For the first time in 14 years, the eight countries that share the Amazon rainforest came together in Belem, Brazil to attempt an agreement on major issues like development and environmental crime.

In less than two days, the group (called the Amazon Cooperation Treaty Organization or “ACTO”) issued the Belem Declaration. The declaration creates an alliance for combatting forest destruction, asserts Indigenous rights and protections, and agrees to cooperate on further sustainable development.

It falls short in one area: deforestation.

Brazil, which has seen a 66% decrease in deforestation since President Luiz Inácio Lula da Silva took office (again) in January 2023, led the way by pledging to end illegal deforestation by 2030. But Brazil couldn’t garner the support from other member countries to pledge the same, making for a disappointing outcome on a critically important issue.

“The reality is that it should no longer be an option to allow illegal deforestation to continue – not if we’re truly going to combat climate change globally,” says my colleague Marcio Sztutman, Palladium Director in Brazil. “The Amazon doesn’t know borders, so unless these countries begin to work together towards the same goals, one country’s efforts will be nullified by another’s failure.”

The formation of the alliance itself is significant and an important step towards preserving the Amazon from further deforestation, but only if every member of ACTO can commit to the same goals. We can’t forget that up until now, the climate change agenda has largely been set by developed countries that have contributed the most to the issue. But those hosting our planet’s most precious natural habitats and carbon sinks – like the Amazon rainforest – must step up and use their voice. ACTO is an important way to join the conversation, and joining the conversation will only be meaningful if all parties are willing to meet targets such as those set for 2030.

If we’re to see efforts like ACTO and the Belem Declaration succeed, partnership with the Global North will also be necessary to build alternative economic incentives that not only don’t require cutting down forests but are actually ‘nature positive’.

“We need policies like the EU deforestation policy that avoids the commercialisation of products that have deforested the Global South, the commitment of companies to SBTi (Science Based Targets initiative) targets, and the creation of funds to invest in nature,” Sztutman agrees. “Only then, will the countries in the Amazon and elsewhere see the value in conserving natural habitats like the Amazon. Pretending that these eight countries will end deforestation without receiving what they’re worth is a fantasy.”

This is where carbon credits and nature-based solutions come into play.
Carbon credits, markets, and their role in halting deforestation have been receiving a lot of attention. For all their faults, they are still a way to put an economic value on the preservation of nature, because without such mechanisms, it will be impossible to preserve and restore nature at the scale and pace we need. Though carbon credits still require maturing as an asset, they remain critical in the fight against climate change and we cannot wait to trade them until they are perfect. If we wait, the destruction of ecosystems like the Amazon will be too far gone.

We have a chance now to continue trading and iterating and improving upon credits as we go, ensuring that we’re protecting nature and the people and communities that live there. But not without bringing those people along with us. There is no such thing as a sustainable carbon credit project that doesn’t benefit local communities.

Around the world, we’ve seen that it’s the local communities that will preserve and restore our forests over the coming decades. It’s on us to recognise the role they can and must play in our carbon credit and nature-based solutions projects. Without them, investors will be buying into projects that are almost guaranteed to fail and further harming already marginalised and vulnerable communities.

So, while the Belem Declaration is reason to be encouraged, action in the short term is critical. ACTO and the eight participating countries have created a platform for action and Brazil has the right leadership to make it happen. If we miss our 2030 targets, it may be too late for everyone – not just those in the Amazon.

For more information, contact info@thepalladiumgroup.com.