Fri | Aug 7, 2020

Brazil asks investment firms to adopt protected Amazon areas

Published:Sunday | July 12, 2020 | 12:24 AM
AP
In this September 2, 2019 file photo, logs are stacked at a lumber mill surrounded by recently charred and deforested fields near Porto Velho, Rondonia state, Brazil. Dozens of Brazilian corporations are calling for a crackdown on illegal logging in the
AP In this September 2, 2019 file photo, logs are stacked at a lumber mill surrounded by recently charred and deforested fields near Porto Velho, Rondonia state, Brazil. Dozens of Brazilian corporations are calling for a crackdown on illegal logging in the Amazon rainforest, expressing their concerns in a letter Tuesday, July 7, 2020, to the vice president, who heads the government’s council on that region.

Brazil’s government on Thursday proposed that global asset managers adopt protected areas in the Amazon rainforest in order to curb illegal deforestation ahead of the season farmers traditional use of fire to clear land and brush.

Vice President Hamilton Mourão, who heads the government’s council on the Amazon region, held a video call with representatives of investment firms and said he hopes for financial support from them to support environmental-protection projects.

Last month, mainly European investment firms sent a letter expressing concern over rising deforestation and demanded forceful action against illegal activities in the Amazon. The 34 firms that have now signed on to the initiative have a total US$4.6 trillion in assets under management.

“The Adopt a Park programme will permit each of these national and foreign companies to choose one of the 132 conservation units in the Amazon and start financially supporting them, for monitoring, prevention, and recovery,” environment minister Ricardo Salles said in a press conference in Brasilia after the virtual meeting. The funding, for example, could pay for security to prevent people from entering the areas.

President Jair Bolsonaro took office in 2019 with pledges to unlock the riches of the vast Amazon and has repeatedly opposed large territories being reserved for indigenous peoples. His government faced international criticism last year when deforestation in the Amazon reached it worst level in 11 years. As a result, some members of European legislatures have said they would vote against ratification of a free-trade deal between the European Union and the Mercosur customs union, which includes Brazil, which was signed in June 2019 after two decades of negotiation.

Deforestation in the Amazon increased 22 per cent in the first five months of this year compared to the same period of 2019, the government agency that monitors the rainforest reported on June 6. Data for the full month of June have yet to be released.

MONITORING DEFORESTATION RATES

In the video call on Thursday, investors told Brazilian authorities that they are monitoring deforestation rates, the prevention of forest fires, and the enforcement of Brazil’s forest code, among other issues important for their assessments, according to a statement from Storebrand, one of the financial institutions at the meeting.

“We are evaluating, and having a dialogue with the government is a way to try to minimise the risk of divesting,” Jeanett Bergan, head of responsible investments for Norway’s largest pension fund, KLP, said by phone from Norway.

“We hope the dialogue can bring forward positive results and progress. We won’t see the same as last year, with all the forest fires and maybe see positive results coming out of this after awhile. It’s a positive first step, and we need to continue the dialogue, and, hopefully, we’ll all see some results on the ground.”

Bergan added that KLP’s participation in any Brazilian programme would require more details and information.

KLP has about US$53 million invested in 58 Brazilian companies. It has already divested from Brazilian meatpacker JBS, mining giant Vale, and power company Eletrobras for reasons related to either corruption, the environment, or human rights.

Brazil already receives money from wealthy nations, namely Germany and Norway, to fight deforestation in the Amazon rainforest. Norway alone has donated US$1.2 billion to Brazil’s Amazon Fund since its creation in 2008. However, both European nations suspended contributions last year, citing continued deforestation and questioning whether the government wants to stop it.

Foreign affairs minister Ernesto Araújo said the government is trying to improve the nation’s image as a responsible environmental steward. Brazil’s government announced n Thursday that it has started conversations with Germany and Norway to restart cooperation to protect the Amazon.

The government’s understanding, Mourão said, is that the two main donors to the Amazon Fund want to see deforestation dropping before resuming contributions.

“We will gradually corner those who commit crimes so that deforestation is reduced to an acceptable amount,” he said.

– AP