Jes Weigelt:
Sustainable Financing of Natural Resource Management -- An Example from the Brazilian Amazon and Implications for the German Bilateral Development Assistance


Freie Universität Berlin, Department of Geography, Germany

Protected areas are an important means for the sustainable management of natural resources, as they prevent ecosystems from being transformed. The management of protected areas causes recurrent costs irrespective of whether they are managed by park administrations or the communities living inside them. Due to the nature of protected areas, recurrent costs occur for very long periods of time. On a global level, insecurity of resources to finance recurrent costs threatens the sustainability of protected areas. Financial resources to cover the recurrent costs of protected areas can be administered by different types of institutions. Commonly, those resources are administered by the state. An alternative type of institution is an environmental fund, which is a specialised institution administering and disbursing financial resources for environment policy measures. This paper compares these types of institutions using the following two criteria: security of financing and community participation. A theoretical analysis of these types of institutions suggests that environmental funds are more suitable for administering recurrent costs of protected areas. Given budgetary constraints of many governments in developing countries, earmarking financial resources for environmental purposes is an advantage of environmental funds. Furthermore many environmental funds have institutionalised participatory structures enabling local communities living in or nearby protected areas to influence decisions on the use of these financial resources. Conversely, in many parts of the world government agencies are characterised by a top-down approach in decision making. As participation is highly important in order to identify appropriate solutions, environmental funds are preferable to government agencies. Protected areas in Brazil can be divided into two categories: protected areas administered by park administrations and protected areas managed by local communities. In areas of high deforestation in the Brazilian Amazon only the latter type of protected area effectively preserves the rain forest. This underlines the importance of establishing an institution with participatory structures to administer the funds used to finance protected areas in the Brazilian Amazon. Currently, budgetary regulations for bilateral development assistance in Germany do not allow using development assistance resources to finance environmental funds. Given the findings above, these regulations should be amended.

Keywords: Brazil, environmental funds, protected areas, sustainable financing


Contact Address: Jes Weigelt, Freie Universität Berlin, Department of GeographyKrefelder Straße 8, 10555 Berlin, Germany, e-mail:
Andreas Deininger, September 2004