Letter of Intent Between the USAID and Brazil’s Ministry of Environment

The Governments of the United States of America and the Federative Republic of Brazil have collaborated, over decades, to conserve the biodiversity and promote the sustainable development of the Brazilian Amazon. The two countries share the understanding that private-sector partnership and engagement are critical to the development of sustainable, market-oriented productive models in the Amazon. Further, access to credit and financing is one of the major impediments to strengthening entrepreneurism, value-chains, innovation, and start-ups in the region. Both countries believe that, with impact investing in Brazil rapidly expanding, a private-sector-led, financially viable, scalable approach must move forward financing for economic opportunities that conserve forests and biodiversity and also have positive impacts on local communities.

The risks and challenges of working in the Amazon have precluded most impact investors from expanding into the region. It is our mutual understanding that unlocking private finance for sustainable enterprises in the Amazon strengthens the autonomy and well-being of forest-dependent communities and entrepreneurs in the Amazon, and creates opportunities for the conservation of biodiversity, the restoration of land, and reduced deforestation, which can displace illegal and unsustainable practices with legal and sustainable options.

The two countries intend to work jointly toward the launch of a first-ever $100 million biodiversity-focused impact-investment fund for the Brazilian Amazon (“Fund”), largely financed with private-sector capital. The Fund aspires to offer investment opportunities in hard-to-reach, high-risk sectors with the potential to create successful and scalable impact businesses that align with the conservation of forests and biodiversity. The Fund intends to provide long-term capital for value-chains, businesses, and start-ups that foster sustainable use of forest and biodiversity resources and decrease deforestation, while improving well-being in local communities. By strengthening the Amazon’s financial and impact-investing ecosystem, and providing a blended-finance model for overcoming the inherent challenges, the Governments of Brazil and the United States are putting forward a new model of development that can be both scaled and replicated in the future, throughout the Amazon, other regions in Brazil, and the rest of the Western Hemisphere.

In addition, the two countries intend to deepen their collaboration to share best practices and technology, data, and tools, such as geospatial information, monitoring, and early-warning systems, to help Brazilian decision-makers address environmental challenges that include drought, fire, the degradation of land, deforestation, and desertification. These problems are increasingly prevalent across Brazil, and threaten vulnerable populations and ecosystems, and lessons learned in the Amazon can help protect other key biomes, such as the Caatinga in Northeastern Brazil and the Pantanal in Southwestern Brazil.

Mark A. Green                                                               Roberto Castelo Branco
Administrator                                                                  National Secretary of International Relations
U.S. Agency for International Development                   Ministry of Environment