When the River Runs Dry: How Amazon Deforestation Threatens the Brazilian Economy

The report argues that the Amazon forest is a strategic economic asset for Brazil because it regulates the 'flying rivers' that distribute rainfall across the country. Deforestation of approximately 20% of the biome has already led to significant financial losses in the hydroelectric sector and increases vulnerability in agriculture, urban water systems, and logistics. The authors conclude that protecting the forest is a national strategic imperative to ensure economic stability and development.

• Amazon deforestation directly reduces hydroelectric power generation potential and revenue. The Teles Pires plant loses an average of US$ 21 million annually, while the Itaipu and Belo Monte plants together lost the potential to generate 3,700 GWh per year, representing annual financial losses exceeding US$ 200 million.
• Brazilian agriculture is highly vulnerable to deforestation-induced rainfall changes because only 13% of farmland is irrigated. Between 2013 and 2022, droughts caused estimated losses of US$ 34 billion in crops and US$ 12 billion in livestock.
• Deforestation compromises the forest's ability to recharge the atmosphere, increasing the risk and impact of wildfires. In 2024, wildfires burned over 30.8 million hectares, resulting in production losses totaling US$ 2.7 billion, including US$ 1.5 billion in livestock and pasture and US$ 400 million in sugarcane.
• Droughts linked to the disruption of flying rivers negatively impact river transport and logistics. In 2023, the Amazon drought reduced grain transport volume by approximately 40%, and in 2024, Hidrovias do Brasil suffered estimated losses of US$ 114 million due to drought in the North and South corridors.
• Urban water supply systems, such as the Cantareira system serving 9 million residents in São Paulo, are located along flying river trajectories and have faced prolonged drought conditions since 2014, leading to recurring supply crises.
• Projections suggest that by 2050, between 10% and 47% of the Amazon forest will be exposed to disturbances that could trigger forest transitions and undermine ecological integrity.

APA

Climate Policy Initiative (2025). When the River Runs Dry: How Amazon Deforestation Threatens the Brazilian Economy. https://www.climatepolicyinitiative.org/publication/when-the-river-runs-dry-how-amazon-deforestation-threatens-the-brazilian-economy/

Chicago

Climate Policy Initiative. When the River Runs Dry: How Amazon Deforestation Threatens the Brazilian Economy. 2025. https://www.climatepolicyinitiative.org/publication/when-the-river-runs-dry-how-amazon-deforestation-threatens-the-brazilian-economy/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=When the River Runs Dry: How Amazon Deforestation Threatens the Brazilian Economy |date=10 October 2025 |url=https://www.climatepolicyinitiative.org/publication/when-the-river-runs-dry-how-amazon-deforestation-threatens-the-brazilian-economy/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2025when, author = {{Climate Policy Initiative}}, title = {{When the River Runs Dry: How Amazon Deforestation Threatens the Brazilian Economy}}, institution = {Climate Policy Initiative}, year = {2025}, month = oct, url = {https://www.climatepolicyinitiative.org/publication/when-the-river-runs-dry-how-amazon-deforestation-threatens-the-brazilian-economy/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }