DM 2003 Project Implementation PROGRESS REPORT [23/07/2004]
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1 DM 2003 Project Implementation PROGRESS REPORT [23/07/2004] I. Background Information DM Project Number and Title Locally made paper and crafts to preserve the rainforests Report Author s Name Kei Otsuki (if different from Team Leader) Total Award US$ 200,000 Amount Disbursed to Date US$ 110,000 (55 % of the Total Award) II. Progress Against Milestones i) List the milestone objectives in the first column as expressed in the Project Agreement. The second column should indicate the current status of each milestone objective. In the third column, please provide quantitative data and qualitative information describing the status of the project against that particular milestone. Milestone Objectives (Copy from the Agreement) 1. Three (3) New Production Groups in different Communities Status (/ In Progress) Descriptive Information on the Status The goal was achieved more than planned since five (5) Groups were formed in this phase: the first Group was already mentioned in the last report, which consist of 15 craftsmen and women who produce objects using Amazon Paper in the municipality of Abaetetuba (This Group, within a month, will be a legal entity of Association). In the same municipality, two more Groups were created: Group of young carpenters who fabricate bases of lampshades from residues of logged timbre of the Region (7 people), and Group of seed-polishers who produce bases, clasps and decorative elements for Amazon Paper products (4 people). In Belém, a new Group of craftsmen and women (6 people) was created for the production of folding screens and other stationary objects. The fifth Group is of ten (10) rural producers in the municipality of Mojú, neighboring municipality of Abaetetuba who work with plantation of curauá (Ananas erectifolius), the base fiber for Amazon Paper. The plantation will guarantee the supply of raw material for Amazon Paper in the middle term. For the plantation, seedlings of excellent quality have been obtained and permanent technical assistance has been given to the producers. Later, these producers will have a capacity for pre-processing to transform curauá leaves into fibers so that they can add 1
2 value to the raw material and still, for Amazon Paper, the principal ingredient with good quality can be secured. In this way, the income in rural areas will be raised and, at the same time, the activities of Cooperative of these producers in Mojú (COOPED) will be strengthened. If we include the Group of eight (8) papermakers who are already producing paper in Amazon Paper Production Unit in Belém, 50 people in total directly receive income and profession through this project. In other words, 50 families are benefited, which equals to approximately 300 indirect beneficiaries (an average size of a household in the Region is six (6)). These results are extremely important since the horizontal productive chain of Amazon Paper, which starts from plantation, preprocessing of fiber and leads to fabrication of paper and different objects, adds significant value to each product along the chain as well as establishing synergies between rural and urban areas with generation of occupation and income. 2. Sample Kits Prepared, 12 new products developed. 1,000 sample kits were prepared for the promotion. Each kit contains 1 box, 1 CD- ROM video, 1 paper sample, 1 small brochure and catalog of the products. The kits are being distributed to buyers including representatives and distributors and at trade fairs as well as possible business partners at local, national and international levels. At the same time, fourteen (14) products were developed and perfected for commercialisation, which can be seen in the new website of the Project ( Invitation card; book cover; CD cover; portrait stand (2 different types); corporate agenda; paper folder; photo album (2 different types); card box with cacao leaf design; memo pad box; letter set (2 different types); pen stand; and scratch pad. The production capacity of these products is 2,000 objects per month. Note that in this phase, we defined 15 types of paper ready for commercialisation among 17 kinds developed so far since there were difficulties in obtaining raw materials for two of these. The 15 different papers are divided into three groups: Paper Year Round, which is produced throughout a year; Paper of 2
3 Harvest, which is produced according to the harvest time of raw materials; and Extraspecial Paper that is only made to order. The production level has reached 6,000 sheets per month. 3. Participation in Fairs, Creation of Amazon Paper Shop. In this phase, we participated in the International Fair of Tourism in the Amazon (FITA) in Belém. We are already registered to participate in the International Fair of Stationaly and Paper Goods (Feira Escolar) 2004 (31 August to 3 September) in São Paulo, which is the biggest paper related trade fair in Brazil. Also, there are some other fairs we are planning to participate together with other sections of POEMAR, in Manaus in September and BioFach in Rio de Janeiro also in September. In this phase, Amazon Paper has also participated in the International Meeting of Rural Microentrepreneurs (1-2 June, invited by the Columbian National Government) in Columbia. It participated in the event organised for Environment Department of the World Bank "Looking to Youth" (3 June) in Washington D.C.and it was present in the Exposition during the International Seminar "South-South-North Dialogue on Natural Fibers" (30 June to 02 July) in Belém, Brazil, which was sponsored by Daimler Chrysler, Federal University of Pará, POEMAR and Pará State Government, and Exposition at the Amazon Bank (5 30 July). As it was explained in the last Progress Report, Amazon Paper shop will not be opened now. 4. Improvement of Web site In Progress The website of Amazon Paper was reformed and systematically improved for its actualization. All the products commercialised in the Project were posted on the website, both in Portuguese and English, and will be continuously updated. 3
4 5. Sales staff training underway In Progress A Sales manager was contracted to arrange price lists and sell paper and products to customers. At the same time, stock control and production management started. 6. New decoration products developed and commercialized. Five (5) decorative lampshades were developed: Barca, which is made of curauápulp-paper using a technique of Amate, Palafita whose structure is made of timber residues,tento, which are filled with natural seeds in the base, Paneiro, with structure of veins, and Barraca, do-it-yourself type, which you can mount structure and paper shade by yourself (they can be seen on the website). The folding screen production is also being developed. 7. Data-Base used to distribute samples; 50 negociations per month. In Progress A data-base of possible buyers was created and used for sample distribution. At the same time, an internal system of Monitoring, which visualizes internal actions of negociations and/or sales contract (Annex a list of negociations). The commercialization of paper and products of Amazon Paper has already started and at the moment, the market target is São Paulo, the largest market for paper and craft prodcts in Brazil. In order to realise the regular sales of the products, a representative of Amazon Paper was contracted in São Paulo, and also planned to have a representative in Europe and the United States where the products of Amazon Paper will appeal to consumers who are interested in development and environment. In the effort of establishing effective marketing strategy, we have solicitated technical assistance to the Sustainable Grassroots Business Organization Initiative of International Finance Cooperation aiming at broad cooperation and marketing in the United States. Moreover, a partnership with Foundation Brazil Connects is being established to obtain support to identify appropariate markets for Amazon Paper. 4
5 8. Training of staff members to improve quality control A training course for staff members was realised in (10 15 May) in Belém and Abaetetuba by Ms. Patrícia Giordano, a specialist in paper confection and note binding in São Paulo. She gave an intensive lecture on quality control of paper products, especially agendas, which we are trying to increase the sales level. ii) If you did not achieve some of your stated milestone objectives, please explain the reasons. iii) Has your project s overall accomplishments to date exceeded the original plan? x Yes No If Yes, describe your achievements: As explained in the last section, the Project today has 5 Groups of craft makers and rural producers instead of 3 as planned. The Pará State Government has made a partnership with Amazon Paper to offer working space and to cover related costs for three Groups in the Municipality of Abaetetuba. Also, it is important to note that we are working with small rural producers' Cooperative in order to complete the productive chain of curauá and secure the supply of principal ingredient of Amazon Paper products (this activity was not really planned for this Milestone). III. Overall Project Progress i) What have been the main challenges of your project to date? What, if any, adjustments have you made to your original business plan in order to overcome the challenges and meet your objectives? Challenges: The principal challenge at the moment is securing and establishing solid business partnership with private sectors that treat handmade paper and crafts as well as other decorative products. Adjustments: As it was explained above, we have started to seek the possibilities to contract some representatives and consultants. However, we urgently need a strategic marketing plan to secure regular income through sales of our products to realize self-sustainability and to increase the number of beneficiaries through the Project. For that reason, we are planning to focus on marketing and strategy building in the next Milestone. ii) Have any of your objectives changed or have you added new objectives since you signed your Project Agreement? If Yes, explain the changes. Yes x No 5
6 iii) Do you have any concerns about meeting your next milestone objectives? Yes x No If Yes, what are the concerns and how do you plan on addressing those challenges? iii) Although this is an interim report, are there any development outcomes or results of your activities to date that you would like to call attention to? We think it is important to emphasize the improvement of our production capacity in this phase thanks to the first disbursement of the DM Award for expansion and (semi)industrialization of production space (Milestone 1). We had been trying to improve the production organisation, but without really reforming the space. With DM grant, we could install a papermaking factory in a large warehouse closeby with adequate installations, which allow the start of commercialisation of Amazon Paper and its products with good quality and significant quantity. In the next phase, we are planning to obtain a freezer (for pulp storage) and a drier (for drying paper especially in the rainy season), which are essential to improve the production level in the future. With the movement of the paper factory to this warehouse, old production space was reformed to install an atlier where prototypes and samples are elaborated. The reform also allowed to reorganise the administration and to prepare for commercialisation activities. We would also like to call attention to our effort to integrate different craft makers and specialists as well as rural producers and young men and women from urban peripheries through the productive chain of curauá and other natural products obtained from the Amazon rainforest to realize sustainable development. At the moment, we are trying hard to secure distribution channels of products with good quality and significant quantity. It is the biggest challenge of the Project of this type, which requires skills and know-hows of private sectors while being non-governmental organisations at the moment. iv) Reminder: In accordance with Paragraph of the Project Agreement, each project team is required to submit a statement of account showing the use of the funds within three months after the last disbursement. As a part of periodical expenditure review exercise, please provide an annex with un-audited summary of expenses during this reporting period. IV. Ancillary Achievements i) Have you or has your organization received any awards/recognitions or media attention as a result of your DM-funded project during this period? x Yes No If Yes, please specify the sources and identify the names. Award /Recognition Media e.g. International: BBC News on Dec. 3-4,
7 Local: National: International: x Local: newspapers: Reporter Diário, 22 May ( asp); Diário do Pará, 06 June 2004, pg. 3, "Amazon Paper pelo Mundo." x National: Casa Cláudia Magazine April 2004, Vol. 28, No. 4, pg. 48, "Planeta Casa: Fibras, Sementes, e Luz." International: Explain the Award/Recognition or the Media content: Reporter Diário is an online version of local newspaper Diário do Pará (Pará Daily News), which covers news of the Amazon Region. The Amazon Paper Project was introduced as one of the new initiatives of development in the Pará State in a column. In Diario do Pará, Amazon Paper was presented as Kei Otsuki was ivited to the World Bank in June to talk about the project in an event of the Envronment Department. Also, the participation of Amazon Paper in a meeting in Columbia in June was mentioned in the article. Casa Cláudia Magazine is one of the most famous and distributed magazines of interior decoration in Brazil. In the Section of Planeta Casa, the lampshades of Amazon Paper were introduced under the title "Fibres, Seeds and Light." Attach web links/news clips, if available: ii) Has your organization made any new partnerships as a result of this project during this reporting period? x Yes No If Yes, specify type of the organization from the list below and describe nature of the partnership: Local Government: x National Government: Brazil Bank Foundation is approving the Amazon Paper Project especially regarding more involvement and training of rural producers and support for preprocessing of curauá fiber. If everything goes well, the project will start in November with the Foundation. x NGO: Brazil Connects Foundation is becoming our partner for marketing and identification of possible markets without involving financial resourses. Bilateral Development Agency x Multilateral Development Agency: At the moment, we have made contacts and teleconference with the director of Grassroots Business Organization Initiative of the International Finance Cooperation in respect of technical assistance and partnership for business development. Private Corporations: Other: 7
8 iii) Sustainability and scalability after completion of the DM fund are top of the DM Team s priorities. Has your organization leveraged new funding or secured future funding during this reporting period? x Yes No If Yes, provide the following information. For training, capacity building, and consulting as well as other materials and equipments, the financial support will be guaranteed from Brazil Bank Foundation as mentioned above. V. Requests to the DM i) Do you have any comments on the overall process and support provided by the DM Team or Project Liaison? As we realized the importance of Technical Assistance for marketing, we discussed with DM Team for the possibility of receiving the support for Assistance, and it was a pity that they could not provide any at the moment. However, it was useful that they indicated the Grassroots Business Organizations of International Finance Cooperation for the possible partnership, which has opened an interesting potential for us (and also for them). Annex I. Project Expenses for this Reporting Period Items Sub-Totals (USD) 1 Personnel ,23 2 Materials and Equipment ,30 3 Training ,95 4 Travel 7.003,36 5 Evaluation/Information Dissemination ,42 6 General Administration/Overhead 0 7 Other ,42 Total Expenses ,68 8
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