The trade agreement between Mercosur and the European Union has been provisionally in force since May. Against this backdrop, on October 16, Brazil announced an estimated 41.8% reduction in Amazon deforestation. This news has reopened the debate over demands from some developed countries for environmental conservation and how the costs and benefits should be distributed among developing nations.
The National Institute for Space Research estimates that deforestation has fallen to its lowest recorded level. Although Brazil benefits from protecting its forests, those benefits also extend beyond its borders, while the costs of protection and the productive uses of that land that the country forgoes are borne within Brazil.
International calls for action have come from prominent figures. In November 2025, during a visit with Lula in Belém, Emmanuel Macron stated that “preserving existing forests is essential,” accompanying his appeal with funding announcements. Earlier, in September 2020, then-presidential candidate Joe Biden proposed raising $20 billion to curb deforestation in Brazil and warned of “significant economic consequences” if it continued. Conservation, then, comes with both cooperation and pressure.
In negotiations with Mercosur, that pressure also extended to trade. Macron criticized the agreement in March 2024, arguing that it was insufficient on climate and biodiversity issues. The text eventually signed made the Paris Agreement an essential element of the trade relationship, and a serious breach could lead to suspension as a last resort. Environmental requirements could therefore have consequences for access to markets.
A double standard for development
The debate carries a historical asymmetry. The FAO has documented how agricultural expansion and demand for timber accompanied the development of Europe and North America. Much of this transformation took place before today’s international environmental commitments existed. Economies that accumulated wealth under those conditions are now asking Brazil to preserve resources that could support profitable economic activities.
There is a double standard when countries are asked to follow a different development path without being provided with the resources needed to do so. The distribution of the burden should reflect the benefits shared and the economic capacities of each country.
For an agricultural operation, expanding its land area can mean higher output and greater income. Preserving that land means giving up this alternative. That is precisely its opportunity cost. Spending on monitoring or fire prevention addresses a different need. A forest may be well protected, yet the question of what activities will replace the income lost by those foregoing profitable expansion may remain unanswered.
Brazil needs to sustain employment and expand its productive capacity. The value of conservation for the planet does not, by itself, pay for the investments required to pursue a different development path.
The gap between funding and costs
A 2019 study by Figueiredo Silva, Perrin, and Fulginiti estimated the cost of forest conservation in terms of forgone agricultural income. On average, this cost amounted to $16.42 per ton of carbon dioxide emissions permanently avoided, compared with the $5 per ton benchmark used by the Amazon Fund to attract funding.
The comparison shows that a funding benchmark can fall well short of the productive opportunities it is intended to compensate for. Establishing a fund and announcing contributions can get cooperation underway, but whether those resources are sufficient depends on how much they compensate and what alternatives they help create.
The Amazon Fund channels international donations into conservation projects, with Norway as its main contributor. However, its support for forest protection does not guarantee that every territory will have access to economic activities capable of replacing the opportunities it has given up.
Brazil is also promoting the Tropical Forests Forever Facility, known as the TFFF. The mechanism aims to raise public and private capital, invest it, and use part of the returns to reward conservation. In this case, forest payments are not loans to recipient countries. Brazil would therefore receive income for conserving its forests without increasing its debt or paying interest on those funds.
The design opens up an additional avenue, but its 2026 Charter makes payments conditional on available resources. This means that between announcing capital for an international mechanism and transferring sustained income to Brazil, decisions still need to be made and timelines established. These instruments do not yet guarantee sufficient and predictable compensation for the costs of conservation.
A counterpart for conservation
The response must combine conservation payments with investments that expand productive opportunities. Establishing a new economic activity, training workers, and gaining access to markets all require resources before returns can be generated. Cooperation must also finance this transition period, because the need for income arises long before the benefits of a promised transformation materialize.
The Mercosur-EU agreement provides a framework for discussing this counterpart. Trade liberalization can create opportunities, but its benefits do not automatically reach the territories that bear the costs of conservation. Linking environmental requirements to identifiable funding and investment commitments would make it possible to assess who contributes, who receives support, and what alternatives become viable.
Commitments should extend over several years and include predictable disbursements. Within Brazil, resources must reach the areas where the costs are concentrated, with verifiable results and respect for the law. They should also recognize those who are already protecting forests, rather than reward threats to destroy them.
Northern countries calling for the Amazon to be preserved must help Brazil achieve that goal without putting its development on hold. Asking Brazil to give up productive opportunities for the benefit of everyone means financing alternatives.
Autor
Master in International Studies at the University of CEMA (UCEMA). Researcher at UNQ and professor at the Universidad Argentina de la Empresa (UADE) and the Universidad de Ciencias Empresariales y Sociales (UCES).
