Brazil is making a multi-billion-dollar bet that money can stop deforestation. At a climate summit in the Amazonian city of Belem, President Luiz Inácio Lula da Silva has proposed a massive fund to pay 74 developing countries to protect their tropical rainforests.
This “Tropical Forests Forever Facility” is a direct attempt to solve the economic paradox of conservation. Currently, destroying forests for ranching, mining, or logging is profitable. Lula’s plan aims to make preservation more profitable, using a novel financing stream.
Instead of donations, the fund will be built on interest-bearing debt. Wealthier nations and commercial investors will provide loans, creating a sustainable financial incentive for governments to keep their trees standing. The plan has already attracted $5.5 billion in pledges, with $3 billion from Norway alone.
The stakes are high. These forests are critical for absorbing carbon dioxide, and their destruction accelerates global warming. The UN Secretary-General underscored this, warning of “moral failure” if the 1.5-degree limit is breached and blasting the “fossil fuel interests” driving the crisis.
While the financial plan is gaining support, the political will of the world’s biggest powers is in question. The leaders of the top three polluters—the US, China, and India—were absent from the preliminary gathering, revealing a divided world that Brazil hopes to unite.