Impact Investing in the Amazon: Pathways for Sustainable Development

2019, 22 January

The preservation of the Amazon and its biodiversity is vital to the world. Environmental balance, forest products, and the rainfall regime that the forest delivers for the rest of Brazil and also influence rainfall in Bolivia, Paraguay, Argentina, Uruguay and even in the extreme south of Chile (the so-called “flying rivers”), give the true dimension of the importance of preserving the Amazon rainforest.

A large number of initiatives, financed by the governments of Brazil and other countries, by international organizations, and by financial resources derived from local and international philanthropy have managed to reduce the deforestation and degradation of the Amazon biome. Still, the challenge remains, since unsustainable economic development, regional political instability, the Manaus Free Trade Zone model and its uncertain future, as well as the growing demand for food, and especially animal protein, create a constant and strong pressure for degradation of the biome.

Thus, it becomes necessary to promote the development of a sustainable economy, capable of supporting the local population at a higher income level and with lower environmental impact, by adopting economic practices with higher productivity per unit of area. This development must take place through innovative business models not yet used in the region, able to deliver solutions with positive social and environmental and biodiversity conservation impact. For this to happen, the development and implementation of an investment ecosystem, involving impact entrepreneurs, investors and donors, will be necessary.

The purpose of this study is to paint a picture of the region through that lens, identifying investment mechanisms, types of enterprise, value chains, obstacles and opportunities for investment in the area.

This image will serve as a subsidy for agents willing to promote the sustainable development of the region. This work is not prescriptive, but rather a basis for fostering discussion on the subject and for structuring decision-making. In order to reach as wide an audience as possible, including specialists in conservation and social action as well as investors, we reviewed some basic investment concepts throughout the study.