Effectively bio-fuel production (sustainable production and inclusion of small-scale feedstock producers in bio-fuel production chains; ethanol and bio-diesel) is a prioritized sector within Latin America that in 2008-2009 will be worked on in all countries in which we are present, from Honduras to Bolivia. Oil crops for bio-diesel, such as jatropha, are central in the regional strategy, with already several concrete initiatives in the region.

In Peru, SNV contributes to the promotion and strengthening of an inclusive and sustainable bio-fuel sector, involving bio-diesel and ethanol value chains, in prioritized areas in the Amazon and northern coast. Embedded in a regional strategy to promote inclusive business (see www.inclusivebusiness.org ) and to foster effective public sector management, in a 2 year period (2008-2009), we aim to increase by at least 50% the income levels of 3,000 small and independent agricultural producers, and generate 1,000 direct new jobs in bio-fuel production plants and plantations. Specific objectives of our program are to:

• Promote inclusive and competitive business initiatives in the bio-fuel sector, involving local communities and small-scale agricultural producers in bio-fuel production chains. 
• Articulate public and private institutions, in order to develop and implement effective strategies and mechanisms that enable a sustainable development of inclusive bio-fuel businesses. 
• Provide the necessary knowledge base for the development and up-scaling of inclusive business initiatives, by strengthening local capacity building service suppliers in the development and sharing of much-needed knowledge in this emerging sector.

This program contributes to increased and equitable job and income opportunities for small holders in the Amazon and northern coast of Peru, while taking into consideration the needs of current and future generations. Our main focus is on the promotion of non-food crops such as Jatropha curcas, in already deforested and degraded areas with no actual agricultural use. For example, with funding from the Inter-American Development Bank (IADB) and a Peruvian development fund (Fondo Empleo), a pilot project is initiated with local partners to validate and implement 1000 ha of Jatropha for bio-diesel production, with small-holders in the department of Ucayali (Peruvian Amazon). The project includes selection of Jatropha ecotypes for maximum profit, development of production and transformation packages, the installation of an oil processing plant and capacity building of 1500 farmers. Apart from Jatropha, we consider sustainable options with oil palm for bio-diesel, and sugar cane for ethanol. In these and others initiatives, we work closely together with companies, local public sector, farmers associations and other key actors. Knowledge development activities are undertaken in collaboration with WWF and local institutes such as IIAP (Research Institute for the Peruvian Amazon) and INIA (National Institute for Agricultural Research).