Strengthening community forestry as a strategy to enhance sustainable and equitable forest management is an important policy in Bolivia. A large part of the forest is used and managed by indigenous communities and local forest producers as part of their livelihood strategies. A key challenge is to develop public policies and instruments and corporate strategies that are compatible with, supportive to, and build on the local realities, needs and interests and the associated local arrangements. Local arrangements are a complex mix of many formal and informal arrangements which are largely unperceived, ignored and/or underestimated in the “formal world”. Neglecting the functioning of informal forestry sector and its linkages with the formal sector in policy making and business development constitutes not only a missed opportunity, but also increases the risks of policy and market failures as it may result in ill-designed instruments and regulations.
The document describe in detail the situation of forest use, timber production and financing modalities in the 12 communities of the study, highlighting the large diversity between them in terms of importance of forests and timber in the livelihoods, modes and levels of organisation of timber production and sale, negotiation power, accessing and preferences of different types of finance and the role and relations between formal and informal practices and actors. This emphasizes the importance to know and understand these diverse realities and that the application of one-size-fits-all approaches run a high risk of being ineffective. The study highlights the importance of forward payments, the reluctance of communities to access and apply for formal credits, the importance of the current system of intermediaries, how it functions (problems and opportunities), and how it could play a role in bridging the gap between the local realities and needs and the financial services provided by the formal institutions. The participatory approach applied, in which the communities - with support of the project - were the main agents of their own inventories and analysis, together with the sequences of sharing and feed-back workshops (in which they could mirror their own situations and experiences with the other communities) proved to be very effective for awareness raising and learning among the communities on their own situation and what they can do about it to improve. At the same time the study provides important insights for Bolivian Forest Authority, financial institutions and private sector how to better serve and/or engage with communities.