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While logging has taken place in the Amazon for over 300 years, starting in the 1960s it showed a significant boost with the development of highways through the forest.[1] By the 1980s, as a result of government incentives promoting agriculture, mining and timber extraction, a model of predatory, extensive and unplanned logging was consolidated as the result of the deforestation associated these incentivized activities.[2],[3]

It was in the context of unprecedented deforestation and land grabbing[4] that, in 2006, the Public Forest Management Law (Lei de Gestão de Florestas Públicas – LGFP)[5] was enacted to ensure the sustainable use of Brazilian public forests, especially in the Amazon, through the implementation of a forest concession system in Brazil.

International experiences with forest concessions had not been largely successful in most cases, either because the environmental variable was not present or because governments failed in supervision and monitoring activities.[6] In Brazil, the forest concession, implemented by LGFP, sought to distance itself from these experiences by reconciling environmental protection with the profitable private exploitation of natural resources, serving as a deterrent against land grabbing.

Despite the law being widely celebrated and generating high expectations, federal concessions of public forests in the Amazon fell short of expectations and currently only cover the extraction of timber in about 1.3 million hectares. In 2006, when the LGFP was enacted, the federal government aimed to concede four million hectares of forest by 2010.[7] State concessions in the Amazon have progressed even more slowly: only 551,000 hectares are under exploration in just two states—Pará and Amapá.

Various causes have been attributed to this modest growth, including competition with the illegal market, legal disputes arising from the presence of indigenous peoples and traditional communities in concession areas, and the issuance of concessions lacking economic viability.[8] However, the findings of this study indicate that fragilities in the governance may be a significant limiting factor.

In this publication, researchers from Climate Policy Initiative/Pontifical Catholic University of Rio de Janeiro (CPI/PUC-Rio) present the evolution of forest concessions in the Amazon and then delve into concessions in Pará, a pioneering state in the sector. The detailed analysis of the concession procedures in Pará, supplemented by interviews with market representatives, allows for the identification of governance concerns and draws lessons that go beyond the state level to help advance the agenda of forest concessions in the Amazon region.

The analysis identified situations in Pará involving (i) the cancellation of bids—i.e., half of the bids held in the state, (ii) non-concession of areas, and (iii) termination of concession contracts. A total of 17 attempts to concede an area for state concessions in Pará were recorded, counting repeated occasions where the same area was conceded, not conceded, or had its contract terminated. This translates to a success rate of 53% in the long term, taking into account the number of existing contracts as a parameter, as opposed to the number of vacant areas due to non-concession or contract termination.

The cancellation of bids seems to be caused by basic errors in the preparation of call for proposal documents, indicating limited capacity of the agencies responsible for managing the concessions. The non-concession of some areas may be caused by the low qualification of some concessionaire candidates, the prolongation of bids, and restrictions on the quantity and total area that can be conceded to a single company. Finally, contract termination may be caused by non-compliance with the qualification and regularity conditions of companies, the terms of proposals, and forest and labor management norms.

At a time when the LGFP has been reformed to allow the trading of carbon credits and to make it possible to include new types of environmental services as the object of concessions, these points of concern become even more relevant due to the increasing complexity of this public forest management model. Improvements in governance must be implemented for concessions to solidify as sustainable business models.

Recommendations

Eliminate legal restrictions on the quantity and total area that can be conceded to a single company to allow more qualified companies to scale up by obtaining more concessions and the possibility to operate in larger areas, without prejudice to the application of general bidding standards.

Improve the training of public officials responsible for forest concession management to enhance the quality of bidding procedures through improvements, such as in the accuracy of preliminary concession studies and in the models of calls for proposal and contracts.


The authors would like to thank João Pedro Arbache and Gustavo Pinto for preparing the figures illustrating the section on the evolution of forest concessions in the Amazon. We would also like to thank Giovanna de Miranda, Camila Calado, and Letícia Miranda for the editing and revision of the text, and Nina Oswald Vieira and Meyrele Nascimento for formatting and graphic design.


[1] Becker, Bertha K. “Revisão das políticas de ocupação da Amazônia: é possível identificar modelos para projetar cenários?” Parcerias Estratégicas, no. 12 (2001): 135-159. bit.ly/3FDv2bi.

[2] Pasquis, Richard et al. “’Reforma Agrária’ na Amazônia: balanço e perspectivas”. Cadernos de Ciência e Tecnologia 22, no. 1 (2005): 83-96. bit.ly/40g2C0o.

[3] Valdiones, Ana Paula et al. A Evolução do setor madeireiro na Amazônia entre 1980 e 2020 e as oportunidades para o seu desenvolvimento inclusivo e sustentável na próxima década. Belém: Imazon, Imaflora, ICV, and Idesam, 2022. bit.ly/3QBpp3s.

[4] Loureiro, Violeta R. and Jax N. A. Pinto. “A questão fundiária na Amazônia”. Estudos Avançados 19, no. 54 (2005): 77-98. bit.ly/3QkUp6y.

[5] Law no. 11,284, March 2, 2006 – Deals with the management of public forests for sustainable production. bit.ly/3s9ocHt.

[6] Lopes, Cristina L. “A tutela jurídica das florestas brasileiras: da colônia à Lei de Gestão de Florestas Públicas”. Monography, Pontifical Catholic University of Rio de Janeiro, 2006.

[7] Ribeiro, Aline. Os inquilinos da Amazônia. Época. 2011. Access date: October 25, 2023. bit.ly/3QbEqrs.

[8] Instituto Escolhas. Destravando a agenda da Bioeconomia: soluções para impulsionar as concessões florestais no Brasil. São Paulo, 2020. bit.ly/3QCltj6.

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