlantic Forest
eco-region is protected from
existing and emerging threats
from multi-sectoral production
practices and is a model for
replication across the country’s
bioregions and biomes.
Objectively Verifiable Indicators
Surface area of forests in the Multiple Use Landscapes
(MUL) out of protected areas in the 3 Departments have
a greater degree of protection, measured by:
a)
Number of hectares of forests certified for
environmental services;
b)
Number of hectares of forests under sustainable
management (REDD+ pilot project);
c)
Number of hectares of legal set-asides and
protective forests established with management
Targets
(End of Project)
a) 3,000 ha (to be adjusted
when the Monitoring
System is operational).
b) 6000 ha (to be adjusted
when the Monitoring
System is operational)
c) 90,000 ha of set-asides;
30,000 ha of protective
69
Intervention Logic
Objectively Verifiable Indicators
criteria
Surface area in the MUL where sustainable production
practices (1 or more) have been adopted on the basis of
the Best Practice Manuals and contribute to establish
deforestation free supply chains:
a) Number of hectares achieved through direct project
intervention in the 3 priority areas.
b) Number of hectares that can be potentially achieved
through indirect effect of project intervention
(replication)
Direct reduction of pressures in forest ecosystems from
production sectors as evidenced by:
a) % of reduction in the use of firewood from native
forests by grain silos and dryers.
b) % of reduction in sedimentation of surface water
bodies
Percentage of increase in coverage of representative
native tree species in the MUL (outside of protected
areas) in the early stages of natural succession that are
characteristic of the UPAF
Tons of avoided emissions of CO2eq attained through
protection of forests in the REDD+ pilot project
a) Direct lifetime (6,000 ha)
b) Indirect lifetime (65,000 ha)
Outcome
1:
Effective
governance
framework
for
biodiversity conservation and
SLM in multiple use landscapes
Improved institutional capacities to effectively plan,
implement, monitor and mainstream biodiversity into
production activities at landscape level as measured by a
% of increase in the Capacity Scorecard
Percentage of increase in the amount collected by SEAM
for fines charged from infringement of forest and
environmental regulations
Percentage of environmental licenses approved in priority
areas based on the Monitoring System
Level of agreement on sustainable production
approaches, including deforestation free supply chains,
international certification standards, best practices for
production and conservation, land zoning criteria for
corridors, biosafety.
Outcome 2: Financial and
market incentives framework to
promote
biodiversity
and
sustainable land management
within the target multiple-use
landscape
Surface area of soy in the 3 priority areas prepared for
certification and certified under international certification
schemes, to enable a deforestation free supply chain,
evidenced by:
a) Number
of
hectares
applying
minimum
environmental standards in preparation for
certification under international schemes.
b) Number of hectares certified.
Percentage of soy purchases by commodity buyers in the
priority areas that come from producers that comply with
best practices
Targets
(End of Project)
forests (to be adjusted
when the Monitoring
System is operational).
a) 500,000 ha (soy); 60,000
ha (livestock)
b) 900,000 ha (soy); 398,000
ha (livestock)
a)
b)
50.%
5%
20%
a) 1,408,128 ton/CO2eq
b) 15,254,720 ton/CO2eq
At least 80% average
60% (US$432,000)
PY2: baseline information
uploaded in the Monitoring
System
PY3: 50%
PY4: 75%
PY5: 100%
PY3: minimum
environmental standards for
soy and livestock production
agreed by the multistakeholder platforms
a) 500,000 ha
b) 250,000 ha (50%)
At least
PY3: 10%
PY4: 30%
PY5: 50%
70
Intervention Logic
Targets
(End of Project)
Objectively Verifiable Indicators
Degree to which environmental sustainability criteria
have been mainstreamed in financial institutions´ (FI)
credit operations for soy and meat, measured by:
a) % of compliance with the pre-requisite of presenting
environmental management plans as per the
provisions of the EIA law
b) Number of FIs (and therefore volume of credits) that
mainstream best practices in the loan approval
procedures
Number of FI (and financing plans) granting long term
loans for reforestation/afforestation projects
Number of transactions and flow of resources derived
from:
a) SEAM certified forest certificates under the
environmental services regime
b) REDD+ carbon credits
a) PY4: 80% of the soy and
livestock loan portfolios
b) PY5: 4 FIs and at least
50% of their loan portfolios
4 FI financing at least 100
plans
a)
b)
Outcome 3: Strengthened
implementation of land set aside
system and sustainable
production practices
Degree of adoption of best practices by producers in the 3
priority areas, measured by:
a)
Number of hectares of direct sowing following the
BP Manuals.
b) % of increase in the use of live fences.
c)
Number of producers adopting best management
practices of agro-chemicals
d) Number of hectares of silvopastoral systems
established
Number of hectares in small farmer settlements in
Canindeyu with continuous forest reserves that have
management plans (land use, fire control, BD
monitoring) under implementation and with SEAM forest
certified environmental certificates issued
Increase in the connectivity index in: a) high
fragmentation areas (Alto Parana) through restoration of
protective forests; and b) areas with larger forest
remnants (Canindeyu) through increase in legal set-asides
and private reserves.
Improvement in the effectiveness of monitoring and
control in the priority areas measured by the number of
monitoring events and related processes finalized in
accordance with the Inter-institutional Manual for
Enforcement of the Forest and Environmental Laws
Number of soy and livestock producers that have
improved their knowledge, attitude and practices for
implementation of best practices to conserve biodiversity,
reduce soil degradation and plan land use in the MUL of
the priority areas (measured by KAP indices and
including disaggregation by gender)
Transactions
corresponding to 27,000
ha x 70 US$/ha/yr
(US$1.8M/yr)
1
agreement
for
transaction
x
45US$/ton/CO2eq/ha/yr
Alto Parana:
a) 175,000 ha
b) 10%
c) 700
d) 300 ha
Amambay:
a) 5,000 ha
b) 5%
c) 100
d) 50.000 ha
Canindeyu
a) 40,000 ha
b) 10%
c) 200
d) 10.000 ha
350 Ha
a) Alto Paraná: distance
between fragments decreased
by 1 point
b) Canindeyu: distance
between fragments decreased
by 2 points
50% in 4 pilot Municipalities
30% in the remaining
Municipalities
4,000 producers and 100
women (KAP indices to be
determined at Project startup)
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Risk analysis and risk management measures
Risks
Institutional Risks
Institutional
weakness
of
government agencies involved in
monitoring,
surveillance
and
enforcement of environmental laws
and planning of land use.
Probability of
Occurrence
Medium
The public agencies involved in the
project (SEAM, INFONA, MAG,
Public Ministry) do not allocate
sufficient budgets to implement their
commitments under the project.
High
Difficulties to coordinate Project
implementation between the MAG,
SEAM and INFONA due toopposing
perceptions of the roles of each
institution
Medium
Lack of interest of small farmers to
adhere to the environmental services
certification system under the
Environmental
Services
Law
(3001/06)
Medium
Environmental Risks
Impacts of climate change: climate
variability and extreme weather
events (droughts, early or late frosts,
high intensity rain) on production of
soy and livestock
Medium
Risk Mitigation Measures
The project will update the regulatory framework to create an
enabling environment for implementation and enforcement of the
land use, forestry and environmental management regulations. This
will contribute to remove the current constraints for adequate
enforcement. It will also develop a capacity building program
comprising the development of a GIS based monitoring and control
system for effective and timely management of information (land
use changes, infringements, etc.), and in-depth training that will
strengthen the concerned institutions for monitoring, surveillance
and enforcement in the field. The Project will also establish the
platforms as an inter-institutional coordination mechanism to
improve public-private cooperation and collaboration.
The
platforms will enable collaborative planning, promoting of shared
responsibilities and strengthening of multisectoral dialogue leading
to agreements and joint efforts; hence improving decision-making
and a more efficient use of resources by the institutions.
The project will negotiate and advocate for timely planning and
management of institutional budgets. Platforms will constitute a
forum to promote awareness raising among managers and decision
makers on the importance of securing budgets on a timely basis, and
with quality and quantity for each of the institutions responsible for
enforcing the environmental and forestry laws.Moreover, cofunding
has been secured from a range of other reliable sources.
The mandates and roles of each institution have been taken into
account in assigning responsibilities for Project implementation at
outcome and output level in order to minimize possible conflicts
between the partner institutions.
This also includes their
commitments as well as their co-financing. The national and
departmental platforms will constitute a forum for dialogue and
conflict resolution if necessary, fostering an inclusive environment
and encouraging adaptive management to stimulate ownership by
stakeholders.
Careful planning and coordination with the INDERT on the
methodology to approach the rural settlements, taking into account
that, due to prior histories of failure, small farmers are often
skeptical of the promises made by projects to improve their
livelihoods. The project´s proposal, including procedures for
involvement and the commitments by each party will be clearly
explained and the project will make sure that they are understood
and agreed. The small farmers will need to clearly understand that
the payments that could be received as a result of selling certificates
will be destined to pay their debts with INDERT to obtain their land
titles and that they will not receive any cash until this requisite has
been fulfilled. Technical assistance will be provided throughout the
process to help the beneficiaries comply with their commitments (ie.
preparation of a fire prevention and control plan and a biological
monitoring plan).
The Project will promote sustainable management of productive
systems. The adoption of best practices that favor adequate
management of water in productive systems (contour lines,
infiltration channels, live fences, direct sowing, restoration of
protective forests) will serve to minimize the impacts of extreme
weather events.
72
Risks
Low degree of connectivity between
forest fragments in certain areas
increase the time period needed to
attain measurable results in terms of
biodiversity conservation benefits
Certain productive practices that are
extremely
harmful
to
forest
ecosystems (ie. fire for pasture
renovation) are strongly rooted
amongst producers
Financial Risks
Financial institutions are not willing
to review their lending policies to
mainstream
environmental
sustainability
criteria,
granting
priority to consumption over long
term investments
Market
The
international
prices
of
commodities (soy, cattle sugar cane)
increases,
without internalizing
negative impacts on environment,
resulting in increasing pressure to
expend production areas.
Lack of interest of potential buyers
in buying SEAM forest set-aside
certificates, or prices obtained are
lower than the ones estimated.
Probability of
Occurrence
Medium
Risk Mitigation Measures
The Project will identify priority areas taking into account the level
or degree of connectivity and will prepare restoration plans to ensure
connectivity through reforestation of riverine forests.
High
The Project will promote the use of fire within an integrated
management approach. In areas where its use could produce
irreversible damage the Project will work to gradually eliminate the
use of fire through training in other less harmful practices for
pasture renovation.
Medium
The Project will outreach to financial institutions raising awareness
in regard to the impacts of unsustainable practices that could be
attributed to activities financed by the loans they are granting to the
productive sector. The Project will provide the necessary financial
assessments to demonstrate the feasibility of adjusting the credit
instruments to mainstream environmental standards.
The Project will also work to raise awareness and engage public
entities that could be potential financiers for long term investments
for reforestation and afforestation (ie. IPS, Itaipu and ANDE
pension funds). The Project will produce financial assessments to
demonstrate these financiers the feasibility of investing their
resources and developing credit lines for this purpose.
Medium - High
The project will internationalize the negative impact caused to the
environment in the cost structure for each commodity in Paraguay to
help convince buyers of privileged purchasing of sustainably
produced commodities. The project will aim to add value to the
commodity produced under a recognized certification scheme, using
best available practices. The project will explore with relevant
institutions the establishment of compulsory norms, standards, and
certification for producers, and for buyers to address this threat.
Medium - High
The project will develop a brokering system to market the set-aside
certificates and negotiate the best prices. The demand will be
stimulated through several approaches: i) monitoring and
surveillance of compliance with the law, identifying the landholders
within the UPAF with environmental liabilities that should either
restore or buy set-aside certificates; ii) raising awareness of potential
buyers related with infrastructure projects that are obliged by law to
buy set-aside certificates; iii) capacity building of judges and
attorneys to destine fines and monetary penalties to acquire set-aside
certificates.
2.3 Incremental reasoning and expected global, national and local benefits
229. The project addresses some of the main barriers to overcoming the threats posed to ecosystem
integrity and globally significant biodiversity in the UPAF, namely:i) Overall governance, policy and
regulatory frameworks are ineffective in limiting natural habitat conversion into farmlands; (ii) Insufficient
economic incentives to incorporate sustainable environmental management practices into economic
activity; and (iii) Limited institutional and individual capacity to enforce land set-asides regulations, or
adoption of sustainable practice standards.
230. Under the “business-as-usual” or Baseline Scenario the threats to the remaining UPAF would
continue. The project area, as well as the remaining of the UPAF withhold a mosaic of productive
activities, many of which are carried out without the due observance of the environmental laws. Driven by
73
favorable international markets for soy and meat, deforestation would continue despite the existing
regulations (Forest Law, EIA law, Zero Deforestation Law), threatening forest remnants in private
properties, as well as the forests of small farmer settlements and indigenous communities which are in
some cases leased to medium and large producers for cultivation of soy. Without GEF support,
enforcement of the legal framework in the field would continue to be uncoordinated, beaurocratic and
uneffective to halt the current situation.Unless the current land uses are geared toward more sustainable
and environment-friendly uses, there is a risk of reducing the production potential of the natural resources
in the landscape that provide the basis for a long term sustained growth of important economic sectors as
are the agricultural and livestock sectors. Given no alternative, farmers would continue to expand
production over forest remnants and venturing into livestock producing areas of the Eastern Region
thereby displacing livestock production toward the Chaco, as well as exploring of agricultural lands in the
Chaco; therefore creating impact on other regions. Without GEF support, the potential role of key
stakeholders such as commodity buyers and financial institutions in promoting sustainable production
through purchasing policies, lending procedures and credit lines would continue to be limited. Adoption of
sustainable practices, including certification schemes, by producers would continue to be limited thereby
reducing the possibilities of increasing the supply of sustainable products and hence increasing the demand
by international buyers. Government incentives (ie. environmental services law) would continue to lack
the structure and mechanisms to facilitate access to financial opportunities by landowners for conservation
of forests and their biodiversity. Moreover, without the proposed GEF project, the currently dispersed
baseline initiatives will remain uncoordinated and isolated efforts, thereby limiting the potential impact of
coordinated efforts towards achieving global environmental benefits.
231. Under the GEF Alternative, the project will deliver global benefits by ensuring future expansion of
production does not compromise biodiversity and ecosystem function. The project will achieve this by
advancing an integrated package of measures. The project will promote an effective governance
framework for biodiversity conservation and sustainable land management in the landscape by
strengthening the regulatory framework; building the capacities of public institutions for planning,
monitoring, surveillance and enforcement; and creating an enabling framework for dialogue, cooperation
and collaboration between public and private stakeholders on key issues such as land use planning,
compliance of environmental regulations and sustainable production (Outcome 1). Secondly, the project
will generate an incentives framework so that markets and financial sectors prize sustainable production
practices within the target multiple use landscape (ie. certification schemes, financing of best practices);
and facilitate access to new financial opportunities to conserve biodiversity and promote sustainable land
management, including long term financing for reforestation, SEAM-certified schemes for conservation of
forests and REDD+ (Outcome 2). Thirdly, the project will improve the knowhow for sustainable land
management amongst producer groups and landholders to create a mosaic of conservation compatible land
uses. This will be achieved by promoting the uptake of sound environmental practices by these groups,
including reforestation and restoration of land set-asides and protective forests of watercourses for
increased connectivity and adoption of best practices for sustainable and environment-friendly soy and
livestock production (Outcome 3).This is designed to enhance functional connectivity across the
landscape. In doing so, the project will reduce deforestation and enhance restoration of natural habitats and
biodiversity conservation. This will help secure the flow of ecosystem services from productive landscapes
and remaining natural habitats. Through these three outcomes the Project will put in place the system that
will allow the soy and beef supply chains to continue deforestation free once the Zero Deforestation Law
expires in 2018. Also by putting this in place in the UPAF the project will be indirectly helping the Chaco,
where livestock production is currently related to deforestation and where the potential for soy growing is
being explored.
232. Within this context, the Baseline Scenario identifies public and private initiatives operating in the
UPAF that are relevant to the project’s outcomes over the proposed 5-year life of the project (project
boundary). The GEF Alternative consists of the Baseline in addition to the costs associated with the
necessary incremental activities to achieve the project objective. The Incremental Cost is the difference
74
between the costs of the GEF Alternative and the Baseline Scenario. The total cost of the project,
including GEF funds and co-funding, amounts to US$27,619,317. GEF financing comprises 24% of the
total, or US$6,624,317. Co-financing constitutes 76% or US$20,995,000. The incremental cost matrix in
Annex B (Section II) provides a summary breakdown of baseline costs and co-funded and GEF-funded
alternative costs.
Expected global environmental benefits
233. Global environmental benefits to be accrued by the project include 686,000 ha under effective land
management with vegetative cover maintained or increased. This includes: 1) 500,000 ha with improved
agricultural management of soy (including 250,000 ha under a recognized certification scheme); 2) 60,000
ha of improved rangeland and pasture management; 3) increased connectivity through 6,000 of improved
forest management (REDD+ pilot project); 90,000 ha of restored forest set-asides and 30,000 ha of
riverine forests.Direct reduction of pressures over forest ecosystems from production sectors will be
achieved through 50% of reduction in the use of firewood from native forests by grain silos and dryers and
5% of reduction in sedimentation of surface water bodies; 4) Increased biodiversity through a 20%
increase in coverage of representative native tree species in the target landscapes (outside of protected
areas) in the early stages of natural successions that are characteristic of the UPAF; and 5) avoided
emissions of CO2eq attained through protection of forests (REDD+ direct lifetime emissions of 1,408,000
tons/CO2eq in 6,000 ha and indirect lifetime emissions of 15,253,334 tons/CO2eq in 65,000 ha).
Collectively these will have positive impacts on a wide range of globally significant species (see Table 22
and Context section).
234. Further benefits to be accrued include the optimization of existing public policies and improved
effectiveness of the governance framework; increased connectivity throughout the landscape; reduction of
deforestation and degradation of forests; institutional and stakeholder capacity building as well as the
increased engagement of private sector stakeholders (producers, commodity buyers, financial institutions)
in biodiversity conservation beyond the project´s lifetime. Through capacity development at national and
departmental levels replication of best practices is expected to reach an additional 900,000 ha in the three
departments. In the long term implementation of best practices and/or certification schemes could reach
the whole area covered by soy (5 million ha).Mainstreaming of environmental standards in lending
procedures and establishment of credit lines for sustainable production and certification will be applicable
to the whole of the UPAF thereby contributing to further uspcaling of best practices beyond the project´s
lifetime.Upscaling of best practices throughout the UPAF and other regions will increase supply of
sustainable products and increasing the demand from the international markets.
The table below summarizes the benefits to be accrued by the project.
Table 22 : Domestic and Global Benefits
Domestic Benefits
 Increase in area covered by sound environmental
practices and forest management
 Local services provided by forests (nutrient
cycling, soil formation, hydrological cycle, water
quality, etc.).
 Soil conservation (soil quality, fertility, nutrient
cycles)
 Reduction of contamination of surface and
underground water bodies
 Reduction of wildfires
 Landscape and aesthetic beauty
 Increased productivity of soy and livestock
 Improved access to markets and prices for certified
Global Benefits
Ecosystem and Biodiversity Benefits
 Increased connectivity and habitats for biodiversity
 Increased tree cover and diversity of tree species
 Reduction of pressure on native forests for timber
and firewood
 Conservation of species that are of global
conservation significance and endangered:
e.gBrazilian Merganser (Mergusoctosetaceus),
Black-fronted Pipin Guan (Pipilejacutinga),
Vinaceous Amazon (Amazonavinacea), Redspectacled Amazon (Amazonapetrei) and Helmeted
Woodpecker (Dryocopusgaleatus), Giant Armadillo
(Priodontesmaximus), Jaguar (Pantheraonca),
75
Domestic Benefits
products
 Improved access to incentives for small producers
thereby creating additional opportunities for better
livelihoods
Global Benefits
Pygmy Brocket (Mazamanana), Bush Dog
(Speothosvenaticus,)
 Conservation of species with social, cultural and
economic values: e.g.anonas (Annona), guava
(Psidium), manioc (Manihot), papaya (Carica),
peanut (Arachishipogaea), peppers (Capsicum),
pineapple (Ananuscomosus), yerba mate (Ilex
paraguariensis), palm (Euterpeedulis) and stevia
(Stevia rebaudiana), Aspidospermapolyneuron,
Astroniumfraxinifolium,
Tabebuiaheptaphylla,Cedrelafisilis
Carbon benefits
Avoided emissions:
 Direct lifetime emissions: 1,408,000 tons/CO2eq
 Indirect lifetime emissions: 15,253,334 tons/CO2eq
Country Ownership: Country Eligibility and Country Drivenness
235. Paraguay has ratified the Convention on Biological Diversity (Law Nº253/93) and the UN
Convention to Combat Desertification and Drought (Law Nº970/96). The project is consistent with
UNDAF Outcome 3:National capacities strengthened for integrated environmental management and for
promotions and management of sustainable and equitable development and its Outputs 3.2:Policies and
programs for conservation and sustainable use of biological and cultural resources and 3.4: Sustainable
and equitable development model. The project is consistent with the central Government’s Economic and
Social Strategic Plan 2008-2018. This planning mechanism sets as a specific strategic objective
decentralized regional development, necessitating the harmonization of government actions. The
strengthening of land use planning systems, the enforcement of land use management regulations at a local
level and the establishment of market incentives to foster the adoption of sustainable land management
practices in the MUL under the project, will all collectively help achieve this national vision.
236. As the project aims to improve land use planning through involvement of supply chain
stakeholders, it contributes directly to the existing National Biodiversity Strategy and Action Plan
(NBSAP). The NBSAP Sectoral Area: Agricultural and Livestock Resource Development sets out as its
principle objective the development and implementation of a sustainable farming system taking into
consideration economic, social and environmental circumstances. The project is in line with Law 352/94
that establishes the Protected Area System and the National Protected Area System Strategic Plan 20102015 which requires the creation of buffer zones around PAs in order to, amongst other things, protect
wetlands and avoid erosion and sedimentation of water sources. The project will also advance
implementation of the Water Resource Law 3239/2007, as it will aim to reduce agrochemical runoff into
water-sources. The GEF investment will also serve to improve enforcement of Law 515/94, which forbids
export and trafficking, or processing of timber within 20kms from the Brazilian border, as it will
strengthen enforcement capabilities in vulnerable areas in the border vicinity. At the same time it will
indirectly help enforce Law 4014 which aims to prevent and control forest fires, because local government
entities will be better equipped to address contributing land use practices. The project is also consistent
with the National Strategy to Promote Organic and Agro-ecological Production in Paraguay, launched in
2008 by the MAG, ICCO, EU, IICA and Alter Vida. Specifically, the project will ensure coordination with
its governing bodies: i) the inter-institutional commission and ii) the roundtable for promotion of organic
and agro-ecological production. This alliance will prove to be a particularly useful way to reach out to
producers who are already working together to scale up adoption of sustainable practices by producer
groups. This project will be executed through SEAM, the national focal point for the UNCCD, and is
76
designed to implement elements of the National Action Plan. The proposed platforms will provide an
important forum to secure commitments and joint action by public and private sector stakeholders to
address land degradation, in doing so the project will address the objective set out in the UNCCD NAP of
incentivizing political decision makers to strengthen existing coordination instruments in order to foster
implementation.
Sustainability
237. The project has been designed to remove barriers and create an enabling environment to protect
the biodiversity and ecosystem functions of the UPAF from existing and emerging threats from multisectoral production practices.
238. The project will build upon the existing policy and regulatory frameworks, filling in gaps and
resolving overlapping and inconsistencies that currently represent constraints to proper implementation
and enforcement of the environmental regulations. The project will build the capacities of SEAM,
INFONA, Public Ministry and Municipalities for effective planning, monitoring of land use and land use
changes, surveillance and enforcement. Moreover, it will provide the mechanisms for enhanced decisionmaking, coordination and collaboration between these institutions that currently does not exist. By
strengthening and updating the existing policy and regulatory framework and building the capacities of the
institutions, the project will generate a much more cohesive and well-funded governance framework that
will be better prepared to efficiently and effectively conserve globally significant biodiversity.
239. The establishment of the national and departmental platforms will contribute to sustainability of
project results. The project will work to engage the public and private stakeholders so that the platforms
will constitute a long-term space where the public and private sectors can align, take ownership and
develop joint concrete actions to strengthen the country's enabling environment for sustainable commodity
production. Several factors will contribute to sustainability of the platforms, namely: they will be
established on the basis of existing initiatives; UNDP´s international experience and lessons learned; the
principles on which platforms are based (neutral, empowerment and social inclusion, multi-stakeholder,
strong facilitation, and conflict resolution) and a financial sustainability study to be carried out by the
project.
240. The project will generate an incentives framework so that markets and financial sectors prize
sustainable production practices. The project will work with the market players to connect them to
sustainable products exported from Paraguay. Commodity buyers in Paraguay will establish preferential
buying agreements from producers that comply with environmental regulations, implement best practices
and/or certify production, thus helping to promote uptake by increasing numbers of producers. This will in
turn increase the supply of sustainable and/or certified products thereby increasing the demand by
international buyers. Financial institutions will mainstream environmental standards into their lending
procedures thereby ensuring that lenders comply with the regulations and that credit funds are used for
sustainable production. The Project will help increase the limited availability of long term funding for
reforestation by engaging potential financiers (ie. pension funds) to provide resources thereby increasing
investments (reforestation for wood energy, recovery of protective forests with native species, etc.). The
project will also contribute to facilitate access of landholders to new financial opportunities to conserve
biodiversity by developing voluntary markets for SEAM-certified forests under the Environmental
Services Law Nº3001/06 and carbon credits within the framework of REDD+. This set of actions will
ensure long term funding for conservation of forests and adoption of sound environmental practices,
including sustainable production and recovery of set-asides and protective forests.
241. The project will support the long-term viability of globally significant ecosystems and biodiversity
in the UPAF by improving the knowhow for sustainable land management amongst producer groups and
landholders. Through training and outreach, landholders will be aware of the value of forests and their
77
ecosystem services, and the risks that unsustainable production represent to the production potential of the
natural resources in the landscape that provide the basis for a long term sustained growth of important
national economic sectors as are the agricultural and livestock sectors. The project will promote the uptake
of sound environmental practices by these groups, including reforestation and restoration of land set-asides
and protective forests of watercourses for increased connectivity and best practices for sustainable and
environment-friendly soy and livestock production. At the same time, monitoring and surveillance of land
use will contribute to enforce regulations, discourage further infringements (ie. deforestation of set-asides)
and promote sustainable production. By doing this the project will contribute toensure future expansion of
production does not compromise biodiversity and ecosystem function.
242. Although the project focus is on medium and large-scale producers, it will nevertheless generate
environmental and socio-economic benefits to small farmers and indigenous peoples. The project will pilot
a model for environmental and socio-economic inclusion that combines conservation of forests to increase
connectivity and sustainable production to improve the livelihoods of small farmers. This model will
generate incomes from two currently non-existent sources: selling of certificates from SEAM-certified
forest set-asides and sustainable supply chains of cash crops. This will allow small farmers to pay for their
land without diverting resources from their current agricultural activities, while at the same time increasing
their agricultural incomes. Project actions will have positive impacts on indigenous communities that have
land bordering soy crops. Project interventions that are viable for indigenous communities will follow and
respect their organizational ways and cultural norms; will ensure that stakeholders show respect for their
dignity and human rights and will be carried out with an intercultural approach, from the worldview of
each ethnic group´s culture, and fundamentally respecting their collective and individual rights protected
by international and national regulations and including safeguards to ensure action do not negatively affect
the livelihoods of indigenous communities; thereby ensuring sustainability of project actions.
Replicability
243. The replication of the project´s interventions will allow expanding GEBs to other Departments that
still retain fragments of the UPAF as well as other regions. The project intervention area contains a large
diversity of habitats therefore presenting a great potential for replicability of project results and landscape
level. The project will develop an enabling framework at both national and local levels to facilitate
replication. At national level, the project will strengthen and update the policy and regulatory framework,
which has a national scope. The strengthened institutional capacities for monitoring and surveillance,
including the increased funding capacity, will enable the SEAM and concerned institutions to extend
enforcement of the environmental and forest regulations at country wide level. This will benefit other
regions such as the Chaco that are currently facing deforestation problems.
244. The project will also develop instruments that will help to replicate project results within the
UPAF and to other regions. The restoration plans for protective forests of watercourses and guidelines for
recovery of forest set-asides will facilitate replication to other areas of the country. Piloting of Delegation
Agreements between national institutions and Municipalities will serve to generate experience extract
lessons learned that can contribute to engage other Municipalities in the long term (there are over 200
Municipalities in the country). The market-based instruments to be developed by the project will be
applicable at national level. The brokering system for trading of forest set-aside certificates will contribute
to implementation of the regulations for environmental services at national level thereby contributing to
halting deforestation and contributing to forest conservation. Mainstreaming of environmental standards in
the lending procedures of financial institutions and the development of credit instruments for sustainable
production and long term investments in reforestation (native species for restoration of set-asides and
protective forests, and exotics for wood energy) will have a national scope.
245. The process for establishment of the Platforms will be systematized to facilitate replication to the
other Departments of the UPAF. The Platforms themselves will constitute a space where the project
78
results will be internalized by the different stakeholders, thereby contributing to promote the replication of
project actions.
246. The project intervention areas were selected to work in different scenarios (different degrees of
fragmentation and size of fragments, threats, scales of production, presence protected areas, etc.) thereby
generating different experiences that can be replicated to similar scenarios in other areas of the UPAF as
well as identifying lessons learned for each one of them, hence increasing the potential for replication of
the project first within the UPAF andthen to other areas of the country with high biodiversity. The
project’s potential for replication is based upon identification of best practices, appropriate technologies
and lessons learned. Mainstreaming of best practices and lessons learned into the technical assistance and
work programs of the key public and private stakeholders that work in the landscape will ensure up-scaling
and replication throughout the UPAF reaching a greater number of producers and their organizations (ie.
cooperatives).The socially inclusive model of forest and landscape conservation and sustainable
production to improve the livelihoods of small farmers developed by the project can also be replicated to
the numerous small farmer settlements throughout the Eastern Region.
247. Collaboration and sharing of experiences with government, as well as engaging the private sector
and NGOs will facilitate widespread dissemination of project efforts. The training and outreach strategy to
be implemented by the project will facilitate replication. Promotional activities may also support further
expansion of Project activities. Actions such as field days and model farms will maximize the exposure of
producers to the most successful and innovative aspects of the project. Actions such as staff exchanges,
technical visits and seminars, both locally and regionally, will also facilitate the extension of project
benefits. Systematization of experiences and lessons learned will serve as guidance for replication.
Cost-Effectiveness
248. The proposed project aims to address the primary goal of securing thelong-term viability of
ecosystems and globally significant biodiversity in the UPAF.To achieve these objectives, the project
identified three main types of interventions: (i) institutional strengthening for planning, monitoring,
surveillance and enforcement of the environmental and forest regulatory framework; (ii) fostering marketbased and financial instruments to prize sustainable production of soy and livestock; and (iii) improving
the knowledge of landholders for widespread adoption of sound environmental practices for environmentfriendly production.
249. Cost-effectiveness is reflected in this design as all three interventions are collectively attending
barriers to addressing primary drivers of deforestation and degradation of forests and the loss of valuable
ecosystem services and habitat within the UPAF in a least-cost approach. The project will build upon the
existing baseline activities and national and local capacities, as well as available infrastructure to resolve
issues undermining the conservation and sustainable production objectives that government authorities and
private sector stakeholders aspire too. Furthermore, the interventions are designed to capitalize on existing
efforts and capacities, and adding value by enlarging and catalyzing efforts already underway. The project
will work with public and private stakeholders that are carrying out activities within the UPAF, helping
them to mainstream biodiversity considerations and sound environmental practices into their current work
programs and activities. Collaboration with this broad base of national and local level institutions and
international advice that the project will receive will help to access cost effective field based expertise of
the institutions involved in project-related activities. Effective coordination with other programs, projects
and initiatives, will serve for reinforcing synergies, avoiding duplication of efforts and reducing overall
costs. Regular coordination meetings with projects and programs will serve to identify complementarity
and joint planning and implementation of activities in the field will contribute to cost-effectiveness. The
project will make use of SEAM and INFONA offices in the project intervention areas. This will reduce the
project’s direct costs.
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250. GEF funds will be used primarily for interventions addressing the policy and regulatory
frameworks, institutional capacity building, targeted technical assistance to public and private
stakeholders, for training and for dissemination of information. By fostering inter-institutional
coordination and cooperation as well as operational frameworks (ie. improved regulations, joint
institutional procedures for surveillance and enforcement, monitoring systems, development of best
practices and financial and market instruments) a more effective and efficient use of resources of the
institutions is expected as well as increased long term funding to sustain project results. The use of marketbased instruments and promotion of commercial relations between farmers and commodity buyers will
serve to maximize cost-effectiveness given that, following relatively short-term and limited investment by
the project in facilitation, the ongoing transaction costs of these instruments and relations will be absorbed
by the stakeholders involved, resulting in major benefits relative to the initial project investment.
251. Stakeholder participation at all project levels will contribute to the cost-effectiveness of the
project. The project structure (Project Board, Technical Committee, Local Committees) as well as the
platforms and will ensure adequate planning and implementation of activities in line with the project
objectives and local development and stakeholder priorities, as well as complementarity with ongoing and
planned programs and projects. National and local level coordination mechanisms will be closely linked,
ensuring in this manner that stakeholder concerns are up-streamed into higher project management levels
and likewise project management decisions and their impacts on the region are down-streamed to keep
stakeholders duly informed. The platforms will have a key role in this process. At field level the project
will benefit from the experiences and knowledge of individual producers, cooperatives, commodity buyers,
NGOs and other institutions. Systematization of project experiences and lessons learned will contribute to
cost-effective upscaling and replication of project results throughout the UPAF and other regions of the
country.
2.4 Linkages with other GEF and non-GEF interventions
Name of Project
1. Paraguay
Biodiversity
Project (WB/GEF)
Implemented
by
Itaipu, SEAM and
MAG
2. Restoration of
Forests (WWF/ A
TodoPulmón
Paraguay respira)
Objective, intervention area
To conserve the natural habitats and
biodiversity of the UPAF by establishing
the Paraguay Biodiversity Corridor. The
objective will be achieved through: i)
recovery of connectivity between core
areas; ii) strengthening of protected
areas; iii) institutional strengthening and
environmental education. Intervention
areas include the Department of
Canindeyu and portions of the
Department of Alto Parana.
Objectives are: i) landscape reforestation
and restoration in the Monda-y River
basin; ii) improvement of the livelihoods
of vulnerable women groups through
tree nurseries to generate incomes; iii)
communication
and
transfer
of
technology to support model farms and
best practices amongst small, medium
and large producers and cooperatives.
Coordination
Coordination began during the PPG to select
the priority areas in order to avoid overlapping
of activities by both projects. Synergies will
be sought during Project implementation to
promote connectivity of forest fragments
thereby enhancing impact by both projects.
PyBio will be invited to participate in
preparation of the Annual Work Plan to
identify potential complementary activities.
Each Project will incorporate these activities in
the respective work plans. Mid and end-year
meetings will be held to review progress.
Training that may be common to both projects
(subjects, beneficiaries) will be implemented
jointly to ensure cost-effectiveness.
Both Projects will coordinate actions in the
Alto Parana priority area.Key issues for
coordination include the elaboration of
restoration plans for protective forests of
watercourses; implementation of tree nurseries
with indigenous communities, women and
youths; and validation of the Best Practice
Manuals.A TodoPulmón will be invited to
participate in preparation of the Annual Work
Plan to identify potential complementary
activities. Each Project will incorporate these
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Name of Project
Objective, intervention area
3. National Program
for
Soil
Management,
Conservation and
Recovery
National level program with the
objective offostering recovery and
maintenance of soil fertility in
agriculture through direct sowing.
Provides training to technicians and
leader farmers and promotes the
adoption of conservation practices.
(MAG)
4. Inclusion
of
Family Agriculture
in Value Chains
(Paraguay
Inclusive Project)
(MAG)
The project seeks to: i) strengthen rural
organizations; ii) facilitate partnerships
between family farmers and value
chains; iii) facilitate access of family
farmers to credit for investments and
working
capital;
iv)
promote
diversification of production, adoption
of appropriate technologies; increase of
food security; and v) increase
employment opportunities for the poor
rural population, especially women and
youths. The intervention area is the
Eastern Region.
5. Forest
Preservation
(Carbon inventory)
The Project will prepare a carbon
inventory on the basis of UN-REDD+
results. It will provide SEAM, INFONA
and University with a laboratory for
analysis of data, equipment and supplies
(GIS, vehicles, computers, laboratory
equipment for soil, water, and air).
Intervention area: protected areas.
The Project will provide technical
assistance to develop a methodology to
quantify carbon stocks and a monitoring,
reporting and verification system
through satellite imagery.
It will
establish measurement plots in the
Eastern and Chaco regions.
(SEAM)
6. MRV REDD+ FFPRI (SEAM)
Coordination
activities in their respective work plans. Mid
and end-year meetings will be held to review
progress. Complementary activities to both
projects in the priority area will be planned and
implemented jointly to ensure efficient use of
resources and cost-effectiveness.
The program will provide inputs to the GEF
Project for elaboration of the Best Practice
Manuals, given their accumulated experience
in soil conservation and management. The
GEF Project will support the Program and the
Paraguayan Federation of Direct Sowing to
prepare a Direct Sowing Program. The
Program will be invited to participate in
preparation of the Annual Work Plan to
identify potential complementary activities.
Program technicians will participate in training
by the GEF project to increase their knowledge
and mainstream biodiversity considerations
into their day-to-day work.
Both projects will collaborate in the
development of best practices for sustainable
production. The GEF project will pilot a small
farmer approach that combines forest
conservation and sustainable production that
the PPI project can replicate.PPI will be
invited to participate in preparation of the
Annual Work Plan to identify potential
complementary activities. Each Project will
incorporate these activities in their respective
work plans. Mid and end-year meetings will
be held to review progress. Complementary
activities to both projects in Canindeyu will be
planned and implemented jointly to ensure
efficient use of resources and costeffectiveness.
Both Projects will hold meetings to coordinate
procurement of equipment within the
framework of the Monitoring System and
surveillance schemes to be developed by the
GEF Project.
Both Projects will hold meetings to coordinate
issues related to measurement of carbon
benefits within the REDD+ pilot Project and
activities
regarding
monitoring
and
surveillance for enforcement, and monitoring
of biodiversity.
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PART III: Management Arrangements
Implementation Agency
252. The project will be implemented over five years with UNDP as GEF Implementing Agency.
Government of Paraguay has requested UNDP assistance for the design and implementation of this Project
based on UNDP’s comparative advantages which include: country presence and relationship between the
project and UNDP’s country assistance strategies, especially as refers to capacity building, policy
development and consensus-building, UNDP’s support to, relationship with and/or implementation of
several initiatives lead by the SEAM and/or other institutions or organization that constitute the project´s
cofinancing; UNDP´s experience in the implementation of projects of similar scope as well as the regional
experience in commodities-related consensus building processes31.
253. As GEF Implementing Agency, UNDP is ultimately accountable and responsible for the delivery
of results, subject also to their certification by MAE, as Implementing Partner. UNDP shall provide project
cycle management services as defined by the GEF Council (described in Section IV Part XII), that will
include the following:
 Providing financial and audit services to the project
 Overseeing financial expenditures against project budgets,
 Ensuring that activities including procurement and financial services are carried out in strict
compliance with UNDP/GEF procedures,
 Ensuring that the reporting to GEF is undertaken in line with the GEF requirements and
procedures,
 Facilitate project learning, exchange and outreach within the GEF family,
 Contract the project mid-term and final evaluations and trigger additional reviews and/or
evaluations as necessary and in consultation with the project counterparts.
Implementing Modality
254. During the project’s initial phase (6-12 months) the project will be executed under the Direct
Implementation Modality –DIM to ensure impartial consensus-building while the different discussion and
decision-making spaces are set up. Several factors contribute to the choice of this implementation
modality:
 The new government (in place since August 2013), has announced a series of structural changes in
State institutions such as Ministries and Secretariats with direct and indirect roles in the project; in
this respect, the Government’s organizational structure is expected to undergo adjustments that
may substantially affect the project’s implementation arrangements.
 Given the scope of the Project, the variety of stakeholders involved (public institutions, small and
medium size producers, traders, local government, campesino and indigenous populations,
amongst others) and their opposing stances, the relevance of commodities for Paraguay´s GDP,
recommendations from key project-related stakeholders, and finally the above-mentioned
comparative advantages, a neutral organism such as UNDP is essential to facilitate the required
process of dialogue and consensus when discussing such topics of utmost importance for the
country’s development.
255. Thus during the initial phase the project will be executed by UNDP in close collaboration and
consultation with the SEAM and other members of the Project Board (see below) and generic
responsibilities outlined in Part I, section 2.5 Stakeholder Mapping and Section IV, Part III Stakeholder
Involvement. Once the expected structural changes, consensus building mechanisms and fine tuning of
institutional roles and responsibilities are agreed upon and confirmed, the Project Board (PB) shall define
31UNDP
established the Green Commodities Programme (GCP) in 2009, as a small unit within UNDP’s global network to
transform agricultural production and trade around the world through multi-stakeholder collaboration and the establishment of
effective national enabling environments in producer countries.
82
the convenience of changing to the execution modality to national implementation -NIM. This change
would involve a substantial revision of the project (including a capacity assessment and procedures to be
used) to reflect adjustments in implementation arrangements including the definition of roles and
responsibilities, and coordination of stakeholders involved in the project’s technical and administrative
management.
UNDP Project Support Services
256. During the initial phase and under the DIM modality, and in addition to provisions of paragraph
251 above, UNDP- through a Project Management Unit will be responsible for: (i) ensuring professional
and timely implementation of the activities and delivery of the reports and other outputs identified in the
project document; (ii) coordination and supervision of the activities outlined in the project document; (iii)
undertaking necessary organizational arrangements for all project meetings; (iv) contracting of and
contract administration for qualified local and international experts who meet the formal requirements of
the UNDP/GEF; (v) manage and be responsible of all financial transactions to realize the targets
envisioned in consultation with the SEAM and the other members of the PB; (iv) to mainstream project
outcomes in its own national programme and consider funding opportunities from its own resources as
appropriate; (vii) to coordinate with UN Country Team in Paraguay with a view to mainstreaming their
interventions at the country level and funding as appropriate; (viii) establishing an effective networking
between project stakeholders, specialized international organizations and the donor community; ensure
networking among the country-wide stakeholders; (x) review and make recommendations for reports
produced under the project; and (x) establish and endorse the thematic areas, with a view to ensuring
linkages to national policy goals, relevance, effectiveness and impartiality of the decision making process.
257. When the project execution modality is changed to national execution the selected National
Implementing Partner will then undertake programmatic and administrative-financial control and
responsibility for supervising the project in line with the Standard Basic Assistance Agreement between
UNDP and the Government of Paraguay, and will be responsible for approving deliverables prior to their
reporting to GEF by UNDP. Capacity building priorities will be addressed at all times.
258. At the request of the Government of Paraguay, when the modality is changed from DIM to NIM,
UNDP shall also provide Direct Project Services (DPS) specific to project inputs according to its policies
and convenience. These services, and the costs thereof, are specified in the Letter of Agreement in Section
IV Part XII. In accordance with GEF requirements, the costs of these services will be part of the executing
entity’s Project Management Cost allocation identified in the project budget. UNDP and the Government
of Paraguay acknowledge and agree that these services are not mandatory and will only be provided in full
accordance with UNDP policies on recovery of direct costs. Direct project services will be charged
annually using the Universal Price List for Direct Project Services requested by the GoP.
259. Support Services for Implementation are related to the recovery of costs for providing services to
the implementation of the project based on real costs or transaction fees, including:
1. Payments, disbursements and other financial transactions
2. Recruitment of staff, project personnel, and consultants
3. Procurement of services and equipment, and disposal/sale of equipment
4. Organization of training activities, conferences, and workshops, including fellowships
5. Travel authorizations, visa requests, ticketing, and travel arrangements
6. Shipment, custom clearance, vehicle registration, and accreditation
260. These costs are an integral part of the project implementation and will be charged to budget 74599
in the Project Management component, according to the current Universal Price List for transactional
services, once the change of implementation modality of DIM (Direct Implementation) to NIM (National
Implementation) is made through a substantive revision and based on the attached Letter of Agreement.
83
Project Board
261. The Project organization structure includes the following instances: (1) the Project Board; (2) the
Technical Committee; (3) the Project Management Unit; and (4) Local Committees( see Figure 1 below)
Project Organization Structure
Project Board
Representati
ve cofinancers
roundtable
SEAM
Ministry
UNDP RR
Spokesperson
National
Platform
Representativ
e Local
Governments
Project Assurance
UNDP
Team
Local Committee
Project Management
Unit
Local Committee
Technical Committee
Local Committee
Figure1:Project Organization Structure
The Project Board
262. The Project Board (PB) is the project’s higher level of analysis and decision-making regarding
programming and supervision. The PB plays a critical role in overall project oversight monitoring and
evaluation, based on RBM. In order to ensure UNDP’s ultimate accountability for the project’s results, PB
decisions will be made in accordance to standards that shall ensure management for development results,
best value for money, fairness, integrity, transparency and effective national and international competition.
263. The PB members will include the Executive Secretary of the SEAM given its roles and
responsibilities as the lead national agency in charge of regulating environmental matters and as GEF
operational and political focal point; the UNDP Resident Representative as chair to the group; a
representative from the co-financers round-table; a spokesperson from the national commodities platform,
and representatives from local governments.
 The co-financers roundtable will be composed of institutions and organizations that have
confirmed their co-financing interest based on their implementation of project-related initiatives.
While the main responsibility of this roundtable is ensuring the adequate coordination of each cofinancer’s initiative with the project’s activities, more specific tasks and operational arrangements
shall be agreed upon in the project´s initial phase.
 The National Platform shall be composed by representatives from several public institutions,
private organizations, traders, NGOs, etc. which shall convene and coordinate the public and
private sector to promote sustainable production at the two levels as further detailed in Output 1.3.
 Local Government Representatives: representatives from the concerned local governments
(Department of Canindeyú, Alto Paraná y Amambay) shall be part of the PB so as to ensure
adequate ownership and coordination of the project’s activities and products at the local level.
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264. The PB will be convened and supported logistically by the Project Management Unit (PMU)and
will meet at least twice a year. The PB will provide overall guidance for the project throughout its
implementation; specifically, the PB will be responsible for: (i) approving the annual work plan and
budget; (ii) achieving coordination among the various government agencies; (iii) guiding project
implementation to ensure alignment with national and local planning processes and sustainable resource
use and conservation policies, plans and conservation strategies; (iv) ensuring the participation of key
stakeholders in consensus building processes; (v) overseeing the work being carried out by the
implementation units and local committees; (vi) reviewing key reports (such as PIR); and (vii) monitoring
progress and the effectiveness of project implementation.
The Technical Committee:
265. The Technical Committee (TC) shall be composed of representatives from institutions and
organizations involved in the achievement of Project outcomes, as generally identified in the below Table.
Project outcomes
Outcome 1: Effective governance framework for biodiversity
conservation and SLM in multiple use landscapes
Key institutions and
organizations
SEAM - MAG – INFONA –
MIC
Outcome 2: Financial and market incentives framework to promote
biodiversity and sustainable land management within the target
multiple-use landscape
SEAM - MIC – Private Sector –
Roundtable for Sustainable
Finance
Outcome 3: Strengthened implementation of land set aside system
and sustainable production practices
SEAM - MAG – INFONA –
MIC – INDERT - Private Sector –
Local Governments
266. The functioning of this TC shall be agreed upon during the project’s start-up phase, including
frequency of meetings, refined scope of roles and responsibilities, decision-making flow and program of
work. In general, members of the TC will provide technical inputs for the achievement of products and/or
results in their respective area of work, and will be specifically responsible for ensuring alignment of
project activities with institutional mandates.
267. During the project’s initial phase, the organization of the TC will be supported by the PMU, while
international advisory services may be provided through the project to provide guidance on technical
issues related to the project outcomes.
Project Management Unit:
268. During the project’s initial phase, the Project Management Unit (PMU) shall be established within
UNDP and under the overall supervision of UNDP, or as may be agreed by the PB. The PMU will be
responsible for day-to-day project coordination and management through adequate work plans, terms of
reference and carefully designed administrative arrangements, which will be reviewed and approved by the
PB. The PMU will be staffed as follows:
 Project manager: The Project manager shall run the Project on a day-to-day basis on and his/her
prime responsibility shall be to ensure that the project produces the result specified in the
project document, to the required standards of quality and within the specified constraints of
time and cost. The PM will be a person with significant technical experience related to the
scope of the project in addition to strong management skills. S(he) will provide overall
technical direction for delivery of key outcomes as part of the functions. In addition S(he) will
provide the Managerial leadership for the project, working closely with Institutions represented
in the PB, the Technical Committee and key stakeholders. This post will be funded by the GEF.
85
 Administrative/Finance Assistant: The administrative/finance assistant will be stationed in the
PMU and will provide support to the PM in management and administration of the project as
well as provide logical support to technical components of the project. This post will be funded
by the GEF.
269.
The responsibilities of the PMU will include the following:
 Achievement of the Project outcomes and objectives;
 To manage day-to-day implementation of the project, coordinating project activities in
accordance with the rules and procedures of UNDP and based on the general guidance provided
by the PB;
 To provide overall project coordination and M&E.
 To provide technical inputs as appropriate into the outcomes;
 To coordinate with the project stakeholders and regional/national programs of relevance to the
project;
 To ensure, together with UNDP, that specified tasks are outsourced to suitable sub-contracted
service providers or national and/or international consultants through competitive bidding
processes. In this regard, PMU responsibilities include the development of bidding documents
and terms of reference;
 To organize project-level meetings and workshops, e.g. inception workshop, PB, TC and LC
meetings, etc..
 To work closely with the UNDP offices in the region in organizing and providing technical and
logistic support and coordination to all missions and assignments by international and national
consultants; and,
 To prepare overall reporting.
Local Committees:
270. A local committee shall be established at each of the 3 priority areas identified within the
departments of Canindeyú (municipality of Villa Ygatimi), Alto Paraná (Municipalities of Cedrales and
San Cristobal) and Amambay (Municipalities of Pedro Juan Caballero) which functions will be to link the
project objective with the local plans (both institutional and sectorial) as well as ongoing or planned
interventions or investments by the local partners and/or beneficiaries. This will allow LCs to identify
supporting requirements of the project as well as opportunities to strengthen the scope of the project. The
LCs shall also help to coordinate the participation of institutions in the implementation of project activities
in each priority area. In fact, its members will be direct executors or beneficiaries of their activities. LCs, if
necessary, might summon experts from public and private sectors and civil society organizations to discuss
and/or participate in key issues for the project implementation.
PART IV: Monitoring and Evaluation Plan
271. Project M&E will be conducted in accordance with the established UNDP and GEF procedures
and will be provided by the project team and the UNDP-CO with support from the UNDP/GEF RCU in
Panama City. The Project Results Framework in Section 3 provides performance and impact indicators for
project implementation along with their corresponding means of verification. The M&E plan includes an
inception report, project implementation reviews, quarterly and annual review reports, and mid-term and
final evaluations. The following sections outline the principle components of the M&E plan and indicative
cost estimates related to M&E activities. The M&E budget is provided in the table below. The project’s
M&E plan will be presented and finalized in the Project Inception Report following a collective finetuning of indicators, means of verification, and the full definition of project staff M&E responsibilities.
Project Inception Phase
272. A Project Inception Workshop (IW) will be held within the first three (3) months of project
start-up with the participation of the full project team, relevant GoP counterparts, co-financing partners,
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the UNDP-CO and representation from the UNDP-GEF RCU, as well as UNDP-GEF headquarters (HQ)
as appropriate. A fundamental objective of the IW will be to help the project team to understand and take
ownership of the project’s goal and objectives, as well as finalize preparation of the project's first annual
work plan on the basis of the project results framework and the GEF Tracking Tool. This will include
reviewing the results framework (indicators, means of verification, and assumptions), imparting additional
detail as needed, and on the basis of this exercise, finalizing the Annual Workplan (AWP) with precise and
measurable performance indicators, and in a manner consistent with the expected outcomes for the project.
273. Additionally, the purpose and objective of the IW will be to: a) introduce project staff to the
UNDP-GEF team that will support the project during its implementation, namely the CO and responsible
RCU staff; b) detail the roles, support services, and complementary responsibilities of UNDP-CO and
RCU staff in relation to the project team; c) provide a detailed overview of UNDP-GEF reporting and
M&E requirements, with particular emphasis on the Annual Project Implementation Reviews (PIRs) and
related documentation, the Annual Project Report (APR), mid-term review and final evaluation. Equally,
the IW will provide an opportunity to inform the project team on UNDP project-related budgetary
planning, budget reviews including arrangements for annual audit, and mandatory budget re-phasings.
274. The IW will also provide an opportunity for all parties to understand their roles, functions, and
responsibilities within the project's decision-making structures, including reporting and communication
lines and conflict resolution mechanisms. The Terms of Reference (ToRs) for project staff and decisionmaking structures will be discussed again, as needed, in order to clarify each party’s responsibilities during
the project's implementation phase. The IW will also be used to plan and schedule the Tripartite
Committee Reviews. A report on the Inception Workshop is a key reference document and must be
prepared and shared with participants to formalize various agreements and plans decided during the
meeting (see details below).
Monitoring Responsibilities and Events
275. A detailed schedule of project review meetings will be developed by the project management in
consultation with project implementation partners and stakeholder representatives and incorporated in the
Project Inception Report. Such a schedule will include: a) tentative timeframes for Project Board (PB)
Reviews (or relevant advisory and/or coordination mechanisms); and b) project-related M&E activities.
276. Day-to-day monitoring of implementation progress will be the responsibility of the Project
Coordinator based on the project's AWP and its indicators. The Project Coordinator will inform the
UNDP-CO of any delays or difficulties faced during implementation so that the appropriate support or
corrective measures can be adopted in a timely and remedial fashion. The Project Coordinator will finetune the progress and performance/impact indicators of the project in consultation with the full project
team at the IW with support from UNDP-CO and assisted by the UNDP-GEF RCU. Specific targets for
the first-year implementation progress indicators together with their means of verification will be
developed at this workshop. These will be used to assess whether implementation is proceeding at the
intended pace and in the right direction and will form part of the AWP. Targets and indicators for
subsequent years will be defined annually as part of the internal evaluation and planning processes
undertaken by the project team. Measurement of impact indicators related to global benefits will occur
according to the schedules defined through specific studies that are to form part of the project’s activities.
277. Periodic monitoring of implementation progress will be undertaken by the UNDP CO through
quarterly meetings with the project implementation team, or more frequently as deemed necessary. This
will allow parties to take stock of and to troubleshoot any problems pertaining to the project in a timely
fashion to ensure the timely implementation of project activities. The UNDP CO and UNDP-GEF RCU, as
appropriate, will conduct yearly visits to the project’s field sites, or more often based on an agreed upon
schedule to be detailed in the project's Inception Report/AWP to assess first-hand project progress. Any
other member of the Steering Committee can also take part in these trips, as decided by the Steering
87
Committee. A Field Visit Report will be prepared by the UNDP CO and circulated no less than one month
after the visit to the project team, all Steering Committee members, and UNDP-GEF.
278. Annual monitoring will occur through the PB meetings. This is the highest policy-level meeting
of the parties directly involved in the implementation of a project. The project will be subject to Project
Board review at least once every year. The first such meeting will be held within the first twelve (12)
months of the start of full implementation. The project proponent will prepare an Annual Project Report
(APR) and submit it to UNDP CO and the UNDP-GEF regional office at least two weeks prior to the PB
for review and comments.
279. The APR will be used as one of the basic documents for discussions in the PB. The Project
Coordinator will present the APR to the PB, highlighting policy issues and recommendations for the
decision of the PB participants. The Project Coordinator will also inform the participants of any agreement
reached by stakeholders during the APR preparation on how to resolve operational issues. Separate
reviews of each project component may also be conducted if necessary. The PB has the authority to
suspend disbursement if project performance benchmarks are not met. Benchmarks will be developed at
the IW, based on delivery rates and qualitative assessments of achievements of outputs.
280. The Terminal PB Review is held in the last month of project operations. The Project Coordinator
is responsible for preparing the Terminal Report and submitting it to UNDP-CO and to UNDP-GEF RCU.
It shall be prepared in draft at least two months in advance of the PB meeting in order to allow review, and
will serve as the basis for discussions in the PB meeting. The terminal PB review considers the
implementation of the project as a whole, paying particular attention to whether the project has achieved
its stated objectives and contributed to the broader environmental objective. It decides whether any actions
are still necessary, particularly in relation to sustainability of project results, and acts as a vehicle through
which lessons learned can be captured to feed into other projects being implemented.
Project Monitoring Reporting
281. The Project Coordinator, in conjunction with the UNDP-GEF extended team, will be responsible
for the preparation and submission of the following reports that form part of the monitoring process and
that are mandatory.
282. A Project Inception Report (IR) will be prepared immediately following the IW. It will include a
detailed First Year/AWP divided in quarterly timeframes detailing the activities and progress indicators
that will guide implementation during the first year of the project. This work plan will include the dates of
specific field visits, support missions from the UNDP CO or the RCU or consultants, as well as
timeframes for meetings of the project’s decision-making structures. The IR will also include the detailed
project budget for the first full year of implementation, prepared on the basis of the AWP, and including
any M&E requirements to effectively measure project performance during the targeted 12-month
timeframe. The IR will include a more detailed narrative on the institutional roles, responsibilities,
coordinating actions, and feedback mechanisms of project-related partners. In addition, a section will be
included on progress to date on project establishment and start-up activities and an update of any changed
external conditions that may affect project implementation. When finalized, the IR will be circulated to
project counterparts who will be given a period of one calendar month in which to respond with comments
or queries. Prior to the IR’s circulation, the UNDP CO and UNDP-GEF’s RCU will review the document.
283. In light of the similarities of both APR and PIR, UNDP-GEF has prepared a harmonized format
for use in fulfilling the following two requirements:
88



The Annual Project Report (APR) is a UNDP requirement and part of UNDP CO central
oversight, monitoring, and project management. It is a self-assessment report by the project
management to the CO and provides input to the country office reporting process and the ResultsOriented Annual Report (ROAR), as well as forming a key input to the PB Review. An APR will
be prepared on an annual basis prior to the PB Review, to reflect progress achieved in meeting the
project’s AWP and assess performance of the project in contributing to intended outcomes through
outputs and partnership work. The format of the APR is flexible but should include the following
sections: a) project risks, issues, and adaptive management; b) project progress against pre-defined
indicators and targets, c) outcome performance; and d) lessons learned/best practices.
The Project Implementation Review (PIR) is an annual monitoring process mandated by the
GEF. It has become an essential management and monitoring tool for project managers and offers
the main vehicle for extracting lessons from on-going projects. Once the project has been under
implementation for one year, a PIR must be completed by the CO together with the project
management. The PIR can be prepared any time during the year and ideally prior to the TPC
review. The PIR should then be discussed in the PB meeting so that the result would be a PIR that
has been agreed upon by the project, the Implementing Partner, UNDP CO, and the RCU in
Panama. The individual PIRs are collected, reviewed, and analyzed by the RCU prior to sending
them to the focal area clusters at the UNDP-GEF headquarters.
Quarterly Progress Reports outlining main updates in project progress will be provided
quarterly to the local UNDP CO and the UNDP-GEF RCU by the project team. Progress made
shall be monitored in the UNDP Enhanced Results Based Management Platform and the risk log
should be regularly updated in ATLAS based on the initial risk analysis.
284. Specific Thematic Reports focusing on specific issues or areas of activity will be prepared by the
project team when requested by UNDP, UNDP-GEF, or the Implementing Partner. The request for a
Thematic Report will be provided to the project team in written form by UNDP and will clearly state the
issue or activities that need to be reported on. These reports can be used as a form of lessons learned
exercise, specific oversight in key areas, or as troubleshooting exercises to evaluate and overcome
obstacles and difficulties encountered. UNDP is requested to minimize its requests for Thematic Reports,
and when such are necessary will allow reasonable timeframes for their preparation by the project team.
285. A Project Terminal Report will be prepared by the project team during the last three (3) months
of the project. This comprehensive report will summarize all activities, achievements, and outputs of the
project; lessons learned; objectives met or not achieved; structures and systems implemented, etc.; and will
be the definitive statement of the project’s activities during its lifetime. It will also lay out
recommendations for any further steps that may need to be taken to ensure sustainability and replicability
of the project’s activities.
286. Technical Reports are detailed documents covering specific areas of analysis or scientific
specializations within the overall project. As part of the Inception Report, the project team will prepare a
draft Reports List detailing the technical reports that are expected to be prepared on key areas of activity
during the course of the project, and tentative due dates. Where necessary, this Reports List will be revised
and updated, and included in subsequent APRs. Technical Reports may also be prepared by external
consultants and should be comprehensive and specialized analyses of clearly defined areas of research
within the framework of the project and its sites. These technical reports will represent, as appropriate, the
project’s substantive contribution to specific areas, and will be used in efforts to disseminate relevant
information and best practices at local, national, and international levels.
287. Project Publications will form a key method of crystallizing and disseminating the results and
achievements of the project. These publications may be scientific or informational texts on the activities
and achievements of the project in the form of journal articles or multimedia publications. These
89
publications can be based on Technical Reports, depending upon the relevance and scientific worth of
these reports, or may be summaries or compilations of a series of Technical Reports and other research.
The project team will determine if any of the Technical Reports merit formal publication, and (in
consultation with UNDP, the GoC, and other relevant stakeholder groups) will also plan and produce these
publications in a consistent and recognizable format. Project resources will need to be defined and
allocated for these activities as appropriate and in a manner commensurate with the project’s budget.
Independent External Evaluations
288. The project will be subjected to at least two reviews/evaluations as follows:
289. A Mid-Term Review will be undertaken at the mid-point of the project lifetime. The Mid-Term
Review will determine progress being made towards the achievement of outcomes and will identify course
correction if needed. It will focus on the effectiveness, efficiency, and timeliness of project
implementation; will highlight issues requiring decisions and actions; and will present initial lessons
learned about project design, implementation, and management. Findings of this review will be
incorporated as recommendations for enhanced implementation during the final half of the project’s term.
The organization, ToRs, and timing of the mid-term review will be decided after consultation between the
parties to the project document. The ToRs for this Mid-Term Review will be prepared by the UNDP-CO
based on guidance from the UNDP-GEF RCU. The management response of the review will be uploaded
to the UNDP corporate systems, in particular the UNDP Evaluation Office Evaluation Resource Centre
(ERC). The GEF Tracking Tool for the project will also be completed during the mid-term review cycle.
290. A Final Evaluation will take place three months prior to the terminal Steering Committee
meeting, and will focus on the same issues as the Mid-Term Review. The Evaluation will also look at
impact and sustainability of results, including the contribution to capacity development and the
achievement of global environmental goals. The Evaluation should also provide recommendations for
follow-up activities and requires a management response that should be uploaded to PIMS and to the
UNDP Evaluation Office Evaluation Resource Centre (ERC). The ToRs for this evaluation will be
prepared by the UNDP-CO based on guidance from the UNDP-GEF RCU. The GEF Tracking Tool will
also be completed during the final evaluation.
Audit Clause
291. The GoP will provide the Resident Representative with certified periodic financial statements, and
with an annual audit of the financial statements relating to the status of UNDP (including GEF) funds
according to the established procedures set out in the Programming and Finance rules and regulations. The
audit will be conducted according to UNDP’s financial regulations, rules, and audit policies by the legally
recognized auditor by the GoP, or by a commercial auditor engaged by the GoP.
Learning and Knowledge Sharing
292. Results from the project will be disseminated within and beyond the project intervention zone
through a number of existing information sharing networks and forums. In addition, the project will
participate, as relevant and appropriate, in UNDP-GEF sponsored networks, organized for Senior
Personnel working on projects that share common characteristics. UNDP-GEF RCU has established an
electronic platform for sharing lessons between the project managers. The project will identify and
participate, as relevant and appropriate, in scientific, policy-based and/or any other networks, which may
be of benefit to project implementation though lessons learned. The project will identify, analyze, and
share lessons learned that might be beneficial in the design and implementation of similar future projects.
Identifying and analyzing lessons learned is an on-going process, and the need to communicate such
lessons as one of the project’s central contributions is a requirement to be delivered not less frequently
than once every twelve (12) months. UNDP-GEF shall provide a format and assist the project team in
categorizing, documenting, and reporting on lessons learned. Specifically, the project will ensure
90
coordination in terms of avoiding overlap, sharing best practices, and generating knowledge products of
best practices in the area of IAS management.
M&E Workplan
Type of M&E
activity
Responsible Parties
Budget US$
Excluding project team
staff time
Time frame
Inception
Workshop
and Report
Measurement of Means
of Verification of
project results.
 Project Manager
 UNDP CO, UNDP GEF
 UNDP GEF RTA/Project
Manager will oversee the
hiring of specific studies and
institutions, and delegate
responsibilities to relevant
team members.
 Oversight by Project
Manager
 Project team
Indicative cost: $16,000
Within first two months of
project start up
Start, mid and end of project
(during evaluation cycle) and
annually when required.
To be determined as part of
the Annual Work Plan's
preparation.
Annually prior to ARR/PIR
and to the definition of
annual work plans








Project manager and team
UNDP CO
UNDP RTA
UNDP EEG
Project Coordinator
UNDP-CO
GoP representatives
Project manager and team
None
Annually
$10,000
Two times per year
None
Quarterly



















Project manager and team
UNDP CO
UNDP RCU
Evaluation team
Project manager and team,
UNDP CO
UNDP RCU
Evaluation team
Project manager and team
UNDP CO
Local consultant
Project manager and team
UNDP CO
Local consultant
UNDP CO
Project manager and team
UNDP CO
UNDP RCU (as appropriate)
Government representatives
Indicative cost: $40,000
At the mid-point of project
implementation.
Indicative cost : $40,000
At least three months before
the end of project
implementation
None
Yearly
0
At least three months before
the end of the project
Cost per year approx. $5.000
(total $ 25.000)
For GEF supported projects,
paid from IA fees and
operational budget
Yearly
Measurement of Means
of Verification for
Project Progress on
output and
implementation
ARR/PIR
Project Board Meetings
Periodic status/ progress
reports
Mid-term Review
Final Evaluation
Lessons Learned
Project Terminal Report
Audit
Visits to field sites
To be finalized in Inception
Phase and Workshop.
Yearly
PART V: Legal Context
293. This document together with the CPAP signed by the Government and UNDP which is
incorporated by reference constitute together a Project Document as referred to in the SBAA [or other
appropriate governing agreement] and all CPAP provisions apply to this document.
294. Consistent with the Article III of the Standard Basic Assistance Agreement, the responsibility for
the safety and security of the implementing partner and its personnel and property, and of UNDP’s
property in the implementing partner’s custody, rests with the implementing partner.
91
295.
The implementing partner shall:
a) put in place an appropriate security plan and maintain the security plan, taking into account the
security situation in the country where the project is being carried;
b) assume all risks and liabilities related to the implementing partner’s security, and the full
implementation of the security plan.
296. UNDP reserves the right to verify whether such a plan is in place, and to suggest modifications to
the plan when necessary. Failure to maintain and implement an appropriate security plan as required
hereunder shall be deemed a breach of this agreement.
297. This Project Document shall be the instrument referred to as such in Article I of the Standard Basic
Assistance Agreement between the Government of Paraguay and the United Nations Development
Programme, signed by the parties on June 7th, 1978. The host country implementing agency shall, for the
purpose of the Standard Basic Assistance Agreement, refer to the government co-operating agency
described in that Agreement.
298. The UNDP Resident Representative in Paraguay is authorized to effect in writing the following
types of revision to this Project Document, provided that he/she has verified the agreement thereto by the
UNDP-GEF Unit and is assured that the other signatories to the Project Document have no objection to the
proposed changes:
a) Revision of, or addition to, any of the annexes to the Project Document;
b) Revisions which do not involve significant changes in the immediate objectives, outputs or
activities of the project, but are caused by the rearrangement of the inputs already agreed to or
by cost increases due to inflation;
c) Mandatory annual revisions which re-phase the delivery of agreed project inputs or increased
expert or other costs due to inflation or take into account agency expenditure flexibility; and
d) Inclusion of additional annexes and attachments only as set out here in this Project Document
Agreement On Intellectual Property Rights And Use Of Logo On The Project’s Deliverables
299. In order to accord proper acknowledgement to GEF for providing funding, a GEF logo should
appear on all relevant GEF project publications, including among others, project hardware and vehicles
purchased with GEF funds. Any citation on publications regarding projects funded by GEF should also
accord proper acknowledgement to GEF.
92
SECTION II: STRATEGIC RESULTS FRAMEWORK (SRF) AND GEF INCREMENT
Annex A: Project Logical Framework
This project will contribute to achieving the following Country Programme Outcome as defined in CPAP or CPD:
Outcome 3.2: Policies and programmes for conservation and sustainable use of biological and cultural resources.
Outcome 3.3: Sustainable and equitable development model
Country Programme Outcome Indicators:
3.2.1: Strengthened environmental institutions for decentralized environmental management
3.2.3: Interinstitutional and intersectoral coordination supported for conservation and sustainable use of biological and cultural resources
3.3.1: Economic incentives for sustainable production.
3.3.2: Systems and technologies for production of environmentally sustainable goods and services developed
3.3.3: Interinstitutional and intersectoral coordination strengthened to integrate sustainable development actions
Primary applicable Key Environment and Sustainable Development Key Result Area (same as that on the cover page, circle one):
1: Inclusive and sustainable growth and development
Applicable GEF Strategic Objective and Program:
BD-SO2: Mainstream Biodiversity Conservation and Sustainable Use into Production Landscapes, Seascapes and Sectors,
LD-SO3: Reduce pressures on natural resources from competing land uses in the wider landscape
SFM REDD+- SO1: Reduce pressures on forest resources and generate sustainable flows of forest ecosystem services
Applicable GEF Expected Outcomes:
BD Outcome 2.1 Increase in sustainably managed landscapes and seascapes that integrate biodiversity conservation
BD Outcome 2.2: Measures to conserve and sustainably use biodiversity incorporated in policy and regulatory frameworks
LD Outcome 3.1: Enhanced cross-sector enabling environment for integrated landscape management.
LD Outcome 3.2: Integrated landscape management practices adopted by local communities.
SFM REDD+ Outcome1.2: Good management practices applied in existing forests.
Applicable GEF Outcome Indicators:
BD Indicator 2.1: Landscapes and seascapes certified by internationally or nationally recognized environmental standards that incorporate biodiversity considerations (e.g. FSC, MSC) measured
in hectares and recorded by GEF tracking tool
BD Indicator 2.2: Polices and regulations governing sectoral activities that integrate biodiversity conservation as recorded by the GEF tracking tool as a score.
LD Indicator 3.1: Demonstration results strengthening enabling environment between sectors (incl. agriculture, forestry)
LD Indicator 3.2: Area under effective land use management with vegetative cover maintained or increased
SFM REDD+ Indicator 1.2 (2): Enhanced carbon sinks from reduced forest degradation
Intervention Logic
Objectively Verifiable Indicators
Project Objective:
The biodiversity and
ecosystem functions of the
Atlantic Forest eco-region
Surface area of forests in the Multiple Use
Landscapes (MUL) out of protected areas in the 3
Departments have a greater degree of protection,
measured by:
Baseline
Targets
(End of Project)
Means of
Verification
Monitoring System
reports
a) 3,000 ha (to be
Risks and Assumptions
International market
favors sustainable
products
Environmental
93
Intervention Logic
Objectively Verifiable Indicators
is protected from existing
and emerging threats from
multi-sectoral production
practices and is a model
for replication across the
country’s bioregions and
biomes.
a) Number of hectares of forests certified for
environmental services;
b) Number of hectares of forests under sustainable
management (REDD+ pilot project);
Baseline
a) Less than 10
certificates have been
issued in the whole
country.
b) 0
c) Number of hectares of legal set-asides and
protective forests established with management
criteria
Surface area in the MUL where sustainable
production practices (1 or more) have been adopted
on the basis of the Best Practice Manuals and
contribute to establish deforestation free supply
chains:
a) Number of hectares achieved through direct
project intervention in the 3 priority areas.
c) No registry or
cadaster of legal setasides or protective
forests
Practices focus on soil
conservation
and
management (medium
and large producers).
Small farmers with
degraded
soils.
Intensive use of agrochemicals. Lack of
environmental criteria.
Targets
(End of Project)
adjusted
when
the
Monitoring System is
operational).
b) 6,000 ha (to be
adjusted
when
the
Monitoring System is
operational).
c) 90,000 ha of legal
set-asides; 30,000 ha of
protective forests
(to be adjusted when the
Monitoring System is
operational).
Certificates issued
within the project
intervention area
a) 500,000 ha (soy);
60,000 ha (livestock)
b) 900,000 ha (soy);
398,000 ha (livestock)
Monitoring System
reports.
a) % of reduction in the use of firewood from native
forests by grain silos and dryers.
b) % of reduction in sedimentation of surface water
bodies
a) Tons of native
firewood used by silos
to be defined in PY1
(data base to be
established in pilot
Municipalities)
Data base of legal setasides demarcated for
restoration and
protective forests
Monitoring and
control records.
Risks and Assumptions
Impacts of climate
variability and extreme
weather events on
productivity do not pose
risks to soy and livestock
production
Political will and support
to adequate enforcement
of the regulatory
framework
Landowners engaged in
complying with
regulations, restoring
environmental liabilities
and participating in
sustainable value chains
Field inspections.
Reports by
institutional partners
b) Number of hectares that can be potentially
achieved through indirect effect of project
intervention (replication)
Direct reduction of pressures in forest ecosystems
from production sectors as evidenced by:
Means of
Verification
a) 50 %
b) 5%
Records of monitoring
of silos
Field measurement
data on sedimentation
b) Sedimentation to be
measured in pilot
94
Intervention Logic
Objectively Verifiable Indicators
Percentage of increase in coverage of representative
native tree species in the MUL (outside of protected
areas) in the early stages of natural succession that
are characteristic of the UPAF
Tons of avoided emissions of CO2eq attained
through protection of forests in the REDD+ pilot
project:
a) Direct lifetime (6,000 ha)
b) Indirect lifetime (65,000 ha)
Outcome 1: Effective
governance framework for
biodiversity conservation
and SLM in multiple use
landscapes
Improved institutional capacities to effectively plan,
implement, monitor and mainstream biodiversity
into production activities at landscape level as
measured by a % of increase in the Capacity
Scorecard
Baseline
Municipalities in PY1
To be defined in PY1
(through GIS)
Baseline map of carbon
stocks for the UPAF
estimates a minimum of
22.2 tC/ha and a
maximum of 189.8
tC/ha (average of 64
tC/ha)
SEAM and INFONA
average 46%
Targets
(End of Project)
Means of
Verification
20%
Satellite imagery (PY1
and PY5)
a) 1,408,128 ton/CO2eq
b) 15,254,720
ton/CO2eq
Agreement for start-up
of pilot project
At least 80% average
Capacity
(mid term)
scorecard
Capacity
scorecard
(end of project)
Percentage of increase in the amount collected by
SEAM for fines charged from infringement of forest
and environmental regulations
Average annual amount
collected by SEAM is
US$270,000
Percentage of environmental licenses approved in
priority areas based on the Monitoring System
0
60% (US$432,000)
Reports from SEAM´s
Directorate General
for Administration and
Finances
Risks and Assumptions
Government commitment
to promote the necessary
reforms to improve the
governance framework,
minimizing staff turnover
and
institutionalizing
processes.
Stakeholders committed
and involved in the
development
of
the
platforms.
PY2: baseline
Reports from SEAM´s
information uploaded in Directorate General
the Monitoring System
for Environmental
PY3: 50%
Quality and Natural
PY4: 75%
Resources
PY5: 100%
Level of agreement on sustainable production 0
PY3: minimum
Minutes and records
approaches, including deforestation free supply
environmental standards of meetings approving
chains, international certification standards, best
for soy and livestock
the
minimum
practices for production and conservation, land
production agreed by
standards
zoning criteria for corridors, biosafety.
the multi-stakeholder
platforms
Output 1.1: A package of modifications in regulations, policies and standards at national level to improve protection of the Upper Parana Atlantic Forest
Output 1.2: Institutional strengthening of SEAM, INFONA, Public Ministry, and Municipalities for improved monitoring and surveillance of deforestation and enforcement of environmental
95
Intervention Logic
Objectively Verifiable Indicators
Baseline
Targets
(End of Project)
Means of
Verification
Risks and Assumptions
and forest regulations in production landscapes
Output 1.3: One national and three departmental soy and beef platforms for inter-institutional and multi-stakeholder dialogue on land use planning regulations, enforcement, and incentives for
best practice adoption within production landscapes, involving all land use managers and supply chains.
Outcome 2: Financial and Surface area of soy in the 3 priority areas prepared 23,000 ha of RTRS a) 500,000 ha
Contracts
between Financial institutions
market
incentives for certification and certified under international certified soy in the
producers
and interested and involved in
framework to promote certification schemes, contributing to a deforestation Department of San b) 250,000 ha (50%)
international certifying mainstreaming
biodiversity
and free supply chain, evidenced by:
Pedro
(outside
the
agencies
environmental criteria in
sustainable
land a) Number of hectares applying minimum UPAF) – 65,000 ha
lending procedures;
management within the environmental standards in preparation for under ISCC scheme by
Commodity buyers´ establishing credit lines to
target
multiple-use certification under international schemes.
ADM
records
finance best practices and
landscape
b) Number of hectares certified.
certification.
Institutional partners´
reports on annual The Central Bank of
monitoring of the Paraguay adjusts its
agricultural campaign regulations to favor long(MAG, Cooperatives, term recovery of loans by
Producer associations) financial institutions.
Percentage of soy purchases in the priority areas by
commodity buyers that come from producers that
comply with best practices
Commodity buyers have
different
purchasing
policies mainly based
on offer and volume
PY3: 10%
PY4: 30%
PY5: 50%
Institutional partners´
reports on annual
monitoring of the
agricultural campaign
(MAG, Cooperatives,
Producer associations)
Degree to which environmental sustainability
criteria have been mainstreamed in financial
institutions´ (FI) credit operations for soy and meat,
measured by:
a) % of compliance with the pre-requisite of
presenting environmental management plans as per
the provisions of the EIA law
Purchase receipts of
commodity buyers
Financial statements,
reports and financing
plans of the FI
a) 3 banks (Continental,
Regional and Bancoop)
have started to request
environmental licenses
Commodity buyers and
producers interested in
expanding certification
schemes that reward
sustainable production.
Landowners interested in
participating in SEAMcertified schemes for
forests and carbon
markets
a) PY4: 80% of the soy
and
livestock
loan
portfolios
96
Intervention Logic
Objectively Verifiable Indicators
Baseline
Targets
(End of Project)
Means of
Verification
Risks and Assumptions
in mid 2013 (within the
public and private banks
sector, these banks
cover 42% of the soy
portfolio and 36% of the
livestock portfolio)
b) Number of FIs (and therefore volume of credits)
that mainstream best practices in the loan approval
procedures
Number of FI (and financing plans) granting long
term loans for reforestation/afforestation projects
Number of transactions and flow of resources
derived from:
a) SEAM forest certificates under the environmental
services law.
b) REDD+ carbon credits.
b) 0
a) PY5: 4 FIs and at
least 50% of their loan
portfolios
0
4 FI financing at least
100 plans
Financial statements,
reports and financing
plans of the FI
Transactions
a) 0
b) 0
a) Transactions
corresponding to 2,000
ha x 70 US$/ha/yr
(US$140K/yr) within
the UPAF
b) 1 agreement for
transaction x 4-5
US$/ton/CO2eq/ha/yr
Output 2.1 Increased and diversified funding complying to environmental standards promotes the integration of biodiversity and sustainable land management for MUL through financing
opportunities, incentives and REDD+
Output 2.2: Differentiated markets for sustainable soy and livestock production stimulate adoption of sound environmental practices, conservation of biodiversity, and compliance with
sustainable land use plans.
Outcome 3: Strengthened
implementation of land set
aside system and
sustainable production
practices
Degree of adoption of best practices by producers in
the 3 priority areas, measured by:
a) Number of hectares of direct sowing following
the BP Manuals.
b) % of increase in the use of live fences.
c) Number of producers adopting best management
practices of agro-chemicals
Generalized use of
direct sowing but not
necessarily done
following technical
recommendations
(management of soils
and agro-chemicals)
Alto Parana:
a) 175,000 ha
b) 10%
c) 700
d) 300 ha
Amambay:
Data base of producers
Public and private
institutions internalize
best practices and are
committed to promote
their uptake by producers.
Producers (men and
97
Intervention Logic
Objectively Verifiable Indicators
Baseline
d) Number of hectares of silvopastoral systems
established
Targets
(End of Project)
Means of
Verification
a) 5,000 ha
b) 5%
c) 100
d) 50,000 ha
Canindeyu
a) 40,000 ha
b) 10%
c) 200
d) 10.000 ha
350 Ha
Risks and Assumptions
women) interested in
increasing land set-asides,
restoring river banks and
adopting best practices for
production of soy and
livestock
Number of hectares in small farmer settlements in
Canindeyu with continuous forest reserves that have
management plans (land use, fire control, BD
monitoring) under implementation and with
environmental certificates issued
0
Resolutions by
SEAM´s
Environmental
Services Directorate
issuing certificates
Increase in the connectivity index in:
a) high fragmentation areas (Alto Parana) through
restoration of protective forests;
b) areas with larger forest remnants (Canindeyu)
through increase in legal set-asides and private
reserves.
0
(Index will be defined in
PY1)
a) Alto Paraná: distance
between
fragments
decreased by 1 point
b) Canindeyu: distance
between
fragments
decreased by 2 points
Connectivity index
Improvement in the effectiveness of monitoring and
control in the priority areas measured by the number
of monitoring events and finalized processes in
accordance with the Inter-institutional Manual for
Enforcement of the Forest and Environmental Laws
0
(Data base to be
established in PY1)
50% in 4 pilot
Municipalities
Data base records
Number of soy and livestock producers that have
improved their knowledge, attitude and practices for
implementation of best practices to conserve
biodiversity, reduce soil degradation and plan land
KAP indices to be
determined at Project
start-up
Satellite imagery
30% in the remaining
Municipalities
4,000 producers and
100
women
(KAP
indices to be determined
at Project start-up)
KAP survey (project
start)
KAP survey (project
98
Intervention Logic
Objectively Verifiable Indicators
Baseline
use in the MUL of the priority areas (measured by
KAP32 indices and including disaggregation by
gender)
Means of
Verification
Targets
(End of Project)
Risks and Assumptions
end)
Output 3.1: Technical assistance to medium and large-scale soy and livestock producers mainstreams best practices for sustainable production
Output 3.2: Improved forest Set aside in small, medium and large scale farms increase forest connectivity across the landscape in Canindeyu
Output 3.3: Restoration of protective forests of watercourses in the MUL of three target landscapes increases connectivity in highly deforested areas
Output 3.4: Decentralized and joint enforcement approaches improves surveillance of deforestation and compliance in 4 municipalities
Annex B: Incremental Cost Matrix
Outcome
Outcome 1: Effective
governance framework for
biodiversity conservation
and SLM in multiple use
landscapes
Baseline Scenario
The project area, as well as the remaining of the UPAF and other regions of
the country continue to present a mosaic of productive activities, many of
which are carried out without the due observance of the environmental laws.
The regulatory framework needs to be completed and updated. SEAM and
INFONA have shared responsibilities over several laws but there are no
coordination mechanisms in place leading to overlap and lack of clarity in
roles; hence the regulations are not properly enforced. Institutional capacity
for planning, monitoring, surveillance and enforcement is low; staffs have
limited knowledge of the regulatory framework which they have the
responsibility of enforcing as well as insufficient skills to interact with a wide
and diverse range of stakeholders covered by the different environmental
regulations. This is compounded by the lack of a monitoring system to
facilitate access to information on land use, land use change, rural properties
and their owners. This information is dispersed among several institutions
(SEAM, INFONA, Public Ministry, National Cadaster Service, Directorate
for Public Registry, Municipalities) and procedures to access it are lengthy
and time consuming. This greatly hinders monitoring, control becomes
inefficient and impedes the adequate enforcement of laws and environmental
management at national and local levels. There is a low level of financing
Alternative Scenario Benefits
Enhanced regulatory and institutional framework for planning,
monitoring, surveillance and enforcement of the environmental and
forest laws at national and local levels. The regulatory framework has
been completed and updated. SEAM, INFONA, Public Ministry and
Municipalities have a strengthened capacity to fulfill their mandates as
well as their individual and shared roles and responsibilities. Staffs
have in-depth knowledge of the legal framework, the scope of the laws
and their responsibilities. Effective cooperation and collaboration
mechanisms are in place. The relevant institutions (SEAM, INFONA,
Public Ministry, National Cadaster Service, Public Registry and
Municipalities) access information on land use, land use change,
infringements on a regular and timely basis providing for effective
detection of infringements.
The Inter-institutional Manual for
Enforcement of Forest and Environmental Laws provides for effective
interventions by the concerned institutions. Delegation Agreements
have been signed with Municipalities enabling them to act as local law
enforcement agencies. Municipalities have been strengthened to fulfill
this role including securing the financial sustainability of the newly
established Environment Secretariats.
The platforms constitute
32
The KAP study measures the changes in Knowledge, Attitude and Practices of a community.The first KAP survey was not done during the PPG but will be done in PY1 once the producers are
identified, to elaborate the educational diagnosis and will be done again in PY5 to measure the changes as a resultof project training and outreach interventions.
99
Outcome 2: Financial and
market
incentives
framework to promote
biodiversity
and
sustainable
land
management within the
target
multiple-use
landscape
which affects the ability of the institutions (SEAM, INFONA) to enforce the
law with a minimum degree of effectiveness. SEAM has a limited capacity to
collect fines due to the lack of a specific law for this purpose. INFONA on its
part has a decreasing capacity to collect since the decrease in forest surface
implies a lower number of management plans approved and therefore less fees
collected. There is also a lack of coordination and multisectoral dialogue
between the different public and private stakeholders involved in land use
planning, compliance with environmental regulations and standards, and
sustainable production.
successful forums for inter institutional and multi-stakeholder dialogue
to promote sustainable production and to define the sustainability
priorities and policies for soy and meat. They have a key role in
promoting sustainable products from Paraguay at international level by
helping to establish connection with buyers of sustainable products
thereby increasing the interest of supply chains in producing and
exporting such products.
Financing of soy and meat represent an important share of the loan portfolio
destined to the productive sector (62%). Financial institutions provide loans
on the basis of a financial assessment, which does not include environmental
criteria. FIs in general do not request the presentation of an environmental
license or an environmental management plans; hence loans are not tied to
sustainable production. There are no long term financial opportunities or
incentives to favor reforestation for restoration of legal set-asides and
protective forests to promote connectivity and/or to produce wood energy for
substitution of firewood from native forests. Despite the existence of a
regulatory framework to promote incentives for conservation of
environmental services, the country lacks mechanisms to implement incentive
schemes such as payment for environmental services and habitat banking.
There is limited knowledge and dissemination of the environmental and
economic benefits of producing certified commodities by key stakeholders
involved in the supply chains (commodity buyers, producers and public
institutions) thereby resulting in a low surface area under certification. There
is no connection between international buyers of sustainable products and the
local stakeholders.
Financial institutions mainstream environmental standards into their
lending procedures, in particular ensuring that clients comply with the
provisions of the EIA law; 80% of the soy and livestock loan portfolios
comply with the pre-requisite of presenting environmental management
plans as per the provisions of the EIA law. Financing of best practices
and certification schemes is incorporated into credit lines of 4 Financial
Institutions to incentivize sustainable production of soy and meat; these
credits representing at least 50% of their loan portfolios. New long term
financing for afforestation and reforestation projects that promote
sustainable management of soils and adoption of renewable energy
sources, and help to reduce pressure over native forests is made
available and at least 100 financing plans have been implemented.
The development of a brokering system for trading of SEAM-certified
forest set-asides and carbon credits will help to negotiate best market
prices thereby optimizing forest conservation. Benefits include avoided
deforestation in 3,000 ha of SEAM-certified forest set-asides as well as
6,000 ha of REDD+ forests. Carbon benefits to be accrued include
1,408,128 tons/CO2eq (direct lifetime) and 15,254,720 tons/CO2/eq
(indirect lifetime).
Increased business relations with international buyers of sustainable
products, dissemination of knowledge on sustainable production and
certification, and the agreement of a set of minimum standards for
certification of soy creates an enabling environment for upscaling
certification in the priority areas whereby the minimum environmental
standards are implemented throughout 500,000 ha in preparation for
certification under international schemes and 50% of the surface area
(250,000 ha) effectively reaches certification. Commodity buyers
establish preferential buying agreements from producers that comply
with best practices thereby helping to promote uptake by increasing
numbers of producers.
100
Outcome 3: Strengthened
implementation of land set
aside system and sustainable
production practices
Deforestation in the UPAF continues despite the existing regulations (Forest
Law, EIA law, Zero Deforestation Law), threatening forest remnants in
private properties, and small farmer settlements and indigenous communities
through leasing for cultivation of soy. Enforcement in the field is
uncoordinated and little effective. Institutions lack capacity to provide viable
alternatives to producers interested in implementing more sustainable
practices to improve production, reducing pressure on forest areas and
conserving biodiversity. Technicians need to increase their knowledge in
biodiversity, reforestation/afforestation, sustainable management of forests,
and best practices. Landowners lack knowledge and skills to establish new
land set-asides, reforest or restore forests in the productive landscape. While
in previous years the deforestation rates in the country were significantly
reduced, there have been no significant efforts to rehabilitate secondary
forests. Although the law for restoration of protective forests was issued in
2010, no restoration plans have yet been elaborated. Producers are unaware
of or do not recognize the benefits of forests and the services they provide to
sustainable food production. Most of them do not know the laws and their
scope. Producers have limited knowledge in implementation of sustainable
production practices. Soil conservation and management practices are the
most commonly used by farmers in varying degrees (74% in Alto Parana and
73% in Canindeyu implement some type of practice, while in Amambay the
percentage drops to 36%). There is limited use of practices such as live
fences, windbreaks, management of microbasins and runoffs, forest
management, agroforestry and silvopastoral systems. Producers do not have
sufficient knowledge to correctly handle agro-chemicals during all stages of
use until final disposal. There is a limited availability of technicians
specialized in management of restored or reforested areas for the purpose of
increasing biodiversity in productive systems. Finally, as there are not enough
tree nurseries, there is a low supply of seedlings, especially of those forest
species suitable for restoration of degraded areas.
Deforestation in project intervention areas has been halted through
optimized monitoring, surveillance and enforcement procedures and
better inter-institutional coordination and collaboration. Capacities of
public and private institutions strengthened to provide landowners with
viable alternatives to comply with set-aside regulations, implement
more sustainable practices to improve production, and conserve
biodiversity. Technical assistance programs mainstream best practices
and disseminate knowledge and practices to producers in the priority
areas, thereby improving building the capacity of 1,000 producers and
promoting the adoption of practices throughout 560,000 ha. Best
practices include: improved direct sowing; contour lines; organic
fertilizers; afforestation / reforestation in sloped areas for protection and
commercial purposes; restoration of protective forests and legal-set
asides; agro-chemical management; live fences; infrastructure for
independent management of water to be used for spraying of agrochemicals and cleaning of equipment (water tanks); municipal
collection centers for containers and chemical residues; fire
management; silvopastoral systems; enrichment of native forests.
Forests in the target landscapes have better protection and coverage
begins to increase through restoration (natural regeneration and
reforestation with native species) in 90,000 ha of legal set-asides and
30,000 ha of river bank forests, increasing connectivity and generating
biodiversity benefits.
Incremental Cost
Baseline (B)
Outcome 1: Effective
governance framework for Baseline:
biodiversity conservation SEAM
and SLM in multiple use
landscapes
INFONA
Alternative (A)
Increment (A-B)
8,795,852 a) Baseline
8,795,852 GEF:
2,226,137
3,285,762 b) Cofinancing
7,272,438 Total Cofinan.
7,272,438
5,510,090 SEAM
3,658,894
101
MAG
INFONA
582,133 TOTAL:
Solidaridad
103,523
UNDP/UN-REDD
c) GEF
d) Total Alternative
Outcome 2: Financial and
market
incentives Baseline:
framework to promote Private sector
biodiversity
and
sustainable
land Financial institutions
management within the
target
multiple-use NGOs
landscape
12,000
6,884,000 a) Baseline
794,000 b) Cofinancing
5,250,000 Solidaridad
840,000 UNDP/UN-REDD+
UNDP/FCPF
2,915,888
2,226,137
18,294,427
6,884,000 GEF:
1,918,064
4,595,072 Total Cofinan.
4,595,072
3,036,661
747,663
810,748
TOTAL:
c) GEF
d) Total Alternative
Outcome 3: Strengthened
implementation of land set Baseline:
aside
system
and SEAM
sustainable
production
practices
MAG
30,611,323 a) Baseline
5,285,651 b) Cofinancing
Project Management
30,611,323 GEF:
9,501,122 Total Cofinan.
1,110,240
Itaipu
9,000,000 MAG
7,225,633
NGOs
3,790,000 INFONA
Not Applicable
805,174 TOTAL:
100,000 Solidaridad
345,075
UNDP/PEI
15,000
c) GEF:
d) Total Alternative
0 a) Baseline
b) Cofinancing
6,513,136
1,918,064
13,397,136
12,435,672 SEAM
Private sector
9,498,575
2,390,852
9,501,122
11,891,974
2,390,852
42,503,297
0 GEF:
1,068,398 Total Cofinan.
326,764
1,068,398
102
SEAM
485,898
MAG
40,000
INFONA
c) GEF:
d) Total Alternative
Total
Total Baseline
46,291,175 a) Baseline
542,500
326,764 TOTAL:
1,395,162
46,291,175 GEF:
SEAM
8,571,413 b) Cofinancing
INFONA
5,510,090 SEAM
4,769,134
12,435,672 INFONA
1,307,287
MAG
Itaipu
9,000,000 MAG
Private Sector
894,000 Solidaridad
Financial Institutions
5,250,000 UNDP/UN-REDD+
NGOs
4,630,000 UNDP/FCPF
UNDP/PEI
22,437,030 Total Cofinan.
7,237,633 TOTAL:
1,395,162
6,861,817
22,437,030
29,298,847
3,485,259
3,663,550
810,748
15,000
Project Management
1,395,162
c) GEF
d) Total Alternative
6,861,817
75,590,022
70,042,505
103
SECTION III: TOTAL BUDGET AND WORKPLAN
PART I. Total Budget and Work Plan
Award ID:
Award Title:
Business Unit:
Project Title:
PIMS no.:
Implementing Partner (Executing Agency)
GEF Outcome/ Atlas
Activity
1: Effective governance
framework for biodiversity
conservation and SLM in
multiple use landscapes
2: Financial and market
incentives framework to
promote biodiversity and
sustainable
land
management within the
target
multiple-use
landscape
3: Strengthened
Responsible Source
party
of funds
00077229
Project ID(s): 00088150
PIMS: 4836; GEF 4860
Mainstreaming Biodiversity Conservation and Sustainable Land Management into Production Practices in all Bioregions
and Biomes in Paraguay
Paraguay
Mainstreaming Biodiversity Conservation and Sustainable Land Management into Production Practices in all Bioregions
and Biomes in Paraguay
4836
UNDP
ERP/ATLAS Budget Description/
Input
International Consultants
Local Consultants
Contractual Services - Individual
Travel
GEF
Contractual services - companies
Materials and Goods
Information Technology Equipment
Audio Visual & Print Prod Costs
Training
GEF Subtotal Outcome 1
International Consultants
Local Consultants
Contractual Services - Individual
Travel
GEF
Contractual services - companies
Materials and Goods
Audio Visual & Print Prod Costs
Training
GEF Subtotal Outcome 2
GEF
International Consultants
Atlas
Code
71200
71300
71400
71600
72100
72300
72800
74200
75700
71200
71300
71400
71600
72100
72300
74200
75700
71200
Year 1
36,667
109,550
48,648
9,703
67,000
4,000
0
0
49,000
324,568
0
76,932
0
0
0
0
0
0
76,932
0
Year 2
99,167
150,514
97,296
16,500
369,000
11,500
120,000
67,500
142,500
1,073,977
0
63,439
0
12,000
108,597
0
87,281
217,000
488,317
0
Year 3
102,500
82,864
0
6,000
46,000
3,500
0
67,500
115,000
423,364
36,667
75,114
97,296
28,500
253,195
8,000
87,281
68,000
654,053
0
Year 4
0
34,864
0
6,000
36,000
3,500
0
45,000
69,500
194,864
36,667
44,764
48,648
23,250
289,195
4,000
58,187
34,000
538,711
36,667
Year 5
40,000
64,864
0
6,000
12,000
3,500
0
45,000
38,000
209,364
0
29,864
0
0
72,000
0
58,187
0
160,051
36,667
Total
278,334
442,656
145,944
44,203
530,000
26,000
120,000
225,000
414,000
2,226,137
73,334
290,113
145,944
63,750
722,987
12,000
290,936
319,000
1,918,064
73,334
Budget
Note
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
(15)
(16)
(17)
(18)
104
GEF Outcome/ Atlas
Activity
implementation of land set
aside system and
sustainable production
practices
Responsible Source
party
of funds
ERP/ATLAS Budget Description/
Input
Local Consultants
Contractual Services - Individual
Travel
Contractual services - companies
Materials and Goods
Audio Visual & Print Prod Costs
Training
Atlas
Code
71300
71400
71600
72100
72300
74200
75700
Year 1
16,000
0
0
45,000
0
0
12,500
73,500
57,987
5,000
500
5,782
3,000
1,000
0
73,269
548,269
GEF Subtotal Outcome 3
PM
Contractual Services - Individual
Rental & Maintenance - Premises
Miscellaneous
GEF
Information Technology Equipment
Equipment and Furniture
Supplies
Direct Project Costs
Total project management
71400
73100
74500
72800
72200
72500
74599
Totals
Year 2
Year 3
Year 4
Year 5
77,000
0
0
295,000
36,000
81,000
85,400
574,400
31,500
5,000
500
0
0
1,000
26,487
64,487
2,201,181
70,000
0
0
250,000
36,000
81,000
298,400
735,400
31,500
5,000
500
0
0
1,000
26,487
64,487
1,877,304
22,575
48,648
5,250
250,000
52,000
54,000
209,800
678,940
31,500
5,000
500
0
0
1,000
26,487
64,487
1,477,002
Total
27,149
97,296
10,500
45,000
8,000
54,000
50,000
328,612
31,500
5,000
500
0
0
1,000
22,034
60,034
758,061
212,724
145,944
15,750
885,000
132,000
270,000
656,100
2,390,852
183,987
25,000
2,500
5,782
3,000
5,000
101,495
326,764
6,861,817
Budget
Note
(19)
(20)
(21)
(22)
(23)
(24)
(25)
(26)
(27)
(28)
(29)
(30)
(31)
(32)
Summary Budget: GEF and CoFin Resources per Year
Project Components
Year 1
GEF
CoFin
Year 2
GEF
1: Effective governance framework for
324,568 1,629,029 1,073,977
biodiversity conservation and SLM in
multiple use landscapes
2: Financial and market incentives
framework to promote biodiversity and
76,932 1,684,204
488,317
sustainable land management within the
target multiple-use landscape
3: Strengthened implementation of land
73,500 1,778,086
574,400
set aside system and sustainable
production practices
73,269
256,398
64,487
Project Management
548,269 5,347,717 2,201,181
Total Project Costs
CoFin
Year 3
GEF
Year 4
CoFin
GEF
Year 5
CoFin
GEF
CoFin
Total
GEF
CoFin
4,348,239
423,364
458,390
194,864
418,390
209,364
418,390
2,226,137
7,272,438
1,684,204
654,053
924,998
538,711
301,666
160,051
0
1,918,064
4,595,072
2,069,336
735,400
1,892,504
678,940
1,892,504
328,612 1,868,692
2,390,852
9,501,122
203,000
64,487
8,304,779 1,877,304
203,000
3,478,892
64,487
1,477,002
203,000
2,815,560
60,034
203,000
758,061 2,490,282
326,764
6,861,817
1,068,398
22,437,030
105
Budget Notes for Total Project Budget
No.
Budget note
Outcome 1:Effective governance framework for biodiversity conservation and SLM in multiple use landscapes
(1)
71200 International Consultants US$278,334 to i) midterm and final Project assessment. (Output 1.2); ii) assistance for installation and operation of national and departmental platforms
(Output 1.3); iii) expert technical assistance in value chains.
(2) 71300 Local Consultants US$ 442,656
 Legal Experts (36 month) to a) Updating the Environmental Impact Assessment Law (EIA), SEAM Act, Forestation/A forestation Law, Penal Code and Environmental Crime Laws; b)
provision of environmental services law; c) regulation of fees and fines law; e) Preliminary Generic Environmental Management Plan and Terms of References for EIA; f) delegation of
power to municipalities. (Output 1.1).
 Forest Expert to prepare a substitution plan of Wood from native forest to Wood from plantations to be used in silos and agricultural industries in the Project priority areas (Output 1.1).
 Experts in indicator monitoring plans, learned lessons, audits (Output 1.2)
 Facilitator of platforms: to planning and implementation of formation, operation and monitoring of national and departmental platforms (Output 1.3)
 Communication Expert: design and implementation of the Project Communication Plan.
(3) 71400 Service Contract US$145,499 to i) Technical Specialists in project management, that coordinate and harmonize the three products, facilitate dialogue with public - private
stakeholders involved, and manage the development and monitoring of the POAs associated with the three products of Component 1; ii) Administrative and Logistic Technician: to
organize workshop and manage the financial-administrative requirements of the contracts and activities of Component.
(4) 71600 Travel US$44,203 Travel allowance of National Platforms Facilitator, Communicator, International Consultant, Project National Coordinator, Manager, Technical Expert and
Administrative Assistant, to activities related to the achievement of result 1
(5) 72100 Contractual Services US$ 530,000
 Computer system design, integration of database of SEAM, INFONA and its connection with the Prosecutor’s office and pilot municipalities: training while system implementation;
development, updating and preparation of reports according to the database (Output 1.2)
 Cadastral data collection and the development of a database of environmental assets and liabilities en 4 municipalities (Output 1.2)
 Functional restructuring of the SEAM, INFONA, Attorney and 4 municipalities in relation to audit and delegation of power, and development of a Interagency Protocol basic manual
(Output 1.2)
 Academic and Operative Design the Specialization Course in Environmental Governance.(Output 1.2).
(6) 72300 Materials US$26,000 Transport expenses (fuel, tolls) of trips made to priority sites for technical supervision of activities related to achievement of result 1.
72800 Computer US$120,000: Computer Kit (2 computers, 2 printers, 2 scanners), including software and licenses, 1 photocopier and, 3 GPS, to the offices of: SEAM, INFONA,
(7)
Prosecutor’s Office and 4 Municipalities (Output 1.2).
74200 Audiovisual & Printing US$225,000: Preparation and reproduction of materials and documents related to the result.. Manuals, leaflets, posters and radio campaigns of driven legal
(8)
reforms.
75700 Training US$414,000
 Plan of incidence of legal reform promoted by the Project with committees and project beneficiaries . (30 sessions with 30 to 40 participants). (Output 1.1).
 Participatory Wood replacement plans in 4 pilot sites. (Output 1.1).
(9)
 Collective construction of delegation of powers agreements, with prioritize municipalities. (Output 1.1).
 Project Start workshops nationwide and sites level (Output 1.2).
 Validation and monitoring with the Project Board. (Output 1.2).
106
No.
Budget note
 Review of institutional responsibilities, processing, validation and dissemination of an interagency implementation manual, and training of environmental secretaries in 4 municipalities
(Output 1.2)
 Facilitation of plan and operation of the national platform and three departmental. (Output 1.3)
Outcome 2: Financial and market incentives framework to promote biodiversity and sustainable land management within the target multiple-use landscape
(10) 71200 International Consultants US$73,334 Technical Advisory specialized in Sustainable Finance and Agricultural products Certification Systems.
71300 Local Consultants $290,113
 Financial Expert: finance a) assistance for soybean and beef sustainable production; b) review of entities credits instruments, c) monitor of financial institutions in coordination with the
Bureau of Sustainable Finance; d) training to managers and credit staff. (Output 2.1).
 Specialized consultants to: a) feasibility analysis and proposal for tax incentives; b) design and implementation of the registration system for environmental services; c) design and
(11)
implementation of the Course on Installation of marketing of Payment certificates for environmental services, aimed to agricultural business brokers (Output 2.1).
 Experts in Marketing and Certification: a) development of comparative studies on certification systems of soybean and beef; ii) facilitation of the participative review process of the
standards of sustainable production of soybean under some certification scheme. (Output 2.2).
 Expert in Communication to design and implementation of the Project Communication Plan.
71400 Service Contract US$145,944. i) Technical Experts in Project management that coordinate and harmonize the two products: ease dialogue with public-private involved stakeholders
(12) and manage the preparation and monitor of POAs related to the two products of the Component 2; ii) Administrative and Logistic Technician: to organize workshop and manage the
financial-administrative requirements of the contracts and activities of Component 2.
71600 Travel US$63,750 i) International travel for referents of the unions concerning production, commodity companies, cooperatives and platforms to make contacts with international
(13) buyers. (Output 2.2). Travel allowances of the Communicator, International Consultant, National Project Coordinator, Manager, Technical Expert and Administrative Assistant, in activities
related to the achievement of result 2.
72100 Contractual Services US$722,987: Formulation of 30 productive financial projects that incorporate sustainable criteria (Output 2.1) Conduct 40 feasibility studies of forestry projects
(14)
(Output 2.1)
72300 Materials US$12,000 Transport expenses (fuel, tolls) of the trips made by the Communicator, International Consultant, Project National Coordinator, Manager, Technical Expert and
(15)
Administrative Assistant in activities related to the achievement of result 2.
74200 Audiovisual & Printing US$290,936. Publications of Studies and Credit Manuals with environmental criteria prepared, operation manual of environmental certificate trading system;
(16) preparation and reproduction of radial spots, brochures, leaflets and posters related to disseminate new lines of long-term financing for reforestation, sustainable soybean and beef and
soybean certification systems, communications plan that stands Paraguayan soybean as a sustainable product
75700 Training US$319,000
 Awareness Plan to authorities and technicians of financial institutions to incorporate environmental criteria in the granting of loans, and long-term financing of forestry Project (14 daysessions); b) training program for technicians and loan officials on adjustments and implementation of credit tools (12 courses,); c) dissemination, with producers, of sustainable
financing lines and financing of long-term forestry projects (20 day-sessions. (Output 2.1).
(17)  Trading process of Certificates of payment for environmental services (4 workshops (Output 2.1).
 a) socialization of results of comparative studies of certification with public and private stakeholders (8day-sessions); b) participative development of minimum standard for sustainable
soybean production under a certification (8 day-sessions); c) training plan on certification systems to producers having speakers from abroad (100 people in seminar and 30 in a technical
course) (Output 2.2.).
 5 technical tours aimed to soybean producers en to soybean producers in the project sites to find out about successful experiences, certification systems, and to promote interchange of
experiences between producers . (25 producers y 10 technicians for each tour). (Output 2.2)
107
No.
Budget note
Outcome 3: Strengthened implementation of land set aside system and sustainable production practices
(18) 71200 International Consultants US$73,334 Specialized technical consultancy on Good Agricultural Practices and Biodiversity.
(19) 71300 Local Consultants US$212.724
 Expert in Agronomist and Gender: a) preparation of Manual of Good Agricultural Practices, with a systemic and comprehensive approach,(gender, health and staff safety, disposal of
chemical containers, etc.) with stakeholders from public and private sector; b) Diagnosis of gender in productive systems of soybean and beef; c) introducing analysis and consideration of
gender in the GAPs Manual prepared; c) design and implementation of a Plan of awareness and training on gender to the key actors. (Output 3.1).
 Environmental Expert: awareness plan, training and implementation of payment mechanism for environmental services in rural settlements (Output 3.2).
 Environmental and Intercultural: implementation of consultation process, dissemination and implementation of the proposal of PSA (Output 3.2).
 Communication Expert to design and implementation of the Project communication plan.
 Specialized consultancy to safeguard development: i) inclusion of safeguard to national standards that include considerations about biodiversity conservation; ii) preparation of guides
and TOR for preliminary EIAs that ensure safeguards for reforestation/deforestation specifically for energy; iii) development of specific guides related to meat production; iv) design and
development of complaints mechanisms.
71400 Services Contract US$145,944 i) Technical Experts in Project management, that coordinate and harmonize the four products; facilitate dialogue with private-public stakeholders
(20) involved ; and manage the development and monitor of the POAs related to the two products of Component 3; ii) Administrative and Logistic technician: that organize the logistic of
workshop development and manage the administrative-financial requirements of the contracts and activities of Component 3.
71600 Travel US$15,750 Trips made by the Communicator, International Consultant, Project National Coordinator, Manager, Technical Expert and Administrative Assistant to the
(21)
intervention areas and activities related to the achievement of result 3.
72100 Contractual Services US$ 885,000:
 Definition of criteria and indicators for delimitation of priority sites, connectivity rate measuring in the 4 sites at the beginning and the end of the Project, and INFONA training in
practices of forest restoration and recovering (output 3.2);
(22)  Participative design, validation and dissemination with SEAM, INFONA and Municipalities, of the Guide for development of plans for restoration of water channel protective forests
(RBPCH); and development of forest restoration plan including 14 municipalities (Output 3.3)
 Organization of supervision and control database in the project pilot sites; capacity building , in the municipalities to manage databases, and evaluation of joint control schemes
implemented in the pilot sites (output 3.4)
72300 Materials US$132,000: Supplies and material for the installation and operation of 12 tree nursery in the of Project sites. (Output 3.2); Transfer expenses (fuel, tolls)of the trips made
(23) by the Communicator, International Consultant, Project National Coordinator, Manager, Technical Expert and Administrative Assistant, in the Project intervention areas, in activities related
to the achievement of result 2.
74200 Audiovisual & Printing US$270,000. Expenses for preparation and reproduction of materials and documents related to result 3: Manual and booklets on Good Agricultural Practices
and Good Gender Practices, Methodological Guide for development of restoration plans of water channel protective forest; radial spots, brochures and posters of BPAs; informative and
(24)
promotion of tillage materials, for future international conferences to be held; booklet and brochures of forest restoration practices, radial spots, brochures and posters for environmental
education campaign, among others.
75700 Training US$656,100
 BPAs Manual Validation (8day-sessions,); dissemination of BPAs Manual (10 day-sessions,); development of plan of awareness on Gender (16 day-sessions,). (Output 3.1).
(25)  6 technical tours and 12 field-days (100 produces per day), aimed to soybean and meat producers in the Project sites, to visit and find out about BPAs successful experiences and promote
interchange of experiences between producers, from the demonstration of methods and results (Output 3.1)
 3 Tillage conferences with participation of speakers from abroad, technicians from private and public sector, and soybean and meat producers. (100 participants per session).(Output 3.1).
 Environmental awareness campaigns in topics related to use and management of natural resources, environmental impacts resulting from climate change, organic products trade fair and
sustainable practices to be implemented mainly by women and young, in the cooperative (18 workshops,) and educational centers (20 day-session,).
108
No.
Budget note
 Awareness, training and implementation of mechanism of payment of environmental services in rural settlements. (15 workshops,) (Output 3.2).
 Training and implementation of mechanism of payment of environmental services in indigenous communities. (20 workshops,) (Output 3.2).
 Training on forest restoration and recovery (4 workshops,) (Output 3.2); b) implementation of process of participative validation and training of RHBC guide (5 workshops, (Output 3.3);
c) training on joint interagency supervision and control protocol manual (4 workshops,) (Output 3.4).
 Dissemination of results of safeguard consultancies (national standards on biodiversity conservation, guides and TOR for preliminary EIAS guide that ensure reforestation /deforestation
safeguards specifically for energy, guides related to meat production , design and preparation of complaints); b) national debates on genetically modified soybean (3 day-sessions).
Project Administration
71400 Contract Services US$183,987; 50% of the Coordinator and Administrator time throughout the Project lifetime at a rate of 31, 500 USD per year; / a National project Coordinator
(26) responsible for providing technical expertise to ensure overall coordination and harmonization of relevant project activities to achieve results, ii) Administrator: responsible for providing
expertise technique for administrative and financial management of the Project.
(27) 73100 Local Consultants US$25,000 Project venues rent. For the meetings to be held on a neutral place due to the multi-national character
(28) 74500 Miscellaneous Expenses US$2,500 any possible expenses incurred in transactions related to the Project implementation that are not covered in the above areas
(29) 72800 Information Technology Equipment US$5,782 computer and software
(30) 72200 Equipment and Furniture US$3,000 furniture and equipment for the operative unit
(31) 72500 Supplies US$5,000 Stationery and office supplies
74599 UNDP Cost Recovery Charges US$101,495 Direct project services requested by the Government of Paraguay to the UNDP Bureau for supporting the implementation of the project
(32)
when it becomes NIM (procurement, payments, travel, others.), according to the provisions of the Letter of Agreement (Annex XX).
109
SECTION IV: ADDITIONAL INFORMATION
PART I: Other agreements. Please refer to separate file
The Letters of Cofinancing are attached as separate files.
PART II: Terms of References for key project staff (Project Management Unit)
i.
ii.
i.
Project Manager
Project Administrative/Financial Assistant
Project Manager
The Project Manager will act as the head of the PMU and will be responsible for overall project
implementation and supervision of the PMU staff. The Project Manager will work under the
supervision of UNDP, and will coordinate with other concerned stakeholders to ensure adequate
project implementation.
The Project manager shall run the Project on a day-to-day basis on and his/her prime
responsibility shall be to ensure that the project produces the result specified in the project
document, to the required standards of quality and within the specified constraints of time and
cost. The PM will be a person with significant experience related to the scope of the project in
addition to strong management skills. S(he) will provide overall managerial direction and
leadership for the project, working closely with Institutions represented in the PB, the Technical
Committee and key stakeholders. In addition on a part time the incumbent will be chief
technical advisor providing technical oversight anddirection to key outcomes.
This post will be funded by the GEF.
Main duties and responsibilities:
 To provide overall project coordination and M&E for the achievement of the Project
outcomes and objectives, based on RBM.
 To manage day-to-day implementation of the project, coordinating project activities in
accordance with the rules and procedures of UNDP and based on the general guidance
provided by the PB;
 To establish the PMU´s internal working procedures and coordination mechanisms with
UNDP, Project Board, the Technical Committee and other key stakeholders.
 To ensure adequate inter-institutional coordination and stakeholder participation mechanisms
during project implementation.
 To prepare the annual workplans and budgets and submit them for approval of the PB.
 To supervise the activities of the PMU staff, including analysis and approval of workplans
and activity reports.
 Ensure adequate compliance of project implementation with UNDP-GEF procedures.
 Supervise drafting of TORs for project activities, analyze and approve technical reports.
 Carry out visits to the project stakeholders as part of the overall supervision of project
implementation and prepare visit reports.
 To work closely with the UNDP offices in the region in organizing and providing technical
and logistic support and coordination to all missions and assignments by international and
national consultants; and,
 To prepare overall reporting.
Profile: At least 8 years of experience in project management and implementation, as well as
significant direct experience related to the scope of the project; experience in environmental
122
governance and capacity building issues is highly desirable; leadership as well as strong
management and interpersonal skills; computer skills; high flexibility and capacity to work
under pressure.
ii.
Project Administrative/Finance Assistant
The administrative/finance assistant will be stationed in the PMU and will provide support to
the PM in management and administration of the project. This post will be funded by the GEF.
The administrative/financial assistant (AFA) will be stationed in the PMU and will be
responsible for project administrative and financial management. In addition on a part time
basis the incumbent will provide logical support to delivery of technical components of the
project. The AFA will work under the supervision of the Project Manager and will coordinate
with UNDP and Lead National Institution to ensure adequate project management.
Main duties and responsibilities:
 Ensure adequate administrative and financial management in accordance with UNDP
procedures.
 Hold regular meetings with the Project Coordinator regarding management issues and
maintain regular contact with the Component Managers and Executing Agency on
administrative and financial issues.
 Draft correspondence related to administrative and financial issues.
 Provide assistance in preparing annual workplans and budgets.
 Monthly accounts and financial reports, and bookkeeping.
 Prepare disbursement requests and keep track of project disbursements.
 Procurement of goods and services, including preparation of bidding documents,
specifications and contracts.
 Management of administrative, accounting and financial files
 Provide support to project audits and external evaluations.
Profile: At least 5 years of experience in accounting and financial matters; experience in project
administrative and financial management; acquaintance with UNDP procedures is highly
desirable; computer skills; initiative and responsibility; teamwork ability, high flexibility and
capacity to work under pressure.
123
PART III: Stakeholder Involvement Plan
The project involves a variety of stakeholders from different backgrounds and with different
roles that shall be further defined and agreed during the project’s start-up phase. These
stakeholders will actively participate during the project’s entire lifespan – design,
implementation, monitoring and evaluation- aiming at ensuring an adequate empowerment and
success of the project.
The purpose of the stakeholders involvement plan is to establish adequate channels for
information, communication and consultation, based on a dynamic interaction between formal
spaces established through the project including the Project Board, Project Management Unit,
Technical Committee, Local Committees and the public in general.
Stakeholder involvement during the design phase - PPG
As concerns stakeholders´ involvement, there were several workshops whereat this project was
presented. More specifically, workshops were held in October 2012 and July 2013 where key
stakeholders were informed on the progress of project design; additionally several interviews,
focus groups and sectoral meetings took place with key stakeholders such as representatives
from the public sector, the private sector, NGOs and IPOs, as seen in the below table. The
purpose of these meetings was to confirm the commitment of these stakeholders with the
project, to obtain inputs for project design and in general to ensure that their interests were duly
reflected in the project strategy.
Activity
(3) Workshops
(24) Interviews
(8)
Sectoral
Meetings
(2)
Groups
Focus
Stakeholders
 SEAM/UNDP
 Public Institutions: SEAM, INFONA, MAG, MIC, ITAIPU.
 Private Sector: UGP, ARP, APS, CAPPRO, CAPECO, FECOPROD,
UNICOOP, ADM, NOBLE,
 NGOs: A todo pulmón: Paraguay Respira, Fundación Moisés Bertoni,
Fundación Solidaridad, WWF, Red privada de propiedades privadas de
conservación, Guyra Paraguay, AlterVida.
 Indigenous Organizations: FAPI, ONAI, Federación Guaraní and “Red privada
de apoyo a pueblos indígenas” -REDESPI.
 CAPPRO members: Bunge, Cargill, Noble, CAIISA, ADM
 NGOS: Solidaridad, WWF, Fundación Moisés Bertoni
 Public Institutions: SEAM, MAG, INFONA (3 meetings)
 SEAM technical staff
 INFONA technical staff
As concerns IPO involvement, two specific meetings took place in addition to the above
mentioned workshops: in late July, a meeting was convened with IPO and IP NGOs to discuss
the project’s areas of work and site selection; in late October, a meeting was held with
representatives from two major IPO networks in Paraguay (Federaciónpor la AutoDeterminación de los Pueblos Indígenas – FAPI and Federación de Organizaciones de
ComunidadesGuaranies de la Región Oriental - FG), and the President of the Paraguayan
Institute for Indigenous People - INDI, the public institution in charge of IP matters) amongst
others, with the purpose to discuss the project’s proposed approach on IP related activities and
outcomes. In both these meetings, IPO representatives concluded that the project tackles
extremely important issues regarding soy production and its impacts on communities, and that
they were willing to accompany this initiative so as to ensure the best possible consideration of
IP rights during project implementation.
122
Stakeholder participation during project implementation
The project management structure will ensure participation of key stakeholders during project
planning, implementation and M&E. The Project Board is made up of the political and
technical representatives of the executing and implementing agencies and departmental
governments and will provide overall guidance for project implementation. Other stakeholders
may be invited to participate in the Project Board meetings where deliberation, negotiation,
elaboration of strategic guidelines and approval of work plans will take place.
For each project output a leading institution and/or organization has been identified based on
roles and mandates within the environmental, forest, agricultural, financial and other projectrelated sectors (see table below).
Output
Output 1.1: A package of modifications in regulations, policies and standards at
national level to improve protection of the Upper Parana Atlantic Forest
Output 1.2: Institutional capacities of SEAM, MAG, INFONA, Public Ministry and
Municipalities strengthened for planning, monitoring, surveillance and enforcement
Output 1.3: One national and three departmental platforms for inter-institutional and
multi-stakeholder dialogue on land use planning regulations, enforcement, and
incentives for best practice adoption within production landscapes, involving all land
use managers and supply chains
Output 2.1 Increased and diversified funding promotes the integration of biodiversity
and sustainable land management for MUL through financing opportunities,
incentives and REDD+
Output 2.2: Differentiated markets for sustainable soy and livestock production
stimulate adoption of sound environmental practices, conservation of biodiversity, and
compliance with sustainable land use plans.
Output 3.1: Technical assistance to medium and large-scale soy and livestock
producers mainstreams best practices for sustainable production
Output 3.2: Increase in connectivity through differentiated strategies for small,
medium and large scale producers in the MUL of the Canindeyu priority area
Output 3.3: Increase in connectivity of forest remnants through agreed plans for
restoration of protective forests of watercourses in the MUL of three priority areas
Output 3.4: Optimized monitoring and control processes piloted in the Departments of
Alto Parana, Amambay and Canindeyufor extraction of lessons learned and upscaling
at broader MUL level
Lead Institution
SEAM
SEAM
National Platform: To be
determined during
establishment of the
platforms
Departmental Platforms:
Departmental
Government
Rountable for Sustainable
Finance
MIC
MAG
SEAM
INFONA
SEAM
Each lead institution will be responsible to coordinate the development of the output ensuring
participation and collaboration of other stakeholders involved, including leading the
participatory planning of the AWP for the output; convening meetings of the stakeholders to
plan and implement the foreseen activities; negotiating agreements between stakeholders;
reporting of project progress to the Technical Committee and the Project Board. The PMU and
the Technical Committee will oversee and support the lead institution in preparing the AWP.
The PMU will consolidate these operational plans into the project’s general AWP, which shall
be analyzed, validated and approved by the Project Board, and later socialized to the public in
general.
The Local Committees will ensure adequate planning and implementation of activities in line
with the project objectives and local development and stakeholder priorities, as well as
complementarity with ongoing and planned programs and projects. The Project Board,
Technical Committee, Projec Management Unit and Local Committees will be closely linked,
ensuring in this manner that stakeholder concerns are up-streamed into higher project
management levels and likewise project management decisions and their impacts on the region
are down-streamed to keep stakeholders duly informed.
123
The project will implement several approaches to stakeholder buy in and involvement in project
implementation:
 The National and Departmental Platforms will allow the participation of stakeholders. They
will provide the opportunity for presenting project strategic directions and advances that are
of specific relevance to stakeholders and at the same time will act as forums where they can
express concerns, interests and suggestions.
 The Gender and Indigenous Peoples strategies will ensure involvement of women and
indigenous peoples, taking into account their specific needs and demands.
 The project´s training and outreach programs will make use of both bottom-up and topdown approaches, integrating the different points of view of the local stakeholders and
beneficiaries as well as those of the institutions, authorities and decision makers.
 On the ground interventions selected by the project will serve the purpose of demonstrating
that the alternative sustainable management practices to be promoted are feasible, costeffective, and a greater benefit will be attained with their adoption compared to the
conventional practices.
 Coordination with ongoing and planned programs and projects for replication and upscaling
of experiences and lessons learned
 Project M&E through several mechanisms provided for by the project such as (i) follow-up
meetings of national and departmental platforms; (ii) Project Board reviews; (iii) national
workshops for verification of indicators, with the participation of local and national
stakeholders, as well as representatives from the project’s direct beneficiaries. The AWP
will be the main M&E, which implementation shall be assessed with stakeholder
participation. Progress towards meeting objectives shall be evaluated including products,
quality and timing using adequate participatory tools that provide pertinent inputs to adjust
project implementation strategy.
124
PART IV: Annexes
Annex 1: Risk Log Matrix
Annex 2: Description of priority areas
Annex 3: Maps
Annex 4: Soy and Beef Supply Chains
Annex 5: Characterization of certification schemes used in Paraguay
Annex 6: GEF Tracking Tools (See separate file)
Annex 7: Safeguards (See separate file)
Annex 8: CoFinancing Letters (See separate file)
Annex 9: Capacity Scorecards: SEAM and INFONA
Annex 10: Letter of Agreement (LoA)
122
Annex 1: Risk Log Matrix
OFFLINE RISK LOG
Project Title:
Mainstreaming Biodiversity Conservation and Sustainable Land Management into Production Practices in all Bioregions and
Biomes in Paraguay
#
1
2
3
4
5
Description
Date
Identified
Institutional weakness of government
agencies involved in monitoring,
surveillance and enforcement of
environmental laws and planning of
land use
11/2013
The public agencies involved in the
project (SEAM, INFONA, MAG, Public
Ministry) do not allocate sufficient
budgets
to
implement
their
commitments under the project.
11/2013
Difficulties to coordinate Project
implementation between the MAG,
SEAM and INFONA due to opposing
perceptions of the roles of each
institution
Lack of interest of small farmers to
adhere to the environmental services
certification
system
under
the
Environmental
Services
Law
(3001/06)
Impacts of climate change: climate
variability and extreme weather
events (droughts, early or late frosts,
high intensity rain) on production of
Type
Impact &
Probability
Medium
Organizational
3
Organizational
High
Award ID: 77229
Date:21/11/2013
Countermeasures / Mngt
response
Owner
Submitted,
updated
by
Last
Update
The project will update the regulatory
framework to create an enabling
environment for implementation and
enforcement of the land use, forestry
and
environmental
management
regulations.
Veronique
Gerard
Liliana
Miranda
11/2013
The project will negotiate and
advocate for timely planning and
management of institutional budgets.
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
5
11/2013
Organizational
Medium
3
Medium
11/2013
Organizational
3
Medium
11/2013
Environmental
3
The mandates and roles of each
institution have been taken into
account in assigning responsibilities
for Project implementation at outcome
and output level in order to minimize
possible conflicts between the partner
institutions.
Careful planning and coordination
with the INDERT on the methodology
to approach the rural settlements,
taking into account that, due to prior
histories of failure, small farmers are
often skeptical of the promises made
by projects
to
improve
their
livelihoods.
The Project will promote sustainable
management of productive systems.
The adoption of best practices that
favor adequate management of water
122
Status
#
Description
Date
Identified
Type
Impact &
Probability
soy and livestock
6
7
8
9
10
Low degree of connectivity between
forest fragments in certain areas
increase the time period needed to
attain measurable results in terms of
biodiversity conservation benefits
Certain productive practices that are
extremely
harmful
to
forest
ecosystems (ie. fire for pasture
renovation) are strongly rooted
amongst producers
Financial institutions are not willing to
review their lending policies to
mainstream
environmental
sustainability criteria, granting priority
to consumption over long term
investments
The
international
prices
of
commodities (soy, cattle sugar cane)
increases,
without
internalizing
negative impacts on environment,
resulting in increasing pressure to
expend production areas.
Lack of interest of potential buyers in
buying
SEAM forest
set-aside
certificates, or prices obtained are
lower than the ones estimated.
Medium
11/2013
Environmental
3
High
11/2013
Environmental
5
Medium
11/2013
Financial
3
Medium
11/2013
Other: Market
4
Medium
11/2013
Other: Market
4
Countermeasures / Mngt
response
in productive systems (contour lines,
infiltration channels, live fences, direct
sowing, restoration of protective
forests) will serve to minimize the
impacts of extreme weather events.
The Project will identify priority areas
taking into account the level or degree
of connectivity and will prepare
restoration
plans
to
ensure
connectivity through reforestation of
riverine forests.
The Project will promote the use of
fire within an integrated management
approach. In areas where its use
could produce irreversible damage
the Project will work to gradually
eliminate the use of fire through
training in other less harmful practices
for pasture renovation.
The Project will outreach to financial
institutions raising awareness in
regard
to
the
impacts
of
unsustainable practices that could be
attributed to activities financed by the
loans they are granting to the
productive sector.
The project will internationalize the
negative impact caused to the
environment in the cost structure for
each commodity in Paraguay to help
convince
buyers
of
privileged
purchasing of sustainably produced
commodities.
The project will develop a brokering
system to market the set-aside
certificates and negotiate the best
prices.
123
Owner
Submitted,
updated
by
Last
Update
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Veronique
Gerard
Liliana
Miranda
11/2013
Status
Annex 2: Description of priority areas
1. METHODOLOGY
1.1. Selection of priority areas
In order to identify and select the priority areas a workshop was convened involving
professionals of the Secretariat of Environment, NGOs representatives and the team of
consultants of the Project. During this meeting, the possible areas of intervention were evaluated
taking into account the following critieria:
- Preserved Forests: existence of remnants forest in the area, especially those whose
surface features can somehow represent biodiversity refuges..
- Potential connectivity: Potential Connectivity: presence in the area of remnants forest
that due to their proximity or characteristics may be elements to start the restoration
process. Criterion of the existence of streams ere also taken into account, .. (remnants
relatively close or waterways).
- Synergies with identified partners: presence in the area of other initiatives identified as
strategic allies (FIDA, Paraguay BIO and others).
- Actors Drivers of change: presence in the initiative areas, programs or owners whose
experiences can be used as drivers of better practices either in agriculture, livestock or
forest management (certification, organic production, agroforestry systems).
- Potential Optimization of Socio-economic benefit: this potential is related to the
population that would receive the benefits, the higher unmet basic needs the most
potential, although it is also important on this point to consider the organizational
structures of communities and existing conflicts.
1.2. Characterization of Priority Areas
The characterization of priority areas was based on the basic information available at district
level, supplemented with data obtained through the use of Geographic Information Systems and
interviews with key players in the selected areas. To obtain mapping information, Landsat 8
OLI imagery and district cartography of 2002 census were used. Maps produced within this
consultancy have no field verification.
2. RESULTS
2.1. Priority Areas
As a result of area selection workshop, 11 possible areas were identified in the 3 departments,
according to the criteria mentioned in the methodology; in the following tables the analyzed
areas during the selection workshop are observed.
122
Table 1. Identified Areas during the selection workshop corresponding to Alto Parana Department.
District/Basin o area
under Analysis s
Preserved
Forests
Potential Connectivity
Alto Parana Nor-West
Yes
High
X
Nor-East
ITABU- ITAIPU
Yes
x
Centre
Few
X
Medium
Synergies
Identified
Partners
Actors
Drivers of change
Paraguay BIO
Itaipú
Campos Mborombi*
ADM*
CARGIL* APS*
National Soil Program
Yguazu Cooperative
CETAPAR (Paraguayan Centre for Research
and Transfer)
Low
Paraguay BIO
Yguazu
Cooperative
San
Alberto
Township
SantaFe
del
Parana
Township
Paraguay Bio
CETAPAR
Municipalities
INFONA
ANDE
Private Reserves
AcarayHernandarias
San Cristobal Cooperative
Raul Peña
Union Curupaity
Naranjal
Naranjito
UNICOOP
A TodoPulmón (USAID)- Monday
Indigenous Communities (Puerto Barra)
FEPAMA
123
Potential
Optimization of Socioeconomics Benefits
High
Medium
Low
x
x
x
Alto Paraná West
GolondrinaConexion
Few
X
Alto Paraná South East
(Ñacunday)
Yes
X
Golondrina
INFONA
WWF
Conservation Network on Private Lands
SENATUR
x
Favero
Ñacunday Township
SENATUR
x
*These actors by its organizational structure, institutional mandate or economic power, are major players in the area; if positive changes in their
practices occur, the impacts would be magnified.
124
Table 2. Identified Areas during the selection workshop corresponding to Amambay Department.
District/Basin
Analysis s
o area under
Preserved
Forests
Potential Connectivity
YES
High
X
Cerro. Guazu/ Kai Rague
YES
x
South Zone
Si
Cerro Cora National
Influence Zone
Park
Medium
X
Synergies
Identified
Partners
Actors
Drivers of change
GIAPA
PPD
INDI
SEAM
Secretariat of Tourism
Secretariat of Culture
(Cultural Patrimony)
INDI
SEAM
Secretariat of Tourism
Secretariat of Culture (Cultural
Patrimony)
Conservation Network on Private
Lands
Kai Rague
INDI
SEAM
Secretariat of Tourism
Secretariat of Culture (Cultural
Patrimony)
Conservation Network on Private
Lands
Kai
Rague
Government
Low
125
Potential
Optimization of Socioeconomics Benefits
High
Medium Low
x
x
x
Table 3. Identified Areas during the selection workshop corresponding to Canindeyú Department.
District/Basin
or area under
Analysis s
Preserved
Forests
Mbaracayú West
Yes
High
x
Mbaracayu
South- Morombi
YES
X
East
ITAIPU
Reservoir
YES
Zone
Connectivity
Potential
Medium
Synergies
Identified Partners
Actors
Drivers of change
MoisésBertoni
Foundation (District
Communities)
Paraguay BIO
Guyra Paraguay
MoisesBertoni
Private Owners
Indigenous Communities
Villa Ygatimi Township (they have
a proposal and were trained by
MoisesBertoni/GIZ/UNFPA
Mancomunidad
MoisésBertoni Foundation
Low
Yaguarate Project
(MoisésBertoni
Foundation)
X
Paraguay BIO
COOPERALBA
Cooperative
(La
Paloma District)
Katuete Municipality
Itaipu
Environmental
Administration
126
Potential
Optimization of Socioeconomics Benefits
High Medium Low
X
X
Notes
Being a conflict zone
it is difficult to
identify the potential
Socioeconomic
Benefits.
High
levels
of
inequality
In order to maximize resources and avoid duplication of efforts in the territory, a meeting with
the coordination team of Paraguay Biodiversity Project was held. From the inputs received in
this meeting, the consultant team conducted the approximate delineation of the intervention
areas. Once delimited the possible areas, we worked with tools of Geographic Information
Systems in order to get the base map of the project intervention area (see map in Annex 2).
2.2. Characterization of PriorityAreas
2.2.1. Mbaracayú Forest Biosphere Reserve (RBBM).
At Canindeyú Department, the area of influence of the Mbaracayú Forest Biosphere Reserve
(RBBM) was selected as the intervention area which has an approximate area of 289.506 ha,
this area houses the Mbaracayú Forest Nature Reserve, which is the largest protected forest
remnant in the east of the country. The RBBM occupies mainly Villa Ygatimí, which occupies
75% of the total area and partially Ypehu, Corpus Christi, Curuguaty and Katuete districts. The
total population settled in the area of influence would be around 30.000 inhabitants1, and the
population of Villa Ygatimi district of about 21.232 inhabitants2. According to the classification
of land use in the framework of this project, it is estimated that there are 65,000 ha 3 of forest in
private properties and indigenous communities.
Villa Ygatimi District is characterized by high cultural diversity with a mix of rural and
indigenous populations, to which is added the presence of Brazilian settlers. 67% of the surface
of the RBBM is comprised of private property areas that exceed 100 and are mainly devoted to
agriculture1. Indigenous communities present in the area keep significant areas of forest, as in
the case of CupaPou Indian community, which has about 8,000 ha.
Table 1 summarizes the practices that impact on biodiversity in the RBBM area and it establish
hierarchical values for each of the sources of impact. In addition to these sources of impact,
water quality studies in the area point potential sources of water contamination by fecal
coliforms, which is the main problem related to the quality of water for human consumption1
Table 1. Main sources of impact to the ecosystems of RBBM zone*
Main sources
Forest Closed
Bamboo groves
Lotic Ecosystem
Incompatible Agriculture
High
Very High High
Very High
Incompatible cattle
High
Very High High
Very High
Incompatible
traffic
and High
High
High
High
accessibility
Incompatible logging
High
Very High
Incompatible Colonization System Alto
Muy Alto
*Source: Second planning workshop of the Core Team to prepare the RNBM management plan
2004.
Sustainable Practices
The creation of the RBBM has helped implement a number of projects in the area, most of them
supported technically by the MoisesBertoni Foundation, among these projects can be mentioned
the formation of the partnership between the districts that are part of the RBBM, this initiative
seeks to promote the area as a tourist attraction. Among the production practices promoted it is
mentioned the yerba mate shaded growing (Ilex paraguariensis) and enrichment of forest areas
with this species for marketing purposes under certification systems.
2.2.2. Cerro Corá Park and its extension to the South (CCS)
In Amambay Department the zone between Cerro Corá National Park, the Kai Rague Reserve
and Cerro Guazú area was established as priority area. The area comprises approximately
582,927 ha and it would mainly cover Pedro Juan Caballero District and partially Capitan Bado
District; estimated forest cover would correspond to 30% of the area (171,846 ha). The area
127
selection was based mainly on flora riches and cultural significance, the need of strengthen the
institutional presences of SEAM in the area was also highlighted.
According to the Agricultural Census (2008) data, Pedro Juan Caballero district has 418,180 ha
of production spread across 2,938 farms, 17,4% of the area has no property certification
documents. The population living in these farms is estimated on 8.832 with a higher percentage
of men (54%) compared to women. The main productive activity is cattle with 72 1% of the
farms area devoted to this activity (300,000 ha). Indigenous communities of the area would be
mostly part of Paitavytera people.
Among the practices that impact on biodiversity has been identified: pollution and silting of
waterways1, pasture3 burning, exotic species invasion and erosion due to poor farming practices.
This area and the RBBM area show as a threat expansion of illicit crops on forest lands
especially in the dry border with Brazil.
One of the initiatives to support the rural economy and improving marketing channels in the
area has been driven by USAID and is known as North Zone Initiative, which also included the
Department of Canindeyú.
2.2.3. Zone of influence of the Rivers Monday and Ñacunday (MÑ)
In the department of Alto Paraná, it was stablished as priority area the area of influence of the
river Monday and Ñacunday , with an approximate area of 549,160 ha, the area of forest in this
priority area would be around 87,000 ha. 13 rural municipalities with a population of
approximately 48,000 people are included. Table 2 shows the general data at municipality level
according to the Census of Agriculture (2008), being mechanized agriculture with emphasis on
export, the primary activity in the area. The potential of this area lies in the restoration, more
than conservation and its selection is due to potential offered by the waterways and the presence
of consolidated organizational structures in the area such as production cooperatives, which in
recent years have shown a growing interest in conforming to environmental standards. Another
important factor in the selection of this area, especially the West, is its proximity to the property
of the Golondrina Agricultural Society, which develops the only forestry certified project on
native forest in the region.
Table 2. General data of districts that are part of priority area MÑ.
District
Rural
Area
Temporary
Population
rural
Crops
farms
(ha)
(ha)
Juan E. O’leary
7.991
13.724
5.657
Dr.
Juan
León
4.944
14.066
5.423
Mallorquín
Yguazu
1.132
41.976
24.606
MingaGuazu
6.268
36.471
20.948
Santa Rosa del
3685
80.295
64.236
Monday
Santa Rita
2.445
49.428
39.747
San Cristóbal
3.663
131.298
99.193
Presidente Franco
2.847
4.641
2.695
Cedrales
3.643
45.663
37.071
Domingo Martínez
3.346
39.885
29.029
de Irala
Ñacunday
2.818
94.166
65.376
Iruña
1.287
59.139
48.110
Naranjal
4.628
98.403
67.578
Natural or
Cultivated
Pasture
(ha)
3.464
4.087
Wooded
Land
(ha)
Fallow
land
(ha)
1.323
1.604
2.366
1.538
5.918
7.452
6.150
9.335
4.803
8.421
1.001
1.483
478
3.633
11.338
780
2.655
3.861
4.639
12.728
379
4.291
6.125
541
1.249
364
559
332
2.812
3.054
6.672
24.383
6.588
21.941
596
674
861
128
Total
48.697
709.15533
509.669
61.876
106.560
12.042
The indiscriminate use of agrochemicals, deforestation of water resources protection forest and
reserve forests, also farming practices that accelerate erosion are some of the practices that
impact on biodiversity in the area. Among the initiatives or activities undertaken to alleviate this
situation are the Legal Adaptation Plan, which seeks to establish mechanisms to facilitate land
owners adapt to the legal requirements in terms of water resources protection forests and forest
reserves
33
This refers to total area as determined by the Census of Agriculture, for the purposes of the project , the area of the
intervention site would be less, considering that some municipalities have only part of their territory within the
project area.
129
Annex 3: Maps
Location of Priority Areas within the UPAF
Alto Parana Priority Area
130
Canindeyu Priority Area
131
Amambay Priority Area
132
Annex 4: Description of Soy and Beef Supply Chains
133
Soy Value Chain
Economic Context
Some of the risks that the global economy faces are the paralyzation of the progress in the euro
zone crisis, tax problems and debts in the United States, the possibility of an unexpected
cutback of the China investments, and the interruption in the worldwide supply of petroleum. 1
The economic growth of Latin America and Caribbean will continue at a moderate pace in
2013, in a scenario of high uncertainty and volatility, mainly from the external sector.
According to the report, in relation to Gross Domestic Product (GDP), the BCP (Central Bank
of Paraguay) mentions that after an expected GDP contraction of -1,2 % in 2012, a very strong
upturn in the economy of 2013 is predicted, with a GDP growth of 13% mainly due to the rapid
recovery of agriculture from the climate phenomenon, to the expansion of cattle raising and
meat industry, after the foot and mouth disease overcoming in 2011, along with the expected
increase of public and private building.
The soybean production in the region of MERCOSUR and particularly in Paraguay is becoming
a field with promising perspectives for the development of a business environment and
investment opportunities. Within this context, an analysis diagram of the soybean value chain is
presented as follows:
Main links of the soybean value chain
Provision of
supplies
Production
Industrial
Processes
Marketing
Export
fcdePro
- Material
supply
- Production
vision
of
food
Fuente:
Elaboración propia
en base aand
la
(seeds, fertilizers,
management
insecticides, herbicidesphytosanitary
and other supplies)
control
- Oil
- Transport
- Consume as
metodología
la GIZ
- Expellerde Value Links -de
Distribution
- Sale
PRINCIPALES ACTORES DE LA CADENA DE VALOR DE LA SOJA
En laSuppliers
siguiente
Primary
Process
of specific
- Machinery
and
Equipment.
supplies
producer
or
industry
Collectors
Soybean
consumers
and
derivatives
Operator categories and its relations
Fuente: Elaboración propia en base a la metodología de Value Links de la GIZ
Seedbed Companies,
Source:
Prepared according to methodology
GIZ Value Links.
Agrochemicals,
Multinational of
Companies
Machinery
Service Providers and Regulating Entities
MAIN ACTORS IN THE SOYBEAN VALUE CHAIN
APROSEMP,
MAG, SEAM,
SENAVE
In the following
figureINBIO,
a summary on the main characteristics
of relevant
sectors involved in
CAPECO,
INFONA,and
MIC,
ADUANAS
soybean value
chainIPTA
in Paraguay, based on its specific functions
according
to participation
(MACRO, MESO AND MICRO):
134
Source: Prepared according to methodology of GIZ Value Links.
MAIN CHARACTERISTICS OF THE SOYBEAN VALUE CHAIN SECTORS
SECTOR
Supplies
providers
Agricultural
Agroindustrial
CHARACTERISTICS
GENERAL INFORMATION
The main supplies (seeds, herbicides,
pesticides) used in agricultural production
are supplied by multinational companies
and, to a lesser extent, by cooperatives. A
very small governmental involvement is
observed (IPTA; DEAg and others).
In the country there are two basic systems
of farming: business farming and family
farming. The production is focused on
medium and large private production,
where the system of direct seeding of
soybean-corn-wheat is stood out. The
involvement of the public sector in the
development of new technologies is very
little. Multinational companies have an
important involvement in the grain
collection and transportation system. The
cooperative sector also has an important
involvement.
The market of soybean oil is growing. The
soybean production in the country is
mainly for grain exportation and, to a
lesser extent, to the elaboration of oil.
However, multinational companies such
Around 90% of producers use
“genetically modified seeds”.
Over 60% use “own seeds”.
Currently, there are 3,2 millions
of hectares (it represents about
60% of the total cultivated area of
the country) and a production of
9,4 million tons, the average yield
is of 2.967 kg/ha. The main
production areas are Alto Parana,
Itapua, and Canindeyu with 30%,
20% and 19%. The cooperative
sector has 15% of the total area.
The world market has grown 20%
in the last five years.
25% of local grain production is
for the oil industry.
60% of oil is exported and the rest
135
SECTOR
Distribution
Consumers
CHARACTERISTICS
GENERAL INFORMATION
as CAIASA, ADM and others are
currently making important investments in
the oil industry. Another value added in
the chain where there could be a progress
is in the porcine and avian production.
Grain marketing follows a very simple
track which starts in the individual
producer or in businesses, which is
generally (90%) sold to multinational
export companies and, to a lesser extent,
to cooperatives. The exporter negotiates
with the importer. Grain marketing is not
too demanding in terms of quality
requirements and it is rather limited to the
degree of cleanliness. However, in the last
few years the main export destination is
Europe,
where
regulations
about
innocuousness are more demanding,
which will require a greater attention in
this aspect.
Soybean is a highly nutritious oily with
multiple uses for both human and animal
consumption. The main soybean demands
are oil industries and production of
balanced meals for animals. The level of
consumption of this product is very low in
Paraguay.
is for local consumption.
It is estimated that in 2013,
Paraguay will be able to process
4,5 million tons.
In 2013, grain production of
Paraguay closed in 14,4 million
tons, and 65% belongs to soybean.
Silos are concentrated in Alto
Parana and Itapua.
In 2012 Paraguay exported 3,2
million tons (78% of grain
production) and 123 million of oil
tons.
The main exportation destination
is Germany, with 28% of total
exports. EU represents 56%.
The main exporters are ADM and
Cargill with 33% and 18%.
Top producers: Brazil, USA and
Argentina with 31, 30 and 19%.
Paraguay is the 6th. Top exporters:
Brazil, USA and Argentina with
38, 37 and 11%. Paraguay is the
4th.
GENERAL ASPECTS OF SOYBEAN
RISKS RELATED TO THE SOYBEAN PRODUCTION
In general terms, the expected risk in the process of an economic activity for a producer is the
possibility of the occurrence of an unfavorable situation or loss. Some risks are inherent to the
activity while others are more general, which can be classified among other types, according to
sources, in:
Production or yield: include climatic factors, pests, diseases, technologies.
Market: are associated with changes in the prices of input and products, investments costs,
changes in the consumption pattern.
Institutional: laws and regulations about taxes, environmental or phytosanitary aspects,
agreements or commercial restrictions.
Financial: related to sources of financing, interests rates, exchange rate, and liquidity.
Production Risks
In Paraguay, soybean production is highly mechanized, conducted mainly in large and mediumsized farms of individual producers and, to a lesser extent, those associated with cooperatives,
which have commercial support from multinational companies and their respective
cooperatives, in a smaller scale there are productions in small farms. Production is mainly
intended for foreign trade (more than 70%) in the form of grains and the local market for the
production of oils.
Most producers apply advanced technologies, such as the use of improved seeds (genetically
modified), the use of chemical fertilizers, application of a wide range of phytosanitaries
136
(insecticides, fungicides, and herbicides), and the use of several equipment and machinery,
which allow a production and harvest with high technological efficiency.
The main risk in soybean production is given by the agro-climatic factor which strongly affects
the performance of the product; it is a component of great magnitude because the production is
closely related to the GDP of Paraguay.
On the production side, there are technological packages available which allow the
management, control and prevention of major pests, diseases and weeds to obtain a high yield
product. However, sometimes there are risks caused by the
emergence of new pests or
diseases, such as soybean rust, which in the agricultural period 2006/07 caused losses and
affected the local average.
Among the measures to mitigate climatic risks and phytosanitary aspects, the sowing
distribution in early, mid and late times, soil preparation under tillage system, crops rotation,
use of resistant varieties and others are mentioned. To implement these technologies there are
many guilds (UGP, CAP, APS, CAPECO, CAPPRO, FECOPROD; APROSEMP, INBIO),
cooperatives, multinational companies which offer agrochemicals, public and private technical
units such as IPTA, SENAVE, CETAPAR and other actors which support soybean production.
Market Risks
In the agricultural sector of commodities, income estimations are made based on international
market prices, widely publicized and updated. In addition, input costs are easily accessible to
producers through the presence of several multinational companies which not only offer their
products but also organize promotional events such as installation of demonstrational plots.
As mentioned above, soybean production in Paraguay is primarily targeted to the international
market in the form of grains and the elaboration of oils, which are also exported.
Statistical data on international price denote a sustained growth in the last years, reaching 650
US$ tons, but which is currently showing some declines. However, the values continue with
levels above the historical average of 200 US$/tons.
However, multinational companies involved in this market, have a quasi-monopolistic power
since they establish high costs in the international marketing logistic (fright, insurance, etc.)
which influence the establishment of final purchase prices. There is a direct correlation between
the price of grain and the “prize” (term related to logistics), when the international market price
increases, there is also an increase is the prize cost. In this respect, guild directors of Paraguay
mention that it went from a value of 40US$/tons at the end of the first semester of 2012, to 120
US$/tons in this period, which affects the producer’s profitability. Within the structure of the
production cost, agrochemicals represent 60% of total cost.
Even though the sector has a high capacity for grains storage, given the country’s landlocked
condition, seaworthiness factor constitutes a significant risk in the process of
commercialization.
One of the comparative advantages of soybean production of Paraguay is the protein content in
grains which can lay the basis for achieving a product distinction. However, since there are no
differential pricing in the market, it becomes difficult to implement the market segmentation by
quality or the production differentiation as the certification (for example RTRS).
The organization of producers of this product is an alternative to negotiate with companies
which allow the mitigation of the sale price risk as well as in the purchase of supplies in more
competitive prices. In this regard, the cooperative sector has created the company ECOP SA for
the marketing of fuel, fertilizers, etc. and is in the process of a feasibility study to install ports
and barges of their own.
137
Financial Risks
The financing of soybean production is done with the support of the local financial system
(mainly banks and, to a lesser extent, by cooperatives) and multinational companies involved in
the marketing process. For investments, the sector has funds from the Financial Development
Agency (AFD), although in a limited way, and from the multinational companies’ own funds.
The sector does not have many difficulties to cover the requirement of financial resources.
Considering that the production cost of a soybean ha in the agricultural period of 2012/13
reached approximately 3 million guaranies and that the sowed area was of 3 million ha, the total
requirement is of about 9 billion guaranies. According to data from the Superintendence of
Banks of the BCP, the loan portfolio of banks for the financing of soybean production reached 5
billion 94.554 million guaranies, representing 60% of the total requirement. Guild directors of
the sector say that the rest is financed by transnational collectors at the beginning of the
respective sowing.
In case of agricultural periods in which agricultural production is affected by adverse agroclimatic conditions (mainly droughts) like agricultural periods in 2008/09 and the most recent
one in 2011/12, the financial sector offers the possibility of refinancing or restructuring debts.
Institutional Risks
The management of farms which produce soybean is governed mainly by the provisions and
regulations of SEAM, INFONA and SENAVE, which fulfill roles about environmental and
health policies, respectively.
Generally, productive sector actors which take part in the soybean value chain mention the
institutional weakness of public technical agencies in establishing inter-institutional
coordination mechanisms in order to improve the public-private link which can allow a
comprehensive planning for a better use of economic, social and sustainable development
opportunities.
SWOT ANALYSIS
With the purpose of making a synthetic analysis of the SWOT tool application, the most
important aspects in the soybean production and marketing process, which were mentioned by
executives of the companies involved in the promotion of this field, are presented as follows:
Strengths: The business agriculture sector supports its productive structure in the production of
the soybean-corn-wheat conglomeration in a vast area of the country of favorable agroecological conditions and which have a growing global demand. In the productive process,
advanced technologies are applied (mainly tillage system) driven by multinational companies,
which are also involved in the marketing process, and the sector has enough credit support for
operating costs as well as for investments. Agricultural production is not only limited to
geographical expansion but also to productivity increase. In addition, there is a strong and
influencing presence of guilds that support production, technological innovation and marketing.
Opportunities: One of the major opportunities in the sector is given in the segment of the
industrial process, where big investments are made to install oil processing plants, which also
have a growing international demand. Another opportunity is related to the possibility of
production certification to which the best grain protein content could be added. Other important
factors are the country’s Macroeconomic stability and international prices (even with the slight
current falling) which are still in relatively competitive levels.
Weaknesses: One of the main weaknesses is related to the fluvial transport. Indeed, by the
landlocked condition and the high volume of grain exports, marketing becomes deficient and
generates additional costs due to the unseaworthiness in certain times of year. The volatility of
the “Prize” (logistic costs) established by companies which are involved in international trade
generates concerns among producers. Yields are exposed to the weather, mainly droughts,
138
which generate difficulties in the credit system. There are limitations of lands suitable for
physical expansion of production in the eastern region of the country, besides the high price of
lands. Another weakness among primary producers is the high concentration of marketing in
only a few export companies. In international market, global production is concentrated in a few
countries (United States, China, Brazil and Argentina). There is an insufficient cooperation and
planning between Public and Private sectors, such as the low control in the distribution and
monitoring of spreading materials.
Threats: In the production segment, the main points refer to social insecurity (mainly
invasions), and a poorly structured agrarian reform and institutional vulnerability for the
application of laws, regulations and provisions related to the production and the probability of
the presence of new diseases or pests, such as soybean rust. In the marketing segment, by
targeting most part of the production to exports, the sector is exposed to volatility of the
exchange rate and protectionist policies, subsidies and other measures in international trade.
Currently, it is on the agenda for discussion the probability of implementing tax laws which
affect the competitiveness of the chain, mainly in the segment of primary production.
PRODUCTION SUSTAINABILITY
In general, it is agreed that “sustainable agriculture” is based on production whose main feature
is the ability to maintain its productivity and be useful to society indefinitely. Sustainable
production systems must therefore meet the following requirements:
1. Keep productive resources
2. Preserve the environment.
3. Be economically competitive and profitable.
4. Respond to social requirements.
In Paraguay there are two very different production systems. On one hand there is Family
Farming, which operates in a very small piece of land, between one and twenty ha, with low
number of property certificates, they use traditional production technologies on marginal soils
and are engaged in a limited production of items which are targeted to the market and, mainly,
to crops for their own consumption. In order to support this sector, MAG has created the
National Record of
2
Decree No.11.464/07
Family Agriculture (RENAF)2 and where family farming is defined as a productive rural
activity which is carried out using mainly family labor for the agricultural production of a
property.
Regarding family farming, the main traditional crop income in the late 90s and early century
was cotton, with areas, which exceeded 300.000 ha, however, in the last agricultural period it
only reached about 50 thousand ha. Sesame sowing is constituted as an alternative income item
with annual areas of approximately 80.000 ha. Another income item among smallholders is
sugarcane of industrial use, which shows a significant growth in peasant’s income crops going
from 97.000 to 115.000 cultivated ha. Other income crops of AF such as cassava, beans,
groundnut, tobacco and spurge also show a constant falling since 2007/08.
On the other hand, there is Business Farming, mechanized and extensive, with high technology,
high capital investment, wide range of financial services and a marketing system with its
logistic services chain, which interact to generate a large exportable surplus, represented mainly
by soybean, corn, wheat and rice crops and, to a lesser extent, other items such as sunflower,
canola, etc.
Within this context of soybean production sustainability, it should be mentioned the expansion
evolution of the agricultural border of Paraguay and, fundamentally, the changes occurred in
soybean, corn and wheat crops. Indeed, between Agricultural Census of 1991 and 2008 the use
of agricultural surface increased in a little more than 1.700.000 ha, where soybean production
139
expansion was the biggest one with a variation of 346% in that period, corn also had an
important growth with an increase of 253% and wheat with a variation of 148%.
VARIATION OF AGRICULTURAL SURFACE. Census of 1991 y 2008
(Main crops)
CENSUS
ITEMS (ha)
Soybean
Corn
Wheat
Total
Agriculture
CENSUS 2008
3.365.203
2.463.510
858.101
381.028
CENSUS 1991
1.662.006
552.657
243.215
153.837
103
346
253
148
VARIATION (%)
Source: MAG. National Agricultural Census 2008
Sector guilds such as CAPECO, UGP, CAPPRO, among others, estimate that the current
sowing area of the production system which includes the soybean-corn-wheat rotation is of
approximately 5 million ha.
To facilitate the understanding of the development level of these production items, some factors
are listed below, which were mentioned by the actors of the sector, who were interviewed
during the study of this consultancy:
 The type of soil and climate predominant in the eastern region favor competitive
agricultural production.
 In the expansion process of agricultural land use, the use of soils was intensified by
implementing tillage system in business farming. It is estimated that a bit more than
90% of soybean acreage is made under this system.
 The cluster is composed by dynamic actors with ongoing training by individual
producers and gathered in associations and cooperatives.
 Network of suppliers of machinery, equipment, supplies which represent firms that
investigate and develop better varieties, advanced technologies for weed and pest
control, fertilization systems, equipments and machineries.
 Promotion of local research programs and training through technical assistance at all
levels.
 Incorporation of friendly production techniques for the environment oriented to a
sustainable production based on the conservation of soil fertility and the improvement
of product quality.
 Production financing system based on contracts of future delivering supported by
guarantees.
 Bank financing for fixed investments and machineries.
 Sustained international demand of food products.
However, some weaknesses were found in the process of achieving a sustainable soybean
production. Among other arguments, the interviewed actors identified the following points:
 Within the scheme of tillage system in the soybean-corn-wheat conglomerate it is
necessary to increase the diversification by incorporating green manures such as oats,
forage turnips and others, which contribute to preserve the environment.
 It is observed that the agricultural area expansion at the expense of native forests is not
planned within a policy of Environmental Land Management Plan which allows a
balanced, integrated, sustainable and socially equivalent growth.
 The scope, implementation and interpretation of the regulatory framework in the
productive activity (environmental impact assessment, zero deforestation, etc.) denote
140





in several occasions legal loopholes which generate conflicts among the involved
parties (producers and public institutions). Because of this scenario, it is necessary to
update the legal framework through a proper planning which allow the consensus of the
economic, environmental and social components.
In the process of grain marketing flow, there are problems considered “bottlenecks” in
the final link of the productive chain because of the difficulties in unpaved roads, the
navigability of rivers and the low capacity in ports. The agribusiness amplitude requires
an infrastructure investment in works to improve land, rail and river roads which not
only include benefits but also social and environmental impacts.
The statement about the institutional weakness of public technical agencies to establish
interinstitutional coordination mechanisms in order to improve the public-private link is
recurrent.
There is no differential pricing in the market which encourage the product segmentation
to achieve a differentiation through a production certification (RTRS or others). The
producers’ comment: “why incur in costs to implement a certification process if the
market does not give additional prices?” is recurrent.
Within the system of “business farming” the presence of the public sector in the
research process, technological development, training and spreading of soybean
promotion is very weak.
In a general way, it can be mentioned that, public policies oriented to the agricultural
sector must consider a commitment to society as a whole (productive sector, nongovernmental organizations, academic units, civil societies, etc.) which allow a better
cohesion from the economic, social and environmental perspectives.
In this context, the future of agricultural production and food industry is encouraging; both
sectors have great opportunities due to the growing food deficit of the world population and the
long term persistence of a strong food demand from high growth countries, such as China and
India.
On the other hand, the short term perspectives of the main agricultural crops estimate a decrease
in international prices. Analysts are focused on the situation in the United States (it produces
40% of the world production), where a probable increase of area is expected, it is also observed
that China, throughout this year, has remained extremely conservative in its purchases.
Paraguay is a major global player in the production of soybean and derivatives, reaching the
sixth position as a world soybean producer, fourth in soybean and soybean oil export. There is
still additional land for the crops expansion; there are agro-ecological conditions and favorable
climate that together with the application of biotechnology will boost production and improve
its position as a producer and exporter of food products.
According to referents from the soybean agro-exporter sector, this expansion will be given in
the recovery of degraded soils, cattle ranching areas and the exploration of suitable lands in the
western region. Another gravitating factor in the international scenario is the country’s
integration to MERCOSUR, which allow the access to more demanding markets. Mercosur is
the largest soybean, soybean oil, sunflower oil, beef exporter. As a whole, it provides a little
over 50% of the world’s soybean production, around 18% of beef, 5% of grains.
Within the complex of soybean chain, it is very important the strong growth of poultry and
porcine meat that has been observed in the world. Indeed, these two meats are generally
produced under intensive systems which normally use high protein flour (like soybean flour) as
an important component of animal diets. This situation opens perspectives for the inclusion of
small producers in soybean chain.
Even though in recent years commodities prices have increased almost three times compared to
historical prices, the expansion of arable land has been slow. To factors such as the high cost of
141
agricultural lands, the requirement of significant investments and unfavorable climate, there are
situations which threaten farming activity and food agribusiness and they are mainly related to:
1) legal, physical and proprietary uncertainty; 2) inadequate agricultural policies for small
farmers (agrarian reform), and 3) difficulties in giving environmental sustainability to
agricultural production, which become factors that can affect its development in important and
sometimes irreversible ways.
These situations must be solved in order to give predictability and sustainability to investments,
taking into account that agriculture, economy and global food safety of many developing
countries will continue to depend on the production of several crops.
Regarding certification of soybean production, the biggest limitation is related to the lack of
buyers demand in the international market and the high costs involved in the process. In an
article published in Brazilian press3, it is estimated that only 3% of the world’s soybean
production is certified, it is also mentioned that 70% of Brazil’s production is purchased by
China, which does not give much importance to environmental issues. It also mentions that the
United States, at the moment, does not have any interest in certification issues either. However,
it states that the European market is more rigorous about it, but since the product is used in
feeding porcine and poultry cattle, it makes the process of measurement more difficult. From the
producer’s point of view, certification is not worth it because of the high costs and there are no
financial incentives.
Finally, within the promising scenario of agricultural production, managers, government
officials and specialists who were interviewed within this consultancy expressed the need to
establish a greater interaction between public-private actors of the chain to promote an agenda
which include, among others, the macroeconomic stabilization, the non-implementation of new
policies which deteriorate the prices received by producers or which generate higher risks to
invest in this type of activities; a more efficient system in matters of intellectual property and
compliance control of the current legal framework in order to keep incentives for the
introduction of new biotech events and seed varieties; a strong investment in fluvial (greater
depth of waterway) and road infrastructure (extension of trunk roads and paving of rural roads).
142
VALUE CHAIN OF BEEF
This part of the study presents an overview of the market structure of the beef business in
Paraguay, to this effect it is used an analytical approach of value chain in order to evaluate and
analyze the various segments that make up the chain: production - processing - marketing distribution of beef products in the country.
Cattle ranching marketing is geared towards two systems: i) internal market, where the product
is sold through livestock markets or direct sales from producers to slaughterhouses or butchers
and ii) direct sale to slaughterhouses for export market .
Below there is an outline of the analysis of the value chain of beef differentiated for the
domestic market and the export market:
Main links of the value chain of local and export meat
Value Chain for internal market
Supply
Providers
-Supply suppliers
(semen straw, embryo
transfer, IVF)
-Producction of bulls
and cows
Production
-Breeding, rearing
and fattening
Cattle
Slaughter
Industrial
Processes
-Cattle Slaughter
-
- Sanitary and
nutritional
management
Marketing
Deboning of
carcasses
-Transport
Internal
Consumption
- Consume as food
-Distribution
Packaging
-Sale
- Vacuum
Packaging
Value Chain for export market
Production
- Breeding, rearing
and fattening
-identification and
traceability records
- Sanitary and
nutritional
management
Cattle
Slaughter
- Slaughter of
cattle suitable
for export
requirements
(crowd pens
knockout
drawers)
Industrial
Processes
-
Maturation
and Deboning
of carcasses
-
Packaging
Export
- customs
clearance
and sale to
wholesalers
Consumption
- Consume as food
- Vacuum
Packaging
Source: Prepared according to the methodology of Value Links from GIZ
MAIN ACTORS OF BEEF VALUE CHAIN
The figure below presents a summary of the main features of the relevant actors involved in the
beef value chain in Paraguay, based on their specific functions and by levels of participation
(MACRO, MESO AND MICRO) :
The year ended with an entry to 4 fairs of Central department for domestic consumption of
210,126 head of cattle, increasing by 7.87% over previous year offered. The Eastern region
participated with 42% of entries, while the West with 58%, which compared to the previous
year, the East increased its shipments by 2%, while the West decreased by 2%. The main
supplier of the East region remains at San Pedro department, with 29% of entries.
143
Source: Prepared according to the methodology of Value Links from GIZ
MAIN FEATURES OF THE SECTORS OF BEEF CHAIN
SECTOR
Supply
Providers
Producción
FEATURES
GENERAL DATA
The main inputs used in livestock
production
(vaccines,
deworming,
supplements) are provided by agriculturalvet companies. The amounts used are
standardized and disseminated by
companies and SENACSA. Genetic
improvement and technical assistance are
developed by the private sector with very
little involvement of the state (IPTA;
DEAg and others).
Livestock production in our country is
under pasture system, from natural or
implanted pastures. Prevailing production
systems are presented through three
schemes: i) raising: ii) rearing and iii)
fattening.
The level of technological adoption of the
ranch is the only differentiating factor in
primary producers (small and large scale).
There is little public involvement in the
development of new technologies and
research to produce more productivity. A
According to SENACSA in the 1st
period FMD vaccines were applied
to a total of 13,260,289 animals and
in the 2nd period 4,010,658.
Nationwide 6,262 commercial
houses for veterinary products are
registered. There are about 600
companies in the vet industry
(exporters, importers, laboratories
and others).
At the end of 2012 the whole
country's
livestock
herd
is
13,291,164 heads in 122,229
ranchs. In 2007 was of 10,464,001
heads. The average growth rate is
500,000 head / year. The average
head / farm increased from 55
(2008) to 109 (2012). Most animals
(55%) are concentrated in farms (a
total of 2,411 or 2% of the total)
that have more than 1,000 heads. In
the lower stratum of producers
144
SECTOR
Industry
Distribution
FEATURES
GENERAL DATA
full cycle cattle company should expect to
market their produce between 33-45
months.
Expansion of livestock production is
much more common in the Western
Region, than in the Eastern Region.
(from 1-20 heads) there are 77,162
(58%) establishments that handle
only 5% of the total livestock in the
country. The departments of Alto
Paraguay and Boquerón showed
higher dynamic expansion with
variations of 77% and 52%,
respectively, between 2007 and
2012. In the Eastern Region the
largest expansions occur in the
departments
of
Concepción,
Caaguazú, Central, and Canindeyú
Itapúa varying between 28% and
33%.
In 2012 1,239,339 head were
slaughtered, twice the number in
2003. 97% was destined for
export.
In the U.S. the price of February
2012 was 5,562 U.S. $ / ton. On
livestock fairs in February 2011 the
maximum price was 8,950 Gs / kg
and in December 2012 was around
7,000
Gs
/
kg.
In slaughterhouses with veterinary
inspection in 2012 284,101 animals
were
slaughtered.
35
slaughterhouses, in the country are
enabled by SENACSA and 15/35
units
are
in
the
Central
Department.
In 2012 supply closed with 210,126
animals, this was about 9% higher
than the previous year.
The Eastern region participated
with 42% of revenues, while the
Western region with 58%. The
main supplier of the East region
remains the department of San
Pedro, with 29% of revenues.
Cold-storage plant: They are subject to
compliance with international legal
standards, tax, labor, health and
environmental.
Higher costs make cold-storage plant less
competitive locally.
From year 2000, by resolution of
SENACSA, export-enabled cold-storage
plants are prohibited from purchasing
animals in livestock markets. They buy
directly from producers, for which they
hire buyers or attend agents.
Among the slaughterhouses for the
domestic market are the ones enabled by
SENACSA and those not enabled in the
countryside, on which there are no official
records
Livestock Fairs: In the auctions the
highest bidder wins animals for slaughter
at a price per live weight and a price for
the animal in the case of animals for
breeding or wintering. The company
charges fair brokerage fees.
The supermarkets, distributors and
butchers in many cases are supplied
with the slaughter that they themselves
made through other companies within
the same group. It is usually
performed in slaughterhouses, where
costs are lower.
Consumers
In recent years there is a marked tendency
for export. This situation resulted in
increased competitiveness of domestic
cattle.
Cold-storage plant mostly targeting their
products to the international market the
remaining to the domestic market, while
slaughterhouses supply exclusively to the
In 2012 chilled meat falls
drastically to 21,272 tons compared
to 93,143 tons in 2010. In 2012
158,035 tons of frozen meat was
exported.
The main markets for chilled meat
are Chile and Brazil. In 2010 the
Chilean market accounted for 89%
145
SECTOR
FEATURES
GENERAL DATA
domestic market.
The destination of Paraguayan beef
exports is strongly conditioned by the
sector health conditions.
In Paraguay there is no consumption of
imported meat.
In the meat market there is underreporting
(consumption in ranchs, etc.) as well as an
informal trade (high permeability of
borders.
of total exports and drops to only
0.3% in 2012. The Brazilian market
in 2012 reached a 93% while in
2010 participated only with 6%.
The main destination of frozen
meat is the Russian market that in
2012 purchased 119,373 tons (80%
of total exports).
RISKS RELATED TO CATTLE PRODUCTION
Production Risks
In Paraguay, beef production is done in one part by i) small farms domestically oriented with
local occasional sales, ii) medium farms that sell in local or regional markets, and iii)
establishment specialized in best quality animal production for the local and external market.
The first group is characterized by, low-skilled, empirical knowledge, limited use of technology,
use of native breeds; animals are used as a first step for milk production and finally, meat. In
general, it is considered that in this type of farms they have less than 100 heads. The output of
this sector is outside the standards required by cold-storage plants.
In the second group are animal producers with 100 to 500 heads. The application of technology
indicators are above the previous layer, they usually receive advice from formal financial
institutions, mainly the Livestock Fund. They are more integrated into the marketing chain,
mostly devote their animals to local, regional or municipal slaughterhouses, also attend fairs
located in the Central Department
Large producers are in properties with more than 500 heads, applying advanced technologies,
according to industrial requirements such as the use of improved breeds (genetic) appropriate
for intensive farming, which earn in earliness, prolificacy and capacity to transform into meat
the food provided. This group of producers is tightly integrated to the commercial chain of
domestic and international market, they have access to credit from private and public banks and
are responsible for the modernization of production.
The health status has become a key competitive factor in meat markets and it is expected that in
the future must be increasingly important. Many markets require that the cattle from the
exporting country is free from a number of diseases (in particular, FMD and BSE or "Mad
Cow") and the appearance of some of these diseases is enough to automatically close any
possibility to access to these markets. The emergence in Paraguay of outbreaks of this disease in
2005 and again in 2011 prompted the need for preventive measures to minimize the risk.
A favorable assessment of sanitary conditions by the World Organization for Animal Health
(OIE) is a key competitive factor. In the case of the disease, when a country achieves to be
declared "free of FMD without vaccination" by the OIE, that amounts to keep the doors open to
sell in any market. In general, the declaration of "free of FMD with vaccination" implies a
somewhat lower health status, but currently there is a trend towards a greater flexibility, to the
extent that several countries do not differentiate access to their respective markets with one or
another statement.
In this regard, coordinated efforts of public and private sector have allowed getting off the
restrictions imposed by the international market by implementing corrective measures that allow
management, control and prevention of major diseases in order to obtain a safe product. Given
146
the pervasiveness of borders, coordinated action at regional level is required in the struggle for
control of this disease.
In the case of BSE, the number of countries that have achieved the status of "free of mad cow
disease" by the OIE is greatly reduced; therefore, to have a statement of this nature is certainly
key factor competitiveness.
The production system prevailing in both the eastern and western region of the country is
developed based on grazing without application of hormones or other substances to artificially
stimulate livestock growth, so it would be, in theory, away from the problems of Mad Cow and
favors getting a safe product. Moreover, the plants authorized to export to the most demanding
markets such as Chile and the European Union, permanently receive visits from international
control over compliance with the requirements of international standards relating to transport,
slaughter and others which ensure the safety exportable product.
The climate risk seen as likely to affect product performance becomes important when related to
food production (corn, soybeans and other grains). But given the levels of grain production in
the country associated with the availability of natural resources, land and technology does not
constitute limitations in this regard.
However, there is a marked seasonality of forage production that generates food deficit for
cattle at certain times of year (mainly in winter). On the other hand, there has been in the sector,
a major expansion of cultivated pasture species suitable for each region.
The progress of agriculture in the Eastern Region at the expense of livestock farms generates a
new production system, where livestock production becomes complementary to agriculture
causing agriculture rotation - farming - agriculture. On the other hand, mechanized farming
areas developed intensive fattening livestock production or feed lot which gives the possibility
to transform into meat by-products of agriculture, considering that use soy waste can be used.
Market risks
The main destination for the production of cattle of Paraguay is the international market;
according to SENACSA in 2012 a total of 1,239,399 heads were slaughtered in cold-storage, of
which 97% went to the external market and the rest for domestic consumption. The beef has no
listings on the international market, so benchmark prices correspond to the values of imports
from each country. Moreover, this product is poorly differentiated and limited to categories such
as fresh or chilled, frozen "with or without bone," and multiple types of cuts.
Also, being a product of human consumption requires stringent compliance and international
market regulations to ensure its safety. In this sense, the most commercially restrictive diseases
are FMD and mad cow disease.
The analysis of the international meat market allows to identify what are the key factors that
determine the competitiveness of the product. These factors operate within a competitive pattern
characterized by high barriers to trade and an active state participation on production incentives.
Traditional protectionist instruments (such as tariffs, import bans or quotas, etc.) are used in
many countries, particularly in the most developed ones. Production subsidies and export are
used to stimulate production in countries with comparative advantages for the development of
the meat chain. Finally, government intervention is crucial in aspects of health conditions of the
herds, to issues regarding food safety and animal welfare.
In this context, in which market forces are not precisely the governing supply and demand, it is
possible to detect a set of factors that, because of their impact on competitiveness can be
147
considered key factors in relation to it. In this sense, the presence of FMD in 2005 and 2011
caused the closure of those most demanding markets.
The recovery of health status (free with vaccination regime) usually requires a period of two to
three years. In fact, we are currently engaged in intensive efforts to enhance exports to the
Chilean market in early 2014. According to officials of the ARP, currently, about 105 livestock
farms are eligible to export meat to the Chilean market matching properties that underwent
serological sampling. Before the outbreak of FMD, Chile claimed about 80,000 tons but at the
end of May this year, Paraguay exported 2,800 tons this country.
Despite the unfavorable situation for the detection of this disease, that caused a large decrease in
export volumes to the most demanding markets, other markets were not restrictive like Russia
that acquired in 2012 about 120,000 tons compared to 52,500 tons last year.
Paraguay access to regional markets, specifically Brazil and Chile by land; to get to Chile, the
way must be done through Argentina. For the other markets in the America as well as Europe,
Africa and Asia, is done by river to the ports of Rio de la Plata where is transshipped to ocean
vessels. This situation entails additional costs compared to countries with coastlines and also
requires coordination for logistics and container availability.
Despite these limitations, in the field of international trade, Paraguayan beef is very competitive
for the continuous improvement of its quality, cold storage facilities that meet international
standards, herd management based on natural food and other factors that allows access to the
most demanding markets such as Chile and European Union, countries that offer better
purchasing conditions. The prices charged for these countries typically double quotes to other
markets.
In Paraguay there is no consumption of imported meat, as the national product is very
competitive from the point of view of production costs. The countries of the region are
generally not in a position to compete on price with domestic production, except temporary
situations such as the case of FMD.
Another risk related to the international market is the exchange rate, which has its influence
since it is by excellence an export product excellence. To mitigate this risk, cold-storage plants
foster dollarization in the meat chain, mainly in the purchase of cattle. However, operating
expenses and investments continue to be made in Guarani, so stability in the dollar is very
important to maintain or improve business competitiveness. It must also be considered that the
exchange rate affects investment and the cost of inputs being the country an importer of capital
goods and intermediate inputs of production.
Referents from ARP mention that the situations in the international market, closings or
openings, have their implications for local market prices that has a high level of consumption
which can influence inflation in the country. However, with the increase in the national cattle
herd, which currently is at about 14 million heads, mitigates the risk of significant increases in
the level of beef price, mainly from the most popular cuts. In fact, statistical data on the average
prices in the country's major fairs reflect a relatively stability in recent years.
Financial Risks
Financing of livestock production is carried out with the support of the national financial
system, mainly banks and to a lesser extent by the cooperatives. In the group of small and
medium producers becomes relevant the Livestock Fund. Regarding investment requirement
there are funds from Development Finance Agency (AFD), which offers to the sector a specific
product called PROCAMPO.
148
According to the Superintendence of Banks of the BCP, the balance of the loan portfolio of
banks to finance livestock production in 2012 reached 4 billion 843.235 million guaraníes,
representing 12% of the total portfolio of the domestic financial system.
Moreover, the AFD since its inception in June 2006, to March 2013 granted a total of $
498,867,189, of which 17.5% went to the livestock sector mainly for enabling new fields in the
western region.
In case of agricultural periods in which livestock production is affected by adverse growing
conditions (mainly drought for fodder production) and agricultural periods 2008/09 and the
most recent 2011/12, the financial sector provides the ability to refinance or restructure debts.
Institutional Risks
Management of farms engaged in beef production are governed primarily by the provisions and
regulations of the SEAM, INFONA and SENACSA, that meet roles on environmental and
health policies, respectively.
In general, productive sector actors involved in the value chain of the meat mention the
institutional weakness of government technical agencies responsible for environmental policies
to establish coordination mechanisms to improve the public-private link allowing designing
more comprehensive programs.
On the side of health policies led by SENACSA, there is a high concept of trust and credibility,
especially regarding to program against FMD and support toward the private sector to reopening
of markets.
SWOT ANALYSIS
For the purpose of synthetic analysis through the application of the SWOT tool, the most
important aspects in the process of production and marketing of beef that were mentioned by
executives of the companies involved in promoting this area are presented below.
Strength:The main feature of the livestock sector is that most of the production is based on
grazing that allows isolation of one of the most restrictive diseases in the market BSE or " Mad
Cow " . The industry has made large investments to improve the genetic quality of animals
(from 2010 they even export genetic materials) as well as management of technologies which
increased the productivity and product quality and gain a place of international prestige for
Paraguayan meat quality. The sector has adapted breeds for different agro-ecological conditions
of the country. In recent years, a public-private structure ( SENACSA - ARP ) it was
established for disease control (mainly FMD) that generated confidence among them. In the
segment of the meat industry there are strong companies with high quality standards that
properly meet international trade standards
Opportunities: One of the major opportunities mentioned by international bodies like the
FASO is regarding the international food market is expanding. Macroeconomic Stability in the
country creates conditions to improve competitiveness. The implementation of the traceability
system is a mechanism for the most demanding market access and a path to facilitate product
differentiation through certifications. The sector has credit lines for production and investments
that allow the improvement of the livestock. In general, import unit values are stable with an
upward trend
Weaknesses: Despite the efforts of public and private sector, health monitoring is still
permeable, complicated by the wide variation in farm size and dispersion of production. Cattle
feeding are hindered by the strong seasonality in forage production by agro-climatic conditions.
In the marketing segment there are enabled cold-storage plants for the local market but they do
not meet the requirements to export, in addition there are also illegal slaughterhouses in many
149
municipalities. The small and medium enterprises have difficulties in access to credit also small
and medium enterprises have technological limitations to access the export market. There is a
low State's participation in research and training and the public-private partnership to promote
our product in the international market is still weak.
Threat: threats to the livestock sector are very similar to those already described for the
soybean sector.
SUSTAINABILITY OF PRODUCTION
The latest Agricultural Report on Agricultural Perspectives of Food and Agricultural
Organization (FAO) and the Organization for Economic Cooperation and Development
(OECD) for 2013 to 2022, expects that growth of global meat production will be increased by
only 1.6% per year over the next decade, under 2.3% annual compare to the previous decade. It
also indicates that livestock is the main source of income for about 200 million families of small
producers in Asia, Africa and Latin America, and the only source of livelihood for at least 20
million families.
However, it estimates that Paraguay will grow by 46% in meat production capacity and it will
increase 52% its red protein exports over the next decade. Brazilian beef production expected to
increase 10.6% over the next decade, to 11 million tons, with domestic consumption of 85% of
total production (30 kg / person / year-average for the next decade). They also estimate a
recovery of Argentina in the world meat business, reaching an export capacity of over 500,000
tons.
The process of cattle ranching expansion that Latin America countries are experiencing,
represents both an opportunity and a threat to the sustainable development of the region. On one
hand, it is an opportunity to create wealth and alleviate poverty if appropriate policy and
decisions are made and promote sustainable environmentally friendly livestock production
systems. On the other hand, is a threat if the expansion of the activity continues without
considering environmental costs and the potential effects of marginalization of small producers?
In this context, the main problems they face are growing pasture degradation and consequent
loss of productivity, deforestation, loss of biodiversity and the reduction of water resources, a
growing dependence on external inputs, technology and genetic material, high incidence of
diseases and deficiencies in organization and marketing.
It is also very likely that if problems of soil degradation are accentuated, livestock production
will face competition for land for agricultural production and is at risk of being displaced to
marginal areas.
In this regard, referents concerning agricultural production sector in Paraguay (CAPPRO), Dr.
Laneri, mention that the expansion of soybean in the Eastern region may occur by substituting
farms for agricultural use and the displacement of these producers to the Western region.
Therefore, planning is necessary for growth and intensification that capitalizes the positive
synergies that integrating agriculture with livestock and eventually to afforestation may grant to
sustainability and competitiveness of production systems.
This may increase the levels of deforestation in the region, land degradation, biodiversity loss
and the reduction of water resources, if no action is taken to prevent it. Decisive action must be
taken for the growth of the sector can be carried out in an environmentally sustainable way and
contributes at the same time, to climate change mitigation, poverty and improving human
health.
According to FAO, about 70% of the grazing areas of Latin America and the Caribbean are in
decline in varying degrees. The most susceptible regions to the expansion of the agricultural
150
livestock frontier are ecosystems of the Amazon in Brazil, the American Chaco in Argentina,
Paraguay and Bolivia, and the arid and semi-arid regions of Argentina and Chile.
It also mention that livestock accounts for about 40% of emissions from agriculture. Therefore
requires greater public and private investment for research and technological development,
harmonize agricultural and environmental policies, and search for workable mechanisms for
environmental service payments to ranchers that implement environmentally friendly
production systems.
Considering all the food chain as whole livestock (cattle, sheep, goats, porcine, poultry)
worldwide accounts for 18% of emissions of greenhouse gases. It is urgent to improve the
efficiency of resource use in livestock production and reduce negative environmental
externalities generated by the sector.
Deforestation caused by increased extensive grazing systems in certain areas is a common
feature in countries of Central and South America, however, there are technological and
management strategies for sustainable intensification of livestock production avoiding
deforestation and expansion of the cattle frontier. That is, the industry can play a key role in
climate change mitigation.
Livestock can play an important role in the adaptation to climate change and mitigating its
impact on the welfare of humanity. To take advantage of the potential of the sector to contribute
to mitigation and adaptation to climate change through greater ability to monitor, report and
verify emissions from livestock production, development of new technologies will be required
In this sense, a strategy to improve the sustainability of livestock production could be the
establishment of Good Farming Practices (GLP), in order that the livestock company can be
sustainable environmental, economic and socially and thus obtain healthy, safe and good
quality. The GLP apply throughout bovine productive chain, from the producer or primary link,
followed by the processor until it reaches the final consumer.
Currently, Paraguay does not have an institutional policy of Good Livestock Practices, however
in the Rancher's Manual of ARP is possible to identify a proposed technical guide to good
farming practices developed for the MERCOSUR.
In this context, the implementation of traceability system (SITRAP) implemented by the ARP
and SENACSA support, is a mechanism to access the most demanding market and a path to
facilitate product differentiation through certifications.
The latest Agricultural Report of Food and Agricultural Organization (FAO) and the
Organization for Economic Cooperation and Development (OECD) from 2013 to 2022, expects
growth of global meat production increased by only 1.6% per year over the next decade, under
2.3% a year compared to the previous decade.
However, it estimates that Paraguay will grow by 46% in meat production capacity and it will
increase 52% its red protein exports over the next decade. Brazilian beef production expected to
increase 10.6% over the next decade, and it also estimates a recovery of Argentina in the world
meat business.
According to annual herd growth, is expected to reach approximately more than 15 million
heads in 2015, which would allow exporting 400,000 tons in 2015. The expansion would occur
mainly in the western region, considering that between 2007 and 2012 the departments of Alto
Paraguay and Boquerón showed expansions with variations of 77% and 52%, respectively.
Any physical expansion should consider another important element in improving productivity
rates and increase production concerning technology. Therefore, it is at this point where greater
emphasis should be made through investment in technological development, which should
cover all stages from research to adoption.
151
In this context, it is recognized in international trade, the emergence of Paraguay as one of the
leading countries in the export of meat, which is a work of perseverance and overcoming from
both the private and public sectors related to livestock. This sectoral alliance has led
technological improvements in the production and marketing reflected in higher sales abroad
The main constraints for trading derive from health status (FMD outbreak) in 2005 and 2011
that tested Paraguay which has shown some speed in problem solving, but it has also bare the
fragility of the health system and has damaged, in part, the strong image projected when
achieving the Free of FMD Certificate.
However, this chain is one of the most representative examples to show how a productive sector
of Paraguay can compete successfully in international markets based on consistent effort,
innovation, and over the medium to long term. Currently, the challenge of the meat chain in the
country consist of taking advantage of expansion opportunities in a favorable context for meat
exporting countries, taking into account the low ability to increase the number of cattle in a
short span of time.
Therefore, it is imperative that all sectors involved in the chain, producers and industry and
related sectors, must be prepared to participate in an increasingly competitive market, market
access even in adverse conditions such as health restrictions and tariff; continue investing in
improving productivity and efficiency throughout the chain and develop differentiated strategies
based on the opportunities and constraints that priority markets may have.
It is also important to consider that productivity, increased production, and promoting
environmental sustainability, is also achieved through the recovery of degraded grasslands.
Regional and national programs for this purpose should be developed. Paraguay's cattle
production which mainly depends on the pastures is an advantage over those countries that rely
on a high proportion of concentrate feeds whose prices are very volatile and tend to rise.
Emphasis should be placed on innovation processes around the pasture improvement.
Finally, it is important to mention that Paraguay is and will remain a country that supports its
growth in the agricultural sector and therefore the main promoter of economic growth will
remain the primary sector (agriculture and livestock).
152
Annex 5: Characterization of international soy certification schemes used in Paraguay
ITEM
RT RS
ISCC
2BSvs
Products
Soy
Biomass. Fuels in general
Biomass. Fuels in general
Geographical
Sphere
Validity of
Certificate
Annual audits
Global
Global
Global
5 years
1 year
5 years
Yes
Yes
Yes
Yes
Implementation
of
existing
legislation
Documented land use
Continuous improvements
Decent, safe and healthy working
conditions
Implementation of existing work
legislation (wages and labour
rights)
No slave or children labor
Training and general Information
Respect and dialogue with
local/traditional communities
Complaint
procedures
implementation
Dispute resolution for land use at
the time of audit
Labor and employments benefits
for local communities
Minimize
negative
environmental
effects
(infrastructure, emissions, waste)
GHG emission reduction
Yes
Implementation
of
existing
legislation
Documented land use
Continuous improvements
Decent, safe and healthy working
conditions
Implementation of existing work
legislation (wages and labour
rights)
No slave or children labor
Training and general Information
Respect and dialogue with
local/traditional communities
Complaint
procedures
implementation
Dispute resolution for land use at
the time of audit
Production should not come from
areas of high biodiversity value
and / or high carbon content but
there are different criteria to
identify those areas
Production should not come from
areas of high biodiversity value
and / or high carbon content but
there are different criteria to
identify those areas
Good Agricultural Practices with
different depth levels
Yes
Preserved identity, segregation or
mass balance
Audit cost + 0,3 Euros/soy ton
Good Agricultural Practices with
different depth levels
Yes
Preserved identity, segregation or
mass balance
Audit cost + 0,03 Euros/biomass
ton
Field audits
Legal Obligations
Labor
requirements
Social/Community
Requirements
Environmental
Requirements
Good Agricultural
Practices
Approved by EU
Chain of custody
Costs/Tariffs
Not required
Minimize
negative
environmental
effects
(infrastructure, emissions, waste)
GHG emission reduction
NO (compliance through
documents and images)
Not required
Not required (the principle
is only a recommendation)
Not required (the principle
is only a recommendation)
Not required (the principle
is only a recommendation
and merely indicative)
GHG emission reduction
(it does not require a
calculation methodology)
Production should not
come from areas of high
biodiversity value and / or
high carbon content but
there are different criteria
to identify those areas
Not required
Yes
Mass balance
Audit cost + PPA Euros
500/year
Source: www.mercosoja2011.com.ar
153
Annex 6: GEF Tracking Tools (See separate file)
Annex 7: Safeguards (See separate file)
Annex 8: CoFinancing Letters (See separate file)
154
Annex 9: Capacity Scorecards: SEAM and INFONA
DOCUMENT ANALYSIS OF INSTITUTIONAL CAPACITIES
Analysed Institutions: SEAM & INFONA
Indicator
SEAM
INFONA
Capacity Result 1: Capacity to assume environmental commitment (governance?)
Participating officials mention For this indicator, the leaders of
Indicator 1
Degree of legitimacy / that SEAM is not currently INFONA mention that they are
weigh/mandate
force
of recognized as a leading instance identified as an instance leading
environmental organizations
in aspects of natural resource conservation
and
sustainable
conservation and sustainable management of forest resources,
management. Its image is which does not mean that they are
greatly affected by deficient recognized in that role and
management
events,
and competence. Call themselves the
corruption. It auto assigned a qualifications 1. 33.3%
high rating of (0) 0%
Measures
and
institutional Even though measures
and
Indicator 2
Existence of co-operative mechanisms for the conservation institutional mechanisms for the
management mechanisms
of natural resources laws, conservation of natural resources
decrees
and
environmental with forestry emphasis as laws,
resolutions
need
to
be decrees
and
environmental
strengthened and adjust for their resolutions exist and are applied,
application. Points assigned (1). they need to be strengthened. Mark
33.3%
allocated (2)
Public-public
cooperation, Public-public cooperation, mainly
Indicator 3
Existence of cooperation with mainly with INFONA and MAG with the SEAM is virtually
groups and stakeholders
is quite precarious, especially nonexistent. Overlapping of roles
with the first. Overlapping of and competencies are observed.
roles and responsibilities are When it comes to coordination with
observed When it comes SEAM the private sector it is also
coordinating with the private unsatisfactory. Mark allocation (1)
sector it is almost nonexistent. 33.3%
Mark allocation (1) 33.3%
Capacity Result 2: Capacity to generate, access and use information and knowledge
There is low environmental There is low environmental
Indicator 4
Degree
of
environmental awareness at all levels of awareness at all levels of
awareness of stakeholders
population
groups
and population groups and institutional
institutions. Mark 1 - 33.3%
public and private sectors. Mark 1 33.3%
The exchange of information The exchange of information (laws,
Indicator 5
Access and exchange of (laws, rules, regulations), in rules, regulations), in relation to the
environmental
information relation to the conservation of conservation of natural resources in
among stakeholders
natural
resources
with production sectors is minimal.
production sectors is minimal. Environmental information / forest
Needs
of
environmental is partially available and shared
information are identified but among stakeholders, but the
the management infrastructure is information
management
and
insufficient (1) - 33.3%
infrastructure to manage and have
access to public information is
limited (2)
The existence of environmental There are environmental education
Indicator 6
Existence of environmental education program is virtually programs regarding management of
education program
nonexistent. Mark (0).
forests, reforestation with key
stakeholders but they are partially
developed and implemented. (1)
33.3%
The articulation, coordination Research needs for development of
Indicator 7
Extend the environmental link between environmental policy environmental policy / forest /
between research / science and and agricultural research is agricultural
are
precariously
155
Indicator
development policy
SEAM
practically nonexistent. Mark (0)
INFONA
identified but they are not
translated into relevant strategies
and effective research programs.
(1) 33.3%
Traditional and/or ancestral The process with the support of UN
Indicator 8
Widen inclusion / use of knowledge,
for
making REDD it is just starting, where
traditional
knowledge
in environmental policy decisions traditional knowledge is identified
making
environmental are not taken into account. (0)
and recognized as important, but
decisions
not collected and used in the
relevant processes of participatory
decision-making (1), 33.3%
Capacity Result 3: Capacities for strategy development, policy and legislation
Suitable
environmental Suitable environmental strategies
Indicator 9
Extend environmental planning strategies and plans are partially and plans are produced partially but
and strategy development produced but only partially only partially implemented due to a
process
implemented due to various variety of constraints including
constraints including financial financial and / or other problems.
and/or other problems such as (2) 66.7%
lack of human resources, among
others. (2) 66.7%
The regulatory framework for The regulatory framework for
Indicator 10
Existence of an adequate environmental/forest
environmental/forest/agricultural
environmental policy and /agricultural
policy
and policy and environmental policy in
regulatory frameworks
environmental
laws
and force are adequate, existing
regulations
in
force
are environmental
laws
and
environmentally adequate but environmental policy, but there are
there
are
problems
in problems in implementation and
implementation
and enforcement. (2) 66.7%
enforcement. (2) 66.7%
Relevant
environmental Relevant
environmental
Indicator 11
Adjustment of
available information is available for information is available for
environmental information for environmental decision making, environmental decision making, but
decision making
but the process of updating this the process of updating this
information does not work information
does
not
work
properly. (2) 66.7%
properly. (2) 66.7%
Capacity Result 4: Capacities Management and implementation
The resource requirements are Las necesidades de recursos son
Indicator 12
Existence and mobilization of known but are not being conocidos pero no se están
resources
managed properly or are not a abordando. (1) 33,3%
priority
for
managers
responsible for the budget. (1)
33.3%
The skills and technologies The skills and technologies
Indicator 13
Technical
skills
and required are available but required are partially available but
technology
transfer
are require resources strengthening. require resources strengthening. (2)
required
(2) 66.7%
66.7%
Capacidad Resultado 5: Las capacidades de monitoreo y evaluación
There is a monitoring and Regular results monitoring is
Indicator 14
Adjustment process monitoring evaluation system but it is not carried out, but needs to be
of project / program
applied and no one responds to strengthened, this information is
the system.
used only partially by the team
project
/
program.
Besides
participatory monitoring is not
performed. (2) 66.7%
There is an evaluation plan, but Evaluations are carried
out
Indicator 15
Adjustment of
assessment evaluation
activities
are according to a monitoring system
process project / program
conducted irregularly (1) 33.3% integrated to the Ministry of
Finance. This allowed progress on
the issue and developed an
156
Indicator
Meaning of colors related to qualifications.
CERO
SEAM
INFONA
interesting learning process. (2)
66.7%
ONE
TWO
1. Methodology Applied to Analysis of Capacities: Focal Groups with both institutions
with participation of the main referents and decision makers of the directions that will
be related to the Project.
2. Capacities and Results
i) CR 1: Capacities to fulfill commitment.
An institutional weakness to on the commitment of the environmental management is observed
as well as a limited legitimate governance of SEAM and INFONA. Although referents from this
last one have self-assessed better than the first one, both admit that they lack of the strength of
political legitimacy in front of the people, the productive and environmental sector and the
articulation and cooperation with the diversity of players as well.
Referents from SEAM and INFONA mention that there is a confusion of roles and
responsibilities. Referents from SEAM admit that there is no institutional leadership and even
its own authorities do not fully understand and are not familiar with the institution duties and
competences “To 98% of the population we are and behave as a police officer who has to
punish. That is something that has to be changed, and that each actor, such as municipalities,
have to take over their roles, education is needed rather than punishment”. They also highlight
that "There is a lack of information addressed to the entrepreneur, who does not know which
project he is getting in. And nobody includes the environmental aspect because it pays off.
There is a lack of communication and information”.
This forces the project to invest in capacity building of both institutions to develop and create an
environment and stage suitable for participative governance and essentially have a
communication plan to disseminate and communicate timely the project actions.
INFONA admits that they have mechanisms of co-operative management although weaknesses
that must be considered remain and work has to be done to eradicate them.
ii) CR 2: Capacity to generate, access and use information and knowledge
In this context, 4 and 5 related indicators point to a low level of awareness and sensitivity
towards the environment stakeholders, impacting also on a low exchange of information and
cooperation (laws, rules, regulations, others.) between the various stakeholders, from public and
private spheres, but essentially of those of actors related to the productive sector in general and
soybean farmers and meat in particular. SEAM and INFONA participants considered that plenty
of work has to be done in the dissemination and awareness in this area, although referents from
INFONA highlight that they currently have a closer relationship with the productive sector due
to its regional offices. However they also highlight a missing National Law land system in
which the vocation of the soil can be considered, in order to prevent loss of natural resources.
Those soils where there is soybean-wheat despite direct seeding are highly degraded by
intensive use of agrochemicals.
Moreover, the results achieved in the analysis of capacities conducted by SEAM referents in the
context of indicators 6, 7 and 8 that refer to the implementation of programs of environmental
education and extension, linkage and cooperation between environmental policies and those of
research and extension, and the consideration and inclusion of knowledge and potential of
territories such as ancestral and peasant cultures respectively, are virtually nonexistent or null.
They mention that a lack of Social-Environmental Responsibility policy from big producers
toward human settlements that surround them, but there are notable exceptions exclusion.
However, for the INFONA, its position in relation to these indicators is emerging, and in
157
relation to some like articulation with indigenous people and consideration of their culture is
done through the UN REDD project and they see it as a great potential to develop.
INFONA referents are aware of the lack of coordination in the territory, and they propose the
creation of a stage of proceedings from the government as the main articulator and then
strengthen it, so that the secretariats of the government of environment and agriculture can
actually work. They propose to consider and use institutional capacities and existing spaces
without creating anything unsustainable, these are learned lessons that should be considered they point.
iii) CR 3: Capacities for strategy development, policy and legislation.
Analysis of capabilities in relation to indicators 9, 10 and 11 regarding policy existence and
policy planning related to the environment, their strategies and regulatory frameworks, and
finally the adjustment of environmental information available for decision-making, both
participants by SEAM and INFONA emphasize that by 67%, these capabilities are met. (2).
Strengthen and improve their management and implementation is what is missing. It is the
highest ranked result.
iv) CR 4: Capacities Implementation and Management
As mentioned above, is regarding management and implementation of environmental policies
where both instances (SEAM and INFONA) observe weaknesses specially when analyzing the
availability and mobilization of financial and logistical resources to fulfill their roles and duties.
SEAM referents point that they face huge weaknesses mainly in the budget which impacts its
ability to fulfill its own role and competence required by law. They highlight that they have no
resources for the implementation of this project. When analyzing the technical skills and
technology transfer both institutions qualify that by 67 % they do have the capacity to do so, but
they still need improvement in updating and strengthening their civil capacities both nationally
and internationally. Meanwhile INFONA request updating its Human Talents in instruments
and upgraded systems to efficiently develop their duties, Certification, Chain of Custody,
sustainable management of native forest based on Paraguayan role models that need to be
spread out and basically work on the de-bureaucratization of services.
v) CR 5: Monitoring and assessment capacities
Regarding the state of capabilities of both institutions to monitor and assess the actions of
implementing its policies and instruments, SEAM mentioned that despite having a Directorate
for Planning and Evaluation and also an Strategic Plan, this is not considered; they just annually
plan their actions that are written in a POA (Annual Operative Plan) but for monitoring they
lack of institutional strength since the others are general directions. They do not do participatory
monitoring either. They also highlight that municipalities should be train in order to facilitate
monitoring, in the same way to the Governments through Directorate of Decentralization and it
should be clear on what and how to monitor, municipalities should promote land use planning,
this essential.
Each municipality may have an environmental department; municipalities provide certificates of
location of projects and should also follow them up.
The INFONA develops a very interesting experience as part of the Operating Plan SIMEP. It is
integrated to STP monitoring system and that of the Ministry of Finance. They are
implementing a computerized monitoring system, however Participatory monitoring is not
performed. It is emphasized that monitoring should be systematic, efficient and timely so that
the institutions can be efficient and for that reason the project must invest in strengthening the
capacity of monitoring and evaluation units, provide equipment, imaging technology, among
other
3. General Conclusion
In no case, the highest rating, that is 3, was observed, this fact shows the great existing need for
capacity building at both institutions in all the indicators analyzed. INFONA assessed itself as
158
more skilled in some of them. The following aspects were generally emphasized at all times as
the greatest weaknesses and barriers for the new project:
 Lack of adequate budget,
 Very few strengthening and updating of human capital, although in parallel it was
mentioned as the highest potential (SEAM
 Confusion and overlapping of roles and responsibilities between the instances related to
the environment,
 the lack of regulation and updating (adjustment) of some laws
 Almost no coordination and cooperation at public and private institutions in the
territories.
159
Annex 10: Letter of Agreement – Spanish version (LoA)
160
161
162
163
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