Derek Newberry is a Private Sector Development Specialist with the Washington, DC-based World Resources Institute. He is also a contributing writer for NextBillion.net, where he discusses the role of the private sector in poverty alleviation, growth in emerging economies, and a sustainable future.

"Some people think I'm crazy."

These were the words of Alexandre Wainberg, as quoted by The Estado de Sao Paulo last Sunday (Article in Portuguese - Subscription required). The Estado details the environmental damage and social issues surrounding aquaculture in Brazil, and the article focuses on Wainberg as a lonely and beleaguered advocate of sustainability. He is a passionate and entrepreneurial advocate, willing to defy an entire industry; yet he remains alone in his quest. As I read, I kept asking myself: where is the government support?

Sustainability lays bare the challenges facing base of the pyramid (BOP) producers; the article describes how shrimp producers in Northeastern Brazil have every incentive to ignore environmental regulations and flaunt formal business registration processes. Aquaculture farms slash and burn forests to make space for their operations while polluting water supplies with harmful chemicals in an effort to grow more, bigger shrimp.

Chemical use has an especially harsh effect on local, small-scale fishermen who are witnessing the slow destruction of their communities. This mirrors a process that has been underway for some time in South Asia with similar results, as WorldChanging has previously reported

Alexandre Wainberg has been in the middle of the battle between business and sustainability for years. He recognizes the difficulty small enterprises face in adhering to environmental regulations – especially since Brazil’s are generally tailored to large corporations. Then there’s the additional burden of legally registering a business – as the recent Doing Business report indicates, this is not easy in Brazil (it ranks 122 out of 175 - not good).

Looking for a solution, Wainberg made his company, Primar, into an organic producer and attempted to launch a cooperative organization aimed at assisting other producers to take the same steps. Despite valiant efforts, the organization failed, in large part due to the quantity of red-tape that entrepreneurs must endure to become certified.

So where is the public sector in all this? Enforcement is one side of social and environmental protection, but the Brazilian government offers little technical assistance for small businesses seeking to adhere to national standards. Primar has since seen greater success, having recently signed contracts to supply retail giants WalMart and Carrefour. However, making the move to organic may not be possible for other producers with fewer resources, constituting a sort of regulatory BOP penalty.

Wainberg showed his incredible ingenuity in learning from failure and reorganizing his business to focus on the organic aquaculture market. What remains to be seen is whether the government will learn from failure as well. There is plenty of talent and entrepreneurial ability at the BOP, but the Primar story is a strong reminder that it cannot be unleashed without the help of a supportive government.

Partnerships between the private and public/financial sectors can give companies the investment and capacity needed to produce high quality, sustainable seafood products at a greater profit margin (for specific examples, see Gil Friend’s WorldChanging post). These efforts could and should be replicated and publicly supported in Brazil.

I had the same exact project Mr. Wainberg had, but in Ecuador. Our organization involves organic hatchery, organic nursery, organic farming and organic packing, all certified by Naturland e.V. from Germany.
Our farm (200 hectares) name is Barquero-Vergel S.A. and our merchandising arm in the USA is Blue Origins Inc.
Ecuador was the first country in the world that certified an organic shrimp farm, and it was precisely in the area where our farm is located. Ever since, a few more farms were certified organic, most of them by the same German certifier.
We have been trying to push our shrimp in the US market for three years already but the results have been very confusing and hard to explain. Part of the problem is the lack of standards for organic aquaculture because the NOP (National Organic Program) has not yet issued them and therefore the USDA will not back those certifications up with the authorization to bear its blue-green seal.
Another reason is education. Most people in the US think that all shrimp come from the ocean and therefore they don't see why they have to pay more for it.
Finally, we need a larger volume to secure the programs of the large corporations that will allow us to plan in advance. Because of such large required volumes, we tried to bring more farmers to the organic practice, but the problem in Ecuador is the lack of organic feed. It is actually available but being a monopoly, prices are highly limiting.
We keep pushing anyway and would love to get in touch with Mr. Wainberg. Maybe an international cooperation could be the key to reach better and better markets.
Otherwise, pollution will continue, driven by a system that privileges price as opposed to quality and sustainability.
Klaus R. Calderon
Camaroneras Barquero - Vergel S.A.

Posted by: Klaus Calderon on September 9, 2006 10:50 PM