CNBC Business | Money Grows Trees

Money Grows Trees

Defying the normal conventions of international relations, Norway is giving $1bn (€700,000) to Brazil to support forest conservation in the Amazon. The cash donation is not a loan, and doesn't even result in a chunky carbon credit to offset Norway's oil production. Instead, the money represents the first instance in which the West has put its money where its mouth is with respect to preserving the Amazon rainforest in order to contain the rate of climate change. Transferring the first $110m (€77m) instalment earlier this year, Norway's prime minister, Jens Stoltenberg, will be watching closely to see if the money is efficiently spent by the newly formed Amazon Fund, a division of Brazil's national development bank BNDES. The remit of the fund is to prevent deforestation in the Amazon, a major source of carbon emissions that has made Brazil the fourth-largest polluter after China, the US and Indonesia. This donor strategy has never been employed before, but was proposed by Brazil two years ago. Brazilian environment minister Carlos Minc recently claimed that Japan, Sweden, Germany, South Korea and Switzerland are considering donating. Brazilian President Luiz Inacio Lula da Silva hopes to attract $21bn in donations from rich countries to protect the Amazon. Individuals and companies may also donate to the fund, which has a special account at Banco do Brasil (write to fundoamazonia@bndes.gov.br).