Can trading save the Amazon?

by John Fialka, E&E special correspondent to ClimateWire

One morning two days before Christmas in 1988, Chico Mendes, the leader of a group of rubber tree tappers, walked into his backyard to take a shower. That was his routine. Two gunmen were waiting for him there, and when he appeared, they stitched his tall body with bullets. That was their routine.

Assassinations were common then in Acre, an almost lawless state in Brazil’s western Amazon. Think of it as a New York-sized state where 87 percent of the land is tropical forests. Environmental groups talk about the Amazon’s vast jungle as being highly valuable. They describe it as the “lungs of the planet” because its trees ingest much CO2 from the atmosphere and store it.

Cutting these jungles down or degrading them so they’re more vulnerable to forest fires and other types of destruction are matters that increase the world’s greenhouse gas emissions by as much as 20 percent a year. That is more than the world’s transportation sector generates.

In theory, then, Acre’s jungle was valuable, and protecting it could be of value to the world and serve as one basis for modern emissions trading. But the facts of economic life in Acre were not based on altruism. In 1988, the value of the jungles was hidden to most people, and Mendes’ corpse was one way to keep it that way. Most of the state’s business was related to illegal logging. The people who ran the business also controlled the state’s government.

Thousands of indigenous people who lived in the forests and gathered Brazil nuts or, like Mendes, tapped the milky latex from its rubber trees were desperately poor, and the state discouraged them from seeking legal title to the land where they had lived for generations.

People like Mendes were drawn to Acre by a boom in the demand for natural rubber that surged in the 1880s and later ebbed. The men who gunned him down were hired by farmers and ranchers who made money by buying former rubber tree plantations, clear-cutting them and terrorizing indigenous people away from their homes. That was in the 1960s, when Brazil’s government subsidized efforts to clear jungle land for growing pigs and soybeans.

Just where the rubber tappers went was not a matter of great concern, but hundreds who remained and organized demonstrations, as Mendes did, were shot or sometimes dismembered by chain saws.

Out of the ashes, a new industry grows

Much of South America’s Amazon was like that then, and parts of it — where illegal logging and gold mining thrive — still remain outside the law today. The value of other resources was dictated by men with guns. Acre’s government felt that even mapping lands where indigenous people lived was bad for business.

Until Mendes came up with a proposal for creating “extractive reserves” that protected forest products and gave them value, much of Acre’s real economy and the costs related to running it — such as killing him — remained a black hole.

But this killing created a martyr. Mendes’ friends, union leaders and Catholic Church officials allied with environmental groups to outvote the oligarchy that ran Acre in 1998. A year later, the new government passed the “Chico Mendes Law” that incentivized land ownership and forest protection.

Logging became legal and regulated in Acre. The government eventually established 67 “extractive reserves” where forests were protected. As the new rules emerged, so did industries including cabinet work, furniture making, a flooring factory and a housing industry. Primitive versions of these businesses were previously invisible to tax collectors because they fed off illegal logging.

Roads were paved. Brazil nut cooperatives sprang up along with a factory that produced latex rubber for contraceptives. The state’s tax base grew to the point where the state could invest in the ultimate way to police the degradation of their forests: modern satellite systems that can see illegal logging and land clearing underway on plots as small as 4 square meters.

Trading has tempted some nations to try to get rich while fighting climate change.

Around 2008, China created a system based on manufacturing and then destroying a powerful greenhouse gas, an effort that was too ambitious and eventually collapsed. Brazil, led by Acre’s example, began to focus on a slower, more sustainable road to prosperity by creating a transparent economy that attempts to measure, expand and then protect the real value of the Amazon’s forests.

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