Sociedad Civil para el Desarrollo Árbol Verde (SCDAV)

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1 CFEs in Tropical Forest Countries, ITTO, Forest Trends and RRI Sociedad Civil para el Desarrollo Árbol Verde (SCDAV) Case Study from Petén, Guatemala Dietmar Stoian & Aldo Rodas CATIE-CeCoEco

2 History of the Enterprise Emergence of the Enterprise in response to the changes in the political and legal frameworks for forest use in the Peten opportunities provided through forest concession process in the multiple use zone of the Maya Biosphere Reserve at the end of the 1990s nine forest-based communities become organized in 1992 Sociedad Civil para el Desarrollo Árbol Verde (SCDAV) founded on February 7, 1998 concession of 64, ha awarded in 1999 forest utilization initiates in 2000 forest certification obtained in 2002 sawmilling initiates in 2002

3 Organizational Structure (1) Leadership Administrator (A), administrative assistant and secretarial support Structure and Governance General Assembly (GA): all members entitled to vote on major decisions and elect BoD Board of Directors (BoD): president, secretary, treasurer, and four other members meet at least every three months to coordinate and guide A Administrator: from within or outside SCDAV Units for forest management, sawmilling, and hotel & restaurant First tier association (member of FORESCOM) Membership and size 344 members ( : 85% vs. : 15%; 94% mestizo vrs. 6% indigenous) from 9 communities

4 Organizational Structure (2) Decision-making structure Administrator consults BoD for major decisions; BoD reports to GA As concessionaire also needs to report to National Council of Protected Areas (CONAP) Legal constitution: SCDAV as civil society association; 25-year community concession (renewable) Membership of FORESCOM: second-tier community forest enterprise with 11 first- tier CFEs Contract with local private industry through FORESCOM for milling of lesser-known species

5 Organizational chart External Auditing General Assembly Board of Directors FORESCOM representation Vigilance Commission Administrator Hotel & Restaurant Administrative Unit Processing Unit Forest Management Unit

6 Location of forest concession in the MBR

7 Economics of the Enterprise (1) Forest Area Concession of 64, ha (33, ha production forest; 31, ha protection forest) Principal timber products ( ) Mahogany: 4173 m³ (46.1%) Manchiche: 1410 m³ (16.2%) Santa María: 1138 m³ (12.6%) Tropical cedar: 782 m³ (8.6%) Tempisque: 473 m³ (5.2%) Principal non-timber forest products Camedor palm or xate (Chamaedorea spp.) Gum or chicle (Manilkarazapota) Allspice or pimienta gorda (Pimentadioica) Bayal (Desmoncus spp.)

8 Economics of the Enterprise (2) Production figures, Year Annually allowable area (ha) Extracted volume (m³) Density of extraction (m³/ha) Allowed Extracted Allowed Extracted ,000 2, , ,000 1, , , ,000 1, , , ,438 1, , Total 6,685 9, , Source: CONAP, Forest Department

9 Economics of the Enterprise (3) Sales Sales contracts for mahogany and tropical cedar (processed by SCDAV) with US-based companies (e.g., Rex Lumber Company or, more recently, Gibson Guitars through FORESCOM) 1 st quality sawn wood of certified mahogany fetches highest price: from US$890/m³ in 2000 to US$1,760/m³ in 2006 Lesser-known species (2-3 per year out of a total of 18) principally sold in domestic or Mexican market: prices vary (US$ /m³) Recent advances in sales of three LKS (manchiche, santa maría and pucté) processed by local private industry and sold through FORESCOM or independently (US$ /m³)

10 Economics of the Enterprise (4) Employment 30 persons in timber extraction (January-April) 5-10 persons in sawmilling of precious woods (mahogany, tropical cedar) and a total of 14 lesser-known species (May-June/July) Full or part-time employment for 19 staff, including administrator, administrative officer, administrative assistant, secretary, forest resource manager, forest technician, hotel & restaurant staff, and forest guards 5-6 staff in hotel & restaurant in Ixlú 3-5 staff in carpentry project (from 2007 on)

11 Economics of the Enterprise (5) Technical Professionals ACOFOP instrumental for community organization and progress in certification process Initially technical assistance by NGOs (NPV, ACODES, Centro Maya) and projects (BIOFOR/ USAID), in particular in quality management Training in carpentry, communal management and communal forest management (INTECAP, Helvetas) Further support through ACOFOP, ACICAFOC, Univ. of San Carlos, Rainforest Alliance, CONAP Forest Resource Manager oversees technicians in charge of logging operations and sawmilling Operations Manager/Administrator requested by SmartWood (certification condition) recently hired

12 Economics of the Enterprise (6) Profitability of different product lines Processing of mahogany and tropical cedar profitable Precious woods subsidize processing of LKS (number of utilized LKS dropped from 15 in 2000 to 2 in 2006) Average cost of sawmilling (2003): US$ 310/m³ Certification mandatory in multiple use zone of the Maya Biosphere Reserve Certification imposes additional costs but brings about benefits for the commercialization of mahogany, tropical cedar, manchiche, santa maría and pucté Group certification with FORESCOM (resource manager of 11 community concessions) helps diminishing certification cost

13 Internal and External Barriers (1) Market Barriers Demand for precious woods (mahogany, tropical cedar) outstrips local supply Difficulties to market lesser-known species profitably (though recent advances with manchiche, santa maría and pucté) Certification helps market precious woods, but less so lesser-known species

14 Internal and External Barriers (2) Internal Barriers Technical and managerial capacities still limited Planning deficient (no strategic or business plan, but recent advances with five-year planning) Blend between social organization and enterprise Payment of dividends despite restricted liquidity Unclear investment policy Changes in board of directors lead to discontinued development processes Employment effect limited to a relatively small number of members; mostly part-time and/or seasonal employment Stricter market orientation required for local production of sawn wood

15 Internal and External Barriers (3) Regulatory Barriers No land titles, only usufruct rights Concession period 25 years (though renewable) Mandatory certification (but perceived positive; group certification helps reduce costs) CONAP as governmental agency with a strong say on what happens in the multiple use zone of the MBR (though also providing certain services) Illegal logging causes unfair competition (lacking law enforcement)

16 Non-financial Benefit Streams (1) Social Benefits Targeted to designate 30% of utilities to social investments (though rarely fulfilled) Employment perceived as social benefit (despite its seasonal character) Financial assistance for funerals (US$ 650) Participatory decision making process (General Assembly as principal forum) Environmental Benefits Less incidence of forest fires Generally better conservation of forest resources

17 Non-financial Benefit Streams (2) Important Trends Link with second-tier organization (FORESCOM) for group certification, resource manager scheme, and commercialization Product diversification: inclusion of three new LKS (manchiche, santa maría and pucté) FORESCOM about to install own processing facilities for lesser-known species (primarily manchiche, santa maría and pucté) Hotel & restaurant, with potential to serve as convention center and starting point for ecological and archaeological tours