in Brazil, Norway

Norway pays Brazil US$1 billion. But what for, exactly?

2015-10-01-151425_1029x1026_scrotIn 2008, Norway agreed to pay US$1 billion to Brazil’s Amazon Fund, if Brazil reduced deforestation in the Amazon. Norway has so far handed over US$900 million and will pay the final US$100 million before the end of this year.

In a recent press release, the Norwegian government explains that the payments are “in recognition of Brazil’s outstanding results in reducing Amazon deforestation over the last decade.”

The press release is chock-full of people telling us that Norway’s US$1 billion helped reduce deforestation in Brazil.

Ban Ki-moon, the UN Secretary General:

“The partnership between Brazil and Norway through the Amazon Fund shows intensified support for one of most impressive climate change mitigation actions of the past decades. This is an outstanding example of the kind of international collaboration we need to ensure the future sustainability of our planet.”

Izabella Teixeira, Brazil’s Minister of Environment:

“The Amazon Fund consolidated the substantive reduction of emissions caused by deforestation in Amazon – the best news regarding climate change in the last years. Led by Norway’s contributions, the Amazon Fund became the anchor of Brazilian efforts to enable a new production and protection sustainable development paradigm.”

Tine Sundtoft, Norway’s Minister of Climate and Environment:

“Brazil’s achievements in reducing deforestation in the Amazon are truly impressive. The benefits for the global climate, for biodiversity and vital ecosystem services, as well as for the people living in and off the Amazon, are immeasurable. Through the Amazon Fund, Brazil has established what has become a model for other national climate change funds. We are proud to be partnering with Brazil in this effort.”

Carlos Rittl, Executive Secreatry of the Brazilian Climate Observatory:

“The Amazon Fund has been an important instrument for promoting innovative policies, measures and actions in order to achieve real sustainable development, and for changing the economic logic that is behind the destruction of forests, in the Amazon, and even in other regions.”

Mark R. Tercek, President and CEO of The Nature Conservancy:

“The Amazon Fund provides critical capital for innovative projects focused on curbing deforestation, mitigating climate change and strengthening sustainable development. I’m delighted to see Norway’s expanded investment in the Amazon Fund. It offers significant opportunity to scale up important work and demonstrates the North-South cooperation that is crucial for solving complex conservation challenges, such as biodiversity loss and climate change. This type of commitment is essential as nations prepare to negotiate a new global climate agreement in December in Paris.

Deforestation has fallen dramatically in Brazil. But what role did Norway’s US$1 billion play in the reduction? And has deforestation just moved elsewhere?

Deforestation started to fall in 2004 and was falling faster before Norway’s payments started

The first problem is that deforestation in Brazil started falling in 2004, as illustrated by this graphic from

Deforestation fell fastest between 2004 and 2007 in the Brazilian Amazon. Since 2008, when Norway’s payments started the reduction of deforestation has been less impressive.

Per Frederik Pharo, Director of Norway’s International Climate and Forest Initiative, argues that Norway’s US$1 billion helped to weaken the agribusiness lobby in Brazil:

“[C]onsider what could have happened if Brazil had not received any international financial support, after delivering what is probably the largest single reduction in greenhouse gas emissions the world has seen in recent years. The forces that want large-scale conversion of the Amazon for agricultural purposes would have had a better hand; those wanting to protect it would be weakened.”

Which is one of those counterfactual arguments beloved of REDD proponents.

What did reduce deforestation in Brazil?

In a 2014 report, the Union of Concerned Scientists argues that the Brazil-Norway agreement, “the largest REDD+ program anywhere in the world”, contributed to reducing deforestation in Brazil.

But the report outlines a series of actions that contributed to reducing deforestation in Brazil. Most of these took place before the Brazil-Norway deal, and the others have nothing to do with REDD, or Norway:

  • The establishment of new protected areas during the administration of President Fernando Henrique Cardoso (1995-2002).
  • the Plan for the Prevention and Combating of Deforestation in the Amazon launched after the election of President Luis Inácio Lula da Silva in 2002.
  • In 2006, following a Greenpeace report titled, “Eating up the Amazon”, the soy industry agreed not to buy soybeans from land that was deforested after 24 June 2006.
  • A Zero Deforestation campaign that started in 2008.
  • In 2009, the four largest slaughterhouses in Brazil’s beef industry agreed on a moratorium on deforestation in the Amazon.

In addition, since 2005, Brazil enforced its Forest Code. Credit was only made available to farmers if they were in compliance with the Forest Code. And farmers were required to geo-reference forest areas on their land in a national registry.

In 2012, Brazil weakened the Forest Code, allowing amnesty for past forest destruction, and reducing the area of protected land.

Deforestation is increasing

The bad news is that deforestation in Brazil is increasing. Earlier this year, the Brazilian government confirmed that the rate of deforestation in the Amazon is significantly higher than a year ago.

One reason could be the fall of the Brazilian currency, the real, against the US dollar. Exports of agricultural commodities are priced in dollars and a weaker real increases the local value of exports. More profits means that forest clearance for agricultural commodities becomes more attractive.

A further problem is that the figures on deforestation are based on satellite data which may not be picking up smaller areas of forest destruction. A recent study published by the Climate Policy Initiative notes that, “Once driven by large-scale clearings, Amazon deforestation now occurs mostly in small increments.” Forest clearings of less than 25 hectares are becoming more common – possibly to avoid detection by satellite.


A blog post by Mikaela Weisse and Rachael Petersen of Global Forest Watch looks at the recent data on tree cover loss in Indonesia and Brazil. In both countries, tree cover loss increased in 2014.

They write that in Brazil,

“our data also indicates that tree cover loss outside the Brazilian Amazon is accounting for more and more of the country’s total loss (the Amazon is one of Brazil’s several forest biomes, and by far the largest). From 2001-2007, tree cover loss within the Caatinga, Pantanal, Atlantic Forest, Pampa and Cerrado biomes of Brazil averaged about 36 percent of Brazil’s loss. Between 2008 and 2014, these areas constituted 46 percent of national loss.

Wiesse and Petersen note that some of this tree loss could be the result of harvesting of industrial tree plantations, that have replaced large areas of grassland and forest in these biomes. “Further investigation will be needed to determine how much tree cover loss in these areas is happening within natural forests,” they write.

Global Forest Watch’s graphic shows the proportion of tree cover loss from outside the Amazon (dark green shows tree cover loss in the Amazon, light green outside the Amazon, and the red line shows a three-year average for total tree cover loss in Brazil):

This is “leakage”: reduction in deforestation in one area, but an increase somewhere else. Paraguay has one of the fastest rates of deforestation in the world. The forests of the Chaco are being cleared to make way for cattle ranches and soy plantations.

Norway’s US$1 billion was paid to Brazil for reducing deforestation in the Amazon. But if this reduction in deforestation comes at the expense of forests in other areas of Brazil and neighbouring countries, has Brazil been paid for moving deforestation rather than reducing it?

Global Forest Watch uses data on tree cover (which is not the same thing as forest cover). Here’s how Global Forest Watch explains tree cover:

“Tree cover” refers to the biophysical presence of trees, which may be a part of natural forests or tree plantations. Thus, loss of tree cover may occur for many reasons, including deforestation, fire, and logging within the course of sustainable forestry operations. Similarly, tree cover gain may indicate the growth of tree canopy within natural or managed forests.

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  1. Great analysis. It would be good to highlight the transboundary leakage even more though. You already mention the Paraguayan Chaco, which is one of the five areas with the highest deforestation rate on the planet (40,951 hectares in June 2015 alone). Expansion of cattle ranching is by far the main cause, and more than 75% of the cattle ranch business is in Brazilian hands – a estimated 30% of Paraguayan territory is owned by Brazilians. Brazilians play a key role in deforesting other neighbouring countries as well. So basically deforestation has simply been exported.

  2. From a source close to the President of Brazil, there the government would like to see about 5 million more hectares deforested, then stop the deforestation.

    Right now there is no impunity for deforesting. We will see about 500,000 hectares deforested this year and next to 2020 and then we will see it drop down to about 200,000 to 250,000 per year to 2030. At this time the 5,000,000 hectares that is technically “legally” allowed private property will be cut.

    Norway’s funds went to ridiculous programs like the Cadastro Ambiental Rural which is a program not enforced. Thus people who plan to cut more simply don’t do this form. Even if they did this form and they have legal areas allowed to be cut they can cut them. About R$700 million went to “get out the word” for this program. With R$700 million Norway could have simply paid for everyone’s Cadastrol Ambiental Rural certificate. Better yet with US$1 billion they could have paid for everyone to have their updated Survey as required by the federal land agency INCRA and they could have worked out numerous better land disputes.

    The biggest waste of funds related to Norway was that in the three southern states of the Amazon of Brazil: Rondonia, Mato Grosso and Tocantins. These states in the case of Rondonia and Tocantins have already deforested everything that is legal to be deforested, thus they still recieved funds of over R$100 million reais. In Mato Grosso the only area really with areas remaining that are legal to be deforested are in the north west corner of this state and up in this area it is many large plots.

    The most funny thing is that this program that recieved R$700 million is all over Brazil in all the states almost and the states not in the Amazon region did not get any money from Norway and they had no issue getting out the word.

    Thus 40% of Norways funds were redundant absolute – waste of money.

    A large chunk went toward taking areas that, in many cases would have never been cut and turning them into Conservation Units (UC) which are reserves. This was smart but most of the 30 or so UC’s allow for sustainable forestry and economic activity, they simply can’t be cut down and turned into cattle pasture. The other fact about these UC’s are that they are really remote for the most part.

    The funds went to BNDES which is based in Rio de Janeiro about 1,600 km south of the Amazon. These people really haven’t been to the Amazon and they are basing data on people who understand the flora and fuana of the Amazon but absolutely don’t understand the economic of local politics who want to see progress for the country through deforestation.

    Norway did not put anything toward REDD besides investigation into the concept of REDD, which would have been mostly to cover salaries for government employees who probably mentioned REDD in a staff meeting once or twice.

    Leakage in your story is WRONG. People in the city of Tome-Acu, Para are not going to get up and go to Paraguay to deforest non-amazon areas if they are stopped to deforest amazon rainforest in Tome Acu. This is uncorrolated events. The Chaco region of Paraguay is being deforested purely because the farmers in southern Brazil, the Mennonites of Paraguay whch is a big farming group and farmers of Argention tired of crazy government policies are going too Chaco as the land is cheap, the soil is great and they are able to irrigate this area which was not possible in the past.