Wall Street banks help drive NYC-sized deforestation in Paraguay’s climate-critical forest

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Tuesday 10 December 2024, London – 10 major banks from the US, UK, and EU – including J.P. Morgan, Bank of America, HSBC, Santander, and BBVA – have financed companies driving large-scale deforestation in Paraguay’s climate-critical Gran Chaco forest, according to a new investigation by Global Witness.

The analysis tracks investments in Minerva and Frigorífico Concepción, major meatpacking companies which Global Witness last month showed were supplied by 16 cattle companies responsible for over 75,000 hectares of deforestation in the Gran Chaco – an area almost the size of New York City.

This destruction threatens the Ayoreo Totobiegosode, one of the last partially uncontacted Indigenous groups in South America, whose lands and culture are at risk from cattle-driven deforestation.

Today, new analysis reveals that 10 financial giants have funneled $1.7 billion into these companies in just three years.

Major US banks top the list of creditors, with J.P. Morgan and Bank of America alone accounting for 56% of this financing, providing over $900 million in credit to the two meatpackers between 2021 and 2023.

HSBC was revealed to be third-largest financier, contributing $210 million to Minerva Foods, while the Netherlands-based Rabobank contributed $198 million. Two Spanish banks – Santander and BVVA – collectively provided almost $200 million to Minerva.

The analysis demonstrates the ineffectiveness of banks’ voluntary sustainability commitments.

While HSBC, Rabobank, Mitsubishi UFJ and BBVA have policies to eliminate deforestation from ‘high risk’ forest commodity investments, all four continued to finance companies linked to deforestation in Paraguay.

The financing of deforestation-linked companies in the Gran Chaco reflects a broader trend in which financial institutions are failing to align their portfolios with anti-deforestation commitments, as noted by Forest500’s recent assessment of anti-deforestation policies.

Ashley Thomson, Senior US Policy Advisor at Global Witness, said:

“ These findings reveal the shocking extent to which US banks are financing the destruction of Paraguay’s Gran Chaco forest, and how even financial institutions with voluntary environmental pledges are complicit.

“World leaders must take urgent action to address the failing financial practices that are driving the destruction of our planet’s ecosystems. They must introduce stronger safeguards that hold banks accountable for their role in funding environmentally harmful operations.”

Last month, Guede*, a spokesperson of the Indigenous group told Global Witness in Paraguay:

“ If the Ayoreo ceased to exist, Paraguay would lose a part of its fundamental spirit. If our territory were lost, the country would also lose a huge conservation asset. The greatest conservation assets Paraguay have nationally been within Indigenous territories. Authorities must act now for the future.”

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