RIO DE JANEIRO, Brazil (30 July, 2012)_The private sector will play an important role in the protection of Amazon forests as it tries to tap into future markets promoting sustainability, a scientist with the Center for International Forestry Research says.

Multinationals and large-scale agribusinesses have for decades been accused of being some of the biggest drivers of climate change – clearing vast tracts of plush, tropical forests mainly for cattle ranching and soya bean farming.

But there is growing realisation they need to comply with environmental regulations. Regulations that many Brazilian states are keen to enforce as result of international commitments to sustainable production. They also have to adapt to consumer markets that are more sensitive to environmental sustainability, said Pablo Pacheco, who is conducting research looking at the implications on forests from globalised trade and investment for CIFOR.

“The private sector has always played an important role in the Amazon,” he said in an interview.

“In some cases, of course, this has led to deforestation and the chaotic process of the expansion of the agricultural frontier, and in some cases to a very unequal distribution of incentives and resulting benefits. This has gradually changed over time, and many landholders and corporate actors increasingly realise that adjusting to the new rules of the game may be the only way for the private sector to position itself favorably in the markets of the future,” he added.

Meeting sustainability goals will be easier for some than others, however.

With more capital to invest, large-scale corporations may have more success exploring alternative approaches, for example, cattle ranching in already opened-up pastures, than medium- and small-scale landholders or entrepreneurs who depend on more limited access to assets to make a living, he explained.

But there are innovative ways around that, as well, he said, pointing to both the logging and agricultural industries.

“There are attempts from the logging companies to start building alliances and partnerships with communities to undertake joint management,” he said.

“Also, in the agricultural sector, there are new initiatives, with some government support, such as in Brazil, to actively involve smallholders into more dynamic markets”.

The way the private sector will contribute to the sustainable use of resources is closely linked to public efforts and those driven directly by consumers and industry, Pacheco said, calling these combined efforts to promote sustainable production and slow the rate of deforestation among the “most innovative” in the region.

He pointed to a moratorium of soya farming initiated in 2006, and to a ban imposed from the leading supermarket chains in Brazil to the purchase of cattle raised on illegally cleared forestlands in the Amazon, which in combination with state efforts to enforce the environmental law, and industry attempts to accommodate to the new policy and market conditions, are stimulating important changes in how regional actors in the region will face the future.

There are many obstacles on the road ahead, Pacheco noted, including contradictory and competing policies that, on the one side, support the expansion of agricultural commodities driven by large scale agribusiness, often in competition with small-scale agriculture, and on the other side environmental policy driven by climate change concerns. These polarising views have lead to lack of consensus over what exactly development in the Amazon should look like, as well as on what would be the role to play by the private sector.

“We have more state enforcement and markets trying to constrain companies who are not adopting more sustainable practices” said Pacheco. “They have to take some steps if they want to continue being important actors in shaping the development pathways in the Amazon region.”