1801 supporting businesses, receiving R$400–500 million/year, and allocating at least 20% of CFEM to economic diversification. b.1.2.) Municipal Sovereign Funds: Several Brazilian cities with natural resources have implemented municipal sovereign funds, marking advances in local financial management. Ilhabela (SP) created the Municipal Sovereign Fund (2018) allocating 15% of royalties, aiming to accumulate R$2 billion in ten years. Maricá (RJ) established a fund43 in 2017 to attract investors to PPPs in health, education, and infrastructure, initially funded with 5% of gross royalty revenue, later expanded to 15%. Niterói (RJ) instituted the Revenue Equalization Fund in 2019, using 10% of special oil participation. Canaã dos Carajás44 (PA) created the Municipal Sustainable Development Fund in 2016 with 5% of CFEM. Presidente Kennedy (ES) maintains Fundesul45 since 2000, financed by municipal and oil royalties, managed by Bandes. Itabira (MG) had Fundesi, linked to the Itabira 2025 project, structured to address Vale’s mine closures, later deactivated. These funds allow more effective planning and preservation beyond a mayor’s term, preventing municipalities from becoming “ghost towns,” though intergenerational transfer and economic diversification remain limited. c. Structures Created to Manage Mandatory Mining Royalties c.1.) Mandatory Royalties: International examples include the Alberta Heritage Savings Trust Fund (Canada, 1976), Alaska Permanent Fund (USA, 1976), Norway’s Government Pension Fund Global (1990), and Chile’s Copper Stabilization Fund (1990), integrated into the Economic and Social Stabilization Fund (2007). In Venezuela, the Economic and Social Development Fund46 (FEM) is discretionary. Brazil’s Mineral Sector Fund (2002) supports technology, research, innovation, and capacity building, financed by 2% of CFEM paid by mining companies. c.2.) Natural Resource Royalties Funds with Traditional Community Participation: Legal instruments for managing natural resource royalties for traditional communities aim at economic independence and self-determination, funding education, health, and infrastructure. Examples: Canada (First Nations Major Projects Coalition, Alberta Indigenous Opportunities Corporation, Fort McKay First Nation, Tahltan Central Government), Papua New Guinea (MRDC), Australia (Aboriginal Corporation Holding, Hiithaarr and Gamaay), South Africa (Black Economic Empowerment programs), and USA (1980– 2005 tribal agreements47 with federal approval). c.3.) Regional Environmental Conservation Incentives: 43 https://fundosoberano.marica.rj.gov.br/lei-de-criacao-do-fundo-soberano-marica/ 4444 https://www.canaadoscarajas.pa.gov.br/ 45 https://www.bandes.com.br/Site/Dinamico/Show/867/FundesulPK 46 Venezuela created two sovereign wealth funds: the Macroeconomic Stabilization Fund of Venezuela (Fondo para la Estabilización Macroeconómica, FEM) and the National Development Fund (Fondo de Desarrollo Nacional, Fonden). 47 Indian Mineral Development Act 1982 (USA) e Indian Tribal Energy Development and SelfDetermination Act 2005 (USA).
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