Nature loss and external vulnerability in Latin America: insights from Brazil’s balance of payments and exchange-rate risks

Guilherme Klein Martins, Annina Kaltenbrunner, Anne Löscher, Isabella Rodrigues, Maria Waaifoort and Karina Axl Araujo

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Pressure on ecosystem services can reduce and destabilise export earnings, raise import costs and dependence, and tighten external financing through higher risk premia. In Brazil, several important activities for earning foreign exchange (FX) are dependent on nature, creating scope for feedback between ecological stress, financing conditions and currency volatility. This new brief from the Land and Ocean series explores these critical channels for understanding macroeconomic risks in Latin America and further afield, providing new insights into the impact of nature degradation on the balance of payments (BoP) and exchange-rate dynamics.

JEL-codes: E6 N0 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2026-04-13
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