Int. J. Global Environmental Issues, Vol. 18, No. 1, 2019 41
Copyright © 2019 Inderscience Enterprises Ltd.
Economic evaluation of massive restoration in Brazil:
how to achieve the iNDC-Brazil target
Andrea Lucchesi*
School of Arts, Sciences and Humanities,
University of São Paulo, Brazil
Email: andrea.lucchesi@usp.br
*Corresponding author
Paula Carvalho Pereda,
Maria Alice Móz Christofoletti and
Keyi Ando Ussami
Department of Economics,
University of São Paulo, Brazil
Email: pereda@usp.br
Email: maria.christofoletti@usp.br
Email: keyi.ussami@usp.br
Eduardo Gusson and Girlei Costa da Cunha
Biodendro Forest Consulting, Brazil
Email: eduardo.gusson@biodendro.com.br
Email: girlei.cunha@biodendro.com.br
Abstract: The Brazilian Government has established a target to restore
12 million hectares of the country’s forest area by 2030. In this study, we
address the economic and financial feasibility of this massive restoration, as
well as job creation and government receivables, by applying a traditional
valuation method and assumptions from the environmental literature.
Conservative scenarios, based on an agricultural producer perspective, indicate
that the recovery is economically unviable: the net present value is negative,
and though the internal rate of return is positive, it is lower than the cost of
capital. However, sensitivity analysis suggests that it may become feasible
when considered as an outsourced business and a market for forest carbon
capture is included. In terms of public policy, there is still room for creating
instruments to improve its feasibility, since we have not addressed other
positive externalities and also the sale of non-timber forest products.
Keywords: ecological restoration; forest restoration; forest economics;
intended nationally determined contribution; UNFCCC; forest carbon capture;
Brazil.
Reference to this paper should be made as follows: Lucchesi, A., Pereda, P.C.,
Christofoletti, M.A.M., Ussami, K.A., Gusson, E. and da Cunha, G.C. (2019)
‘Economic evaluation of massive restoration in Brazil: how to achieve the
iNDC-Brazil target’, Int. J. Global Environmental Issues, Vol. 18, No. 1,
pp.41–70.