Promotion of Payment for Ecosystem Services (PES) for deforestation-free supply chains in Brazil

The Promotion of Payment for Ecosystem Services (PES) for deforestation-free supply chains in Brazil initiative aligns with the objectives of the CompensACTION Project, which aims to develop large-scale compensation mechanisms for carbon and other ecosystem services. In Brazil, this initiative is known as CompensAÇÃO. The project is being carried out in the state of Bahia, within the Atlantic Forest biome, one of the most critically endangered biomes globally. The project area covers 77 municipalities and benefits 1,600 families, including smallholder farmers, quilombolas, and agrarian reform settlers. CompensAÇÃO aims to reduce rural poverty by increasing the productivity of recovered ecosystems and paying for the provision of environmental and ecosystem services. It promotes the agroforestry transition of cocoa-growing areas towards more profitable and biodiverse production arrangements. OCT, a non-governmental organization with experience in PES projects in Bahia, is responsible for implementing CompensAÇÃO. The project has a total budget of US$4.9 million, with IFAD providing 89.9% of the funding and OCT contributing 10.1%.