Eco - Enterprises and Indigenous Peoples

Two Case Studies of the BCN Experience in the Philippine Uplands

Carlos Encarnacion
BCN Program Officer, Manila

Introduction

The Critical Situation of the Philippine Uplands

The 7,100 islands of the Philippine Archipelago are estimated to have a total land area of 300,000 square km. Around 55% of this area (165,000 sq. km.) is classified as uplands or lands with a gradient slope of 18 degrees or more. It was estimated in 1995 that 11 million hectares or 66% of these uplands are degraded, and have been converted from forest into agricultural or grazing lands. Total remaining old growth forest stand only at 2.7% (8,100 sq. km.) while secondary forest, sub-marginal, mossy and pine forest are at 15.5% (46,650 sq. km.) (DENR, 1995).

The main causes for deforestation and land conversion in the Philippines have been commercial logging, large-scale mining and expansion of urban-industrialized areas. In the past decade however, additional strain to the environment has come from a rapidly increasing rural population that is directly dependent on the natural resources for agriculture, grazing, fuelwood and NTFPs.

By the year 2000, the Philippines is expected to have a total population of 70 million, 21 million of which will be upland dwellers. Of these, 12 million will be indigenous peoples (IPs). If current efforts to deter these trends of deforestation, exploitation of resources and population growth are not successful, then the Philippines faces a very bleak future going into the next millennium.

Community-Based Forest Management as a Strategy for Upland Forest Protection

Over the past few years, there has been a growing trend to promote local management of forests as a potential solution to these threats. The rationale of community forestry is to transfer the direct management and stewardship of identified upland areas to the communities residing in those areas. The underlying philosophy is that these communities are best suited to be "keepers of the forest" since they are dependent on the protection of these resources for their very own social, economic and political survival. This strategy is also designed to augment the limited resources of the government, specifically the Department of Environment and Natural Resources (DENR) in handling the task of administering over half the country's land.

In the mid-1990's, thanks in large part to the efforts of numerous of private organizations, funding institutions and upland communities themselves, the DENR launched what is known in the Philippines today as the Community-Based Forestry Management Program. Commonly referred to as CBFM, its goal is to consolidate the different government laws, policies and programs into a workable strategy. Executive Order No. 263 was signed in 1995 formalizing the CBFM Strategy as the national strategy that aims to ensure the sustainable development of the country's forestland (upland) resources by recognizing, involving and empowering local communities as indispensable partners for development. The numerous government policies and programs which fall under CBFM involves providing upland communities with stewardship rights, technical support, and economic incentives to manage their land.

Objectives of this Paper

The Biodiversity Conservation Network (BCN) was established to fulfill two main programmatic goals:

1. Conservation Impact – Support enterprise-based approaches to biodiversity conservation at a number of sites across the Asia/Pacific region, and
   
   
2. Enhanced Knowledge – Evaluate the effectiveness of these enterprise-based approaches and provide lessons and results to BCN's audiences.

BCN's core hypothesis is that if the community-based enterprise approach to conservation is going to be effective, it must (a) have a direct link with biodiversity, (b) generate benefits for a community of stakeholders, and (c) involve these stakeholders in the process. In this paper, I examine this hypothesis in the context of two BCN-funded projects in the Philippines.

• NTFPs in Palawan – The project sites of Cayasan (in Puerto Princesa), Campung Ulay and Punta Baja (in Rizal) are all located in Palawan, which has been described as "the last frontier" of the Philippines. The Bataks, Tagbanuas and Pala'wans tribes of these areas have all just recently completed their resource management plans and are in the process of implementing them.

• Jam and Jelly in Northern Luzon – The Kalahan Reserve which is located at the boundaries of Nueva Vizcaya and Pangasinan in the northern part of the Philippines, is technically the first CBFM project in the Philippines. Established in 1973, the Ikalahans are protecting 13,894 hectares of forest in the Caraballo and Cordillera mountain ranges.

Both of these project sites are located within the vital upland areas in the Philippines, and typify the basic issues present in these areas.

The Palawan Experience in Community-Based Enterprises

Project Setting

Project Background

The "Community-based Conservation and Enterprise Program for Indigenous Communities in Palawan, Philippines" was one of the most ambitious of the BCN projects. Not only did the project aim to achieve conservation by developing NTFP enterprises at four identified sites, but it also intended to do extensive institutional development.

The reason for launching such a comprehensive program was that when the proposal was conceptualized in 1993, the implementing agency, Nagkakaisang mga Tribu ng Palawan (United Tribes of Palawan or NATRIPAL), was only in its first year of existence. Though it had other proposals in the pipeline, it had yet to gain experience in actual project implementation. In addition to this, the Batak, Pala'wan and Tagbanua beneficiary communities were not yet at a level of organizational development required to successfully implement a community-based enterprise. As a result, much of the proposed $627,698 three-year project budget was directed at activities that were vital but not necessarily directly linked to the enterprises.

Casayan with St. Paul half-dome at the background

Site Definition

Palawan originally had four project sites. This was later reduced to three with the exit of the Cabayugan due to internal conflicts with NATRIPAL in 1996 (Pinto, 1997). The sites that remained were:

1. Cayasan	2. Campung Ulay*	3. Punta Baja*
7,503 hectares located in Puerto Princesa at the boundary of the St. Paul's Subterranean Park. Inhabited by Tagbanua and Bataks (48 HH) and migrants (10 HH). The IPs are organized under SATRIKA which was formed in the early 90s.	7,000 hectares located in the Municipality of Rizal. Inhabited by Pala'wan (118 HH), Tagbanua (36 HH), migrants (60 HH) and other (26 HH). The IP community is organized under CAMPAL which was formed in the early 90's.	8,092 hectares located in the Municipality of Rizal. Inhabited by Pala'wans (371 HH), Tagbanua / mixed (143 HH) and non-IP migrants (276 HH). The IP community is organized under PINPAL which was formed in the early 90s.

*Note: These two sites are adjacent to each other and are located around the Mt. Mantalingahan, Rizal which is the highest peak in the province.

Community Enterprise Structure

Aside from swidden agriculture and homegardening, NTFP gathering has long been one of the main sources of economic livelihood for the IPs in Palawan. Practically all IP households in Cayasan collect honey and almaciga while almost all households in Campung Ulay collect almaciga and rattan. In Punta Baja, around half the households collect almaciga and rattan. Overall, the IPs of Palawan have a yearly household cash income average of around 10,000 pesos (US$ 250.00), 50-90% of which comes from NTFP trading and the bulk of the remainder from swidden agriculture.

As illustrated in Figure 1, honey, rattan and almaciga (resin) are gathered from the wild and are sold to financiers, who up until 1997, held all the legal permits for NTFP extraction at the three sites. These traders then transport the products to Puerto Princesa where the goods are processed or shipped directly to larger trading centers such as Metro Manila. To facilitate this mechanism, each community has a kapatas, or local foreman. The kapatas manages the loans and advances made to the community and consolidates the products on behalf of the financiers. Although this arrangement is based on economics, the community-kapatas-trader relationship is not purely a business one. The kapatas is also looked up to as a leader and is usually a very influential person in the community.

Figure 1: Palawan NTFP Enterprise Structure Prior to the Project

Though the traditional arrangement provides the IPs with a steady source of income, this arrangement is nevertheless disadvantageous to the community for several reasons. The community members are generally not paid for the true worth of their labor and goods, resulting in continued debt bondage and wanton resource exploitation. Nor do they have the capacity as small traders to dictate the price that they want. Also, going against the system is risky as one may risk losing the only source of capital for NTFP trading.

Project Structure

The project was initially set up with the WWF-Philippine Programs acting as lead agency and serving as a bridge between NATRIPAL and BCN. In 1997, project oversight was transferred to a Management Committee composed of representatives from the NATRIPAL Board of Directors, PANLIPI, an NGO that provides legal services for the federation, and the Indigenous Peoples Apostulate (IPA), which is a church-based program that provides development services to indigenous peoples.

Project implementation was assigned to the project team including a project manager and technical advisor who were hired in lieu of the fact that NATRIPAL still did not have sufficient management capabilities. Their responsibilities included overseeing the office-based administrative staff, and coordinating the activities of the five intervention components, namely the Community Organizing Component (CO), Enterprise Development Unit (EDU), the Resource Management Unit (RMU), the Legal Services Unit (LSU) and the Monitoring and Evaluation Unit (M&E).

 

Major Project Activities

Revitalization of the People's Organizations

One key activity involved strengthening of the People's Organizations (POs) at each site. This was crucial to the project because it is with the leadership of the PO that all other organizing, enterprise and resource management activities were anchored. The PO also offered an alternative to the kapatas-based system. To achieve this, a series of capacity building trainings were carried out to enhance the capabilities of both the PO and the community as a whole. These trainings included workshops on basic reading and math skills, leadership, para-legal training, biological-monitoring, and credit & savings development. The venue for conducting these activities was the Area Servicing Unit (ASU). Though intended by the project to act as a warehouse for consolidating the NTFPs, it likewise served as the center of community organizing activities at the three areas.

Securing of Land Tenure

Helping the local communities secure land tenure was one of the prime objectives of the project. In 1997, all three sites were finally able to secure their Certificate of Ancestral Domain Claim (CADC), which were awarded to them by the DENR. This certificate grants the communities legal stewardship rights to live and exploit the resources within their identified ancestral domain. Though the CADC is revocable under certain conditions of "national interest," it enables the IPs to exercise the right to disallow commercial exploitation operations such as mining. As a result, all NTFP licenses held by the concessionaires were cancelled and legal control over NTFPs was transferred to the IPs.

NTFP Enterprise Development

As illustrated in Figure 2, the project attempted to set up a new NTFP harvesting enterprise that would parallel the old structure. This strategy involved attracting harvesters to market their products through the ASUs and NATRIPAL rather than the kapatas and financiers. In this way, the POs could control the rate and methods of NTFP harvest, thereby empowering them to protect the uplands.

Figure 2: Palawan NTFP Enterprise Structure Prior to the Project

Given the importance of NTFPs, the project enterprise employed the several tactics across the project sites in order to "win over" the IPs from the financiers and kapatas. In Punta Baja and Campung Ulay, the ASUs bought almaciga at 10.00 pesos per kg. instead of the standard 7.00 pesos being offered by the traders. Rattan was purchased 3.50, or .50 pesos higher then the going forest gate price. In Cayasan though the ASU continued to purchase honey and almaciga at the same price as the traders, it provided free containers to the honey gatherers as a way to lure their participation. It is estimated that since this scheme was implemented in 1997, a total of 30% of all IPs selling NTFPs coursed their goods through the ASUs. This figure could have actually increased, but a dip in prices in late 1997 and the ongoing struggle of the community leaders in facing other threats such as encroachment prevented the expansion of enterprise activities. In Punta Baja, at the project's end, the ASU had yet start NTFP trading. The community was, however, able to make some sales after the 1^st Quarter of 1998.

During the project, each ASU center incurred a yearly overhead cost of around 70,000 pesos a year, while generating gross sales of around 80-100,000 pesos a year. 55,000 pesos of this went anually to the salaries of IP ASU staff. The reason for this was to provide incentive for potential IP entrepreneurs to invest their time in the development of the ASU and later on carry out the activities themselves once the project ends. It should thus be possible for the Cayasan, Punta Baja, and Campung Ulay ASUs to increase profits by 1999 since it is hoped that by this time, the units will be managed by the IPs. Questions still remain, however, as to who will shoulder the ASU maintenance, marketing and bio-monitoring costs now that the BCN funding for the project is over. This brings forth the issues of how sustainable the ASUs are and whether NATRIPAL can sustain the assistance it is providing to these communities.

Development of Ancestral Domain Management Plans

In connection with the CADC, all three sites have also submitted Ancestral Domain Management Plans (ADMPs) to the DENR for implementation. Contained in these documents are the communities' policies on NTFP gathering, conflict resolution and community structure for governance of the CADC. Examples of these policies are:

1. The People's Organization will oversee the overall management of the domain.
2. The ancestral land will be used in accordance with its classification of agricultural and settlement areas, protection, and production forest.
3. IPs will follow the quotas and approve methods for NTFP extraction
4. Outside individuals and companies will not be allowed to use the resources of the domain without the approval of the PO/community.
5. There will be set fines and penalties for those who do not abide by the ADMP policies.

At present, all POs at the different sites are still at the early stages of further refining and implementing their ADMPs.

Project Results

Following the BCN Analytical Framework (1998), project results can be considered in terms of the factors that affect conservation (independent variables) and measurements of overall conservation (dependent variables).

Factors Affecting Conservation: Independent Variables

Table 1 illustrates the different Linked-Enterprise, Generation of Benefits and Stakeholder variables that were addressed and monitored from Time-Zero (1995) of the Palawan Project to Time-Final (1998). As can be seen from the different factors, the project addressed many issues and needs that were not directly linked to the enterprise, but that were necessary for the success of the community-based enterprise. This "checklist" provides important insights to future programs that are looking at the feasibility of enterprise intervention approaches.

Table 1. Factors Affecting Conservation

	CAYASAN	CAMPUNG ULAY	PUNTA BAJA
Enterprise Structure	95- Financiers through the kapatas dictated the sale prices of NTFPs.	95- Financiers through the kapatas dictated the sale prices of NTFPs.	95- Financiers through the kapatas dictated the sale prices of NTFPs.
	98- Financier-kapatas structure still exists. Community members though through the ASU have started initial trading with outside buyers. They also determine the price by which they want to buy.	98- Financier-kapatas structure still exists. Community members though through the ASU have started initial trading with outside buyers.	98- Financier-kapatas structure still exists. Community members though through the ASU have started initial trading with outside buyers.
Enterprise Ownership	95- IPs possessed no legal instrument for rights to extract NTFP. A total 6 outside individuals/groups held rattan and almaciga concessions.	95- Before the project, CAMPAL was actually able to acquire a rattan license, which they "rented" to an outside trader.	95- IPs possessed no legal instrument for rights to extract NTFP.
	98- With the CADC, the IPs get full stewardship, exploitation and trading rights of the resources within the domain.	98- With the CADC, the IPs get full stewardship, exploitation and trading rights of the resources within the domain.	98- With the CADC, the IPs get full stewardship, exploitation and trading rights of the resources within the domain.
Capital Invested	95- minimal	95- minimal	95- minimal
	98- Building of the ASU center. Revolving capital of 150,000 pesos (around $4,000).	98- Building of the ASU center. Revolving capital of 150,000 pesos (around $4,000).	98- Building of the ASU center. Revolving capital of 150,000 pesos (around $4,000).
NTFP Sales and Marketing	95 - NTFPs were traded solely through the outside financiers.	95- NTFPs were traded solely through the outside financiers.	95- NTFPs were traded solely through the outside financiers.
	98- IPs through the ASUs/POs and NATRIPAL are now able to establish their own links to buyers.	98- IPs through the ASUs/POs and NATRIPAL are now able to establish their own links to buyers.	98- IPs through the ASUs/POs and NATRIPAL are now able to establish their own links to buyers.
Enterprise Management	95- NTFP trade managed by the kapatas.	95- NTFP trade managed by the kapatas.	95- NTFP trade managed by the kapatas.
	98- SATRIKA still unable to manage the enterprise activities w/out project staff support.	98- CAMPAL still unable to manage the enterprise activities w/out project staff support.	98- PINPAL still unable to manage the enterprise activities w/out project staff support.
Enterprise Participation	95- All major NTFP trading activities were done under the financier-kapatas structure.	95- All major NTFP trading activities were done under the financier-kapatas structure.	95- All major NTFP trading activities were done under the financier-kapatas structure.
	98- Around 30% of IPs trade their NTFPs through the ASUs.	98- Around 30% of IPs trade their NTFPs through the ASUs.	98- Around 30% of IPs trade their NTFPs through the ASUs.
Land Tenure	95- No legal security of tenure.	95- No legal security of tenure.	95- No legal security of tenure.
	98- Achieved stewardship through awarding of CADC.	98- Achieved stewardship through awarding of CADC.	98- Achieved stewardship through awarding of CADC.
Community Control and Policing	95- IP community aware of threats and illegal activities but is unable to respond.	95- IP community aware of threats and illegal activities but are unable to respond.	95- IP community aware of threats and illegal activities but are unable to respond.
	98- IP SATRIKA forest guards / monitoring teams able to apprehend illegal gatherers.	98- Community via CAMPAL fighting PCA plantation threat w/ local gov't assistance.	98- IP community and PINPAL able to monitor threats but unable yet to apprehend.
Resource Governance	95 - No formal management plan. Wanton exploitation of resources by insiders and outsiders.	95- No formal management plan; Wanton exploitation of resources by insiders and outsiders.	95- Existence of IP demarcation of almaciga tree ownership. Continued exploitation of resources.
	98- Construction of ADMP. Sustainability of NTFP practices yet to be verified.	98- Construction of ADMP. Sustainability of NTFP practices yet to be verified.	98- Construction of ADMP. Sustainability of NTFP practices yet to be verified.
Formal Community Monitoring	95- No formal community monitoring.	95- No formal community monitoring.	95- No formal community monitoring.
	98- One time bio-inventory; community however still lacks capacity to continue.	98- One time bio-inventory; community however still lacks capacity to continue.	98- One time bio-inventory; community however still lacks capacity to continue.
Stakeholder Dynamics	95- IPs under the leadership of an influential kapatas family.	95- IPs with little community cohesion and collective effort.	95- IP presence of traditional, elder and young leadership.
	98- Power struggle ongoing between kapatas and SATRIKA.	98- Improved collective efforts through PO activities and project objectives.	98- Very good; No conflict reported among the IPs. Good rapport with other groups.
Leadership	95- SATRIKA established and is able to carry out limited community activities.	95- CAMPAL established and is able to carry out community activities.	95- No existing PO. Activities carried out through individual influence.
	98- SATRIKA has young-dynamic leadership; but still with limited organizing influence.	98- Slight improvement of leadership with the advent of elections and more collective participation.	98- PINPAL formed and functioning. Set of elected officers with good young charismatic leadership.
Community Organizing Process	95- Identified set of leaders with established PO.	95- Identified set of leaders with established PO.	95- Identified leaders but with no formal organizing yet.
	98- In transition from traditional leadership to formal democratic leadership.	98- In transition of formalizing democratic systems of governance and leadership.	98- Formal CO started only in 1997 through the efforts of NATRIPAL.
Participation in Project Activities	95- Existence of PO but with little community participation.	95- Existence of PO but with little community participation.	95- Limited community participation.
	98- Very Good; 30 adult IPs or 20% attend project activities.	98- Very good; 176 or 35% of adult IPs participate in monitoring.	98- Very good and enthusiastic participation. Ave. of 100 IPs in ADMP making.
NATRIPAL Development	95- Newly organized IP federation. Limited experience and management capabilities. Managing three projects with funds coming from VIDC, NOVIB and BCN.
	98- NATRIPAL still lacking sufficient management capabilities. Able to get IUCN funding to continue activities at the three sites.

 

Measurements of Overall Conservation

Measurements of overall conservation success include looking at the sustainability of the resource harvesting and the reduction of identified threats.

Resource Sustainability – Initial analysis has revealed that NTFP stocks are at a critical level, and might not be able to sustain current NTFP gathering rates for long. As an example, we consider rattan harvesting in Campung Ulay (this analysis was conducted with the help of Forester Vergel Medina). This analysis is based on sampling 230.9 out of a total of 8817.8 ha. Extrapolating from this sample, we can make the following calculations for Campung Ulay:

Factor	No. of Poles
Initial stock of poles	386,013
Poles maturing per year	102,631
Total rattan harvested per year	168,960

Note: Though the Campung Ulay CADC is 7000.88 ha, computations for the initial estimates used an area of 8,817.

The maturation rate is based on the growth rate of average rattan species before it reaches 3 meters long, the standard length in rattan trading. Using these factors, we can make the following calculations.

Year	Existing rattan standing stock	Addition of stock (regeneration)	Available rattan stock for the yr	Less harvested quantities	Rattan standing stock for next yr
1) 1997	386,013 poles			168,960 poles	217,053 poles
2) 1998	217,053 poles	102,631 poles	319,684 poles	168,960 poles	150,724 poles
3) 1999	150,724 poles	102,631 poles	253,355 poles	168,960 poles	84,395 poles
4) 2000	84,395 poles	102,631 poles	187,026 poles	168,960 poles	18,066 poles
5) 2001	18,066 poles	102,631 poles	120,697 poles	168,960 poles	(48,263)

Based on these figures, it is estimated that the supply of rattan will only suffice for 4 years and 8.6 months of continuous harvest. As a result, of these calculations, the IPs at the three sites and NATRIPAL need to strategize ways to improve the standing stock of their resources. These may include methods such as establishment of nurseries, development and stock piling of seedlings, reforestation and the implementation of zoning strategies. There is also a need to undertake education and information activities to let all those involved in extraction and utilization of the NTFPs become aware of the urgency to rehabilitate, monitor and protect the biodiversity of the project sites.

Threat Reduction Assessment (TRA) – A second measure of conservation success involves examining reduction of identified threats using a threat reduction assessment (TRA) index (Salafsky and Margoluis 1999). For the Palawan Project, the TRA exercises were conducted with IP leaders and project staff of the three different sites. The direct major threats that were identified and how reduction were defined as follows:

Over Harvesting: 100% threat met means the regulation of sustainable NTFP harvesting

Land Conversion: 100% threat met means the prevention of further conversion of forestlands

Illegal Logging: 100% threat met means being able to stop unregulated lumber harvesting

Hunting/Fishing: 100% threat met means stopping of all illegal or unregulated hunting/fishing activities

The TRA ranking exercises reveal that the project staff and IP leaders from across the three Palawan sites feel that they have achieved a 40-50% reduction of threats. These reductions are due not only to the enterprise, but also the other project activities.

Project Staff and Cayasan IPs receiving bio-monitoring training from a project consultant.

However, despite positive gains such as the apprehension of illegal gatherers and initial sales of NTFPs by the IPs, the implementation of the Ancestral Domain Management Plans and conservation at the Palawan sites still have question marks. The main issue here is the sustainability of the current efforts of the NATRIPAL Federation and the IP organizations to continue to provide the community development and enterprise leadership needed. In terms of the enterprise itself, initial findings show, for example, that rattan resources will only last 4 more years given the present rate of extraction. The IPs, with the aid of NATRIPAL thus need to adjust accordingly and include formal monitoring as part of their priorities.

Conclusions

Assessing the Enterprise Approach

In retrospect, rattan, almaciga and honey NTFP gathering was an appropriate target enterprise for biodiversity conservation in Palawan. The factors that made this so were:

• It was/is a major cash enterprise for the IPs in Palawan. As a result, the IPs were more than willing to participate in the project activities and fight for the assertion of their rights. They had many complains about the kapatas-trader relations, but until the project began, had no real opportunity to engage in trade of their own.
  
  
• It made use of a traditional livelihood activity that the IPs were familiar with. It is also a common activity that can enable the different IP groups in Palawan to link-up with each other. In fact, it is NATRIPAL's plan to eventually act as a wholesaler by consolidating the NTFPs from different sites around Palawan.
  
  
• It necessitated the securing of the upland areas and the acquisition of legal user rights by the IPs. This made the CADC and ADMP more meaningful since the incentive was not just about ancestral rights, but about economic survival as well.

However, downsides of the enterprise were:

• It was very capital intensive. In order to accommodate all the IP gatherers, each ASU needed at least 500,000 pesos of revolving capital. Considering that the allotted revolving fund by the project for each ASU was 150,000 pesos, the IP leaders were naturally unable to capture the intended number of gatherers. This budget also does not take into account the cost of monitoring and additional community organizing activities.
  
  
• There is a risk in challenging existing kapatas-community relations. It is easy for any project to say that it will get rid of the "middlemen" so that the community can realize more profits. But middlemen, for better or worse, perform many important functions that the people rely upon for survival. More often than not, they are the community's only avenue for credit and are a more lasting source of cash than externally funded projects.
  
  
• There is a need to run the enterprise like a business instead of a project. In the effort to attract IPs, the project employed several strategies like offering higher prices and buying NTFPs even when there were no identified buyers or when the market prices were low. In hindsight, this was not very sustainable as a long-term strategy.

Looking at the Conservation Process

Although the project has not been able to set up sustainable enterprises, it has been able to establish a foundation by which the community organizing and conservation process can build upon. Unfortunately, because of the lack of management capabilities and conflicts within the project management team, only a year instead of the needed three years was fully devoted to developing this process. The communities as a result are not yet at a level where they can carry on the activities by themselves. They are still heavily dependent on NATRIPAL, which in turn is still grappling with internal issues such as its own future direction and developing its financial and management capabilities. Conservation at this point is still a question mark alongside the components of enterprise, bio-monitoring and ADMP Implementation.

It is encouraging news that NATRIPAL has just recently been awarded a grant from IUCN to continue the development of the communities' NTFP enterprises. In addition, the project staff are starting to trade with private individuals in an attempt to expand the communities' NTFP market. Now in its sixth year, the NATRIPAL federation must now demonstrate to outside agencies and organizations that it is capable of successfully implementing projects on its own. It must draw valuable lessons from its previous experiences and must be able to rise above its internal organizational weaknesses and infancy.

 

The Kalahan Forest Farms Development Project

Project Setting

Project Background

The project works with indigenous people called the Ikalahans, whose name means "people of the broad leaf forest" and who have lived here for centuries relying mainly on hunting, gathering and traditional swidden agriculture to survive. The natural resources in these areas remained relatively intact until the 1950s, when the Philippine government started to actively enforce the doctrine that all forested uplands were government lands and proclaimed that all uplanders/indigenous people's were "squatters" in their own land. Realizing the futility of challenging the Philippine government and military over control of their land, their attitude changed from that of protection to full utilization. "They decided to get as much as they could for today and forget about tomorrow." As a result, several traditional and dependable technologies were ignored, and new destructive practices such as cattle raising were introduced.

As early as the late 1960's, negotiations began for the control of the Kalahan Reserve in order to counter numerous external and internal threats such as land grabbing and harmful agricultural practices. In 1970, the Ikalahans tried to organize a Producers Cooperative to address the rampant economic exploitation of the resources happening at that time. Unable to negotiate with the government for the formation of this cooperative, they decided in 1973 to form the Kalahan Educational Foundation Inc. (KEF) to give the community legal representation. The purpose of KEF is to "promote the education and development of the Ikalahan people." Since then, KEF has been the main stakeholder organization in the reserve, having taken the lead in implementing many activities such as land tenure, resource management, policy formation, sustainable agriculture, and education, among others.

By 1974, KEF was finally able to negotiate an agreement with the now defunct Department of Agriculture and Natural Resource and Management. This agreement, simply referred to as Memorandum of Agreement No. 1 (MOA1), gave the Ikalahans full and legal stewardship, management and utilization rights for 25 years in exchange for the protection and rehabilitation of the Kalahan Reserve. As the agreement was nearing its end, KEF secured three Certificate of Ancestral Domain Claims (CADCs) in the adjacent provinces of Nueva Ecija, Nueva Vizcaya and Pangasinan that would expand their stewardship rights and management activities to 45,000 hectares by 1999.

Site Definition

The official Kalahan Reserve is part of the larger Cordillera and Caraballo mountain ranges that comprise part of the major watersheds that supply water to the agricultural areas of Northern Luzon. The reserve is 13,894 hectares large and is composed mostly of Pine and Dipterocarp Forest. It is home to many endemic and endangered flora and fauna such as the Tarictic Hornbill.

The people of the Kalahan reserve are highly homogenous. Of the 550 households, 547 are Ikalahan and three are Ifugao. The largest barangays (towns) in order of population are Imugan, Malico, Baracbac, Bacneng and Unib. Historically the Ikalahans were scattered around the reserve. A large earthquake in 1990, however, forced the Ikalahans to settle in flat areas, a trend that continues today with development infrastructure, electricity and schools at these towns. Originally called the kalanguya, around 6% of the Ikalahans have immigrated from the adjacent town of Kayapa and 2% from Pangasinan province. The Ikalahans practice traditional swidden agriculture with kamote (sweet potato) as their staple crop. Other sources of income include small businesses and employment in KEF and the nearby town of Santa Fe.

Project Structure

The main vision of the Forest Farms Development Project is "to establish an effective resource management to ensure a stable and bio-diverse forest system within the Kalahan Reserve." It is envisioned that the 550 local families will be able to source their (1) Food Needs, (2) Cash Needs, (3) Domestic Needs, and (4) Knowledge Needs from the 13,894 hectare reserve. As outlined in Figure 3, the main objective of the Forest Farms Development Project is thus to identify and develop several niches from the forest that would satisfy these needs of the community and, in turn, encourage the Ikalahans to protect and cultivate the biodiversity at the Reserve.

Figure 3. Basic Structure of the Forest Farms Project

Fruit Harvesting*	Fruit Harvesting*
	Food Processing*
	Timber Improvement*	Timber Improvement*
			Timber Inventory*
	Flora Inventory*		Flora Inventory*
Fungi (mushrooms)	Fungi (mushrooms)
	Handmade Paper
	Wild Orchids
	Butterfly
			Fauna Inventory*

*Major BCN-funded activities

Underlying assumptions of the Forest Farm Development concept are:

• An understanding of ecological principles will produce environmental protection.
• The Modified Timber Stock Improvement (MTSI) will improve secondary growth.
• Forest-based industries in the community will generate new employment opportunities as well as value addition, which will reduce environmental degradation.
• Maintaining a "forest-based community" will provide opportunities for educated youth who will, in turn, provide appropriate leadership for future community development.

Major Project Activities

Given the above framework, BCN support for the Kalahan Forest Farms Development Project, which started in 1994 and ended in 1998, had three major objectives. The first was to strengthen the existing KEF Mountain Fresh jams and jelly production. The second objective of the project was to explore other livelihood niches, the most notable of which is the ongoing Modified Timber Stock Improvement (MTSI) research. The last major objective of the project was to assist in KEF's various research activities in support of the conservation efforts within the Kalahan Reserve, including the documentation of existing flora and fauna, GIS mapping of the Reserve, and the development of KEF's institutional structure.

Managing the Mountain Fresh Jams and Jellies Enterprise

The main product of the KEF enterprise is the Mountain Fresh line of jams and jellies. This enterprise has been supplying products to major supermarkets in Manila since the late 80's. BCN's objective was to strengthen the current operations and examine its link and contribution to conservation in the area. Figure 4 shows sales over the past few years. Note that the large amount of sales generated in 1994 was due to a one-time export order from Germany. Gross revenue has tapered off to around 2,000 bottles or 650,000 pesos of sales annually in the last three years. At this level, the enterprise is able to cover its variable cost but has not yet been able to cover fully all of its fixed costs. According to Pastor Delbert Rice, KEF's Executive Director, "The biggest challenge is to bring the Food Processing Center to the point where its net profits can support the other activities of the KEF." To do this, KEF has been working with the Upland NGO Assistance Committee (UNAC) and the Philippine Business for Social Progress (PBSP) to increase Mountain Fresh sales. Aside from promotions and increased marketing efforts, KEF will soon be introducing a line of low-sugar jams and jellies, which they expect will substantially add to their gross sales. KEF is also looking at ways to lower the costs of production.

As part of the enterprise, the Ikalahans sell an average of around 60,000 pesos (US$1,500) or around 15,000 kilos worth of fruits to KEF each year. 65% of this total is Guava, their best selling product. There are around 90-110 gatherers who sell fruits in any given year to the Food Processing Unit. In 1996, the average revenues generated by each gatherer was roughly 687 pesos ($18.09), which represents 2% of the Ikalahans individual annual cash income of 33,147 pesos ($872.31). In 1997, the average revenues generated by each gatherer amounted to just 0.95 % of their annual income or 360 pesos ($ 9.49) out of 37,861 pesos ($ 996.36). Though this may seem like an insignificant amount, KEF states that this is an important contribution to the Ikalahans cash accessibility. Since KEF's policy has been not to turn down anyone who comes to sell them fruits, selling to the Food Processing Unit has become a source of "instant cash." This policy also encourages the gatherers to have a part in the production of the jams and jellies, and to assist KEF with the monitoring of fruit supply and production. 10-20% of the gatherers are students, while less than 10 are classified as consolidators, or people who collect fruit from other gatherers and then sell them to KEF.

Exploring the Potential of Timber Stock Improvement as a Cash-Generating Alternative

KEF is now in the process of examining timber growth and harvest information from around eighty-six different Modified Timber Stock Improvement (MTSI) sample plots scattered around the Kalahan Reserve. KEF has placed the sustainable culling rates per forest type as 10% of the Annual Volume of Timber Produce. At present, the forestry team estimates that fewer than 10% of the growth increments are extracted for forest improvement, which is used by the local population.

(Modified) Timber Stock Improvement Production and Extraction Analysis
Forest Class	Total Volume Produced 94-97 (Vol. Increments) (A)	Gross Volume of Extraction 94-97 (B)	Actual Recovered Volume* (C)	Rate of Extraction (A / B)	Recovery Rate (C / B)
All types within the Kalahan Reserve	8,716 cubic meters	863.00 cubic meters	616.43 cubic meters	863 / 8,716 = 9.9%	616.43 / 863 = 71.4%

*This is less the wastage from cutting

As mentioned, MTSI research also serves as a feasibility study for the cash generating capability of the activity. As of now, extraction is only permitted for local use; commercial sale of lumber is prohibited. If studies show timber logging as a sustainable and profitable enterprise, then the TSI can be replicated in other areas both within and outside the reserve. Such monitoring and regulation can lessen "illegal timber cutting" for local use, as the scheme allows the community to cut provided the regulations for doing so are followed.

Using Biological Inventory Research to Combat Threats to Biodiversity

The Convention of International Trade on Endangered Species (CITES), to which the Philippine government is a signatory, aims "to protect important tree and wildlife species against over-exploitation and promote their aesthetic, scientific cultural, recreational and economic values." The biodiversity research component of the project has been able to identify within the project site, several species of flora and fauna listed by CITES as endangered. This was one of the major arguments used by KEF when it recently won its case in having the proposed national highway linking Nueva Vizcaya and Pangasinan rerouted away from the Kalahan Reserve. This research and monitoring definitely played a big role in this victory. As KEF wrote in one of their Technical Reports to BCN: "It is very fortunate that this BCN project in biodiversity is ongoing because the discovery of the endangered species within the Reserve will be the strongest protection of the area from the proposed road. A total of four bird species were identified in the report to the Department of Public Works and Highway. One of them, the Tarictic Hornbill, is on the critical list" (KEF 1996). In a related move, KEF is also in the process of filling a legal suit against the contractors who conducted the EIA of the proposed national highway, on the grounds that it severely understated the negative impacts of the road.

Developing KEF as a Stakeholder Organization

There are three components that make KEF an effective stakeholder including (a) structure, (b) leadership, and (c) local government relations.

KEF Structure – As outlined in Figure 5, KEF is governed by a Board of Trustees (BOT) that consists of 11 members elected from the different communities within the reserve. The BOT has two basic functions: Management of KEF wherein they have the sole authority to make management decisions regarding issues like the hiring and firing of staff, and management of the Kalahan Reserve itself. BOT members are required to regularly consult with their communities and personally make their "monitoring rounds," such as the updating of farming activities in their areas in order to allow them to make and re-enforce the necessary resource management policies. In terms of the project activities themselves, these are implemented by designated staff that are organized into project teams. There is an Administrative Team that is headed by an Executive Director that oversees the implementation of such activities.

Fig 5. Structure of the Kalahan Education Foundation

 

Strength of the Leadership – There are three basic leadership requirements in an undertaking such as the Forest Farms Development Project. First is leadership to spearhead the community development-organizing process. KEF certainly ranks high in this regard, not only because of its achievements, but with its ability to integrate traditional leadership and with newer democratic processes such as elections and policy enforcement. Its organizational structure also allows for a high representativeness that has resulted in establishing KEF as the main stakeholder organization in the area. KEF reports that around thirty years ago, there were only two high school graduates out of the entire population of 2,000. Now there are three Ikalahans with MS degrees, and 95% of the present population is able to attain at least seven years of formal schooling.

The main issue with KEF, however, has to do with project administration and enterprise management. Here there are mixed reviews concerning KEF's performance. The main issue here is the question of the development of "second liners." Pastor Rice, the current KEF Executive Director, is an American who has lived in the reserve area for nearly 40 years, and has been recognized as a great influence in the organizing of the Ikalahans. At the same time however, there are those who point out the dependence of the Ikalahans on Pastor and that there exists a question as to who would replace him when he retires. KEF has recognized this and, in response, they are taking steps to address this issue.

KEF and Local Government Cooperation – Another important aspect of KEF's influence has been its relation with the local government. The barangay is the smallest political unit of the country. Several barangays make up a municipality, and in turn, several municipalities make up a province. Each barangay has a set of elected local government leaders as do the municipality and the province. KEF therefore is not the only stakeholder organization in existence in and directly influencing the reserve.

There is a strong relationship between KEF and the local government. For example, the Barangays, Municipal Government and KEF took a united stance against the National Government on the proposed highway. Also, because the Local Government Code devolves a considerable amount of authority to the municipal government for the protection and rehabilitation of their resources, KEF closely coordinates its management activities with the local government officials – indeed, several elected town officials are also KEF members. This arrangement has greatly strengthened the existing conservation efforts, not just at the Kalahan Reserve, but in the adjacent areas as well.

Project Results

Project results include both the ability to implement resource management policies as well as more direct biological evidence of conservation.

Implementation and Efficacy of Resource Management Policies

Table 2 illustrates the different resource policies and guidelines that were written and are being implemented by the KEF. As reported in the BCN Stakeholder Organization Study (Mahanty 1998): "These rules are enforced by KEF staff, including forest guards and agroforestry (AF) staff, barangay officials, and BOT members themselves. As an incentive for strong enforcement by barangays, a system has been developed between KEF and barangays where 75% of the fine goes to the apprehending body and 25% to the other. For example if a barangay official catches an offender, the barangay receives 75% of the fine and 25% goes to the KEF. A number of respondents (25%), some of whom were barangay officials, spontaneously commented on the effectiveness of this system and the active role barangays now play in implementing KEF's resource policies. The BOT gets an overview of the implementation of resource rules during their annual monitoring visits to all the barangays in the reserve. Rewards may be presented to barangays where policies have been well implemented, for example where there have been no illegal fires during the year. This provides a further incentive for strong enforcement of resource policies by barangays."

Table 2. Resource Policies in the Kalahan Education Reserve

Source: KEF, 1995, Development Plan: Ancestral Domain Kalahan Reserve Phase 2.

Resource Use/Issue	Nature of Restriction	Fine/Penalty
use rights	Kalahan residents only Access to resources in secondary forest areas only, not primary forest, subject to resource guidelines below New residents to get permits for resource use	non-residents reported to DENR for prosecution
firewood and lumber	on-reserve use only, not for outside sale harvesting restrictions – marked trees only to be cut cutting permit required registration of chainsaws with AF office	400 pesos per tree cut Confiscation of all produce 500 pesos for unregistered chainsaws and reported to DENR for prosecution
swidden farming	New clearings must have permit from Agro-Forestry (AF) office Cultivated lands to be interspersed with forest and not on land susceptible to slides	500 pesos in dedicated watershed or sanctuary (primary forest) areas and required to cover cost of reforesting area 100 pesos anywhere else
forest fires	no burning except for 'proper agricultural development' (see swidden farming above) guidelines re firelines and burning times	500 pesos, plus payment for damages and reforesting area plus renumeration of people involved in putting out fire.
fishing	bona fide residents only allowed no use of chemicals or electric current allowed	200 pesos for fishing with chemicals or electrical current Confiscation of electrical equipment for second offence by residents
orchid collection	strict guidelines on methods for orchid collection complete ban on collection of endangered orchid species	see below
wildlife and flora	in sanctuary areas: no harvesting of trees, orchids, rattan, bamboo, birds or other animals outside sanctuaries: hunting of animals permitted from July-August; birds from September-October	1st offence: 1000 pesos + confiscation 2nd offence: 2000 pesos + confiscation 3rd offence: 3000 pesos + confiscate resources (this fine also applies for hunting wild pig and other big animals in sanctuary areas on the 1st offence)

 

Biological Monitoring

Sustainability of Resource Harvest – Though the food processing of the jams and jellies was considered as the project's major enterprise activity, examining the fruit gathering activities of the Ikalahans was also important. The key question being addressed here was whether there was enough fruits and regeneration of species to supply the needs of Mountain Fresh. There are basically eight "ingredients" that are being sold by Ikalahan fruit gatherers to the KEF Food Processing Unit for the production of Mountain Fresh jams and jellies. The table below outlines their relative abundance in each of the habitat types in which they are found.

Fruit Type Habitat Type	Dagwey	Guava	Passion- Fruit	Dikay	Citrus	Santol	Ginger	Bignay
Mossy Primary
Mossy Secondary	ample		few	ample			Ample
Pine Primary	few		few
Pine Secondary	few		few		few
Dipterocarp Primary			few
Dipterocarp Secondary	abundant	ample	Abundant	ample	ample	ample	abundant
Open/ Grasslands		abundant	Abundant	ample	abundant	ample	few
Outside Reserve			Abundant			ample		ample

Note: The KEF also buys fruits from outside the Reserve in order to assure the Food Processing of a continuous supply.

Studies from the forestry teams reveal that the quantity of fruits that are sold by harvesters to the food processing plant does not limit production nor threaten the regeneration of fruit tree/fruits within the Kalahan Reserve. To give an example of this, research in samples sites show that a hectare of dagwey fruit trees can produce up to 891 kilos of fruits per year. This already takes into consideration the population structure and fruit bearing capacity of each class at the sample sites. There are an estimated 509 hectares of dagwey fruit trees within the reserve which produce an estimated total of 45,387 kilos a year. At present, the KEF food processing plant processes not more than 5,000 kilos a year, or just 11% of the total dagwey fruits produced each year. By comparison, it is estimated that the Ikalahan population eats around 50% of the fruits. This research is important as the regeneration of fruit trees and the production of fruit also serves as an indicator of biodiversity quality within the Kalahan Reserve.

A picture of what an Ikalahan gatherer is like

Changes in Vegetation Cover – Table 3 indicates the changes in vegetation cover from 1994 to 1997 in the Kalahan Reserve. Despite the slight decrease in Mossy Forest (.04%), Pine Forest (1.03%) and Dipterocarp Forest (.35% ), the status quo in Lowland Agriculture and decrease in Grasslands (.69%) show the maintenance of the Kalahan Reserve over the last four years. The slight increases in Upland Agriculture (8.24%) can be understood in the light of the Forest Farm Concept that the Ikalahans should be able to get at least 50% of their food needs from their land-forest resources. It is then natural that swidden activities should increase as population needs rise. One must note however that the 67 hectare addition of upland/swidden agriculture affects only 0.48% of the reserve.

Table 3. Changes in Vegetation Cover from 1994 - 1997

Vegetation Cover	1994 Cover Ha		% of Class Cover		1997 Cover Ha	% of Class Cover		Hectare Change	Percent Change
Mossy Forest	2,403		17.19%		2,404	17.30%		+ 1	+ 0.04%
Primary Pine Forest	476		3.42%		439	3.16%		- 37	- 7.8%
Secondary Pine Forest	241		1.73%		241	1.73%
Scattered Pine Thick Stand	370		2.66%		370	2.66%
Scattered Pine Medium Stand	1,871		13.47%		1,873	13.48%		+ 2	+ 0.11%
Scattered Pine Few Stand	434		3.12%		434	3.12%
Classification Sub -Total	3,392		24.41%		3,357	24.16%		- 35	- 1.03%
Mixed Dipterocarp Pine Forest	640		4.60%		640	4.60%
Primary Dipterocarp Forest	709		5.10%		707	5.09%		- 2	- 0.28%
Secondary Dipterocarp Forest	1,322		9.51%		1,305	9.39%		- 17	- 1.29%
Scattered Dipt. Thick Stand	291		2.09%		291	2.09%
Scattered Dipt. Medium Stand	1,230		8.85%		1,230	8.85%
Scattered Dipt. Few Stand	722		5.20%		724	5.21%		+ 2	+ 0.28%
Sub -Total Hectares	4,914		35.37%		4,897	35.24%		- 17	- 0.35%
Scattered Swidden w/Dipt.	678		4.88%		732	5.27%		+ 54	+ 7.38%
Upland Agriculture	68		0.49%		81	0.58%		+ 13	+ 16.05%
Classification Sub -Total	746		5.37%		813	5.85%		+ 67	+ 8.24%
Lowland Agriculture	115		0.83%		115	0.83%		0	0.0%
Grasslands w/Scattered Pine	133		0.96%		133	0.96%
Grasslands w/Scattered Dipt.	1,887		13.58%		1886	13.57%		- 1	- 0.05%
Grasslands	304		2.19%		289	2.08%		- 15	- 4.93%
Classification Sub -Total	2,324		16.73%		2,308	16.61%		-16	- 0.69%
Kalahan Reserve Total Ha	13,894				13,894

Note: The 67 hectare addition of upland/swidden agriculture affects only 0.48% of the Reserve

From a larger perspective, KEF estimates that when the Ikalahans assumed responsibility for the management of the reserve in the 60's, around 35% of the upper half was grass and thinly scattered pine, while several areas around Imugan, Malico and Baracbac were grass. Now these areas are mostly covered with secondary pine and dipterocarp forest.

Changes in Land Use Classification – One of the first things that the Ikalahans did after attaining land security through MOA1 was to establish rules and regulations for protecting the forest. One of these was the classification of their forest and agricultural lands as shown in Table 4.

Table 4. Changes in Vegetation Cover from 1994 - 1997

Land Use Classification	1994 Area Ha	% of Class	1997 Area Ha	% of Class	Class Change	Percent Change
Sanctuary Area	3,159	22.73%	4,224	30.40%	+ 1,065	+ 25.21%
Protection Forest	N.A.		2,481	17.86%	N.A.	N.A.
Production Forest	9,316	67.05%	5,515	39.69%	- 3,801	- 40.80%
Upland Agriculture	466	3.21%	386	2.78%	- 80	+ 17.17 %
Pasture Land	468	3.37%	804	5.79%	+ 336	+ 41.79%
Titled Land	485	3.49%	484	3.48%	- 1	- 0.21 %
Kalahan Reserve Total Ha	13,894		13,894

Since the Ikalahans recognized the importance of watershed protection and biodiversity preservation early on, they immediately decided to classify a 3,159 hectare portion of the reserve as a "Sanctuary Area" where extraction, hunting or agriculture of any kind is not permitted. The vegetative cover in this area was composed of mostly Mossy Forest, some Primary Dipterocarp Forest and a small portion of Grasslands w/Scattered Dipterocarp Forest. Realizing the importance of having a "reserve" within the reserve, the Sanctuary Area by 1997 was expanded to 4,224 ha to include some Primary Pine Forest and Secondary Mossy Forest. The Ikalahans and KEF also decided to designate parts of the reserve (Secondary Mossy, Pine and Dipterocarp Forest) as Protection Forest. This is more of a bureaucratic classification since the steep slopes of these areas have rendered them out of reach to any form of exploitation. Production Forests on the other hand are designated for livelihood use and are open to regulated exploitation.


Conclusions

The ongoing efforts for the preservation of the Kalahan Reserve and its people and biodiversity are part of the struggle for conservation that started some 30 years ago. Aside from land tenure, strong stakeholder organization and implementation of resource policies, another key factor worth stating was the stabilization of the Ikalahans' resource usage and food supply. This was achieved by several means. The Ikalahans were first and foremost able to maintain the size and homogeneity of its population by being able to effectively address the threat of encroachment or inmigration. They were then able to reverse the destructive land use practices within the reserve and reintroduce traditional land use practices that aided in the rehabilitation of the area. Examples of these are: (a) Gengen – a system of contour composting which returns nutrients and protects the soil; (b) Balkah – a system of making vegetative terraces to lessen the slopes by 5-10 degrees; (c) Day-og – a system of composting dung on a soil level to rebuild fertility and (d) Pomy-omis – a system of planting nitrogen fixing plants. This allowed them to continue to engage in upland agriculture thereby stabilizing their main source of livelihood.

In terms of the enterprise itself, NTFP gathering at this stage is purely a supplementary form of livelihood. Fruit gathering, food processing and Modified TSI has not yet reached a level where direct cash benefits to the community can significantly affect conservation. What it has done, though, is allow KEF to solicit substantial external funding and support, that in turn has benefited both the Foundation and the community. The Ikalahans, however, are optimistic that these secondary enterprises will become major sources of cash income in the future.

The last significant impact of the project was the implementation of formal monitoring. At the start, the KEF staff and those involved in the project did not really see the need for such rigorous monitoring. By the end, they realized its value and role in conservation. Formal monitoring has made the feasibility assessment of their NTFP-Food Processing enterprise, the countering of threats, and documentation of conservation impact and changes possible. As Pastor Rice has stated: "Much of the work happened before BCN. But what BCN has been able to do is to make us realize how much work has been done." KEF plans to take the lessons learned from the project and apply them to nearby areas in the future.

Author: Chuck Encarnacion
Editor: Nick Salafsky

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