Principal investigator: Eduarda Miller Figueiredo
Location of the Intervention: Brazil
Sample Size: 350 farms
Sector: Environment
Primary Variable of Interest:
Type of Intervention: Information, technical assistance, credit and payment.
Methodology: Another
The Brazilian government is simultaneously seeking ways to reduce emissions from agricultural changes and ensure the livelihood and well-being of rural producers. The Low Carbon Agriculture Plan was launched as a strategy to reduce greenhouse gas emissions using a low-interest rural credit line that encourages the implementation of good agricultural practices. The Sustainable Rural Project promotes low-carbon agricultural technologies aimed at small and medium-sized farmers. Through these programs, the goal is to motivate farmers on private land to adopt good agricultural practices that will help mitigate climate change.
Policy Problem
In Brazil, agricultural production is responsible for 32% of domestic greenhouse gas emissions, and this production is estimated to increase in the coming decades. This increase is supported by the United Nations Framework Convention on Climate Change (UNFCCC).[1] and by the Food and Agriculture Organization of the United Nations (FAO)[2]This is because it will help the national economy, meet the growing international demand for food, and the country has committed to achieving this increase in agricultural production in a sustainable way.
Therefore, the Brazilian government, as well as donor agencies, banks, and NGOs, are seeking ways to reduce emissions from agricultural and land-use changes, while simultaneously ensuring the livelihoods and well-being of rural producers.
Implementation and Evaluation Context
The Low Carbon Agriculture Plan (ABC Plan) was launched in 2010 as a strategy to reduce greenhouse gas emissions. This plan is a new rural credit line with low interest rates intended to finance the implementation of good agricultural practices that contribute to mitigating and adapting to climate change through the reduction of greenhouse gas emissions and/or carbon sequestration.
In Brazil, low-carbon agricultural practices include the restoration of degraded forest areas, the development of commercial planted forests, the management of natural forests, the development of integrated crop-livestock-forestry systems, as well as non-forest technologies for the restoration of degraded pastures, biological nitrogen fixation, no-till farming, and manure management.
Policy/Program Details
Through loans from the ABC Program, more than R$ 13,2 billion reais were loaned to rural producers (MAPA, 2016). However, the amounts loaned in 2015-2016 were 45% lower than in 2014-2015, and this slowdown in the use of the program may be due to: (i) an increase in credit interest rates from 5% to 8% (on average); and/or (ii) the availability of other credit lines that do not focus on low-carbon agricultural technologies but have lower interest rates. This indicates that Brazil will fall short of the stated targets for Nationally Appropriate Mitigation Actions.[3] 2020 up.
The Sustainable Rural Project promotes low-carbon agriculture, including forest restoration and management, through a set of mechanisms that help overcome barriers to participation in the ABC Plan and the ABC credit program. It facilitates access to information, assistance, rural credit, and financial incentives.
The project creates conditions for different mechanistic approaches to interact and thus complement each other. Since information, technical assistance, rural credit, and financial incentives are necessary, but individually insufficient to stimulate behavioral changes in rural producers, a project that cohesively includes all four of these points may be more successful than actions that promote only one or two of these approaches.
Method
The Sustainable Rural Project, initiated in 2013, aims to reduce greenhouse gas emissions, alleviate poverty, and promote rural development. It promotes four low-carbon agricultural technologies involving forest restoration or management. The project targets small and medium-sized farmers in 70 municipalities across the following Brazilian states: Pará, Mato Grosso, Rondônia, Bahia, Minas Gerais, Paraná, and Rio Grande do Sul. This project is funded by the International Climate Fund.[4] and the UK Department for Environment and Rural Affairs[5], being implemented by the Inter-American Development Bank (IDB)[6].
Through a public call, a number of farms were identified in the seven states of the project, designating them as Demonstration Units (DUs).[7]In these farms, one of the four low-carbon technologies of the project had already been implemented, regardless of the project itself. “Field days” were organized in the DUs (Development Units), where interested farmers were invited to observe and learn about the process and benefits of implementing these technologies. This disseminated information about the opportunities associated with the Low Carbon Agriculture Plan and Program (ABC). Therefore, the project aims to establish 350 DUs in the seven Brazilian states that will host 2.600 “field days.” Project participants can access training opportunities during the “field days” through online courses and information available on the website.
Farmers may be reluctant to take the risk of adopting new, unfamiliar practices; therefore, the project offers results-based payments to teams of rural extension agents whose proposals are approved and successfully implemented. Since payment depends on success, it will generate motivation for both parties to continue the collaboration until completion.
Main results
The central component of the Sustainable Rural project is to encourage teams of farmers and extension workers to jointly develop and submit proposals that, if funded, would allow the implementation of one or more low-carbon agricultural technologies on the farmer's property. These proposals must be eligible for a loan from the ABC Program, aiming to leverage their main funding. Farms that successfully implement a proposal are called Multiplication Units (MUs), with the project aiming to establish ten times more MUs than DUs.
All four low-carbon agricultural technologies promoted by the project involve forest restoration or management. In this way, the project can contribute to forest restoration and management efforts among small and medium-sized farmers on private Brazilian lands. Thus, restoration and management can generate both private and public benefits. Forest restoration can provide access to natural resources (such as food, firewood, and timber), restore or maintain ecosystem services, and lead to more diversified livelihoods. Furthermore, such restoration helps farmers comply with the Brazilian Forest Code.
Finally, large-scale forest restoration will contribute to Brazil achieving its climate change mitigation and adaptation goals, which include a target of 20 million hectares of reforestation. Similarly, it is important to emphasize that forest restoration and the planting of commercial forests on degraded lands also offer significant potential for carbon sequestration.
Embrapa, the Brazilian agricultural research company, is leading the research on the project's outcomes. Therefore, the authors emphasize that some uncertainty remains regarding the scale of the project's impacts.
Lessons in Public Policy
Large-scale forest restoration on private land presents a challenge given the large number of farmers required to implement it; therefore, the project's success depends on convincing farmers to change their farming practices. However, if the combination of information, technical assistance, credit, and results-based payment is sufficient to motivate a significant number of farmers to adopt low-carbon agriculture, the project will generate important lessons on combining governance interventions for environmental and socioeconomic development.
References
MAPA (2016). ABC Program released R$ 2 billion in credit in the 2015/2016 crop year. Ministry of Agriculture, Livestock and Supply. Available at: http://www.agricultura.gov.br/comunicacao/noticias/2016/08/programa-abc-liberou-rs-2-bi-em-credito-no-ano-safra-20152016
[1] United Nations Framework Convention on Climate Change.
[2] Food and Agriculture Organization of the United Nations.
[3] Nationally Appropriate Mitigation Actions.
[4] International Climate Fund.
[5] UK's Department of Environment and Rural Affairs (Defra).
[6] Inter-American Development Bank.
[7] Demonstration Units.
