Aug. 22, 2006: In a remote region of northern Ecuador, the indigenous Chachi community of El Encanto recently denied a logging company the right to harvest timber on traditional land.

The option to reject an immediate payoff for selling timber concessions exists because of the Gran Reserva Chachi – a 7,000-hectare protected area in the Tumbes-Chocó-Magdalena Biodiversity Hotspot that includes El Encanto and two other Chachi communities.

Economic Gains From Intact Forests
A pilot project that entered its second year in May, the Gran Reserva Chachi resulted from a partnership of international, Ecuadorian, and local groups to protect tropical forest from large-scale commercial logging and clear-cutting for oil palm plantations.

The Chachi people traditionally were hunter-gatherers who now also take part in agriculture. Despite unregulated economic activity in past decades, Chachi communities in the region have faced intense poverty. As holders of legal title to the majority of the intact forest, they decided to work with several partners to conserve biodiversity while providing economic and social benefits for their people.

The project includes a conservation agreement that provides communities with a direct economic benefit for their role in environmental stewardship.

"We recognized that in this context, there is a cost to the communities for doing conservation – losing income from logging or hunting in the reserve, for example – so we worked together to design an agreement that makes conservation economically beneficial through providing a direct payment based on the provision of conservation itself," says Aaron Bruner, CI's director of conservation incentives and protected areas financing.

Part Protected Area, Part Buffer Zone
The Gran Reserva Chachi increases protection of species dependent on its unique ecosystem, such as the Endangered Ecuadorian sac-winged bat (Balantiopteryx infusca) and the Vulnerable long-wattled umbrellabird (Cephalopterus penduliger). The reserve also creates a protective buffer zone for the neighboring 494,000-acre Reserva Ecologica Cotacachi-Cayapas (RECC).

Participatory From the Start
In 2004, the three local Chachi communities collaborated with two partners, Conservation International (CI) and Die Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) – a company owned by the German government dedicated to sustainable development – on preliminary planning, eventually agreeing to the reserve's borders and permitted uses. They also settled on compensation of $5 per hectare per year paid by the CI/GTZ project into a fund that communities allocate for their priority needs.

"Every phase of reserve creation was participatory," said Christian Terán, GTZ's Gran Reserva Chachi project coordinator. "Assemblies representing each of the three communities invited us to work with them in the first place. Together, we designed a protected area that would be viable and attractive for the community, as well as potentially attractive to funders."

It's Already Paying Off
The community fund has paid for school supplies and medicines, technical assistance and tools for planting shade-grown cocoa, and other activities. It also supports community-specific projects: In Capuli, a new running water system prevented women from having to draw water from rivers, while a group of women in El Encanto set up a gas station and residents in Corriente Grande opened a general store.

"The project itself has been very good because it has generated economic resources," says Raul Freire, a community leader in Corriente Grande. "Before, people didn't even have school supplies or financial support for their festivities. Now they have the chance to invest in some things that generate some economic benefits."

"This project is an excellent example of collaboration between indigenous communities and national and international organizations," adds Luis Suarez, CI-Ecuador's executive director. "Successful implementation here will help pilot a model for collaboration that could be valuable around the world."

Long-Term Partners
The U.S. Agency for International Development's Conservation of Managed Indigenous Areas project is helping create and raise funds to endow a $2 million trust fund that will cover the long-term costs of the reserve.

Additional partners in the project include the Fundación Ecuatoriana de Estudios Ecológicos (EcoCiencia), a local nongovernmental organization. The Critical Ecosystem Partnership Fund (CEPF) and Global Conservation Fund (GCF), along with the GTZ and CI, provided financial support for creating the reserve and developing a management strategy.

Related Links:
> CI: Conservation Strategies: CI and Indigenous People
> CEPF: Tackling Conservation With the Chachi
> CI: Conservation Programs: Economic Incentives
> Hotspots: Tumbes-Chocó-Magdalena Biodiversity Hotspot
> CEPF: Ecosystem Profile: Tumbes-Chocó-Magdalena
> CELB: Places: Ecuador
> Web: Critical Ecosystem Partnership Fund (CEPF)
> Web: Global Conservation Fund (GCF)
> Web: Die Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ)

Die Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) provides viable, forward-looking solutions for political, economic, ecological and social development in a globalized world. We support complex reforms and change processes. All our activities are geared to improving people's living conditions and prospects on a sustainable basis.

The Global Conservation Fund (GCF) is the first major fund designed to quickly mobilize financial resources to finance the creation, expansion and long-term management of protected areas in the world's biodiversity hotspots, high biodiversity wilderness areas and important marine regions.

The Critical Ecosystem Partnership Fund (CEPF) is a joint initiative of Conservation International, the Global Environment Facility, the Government of Japan, the John D. and Catherine T. MacArthur Foundation, and the World Bank. As one of the founding partners, CI administers this global grant-making program that seeks to enable conservation action by partners and build capacity for sustainability. CEPF has provided support to more than 600 partners working to conserve biodiversity hotspots, the Earth's biologically richest and most endangered regions.