National Monetary Council Resolutions
National Monetary Council regulations that restrict credit to producers who do not comply with environmental legislation.
Over the years, the CMN (National Monetary Council) has been issuing resolutions that seek to restrict credit concessions and other areas to curb criminal and legal deforestation in the Amazon. The CMN establishes the general guidelines for monetary, exchange, and credit policies, in addition to regulating the operating conditions and inspection of financial institutions in the country. In 2008, when federal legislation tightened sanctions against illicit deforestation, CNM Resolution 3545 linked rural credit concession to rural producers in the Amazon to environmental compliance. In 2020, Resolution 4,883 conditioned credit approval to an absence of areas embargoed by the Brazilian Institute for the Environment and Renewable Natural Resources (Ibama) in the property or any sanctions on settlers for illegal deforestation. Estimates show that these restrictions have reduced the supply of medium and large loans to businesses that damage the environment. Between 2008 and 2011 alone, approximately R$2.9 billion was not lent to rural investors.