« Natural Savings »: A New Microsavings Product for Inflationary Environments. How to Save Forests with Savings for and by the Poor? M. Hudon and B. Lietaer Decentralized sustainable resource management in developing countries is important both from a poverty-reduction and an ecological viewpoint. At the same time, no financial instrument is available that enables small savings to be protected against the vagaries of monetary instabilities and inflation. This paper proposes a solution that would address all three issues simultaneously: an inflation-proof savings instrument, fully backed by the organic growth process of a local resource, which at the same time gives a market-based financial incentive to protect that natural resource. A specific example involving sustainable forestry plantations in the Third World is provided. JEL Classifications: G21, G32, L22, L31, O16, P23, Q14 Keywords: savings, microfinance, natural resources, deforestation, inflation, sustainable development, poverty reduction.

CEB Working Paper N° 06/014 2006

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