Economic Analysis

The project, developed by IIS, focuses on sustainable rural development in the Paraitinga River Basin (São Paulo) using multicriteria analysis, as well as a diagnosis of the main land uses and ecosystem services of the region. The goal is to propose alternatives production activities and public policies, such as long-term sustainable land use activities, as well as the social inclusion of producers in the region through increasing the competitiveness of their products.

The project works to understand implementation challenges focusing on financial requirements, management of potential risks, and financing mechanisms. It focuses both at the producer level by investigating financial needs, as well as at the broader level of execution by discussing possible and viable financing mechanisms. This is an international initiative with projects in Latin America, Africa and Southeast Asia. IIS coordinated the analysis for Brazil, focusing on the state of Mato Grosso. In this study, we employ the concept of "Land-Neutral Agricultural Expansion" (Strassburg, 2012), which guides farmers in agricultural expansion with no direct or indirect impacts on natural environments. Under the context of avoided deforestation-related incentives, this mechanism allows those who implement it to claim avoided deforestation credits. In the absence of such a mechanism, it can still be used to demonstrate commitment to sustainability goals, either to gain access to specific markets or to meet their or their partner's commitment to sustainability.