Development model in Guatemalan rainforest is slowing deforestation, but can it last?

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The small furniture factory, littered with pieces of wood and piles of dust, is unassuming enough, but to Iván Arredondo it represents more than just a workshop.

“It's something, isn't it?,” he told Fox News Latino, baring his teeth in a proud smile. “Twenty years ago, what you see here was unthinkable. Wood was being cut without any control, any oversight. And the people were poor. We didn't have education, we didn't have health care, there wasn't even a road to connect us with the rest of the country.”

But now, Arredondo said, “We're taking care of the forest together. Everything's better – our economy, our welfare and the environment.”

While the world scrambles to reach a global solution to climate change as the U.N. Climate Conference in Paris draws to a close this week, this remote corner of Guatemala may hold  a possible solution to deforestation.

Arredondo, a heavy-set man in his early 40s, is the general manager of the La Carmelita cooperative, a community-led business located in a village of 345 people with which it shares a name.

It is surrounded by the dense rain forest of the Maya Biosphere Reserve. A protected jungle area the size of Massachusetts, the reserve covers about a quarter of the northern Guatemalan department of El Petén – which is famous with tourists for its spectacular Mayan ruins, its biodversity and its charming capital city of Flores, situated on an island in the middle of Lake Petén Itza, some 50 miles to the south.

Together with ten other such communities, La Carmelita is part of a unique pilot project that began two decades ago. As the Central American country's 36-year civil war drew to a close in 1994, land concessions were given to the impoverished villagers.

The communities formed small companies that began extracting tropical wood, the rubber-like chicle used as a base for chewing gum and xate, a palm leaf sold mainly as an ornament for homes and flower bouquets.

The goal was to stop the relentless destruction of the region's environment. Sixty years ago, Petén, which takes up almost a third of Guatemala's total land area, was still mostly covered with rainforest.

But Petén, with around 350,000 inhabitants and historically without a strong government presence, fell victim to logging and oil extraction operations – both corporate and illegal ones – and the uncontrolled hack-and-slash deforestation by local farmers.

Today almost 80 percent of the jungle is gone.

“Large corporations would exploit tropical wood without taking into account the damage they inflicted on the environment and the people who lived there”, says Arredondo. “The livelihood of our communities depends almost completely on the forest. Our future was in jeopardy.”

Not so in La Carmelita and the nine other concessions, however. Satellite images show how the deforestation abruptly stops where the concessions begin. It's a remarkable success in a country plagued by poverty, crime and corruption and where little thought is given to environmental preservation.

The business model for the concessions maximizes sustainability rather than profit. The cooperatives have members, not shareholders, who take joint decisions over how the forest ought to be exploited and how the money should be spent.

In La Carmelita’s concession, which covers some 130,000 acres, loggers take care only to cut down trees of a certain age, allowing previously cleared swaths of jungle to restore over the course of several decades.

Moreover, instead of selling the tropical wood directly, it created its own furniture factory, adding value and increasing the community’s income.

Although functioning independently, the concession communities joined forces to form the Association of Forest Communities of Petén (ACOFOP). In 2004, they also set up Forescom, an umbrella company aimed at broadening their market.

The concession communities now sell their finished products to buyers both domestic and foreign, bearing a seal of approval from U.S. NGO, Rainforest Allliance, which is only given to suppliers adhering to strict conditions of sustainability. The communities also hope to generate revenue from ecotourism.

After a bumpy start in the 1990s, when La Carmelita's members had trouble getting used to the democratic model of doing business and, as a result, little money was made, the cooperative is now increasingly successful.

Last year, it made a profit 150,000 quetzales – or around $20,000. It's a modest amount compared to the money regular logging firms rake in, but to the workers of La Carmelita, it's a spectacular success.

Not only do they use the proceeds to bolster the company, they also invest heavily in the village itself. The company finances social welfare, education and health care in La Carmelita and is building a water purification facility.

Thanks to the cooperative, La Carmelita has become self-sufficient as both a business and as a community.

“This used to be a very poor area. There were no schools and no clinics at all, but now that we're able to exploit the forest ourselves, the average income has gone up, and we were able to set up our own school and our own medical facility. It's completely self-sufficient,” Jorge Sosa, a director with ACOFOP, told FNL.

“But the state also benefits,” he added. “The local economy used to be completely informal, but now we're paying taxes.”

A report published last month by the World Resources Institute (WRI), an NGO based in Washington, D.C., pointed out how the Guatemalan concessionary model could serve as an example to the world on how to deal with climate change and deforestation.

The World Resources Institute (WRI), an NGO based in Washington, D.C., investigated both the Guatemalan concessions and a similar model found in Brazil’s indigenous communities in the Amazon, concluded that, in the long run, the economic benefits can be enormous as preserving the forests helps mitigates carbon emissions the harmful effects of climate change.

The WRI estimated that Guatemala stood to benefit up to $800 million over the next two decades by letting the communities manage the exploitation of the rainforest. The potential benefits in the far larger Indigenous Territories of Brazil could be worth a whopping $194 billion.

“Communities in Guatemala and Brazil identify themselves not only economically, but also socially, with the land and forest. They don't see it as a way to make a profit but as a way of life,” Juan Carlos Altamirano, a Mexican economist with the WRI and one of the authors of the report, told FNL. “Indigenous people and local communities only have about one-eighth the property and exploitation rights of forests worldwide – but here we can see they are able to stop deforestation.”

It remains to be seen, however, if the success of these Guatemalan concessions is sustainable. The threat of illegal logging is always present, even if so far the communities have been able to stop it almost completely.

Oil companies are looking to explore possible crude reserves in Petén, while the presence in the region of drug traffickers puts the members of the communities under constant threat.

What’s more, the concessions only last 25 years – the communities will have to renegotiate them over the next five years. And in Guatemala's volatile political climate, renewal is far but certain.

“It is a constant struggle for us”, ACOFOP’s Sosa said. “We have proven the success of our model, but that doesn't mean that our future is guaranteed.”