Challenges and opportunities for Amazon impact investment
A comprehensive study identifying investment mechanisms, types of enterprises, value chains, obstacles and investment opportunities for impact business in the Brazilian Amazon was launched by SITAWI – a PCAB partner, during the First Forum of Impact Investment and Sustainable Business in the Amazon.
Among the challenges listed is the scarcity of credit for investments, of risk limited government support, the lack of support systems such as incubators and accelerators, as well as logistical difficulties, training for entrepreneurs, and bureaucracy.
On the opportunities side, there is a strong presence of institutions connected to social and environmental issues in the region: civil society organizations, donors, financiers and government can serve as the base to support and develop impact businesses. There is also high potential for value-chain creation, as is the case of Brazil nuts. The study also identified room for more capacity building of entrepreneurs and growth of this service sector.
For Leonardo Letelier, CEO and founder of SITAWI, which specializes in mobilizing capital for positive social-environmental impacts, attracting new investors to the Amazon must be a priority as such investments underpin the long-term conservation of biodiversity for the region. He believes there needs to be more realistic expectations when dealing with Amazon projects, including the need for awareness of the complex local reality. According to Mr Letelier, investors need to understand that investment returns will be around 10 years, and that it is also necessary to match the different type of investors to the business more suited for them.