August 22, 2014

Commentary - Returning to Brazil


By Brent Heard, BS candidate in Economics and Environmental Policy at Carnegie Mellon University and a consultant for the National Academy of Sciences

This post originally appeared on Sense & Sustainability.

While most of the discussion about Brazil lately has been soccer-focused, eyes have also been turning toward their anti-deforestation policies. Brazil has long been the poster child for environmental damage and poor land management. The Amazon rainforest has been reduced in size by nearly 20% in the last 40 years, often due to cattle grazing, logging, and similar activities. However, as a result of innovative land-use policies, Brazil has managed to decrease deforestation by 70% in 8 years, from a ten-year average of 19,500 km/year in 2005 to 5,800 km/year in 2013. This reduction corresponds to 3.2 billion tons of carbon dioxide not released into the atmosphere, greatly enhancing efforts to reduce emissions from deforestation.

The incentives for deforestation have always been high for Brazil. The beef industry traditionally played a substantial role in Brazilian agriculture, demanding land for pasture. Additionally, as was noted in a paper published by Tropical Conservation Science, Brazil has been facing high international demand, and correspondingly high export prices, for soybeans, which has provided a substantial incentive for clearing rainforests to raise soy.

 



Brazil attempted to combat these growing incentives for deforestation through three stages of policy actions. The first step, begun in the late 1990s and lasting until 2004, was the Brazilian Forest Code. This increased the share of property that must be kept as a forest reserve from 50% to 80%. However, these requirements were unfeasibly high and too difficult to enforce, creating difficulties in efforts to preserve the Amazon. The second stage, between 2005 and 2006, coincided with a drop in soy profitability, and was characterized by an increase in effective enforcement due to better intra-governmental cooperation efforts as well as an increase in the amount of forest where farming was banned. Soy profitability increased during the final stage, beginning in 2009, and policy enforcement focused regionally, making it more difficult for areas with higher deforestation to get access to agricultural credit. Additionally, Brazil’s government created the National Climate Change Policy, which required a reduction in Amazon deforestation of 80% by 2020 and created low carbon credits to help farmers attain this goal.

The benefits from reductions in deforestation are not only environmental. A study of almost 300 communities in Brazil determined that the economic “boom” created from deforestation is short-lived, leaving degraded soil and a greater population in an area without effective farming resources. This results in a boom-bust cycle for those communities that build their economic foundations on practices of deforestation.

While Brazil’s 70% reduction in deforestation is an impressive milestone in their environmental preservation efforts, their government should strive to reap the benefits of even greater deforestation reductions. A study published in Proceedings of the National Academy of Sciences by UC Berkeley researchers determined that by subsidizing the most productive uses of pastureland and taxing those using non-sustainable practices, Brazil could reduce its deforestation rate by half and reduce its greenhouse gas emissions from deforestation by 25 percent. This accomplishment, however, would require efficient government coordination from Brazil and a strong, explicit policy commitment to conservation efforts.

Despite the progress made in Brazil, deforestation still remains a dangerously widespread problem. Indonesia recently surpassed Brazil’s rate of deforestation in 2012 by removing 840,000 hectares of their forests. Additionally, a 2014 Scientific American article cites data indicating that actual deforestation is double the rate being reported by Indonesia’s government. While discussions of deforestation did not play a major role in the recent election there the new government will face enormous challenges in following Brazil’s lead to rein in both legal and illegal logging.

One option for accomplishing reductions in deforestation are community-targeted programs. While Brazil has had some success with centralized policy, the paper The Political Economy of Deforestation in the Tropics determined that in the case of nations such as Indonesia, incentives faced by local officials and politicians are more directly connected to rates of deforestation than those faced by a central government. Community-targeted programs could provide an effective means for communicating the benefits of decreasing forest loss, and can be coupled with Brazil-style programs increasing the availability of agricultural credit. Testing these policy options could provide an excellent means to reduce Indonesia’s growing deforestation problem, in addition to creating an effective model for other nations.

The challenge of limiting deforestation globally is still very real. Tropical forest loss amounts to 15% of global carbon dioxide emissions, and as tropical nations realize more of their agricultural potential this threat will not recede. Brazil can serve as a successful model for other nations like Indonesia striving to reduce deforestation but it is important to remember that successful policy must also take into account local conditions.

 

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The Global Food and Agriculture Program aims to inform the development of US policy on global agricultural development and food security by raising awareness and providing resources, information, and policy analysis to the US Administration, Congress, and interested experts and organizations.

The Global Food and Agriculture Program is housed within the Chicago Council on Global Affairs, an independent, nonpartisan organization that provides insight – and influences the public discourse – on critical global issues. The Council on Global Affairs convenes leading global voices and conducts independent research to bring clarity and offer solutions to challenges and opportunities across the globe. The Council is committed to engaging the public and raising global awareness of issues that transcend borders and transform how people, business, and governments engage the world.

Support for the Global Food and Agriculture Program is generously provided by the Bill & Melinda Gates Foundation.

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