Selected category: Brazil

Part II:  Amazon Hydroelectrics, the UN Climate Treaty and the International Civil Aviation Organization (ICAO) – will greed and corruption derail the international climate negotiations?

Santo Antônio Dam under construction in the state of Rondônia, Brazil, 2009 | Photo: Wiki Commons

Brazil’s climate change negotiators are trying to throw the best hope for at-scale finance for stopping deforestation under the bus to ensure a big payday for bogus carbon credits from Amazon dams and other Clean Development Mechanism (CDM) projects  — benefitting the scandal-plagued national power company Eletrobrás at the expense of the Amazon. (See EDF and Brazilian partners report.) There are far better ways to combat climate change.

A Better Mousetrap

One of the best examples of how to do it, ironically, is what Brazil and Amazon states have actually done in reducing Amazon deforestation since 2004. Government ramped up enforcement, recognized indigenous territories and protected forests for other communities, and consumer goods companies like Walmart told their suppliers they needed zero-deforestation commodities. The result was a 70% reduction in deforestation by 2016 that kept 3.65 billion tons CO₂ out of the atmosphere – on the order of what the European Union achieved, only in one developing country. But positive incentives for forest protection called for repeatedly in legislation never materialized, so pushback from the big ranchers’ and farmers’ caucus in the Congress has put all of these gains at serious risk, and deforestation started to tick up again.

There is a lot at stake here, for the atmosphere as well as the forest. New research shows that much more cost effective climate change mitigation than anyone suspected – 11 billion tons of CO2 per year till 2030 — can come from “natural climate solutions”, mostly from stopping tropical deforestation and forest degradation. This is almost 40% of the mitigation needed by 2030 to have a 66% or better chance of keeping warming below 2°C, according to the authors.

Bringing jurisdictional reductions in deforestation and forest degradation into carbon markets could generate the funds that Brazil needs to end Amazon deforestation and effect the transformation to low-carbon sustainable agriculture. 

Reducing and ultimately stopping large-scale deforestation is fully feasible. We know this because Brazil and the Amazon states have done it. They have taken reductions targets below historical levels, and made world-leading reductions while increasing cattle and soy production – historically the major drivers of deforestation (Figure 1).  Making emissions reductions at the scale of a state or region or country is much more like the EU or California cap-and-trade systems than an offset project. It’s actually systemic climate change mitigation. Bringing jurisdictional reductions in deforestation and forest degradation into carbon markets could generate the funds that Brazil needs to end Amazon deforestation and effect the transformation to low-carbon sustainable agriculture. Transparent accounting, rigorous double-entry bookkeeping to avoid double counting, and fair benefit sharing will be critical to making it work, but are also completely feasible. Doing sustained, large-scale deforestation reduction would also allow Brazil to call for more ambitious goals for other big emitter countries, and create cost-effective opportunities to make that happen. A revamped CDM could then channel funds to the least developed countries that most need them.

Figure 1. Brazil annual Amazon deforestation, soy and cattle production 1996 – 2016 (source: Stabile, M. 2017. Amazon Environmental Research Institute (IPAM); Brazil National Space Research Institute – INPE/PRODES; Brazilian Geographical and Statistical Institute – IBGE PPM and PAM, Amazon Fund.

Operation Car Wash and Chico Mendes

So why wouldn’t any country with a lot of forest to protect, and potentially a lot to gain from it, want to continue a winning streak? Well, as Brazil’s experience shows, there’s a lot less opportunity for corruption in reducing deforestation than there is in, say, building dams. Carbon credit for Amazon dams fits right in with the massive corruption, “Operation Car Wash”, super-sketchy side of Brazil. World-leading emissions reductions from controlling Amazon deforestation are an example what we could call the Chico Mendes side of the country. Brazil has always had these two sides. Corruption is endemic but so is innovative public policy. Brazil’s world-class AIDs program, which has kept infection rates far below other early hotspots; the sugar cane ethanol program that gave Brazil the biggest flex-fuel automotive fleet in the world; internationally recognized high-tech remote sensing monitoring of deforestation; and former President Lula’s poverty reduction programs are all examples.

Brazil has an exceptional opportunity to become an economic/environmental innovator and global leader of truly transformative impact – a 21st century environmental/economic superpower — if it succeeds in creating real economic value for living forests. What Acre Governor Tião Viana calls “the low-carbon, high social equity economy” shows the way to zero deforestation, sustainable commodity and family farmer agriculture, and sustainable, prosperous forest communities.

Which side of Brazil’s Jekyll-Hyde political character will win? When Chico Mendes was alive, most people would have probably picked the Car Wash side. Along with ever-increasing numbers of Brazilians, I’d pick Chico’s side.

Both sides are on display at the international climate negotiations, where Brazilian negotiators are pushing hard for deeply flawed CDM projects including Eletrobrás’s Amazon dam boondoggles. Which side wins won’t only affect Brazilians. It will make a real difference to the atmosphere, and to us.

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Amazon Hydroelectrics, the UN Climate Treaty and the International Civil Aviation Organization (ICAO) – will greed and corruption derail the international climate negotiations?

Belo Monte Dam under construction on the Xingu River in the state of Pará, Brazil in 2013 | Photo credit: Letícia Leite-ISA

Brazil’s climate policy theater: Brazil climate negotiators fight for carbon credit payout for scandal-plagued national power company Eletrobrás and Amazon mega-hydroelectrics, block carbon finance for ending Amazon deforestation.     

Behind the headline-grabbing news about Brazilian political corruption, Brazilian climate change negotiators are busy pushing proposals that could seriously damage important new climate change agreements – and shut the door on much-needed finance for stopping deforestation.

New market mechanisms in the UN Paris Agreement and in the International Civil Aviation Organization’s Carbon Offsetting and Reduction Scheme for Civil Aviation (CORSIA) could provide money Brazil needs to protect its rainforest, including protecting heavily threatened indigenous territories twice the size of California. The new mechanisms could also help other tropical countries stop deforestation. That would be great news for the global atmosphere and for the people who live in the forests.

But Brazil’s negotiators are dead set against it. Instead, they’re fighting hard to preserve the Clean Development Mechanism (CDM), a relic of the Kyoto Protocol. Global climate change champions California and the European Union have largely or entirely shut the CDM out of their markets because they’ve concluded, rightfully, that its claims to environmental integrity have lost credibility.

Brazilian negotiators say the CDM is the gold standard for environmental quality, and reducing deforestation is too risky for carbon credit. A new report by EDF and Brazilian partners – along with a plethora of other analyses — reaches a different conclusion.

Bogus Carbon Credit for Amazon dams

The CDM was created in 1997 by the Kyoto Protocol to allow emissions reductions projects in developing countries to generate tradeable carbon credits, called “Certified Emissions Reductions” (CERs), which, the Protocol specifies, could be used by industrialized countries to help meet their emissions targetsduring the years 2008-2012. But since new targets for these countries didn’t take effect under the Kyoto Protocol, CER prices plummeted for lack of buyers. Brazil has a big portfolio of projects that are generating currently zero-value CERs that could turn into real money if the new market mechanisms of the Paris Agreement and CORSIA accept CDM credits. No wonder they like the CDM.

Three Amazon dams – Santo Antônio, Jirau and Teles Pires – are Brazil’s biggest CDM projects, and say a lot about what’s wrong with the mechanism.

Starting in 2012 affiliates of Brazil’s state power company, Eletrobrás, registered the mega-hydroelectric dams in the Amazon as CDM projects. They said that the dams would reduce greenhouse gas emissions that would have otherwise happened, and that since they were big, risky projects, they wouldn’t be financially viable unless they got the carbon credit. The CDM approved the dams, issued millions of CERs for them, and stands ready to issue hundreds of millions more.

Carbon Credit for Corruption?

But, a little later, these dams were implicated in the “Operation Car Wash” investigation, probably the largest corruption investigation in the world. The investigation first uncovered bid rigging, bribery and kickbacks worth billions of dollars in state oil company Petrobrás. It has now convicted scores of politicians and top executives at Brazil’s biggest companies. Eletrobrás executives engaged in exactly the same schemes in the three Amazon dams and other projects, according to whistleblowers. One former officer of an Eletrobrás subsidiary has been sentenced to more than forty years in prison for bribery, money laundering, obstruction of justice, tax evasion, and participation in a criminal organization, and similar charges are pending against others.

Eletrobrás’s stock price crashed as a result. US investors brought suit against the company, now pending in federal court in New York. They allege that Eletrobrás publicly claimed it was keeping clean books and building legitimate energy projects, while in fact concealing massive corruption and kickbacks. The dams ran up billions in cost overruns (allegedly to pay the bribes and kickbacks) at the investors’ expense.

Meanwhile, while it told the CDM that carbon finance was crucial for the dams to go forward, the company went ahead and built the dams.

Certified Emission Reductions market price crashed after the end of 2012 | Source: eex.com

The dams are operating today with basically zero carbon finance, because the CERs became virtually worthless after the end-of-2012 the price crash. If the dams in fact caused any emissions reductions, they did it without money from the CERs – so they  would have happened anyway. But, in fact the dams never caused any emissions reductions – the decision to build them was political, not economic. Opportunities for bribes and kickbacks were by all indications a key factor. It’s not surprising Eletrobrás and affiliates never told its investors that it needed carbon credit for the dams to pay off – the credits were just icing on the cake.

In 2016, KLP, one of the world’s largest investment funds, managing over $36 billion in pension funds in Norway, decided to exclude investments in Eletrobrás, citing “unacceptable risk of gross corruption. According to the company's financial reports to US authorities, Eletrobrás contracts with suppliers have been overbilled during a period of almost seven years, with the excess funds paid out to Brazilian politicians, political parties and company executives.”

That the CDM approved the dam projects at all is a serious indictment of its rules. Lots of other analyses have concluded that this mechanism needs serious overhaul or phase-out. See my next post for a better approach to international collaboration on climate change mitigation.

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Temer’s rollback of Brazil’s environmental and indigenous protections threatens livelihoods and world’s climate goals

Guest authors: Juliana Splendore, EDF climate change and indigenous issues consultant in Brazil, and Joelson Felix, Communications Officer of COIAB – a Brazilian indigenous organization representing indigenous peoples in the Brazilian Amazon

An aerial view of the Brazilian Amazon under a pouring rain | Photo by Juliana Splendore

One year into his presidency, Brazilian President Temer is leading a dismantling of crucial protections for Brazil’s indigenous territories and the environment.

New policies the president recently approved put at risk indigenous peoples’ rights to their lands, and could open the flood gates for Amazon deforestation, which has been rising dramatically in the past few years.

The president’s actions, aimed at winning the favor of the powerful agriculture lobby in Congress, threaten the livelihoods of the indigenous peoples who live in the forests, as well as Brazil’s international climate leadership and the world’s ability to meet the greenhouse gas emissions targets agreed to in the Paris Agreement.

One of the world’s largest tropical forest areas, the Brazilian Amazon is home to more than 200 groups of indigenous peoples. Nearly half of the Brazilian Amazon, an area about five times the size of California, is designated as indigenous lands or protected natural areas, and as such is protected from development. These indigenous and protected areas and their indigenous populations were key to Brazil’s decreasing its deforestation by 70% from 2005 to 2014, which has made it the world leader in reducing greenhouse gas emissions.

However, these gains are now at risk. Over the last two years, deforestation in the Brazilian Amazon nearly doubled from 4,500 km2 in the period of 2011-2012 to 8,000 km2 in the period of 2015-2016, according to the National Institute of Space Research (INPE).

The significant rise in deforestation caused the Norwegian government this year to cut its forest protection payments to the Amazon Fund to about $35 million, $65 million less than in 2016. This cut directly affects the indigenous populations in the Amazon, who are among the main beneficiaries of the Fund.

Rollbacks in indigenous lands and environmental protections

Since he took office August 31, 2016, scandal-plagued Brazilian President Temer approved new measures and federal rules aimed at helping him gain critical support from the advocates of agribusiness and large rural landowners, known as the ruralistas, who make up one of the most powerful caucuses in the National Congress with over 200 seats.

Temer has created a new federal rule to be implemented by Brazilian Administration that can be used to deny many indigenous peoples the right to their lands. It stipulates that indigenous peoples do not have the right to their lands if they were not occupying them in October 1988, when the current constitution came into effect. Essentially, it denies the right of the indigenous peoples who lack sufficient documentation to prove that they were expelled from their lands during that time. As a result, many pending requests by indigenous groups for titles to their traditional territories could be denied because of their earlier expulsions. Another part of the new rule also prohibits the expansion of existing indigenous territories. Finally, the new rule also allows certain types of infrastructure projects to be permitted on their titled territories without any consultation.

A new short-term measure signed by President Temer (MP759) – which can be easily turned into a law – is expected to substantially intensify deforestation in the Amazon region. The new measure facilitates the legalization of public lands that were illegally occupied in the period of 2004 – 2011 and increases the size of land parcels that can be claimed. This measure could result in the loss of millions of hectares in the Amazon to land speculators.

Indigenous peoples in a training organized by ISA (Instituto Socioambiental) | Photo by Juliana Splendore

Need for more international attention and support

Taken together, these developments in Brazil endanger not only the livelihoods of indigenous populations, but also the significant amount of forest carbon stored in indigenous territories in the Brazilian Amazon, threatening the world’s ability to stabilize global climate.

The silver lining here is that the advocacy efforts led by the indigenous movement, environmentalists, Norway, and some international organizations are playing a key role in  mitigating the effects of the policies and guidance approved by Temer.

Now, indigenous peoples need even more support from international actors, in particular from EU governments and international companies committed to reduce deforestation in their supply chains. The governments and business leaders need to tell President Temer to roll back the new rules and measures.

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Deepening collaboration: Aligning private sector and government commitments to tackle deforestation

By Breanna Lujan, EDF Policy Analyst, and Brian Schaap, Forest Trends Senior Associate

Aerial view of the Amazon rainforest, photo by Neil Palmer (Flickr: CIAT)

When it comes to reducing deforestation, companies and national governments tend to operate in their respective silos. Effectively reducing forest loss, however, will require collaboration between both corporations and governments. According to a report published today, Collaboration Toward Zero Deforestation: Aligning Corporate and National Commitments in Brazil and Indonesia, companies and governments are beginning to work together toward their shared goals of reducing deforestation.

The report presents case studies that explore the ways in which companies and governments are collaborating, and highlights recommendations for how this collaboration could be strengthened—with implications not only for the two focal countries of Brazil and Indonesia, but for tropical forest countries worldwide. Aligning corporate commitments and Nationally Determined Contributions (NDCs) – official climate action plans submitted by parties of the Paris Agreement–is of critical importance to meeting national deforestation reduction and reforestation goals. Collaboration between companies and governments will not only enable each sector to achieve their respective deforestation reduction goals, but will also pave the way for future partnerships and enhanced action.

Need and opportunity for public-private partnerships

Deforestation continues to account for around 15% of global greenhouse gas emissions, while destroying biodiversity and threatening livelihoods. In 2014, Brazil and Indonesia together accounted for 38% of global tropical deforestation—with the majority of deforestation in each country driven by commercial agriculture.

Many companies and governments have committed to reduce deforestation. As of early 2017, 447 companies have made commitments to reduce deforestation in their supply chains, according to research by Forest Trends’ Supply Change initiative. Concurrently, of the 191 countries that submitted Nationally Determined Contributions (NDCs) to the United Nations Framework Convention on Climate Change (UNFCCC), an estimated 80% included plans to address the land sector in their mitigation targets.

Collaboration between these two sectors is essential: corporations need a regulatory and policy environment conducive to their reduced deforestation commitments—which governments can provide; and governments would benefit tremendously from the participation of key corporate actors in order to achieve the reduced deforestation and forest landscape restoration goals put forth in their NDCs.

Finding Synergies: Lessons from Brazil and Indonesia

Brazil

Brazil’s  NDC aims to reduce emissions 37% below 2005 levels by 2025, and 43% below 2005 levels by 2030—and outlines the role that reducing deforestation and increasing forest landscape restoration could play to achieve these emission reduction targets. Many companies with operations in Brazil developed zero deforestation commitments and are collaborating with the government and NGOs in multi-stakeholder initiatives such as Mato Grosso’s Produce, Conserve, Include (PCI) program. The PCI aims to reduce deforestation, increase reforestation, and increase sustainable agricultural and livestock production—all goals that align with Brazil’s NDC. Companies including Marfrig and Amaggi have signed on to this initiative and are contributing to the design, implementation, and mobilization of finance to support the PCI. Another PCI participant, the Sustainable Trade Initiative (IDH), created a de-risking fund to increase cattle intensification and reforestation. Through interactions via the PCI and other partnerships, the private sector is supporting the government to accelerate the implementation of the country’s NDC goals, and revealing the ways in which these collaborations can be scaled-up and amplified throughout the country.

Indonesia

The government of Indonesia, in addition to enacting several policies focusing on peatland and forest conservation and restoration, has made an unconditional commitment in its NDC to reduce emissions 29% below business-as-usual (BAU) estimated emissions by 2030, and a conditional commitment—contingent upon international support, including finance—to reduce emissions 41% below BAU by 2030. Meanwhile, companies committed to reducing deforestation in their supply chains have made No Deforestation, No Peat, No Exploitation (NDPE) commitments of their own. Many of these companies are collaborating with subnational governments in jurisdictional, multi-stakeholder initiatives aimed at achieving their shared goals of reducing deforestation. The Central Kalimantan Jurisdictional Commitment to Sustainable Palm Oil is one of the most advanced public-private collaborations to address deforestation and emissions in Indonesia, and is bringing together representatives from local governments, NGOs, indigenous peoples, smallholder farmers, and oil palm growers and buyers toward the goal of certifying all palm oil produced in the province by 2019—with Unilever as a particularly active private sector participant.

Recommendations

Lessons from Brazil and Indonesia show that corporate zero deforestation commitments—when buttressed by strong government policies and enhanced by multi-stakeholder partnerships—can help countries reach their goals of reducing deforestation and enhancing forest landscape restoration. This type of collaboration is of increasing importance and has come to the fore in countries such as the United States, where businesses and local and state governments are teaming up to uphold the spirit of the country’s Paris Agreement pledge, despite the US federal government’s announcement to leave the Agreement.

Based on the findings of the report, companies and governments from tropical forest countries worldwide should consider the following recommendations to promote more effective public-private partnerships toward reducing deforestation:

Companies

  • Advocate for policies that support corporate deforestation-free goals
  • Participate in existing multi-stakeholder initiatives and help them scale-up and replicate
  • Support efforts to strengthen and enforce regulations that can help to reduce deforestation

Governments

  • Conduct transparent consultations on elaborating and implementing NDCs, and solicit corporate input
  • Identify ways that private sector actors and subnational initiatives can support NDCs
  • Support private sector supply chain sustainability improvements through targeted policies, incentives, and financial mechanisms
  • Remove barriers to more stringent conservation efforts by companies
  • Better align national definitions of ‘forest’ and ‘deforestation’ with private sector zero-deforestation policies

For more details, please view the full report.

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Local government must lead zero-deforestation efforts at jurisdictional levels

Véu de Noiva Waterfall in the state of Mato Grosso, Brazil | Photo credit:Robert L. Dona via Wikipedia comms

Major consumer goods companies that have pledged to eliminate deforestation from their supply chains need support from their local governments to accelerate and scale up the implementation of their commitments, according to analysis from Environmental Defense Fund published in the latest journal from the European Tropical Forest Research Network (ETFRN).

Deforestation is a major contributor to climate change, and hundreds of consumer goods companies that purchase soy, palm oil, timber & pulp, and beef—the big four commodities that contribute significantly to deforestation—committed to eliminating deforestation from their supply chains.

But a vast majority haven’t yet acted on their zero-deforestation commitments or reported their progress—and leadership from local government can help.

Why local government leadership is needed

One way companies are trying to reduce deforestation in their supply chains is by using global certification processes. But because the processes didn’t include local governments when designing their certifications, the certifications have not solved the underlying governance issues at the heart of deforestation. 

Global certification processes have not solved the underlying governance issues at the heart of deforestation

A more inclusive and comprehensive solution to illegal deforestation focuses on resolving deforestation from all activities located in a state, province, or within national boundaries, i.e. a “jurisdiction”, instead of focusing solely on the supply chain of one commodity or company. This means the local government leads a multi-stakeholder process including producers, purchasers, civil society, and other relevant actors.

Leading multinational private sector companies such as Unilever, Marks & Spencer, and Mondelez have adopted the jurisdictional approach to implement their zero-deforestation commitments.

Mato Grosso: an example of local government leadership

Mato Grosso’s jurisdictional approach, known as Produce, Conserve, and Include (PCI), provides a good example of how local governments can take the lead.

Launched in 2016, the initiative encapsulates the state government’s ambition to decrease deforestation while increasing agricultural production. The government is collaborating with local soy and beef producer associations, soy buyer Amaggi, beef packer Marfrig, and civil society organizations to grow the agricultural economy, improve incomes and services for the state’s small farmer families and maintain the 60% of the state under native vegetation cover.

While economic and political turmoil have slowed progress on implementing the ambitious strategy, it may nonetheless already be making a contribution to reducing deforestation: in 2016, deforestation decreased by 6% in Mato Grosso, while Brazil’s national deforestation increased by 29%.

How a jurisdictional approach should be implemented

In the analysis, EDF proposes a blueprint of how a jurisdictional approach should be implemented. Specifically, it provides guidance on:

  1. Which actors need to be involved and their roles
  2. Important definitions to be decided upon such as what is deforestation in the local context
  3. Process infrastructure needed such as a robust multi-stakeholder platform
  4. Where to find the funding for implementation

To move forward with zero-deforestation efforts, companies must build on the existing platform of global certification processes and speed up local governance solutions. Local governments must be involved and lead the process to tackle deforestation.

The new ETFRN journal serves as a timely guidebook for companies to work together with local governments and other stakeholders to accelerate and scale up the implementation of zero deforestation commitments. EDF will continue to work with our corporate and government partners to implement these lessons.

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Is Brazil stepping back from environmental leadership, just when it’s needed the most?

Michel Temer in April 2016. Credit: Fabio Rodrigues-Pozzebom/ Agencia Brasil via Wikimedia Commons.

Every conversation I have with my Brazilian friends and colleagues these days starts off with a discussion of whose political crisis is worse. It’s a hard question. But Brazil’s President Temer has the chance to show a little real leadership June 19th if he decides to veto a blatant giveaway of a large swath of protected Amazon forest to land grabbers and environmental lawbreakers.

U.S. and Brazilian presidents: The 19th-century take on development and the environment

Wildly unpopular U.S. President Trump was elected by maybe a third of eligible voters, with a substantial minority of votes cast. He is doing everything he and his staff can think of to roll back environmental protections in the United States and stymie progress on climate change globally. His ill-conceived scheme to pull the United States out the Paris Agreement would have us abdicate international leadership and surrender the enormous economic opportunity of the new, renewable, energy economy to China and other competitors.

Wildly unpopular Brazilian President Temer was put in power by an even more wildly unpopular Congress in an ultimately failed bid to shut down judicial investigations that are sending herds of them, and their business associates, to jail for massive graft and corruption. He (and his predecessor, who mismanaged the economy into the worst recession in Brazil’s modern history) has totally dropped the ball on controlling Amazon deforestation, which, in the absence of budget for enforcement has increased for two years running for the first time since 2004.

Brazil’s Amazon at risk

Since the weight of corruption scandals Temer is personally implicated in has him clinging to power by his fingernails, the yahoos in the “rural caucus” of the Congress (the voting bloc of big ranchers’ and agribusiness’ representatives) are taking the opportunity to run hog-wild with proposals to gut forest protections and roll back indigenous territories – two of the major reasons why Brazil became the world leader in reducing greenhouse gas emissions by decreasing deforestation by about 80% from 2004–2014.

By June 19th, Temer has to decide whether to veto measures that would deliver 600,000 hectares in an Amazon protected area to land-grabbers – and rampant deforestation. It's not just 600,000 hectares of forest at stake – caving to a flagrant play to carve up a federal conservation area to benefit slash-and-burn land grabbers is a terrible precedent for all of the Amazon protected areas.

All of this is rapidly eroding Brazil’s international climate leadership, and is bad news for the Paris Agreement. Brazil’s demonstration that a major emerging economy could reduce large-scale emissions while growing its economy and bringing millions out of poverty was a beacon of light in the climate negotiations that is dimming by the moment.

Brazil’s President Temer can show a little real leadership if he vetos a blatant giveaway of a large swath of protected Amazon forest to land grabbers and environmental lawbreakers

The abandonment of Brazil’s successful deforestation control program by President Temer and former President Dilma, if continued, will only hinder Brazil’s economic prospects in the 21st century global economy – like President Trump’s radical misreading (or ignorance) of the economic implications of the Paris Agreement for the United States. Increased deforestation will likely cause Brazil to lose market share as major commodity traders and consumer goods companies that have committed to zero-deforestation beef and soy supply chains curtail market access. Rampant violence and human rights abuses against indigenous peoples and grassroots environmental activists will expose public-facing companies to increasing reputational risk – and send them looking for lower-risk places to source.

On the other hand, support for sustainable development first movers such as Acre state and agriculture powerhouse Mato Grosso could make Brazil the go-to supplier for zero-deforestation commodities worldwide. And, as Amazon states, civil society and green business leaders have consistently advocated, if Brazil opened up to carbon market crediting for reduced deforestation in emerging international markets, it could unlock the finance needed to end deforestation in the Amazon and Brazil’s other mega-diverse biomes; make family and industrial agriculture 100% sustainable; and create sustainable prosperity in the 200 million hectares of indigenous territories and protected areas of the Amazon.

It’s hard to say whose loss is worse under U.S. and Brazil’s lamentable current policies, but maybe even harder to say whose gain would be greater if Trump and Temer would wake up and recognize the real opportunities in the 21st century economy.

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