Chapter 5

How deforestation and climate change could push the Amazon to a tipping point

David A. McKay 

The Amazon rainforest is one of the most biodiverse places on Earth, fitting around half of the planet’s remaining rainforest and 10% of known species (WWF, 2010) in only 1% of the Earth’s surface. Around 17% of the forest has been lost since 1970 (WWF, 2022) and another 17% degraded, mostly from clearance for cattle ranching, soy plantations, logging, and mining. This damage is threatening many rare species and is pressuring the Indigenous peoples and local communities who depend on the forest (Conceição et. al., 2021).

As well as direct loss, researchers are also worried that beyond a certain level of deforestation or warming the rainforest could start to retreat on its own, even if deforestation or warming stopped – a tipping point (McKay, 2019) known as ‘Amazon dieback’.

This could happen because the Amazon rainforest is partly self-sustaining (Looms, 2017). A rainforest can only grow above a minimum rainfall level, but the Amazon also makes around a third (Staal et. al. 2018) to a half (SPA, 2021) of its own rainfall by recycling moisture (Staal et. al. 2020) from the Atlantic. Winds transport this moisture further inland in a great ‘atmospheric river’ where it can be recycled again and again, expanding the area wet enough for rainforest to grow. Moisture recycling also acts like a giant ‘air-conditioner‘, allowing the forest to cool itself (SPA, 2021).

If enough forest is lost due to drought or deforestation in key rain-producing regions though, less rain is recycled, and areas downwind get drier. The Amazon is also seeing more frequent droughts (SPA, 2021), with water levels on the Rio Negro recently hitting record lows (Reuters, 2023) due to this year’s El Niño on top of long-term climate change-induced drying. These droughts make wildfires – to which rainforest is particularly vulnerable – more likely. If this pushes these downwind areas below the rainfall level needed for rainforest to survive it could lead to further forest loss, even less moisture recycling, and dieback could cascade through vulnerable parts of the Amazon.

When could dieback happen?

An estimated 40% of the Amazon (Staal et. al., 2020) – mostly in the drier south and east – can tip from a wet rainforest state to a drier, more open degraded forest or savanna-like state (Hirota et. al., 2011). Each state sustains itself through feedbacks (such as moisture recycling for rainforest or wildfires for open state), and can tip from one state to the other when pushed beyond climate or forest loss thresholds.

In 2016 Brazilian climate scientist Carlos Nobre led a paper that estimated dieback could be triggered around either 40% deforestation or 3-4°C of global warming (Nobre et. al., 2016; Nobre and Flatow, 2019). This matches other studies that found the risk of dieback grows above 2oC (Boulton et. al., 2013) and becomes likely beyond around 3.5oC (McKay et. al., 2022), and would take several decades to a century to fully play out. However, in 2018 Nobre and ecologist Thomas Lovejoy suggested that deforestation-induced tipping could start at as low as 20-25% due to interactions with warming-induced droughts not fully captured by their models, which is worryingly close to the current 17% deforestation level (Lovejoy and Nobre, 2018). Localized dieback may have even started in a few places (Downie, 2022), but has not yet spread across larger regions.

There is some uncertainty around model projections and driver interactions though, so these lower deforestation thresholds are based on expert judgement. The IPCC’s latest report gave a low likelihood for Amazon dieback this century as it features in only some leading climate models, but project biome large shifts by 4oC of warming. Some recent models suggest the forest may be more resilient to climate change (Cox, 2020) than first feared due to high adaptability (allowing it to survive past natural dry periods), and the Scientific Panel for the Amazon found a basin-wide threshold was too uncertain to identify (SPA, 2021). Key feedbacks like nutrient limitations or wildfires are not yet well represented in many models though, so these model projections may be over-stable thus underestimating the risks of a transgression of a threshold.

Given this, 20-25% deforestation acts as a provisional precautionary threshold that is wise to stay within even if the actual tipping point threshold turns out to be higher, and the Science Panel for the Amazon (Rodrigues, 2021) has called for an immediate moratorium on deforestation in tipping-prone regions.

What’s at stake

The Amazon rainforest stores around 150 to 200 billion tons (SPA, 2021) of carbon in its plants and soils, and over the last few decades has absorbed 5-10% of yearly human CO2 emissions from the atmosphere (Cox, 2020). However, the capacity of this ‘carbon sink’ peaked in the 1990s and is now falling, and combined with degradation the Amazon likely now emits more CO₂ than it absorbs (Welch, 2021; Carrington, 2021). This shift is not a tipping point in itself, but means the Amazon has started to amplify rather than counter global warming.

If wide-scale dieback were to start, then it would lock in far more CO₂ release over the coming decades. Dieback in the dry south and east could release around 30 billion tons of carbon (McKay, 2022), which is the equivalent of around 3 years of current human emissions, and along with biogeophysical feedbacks could add 0.1oC to global warming over the next century. Even more carbon would be at risk if higher warming makes more forest vulnerable to dieback (Staal et. al., 2020). Regional impacts would include extra local warming of up to 1oC as the forest’s self-cooling ability is reduced, and reduced rainfall across the Amazon and the Southern Cone (See Chapter 5). Thankfully, the planet’s oxygen supply is not at risk though, as it was built up over millions of years (Zimmer, 2019).

Action now is critical for protecting what remains of the Amazon rainforest. Keeping to the Paris Agreement goal of limiting warming to 1.5oC (or well below 2oC) would help to minimize the chance of Amazon dieback, requiring the rapid phase out of fossil fuels and the transformation of global food systems. Restoring degraded or lost forest and shifting to agroforestry can also help restore moisture recycling and recapture some lost carbon, while legally protecting intact forest and empowering Indigenous Peoples and local communities deters deforestation (Boadle and Shumaker, 2019). Together these would help improve Amazonian resilience to climate change, but ultimately the Amazon is not safe until both greenhouse gas emissions and deforestation stop. 

Boadle, A. and Sumaker, L. (2021). Protecting indigenous people key to saving Amazon, say environmentalists. Reuters. Available at: [Accessed 17.11.2023]

Boulton, C.A., Good, P., Lenton, T.M. (2013). Early warning signals of simulated Amazon rainforest dieback. Theor Ecol. 6:373-384. DOI 10.1007/s12080-013-0191-7.

Carrington, D. (2021). This article is more than 2 years old Amazon rainforest now emitting more CO2 than it absorbs. The Guardian. Available at: [Accessed 17.11.2023]

Conceição, K.V., Chaves, M.E.D., Picoli, M.C.A., Sánchez, A.H., Soares, A.R., Mataveli, G.A.V., Silva, D.E., Costa, J.S., Camara, G. (2021). Government policies endanger the indigenous peoples of the Brazilian Amazon. Land use policy 108: 105663.

Cox, P. (2020). Could climate change and deforestation spark Amazon ‘dieback’?. Carbon Brief. Available at:

Downie, A. (2022). Large parts of Amazon may never recover, major study says. The Guardian. Available at: [Accessed 17.11.2023] 

Hirota, M., Holmgren, M., Van Nes, E.H., Scheffer, M. (2011). Global Resilience of Tropical Forest and Savanna to Critical Transitions. Science. 334: 232-235. DOI:10.1126/science.1210657.  

Looms, I. (2017). Trees in the Amazon make their own rain. Science. doi:10.1126/science.aan7209. 

Lovejoy, T.E., and Nobre, C. (2018). Amazon tipping point. Science Advances. 4(2).

McKay, D.A. (2019). What are Climate Tipping Points?. Available at: [Accessed 17.11.2023] 

McKay, D.A., Staal, A., Abrams, J.F., Winkelmann, R., Sakschewski, B., Loriani, S., Fetzer, I., Cornell, S.E., Röckstrom, J., Lenton, T.M. (2022). Exceeding 1.5°C global warming could trigger multiple climate tipping points. Science. 377(6611): eabn7950. DOI:10.1126/science.abn7950. 

Nobre, C.A., Sampaio, G., Borma, L.S., Castilla-Rubio, J.C., Silva, J.S., Cardoso, M. (2016). Land-use and climate change risks in the Amazon and the need of a novel sustainable development paradigm. PNAS. 113(39): 10759-10768.

Nobre, C.A. and Flatow, I. (2019). A Spike In Tree Loss Puts The Amazon Rainforest At Risk. Science Friday. Available at: [Accessed 17.11.2023] 

Reuters. (2023). Amazon rivers fall to lowest levels in 121 years amid a severe drought. CNN. Available at: [Accessed 17.11.2023]

Rodrigues, M. (2021). New Report Puts the Amazon Rain Forest on the Main Stage at COP26. Available at: [Accessed 17.11.2023] 

Science Panel for the Amazon (SPA). (2021). Executive Summary of the Amazon Assessment Report 2021. C. Nobre, A. Encalada, E. Anderson, F.H. Roca Alcazar, M. Bustamante, C. Mena, M. Peña-Claros, G. Poveda, J.P. Rodriguez, S. Saleska, S. Trumbore, A.L. Val, L. Villa Nova, R. Abramovay, A. Alencar, A.C.R. Alzza, D. Armenteras, P. Artaxo, S. Athayde, H.T. Barretto Filho, J. Barlow, E. Berenguer, F. Bortolotto, F.A. Costa, M.H. Costa, N. Cuvi, P.M. Fearnside, J. Ferreira, B.M. Flores, S. Frieri, L.V. Gatti, J.M. Guayasamin, S. Hecht, M. Hirota, C. Hoorn, C. Josse, D.M. Lapola, C. Larrea, D.M. Larrea-Alcazar, Z. Lehm Ardaya, Y. Malhi, J.A. Marengo, M.R. Moraes, P. Moutinho, M.R. Murmis, E.G. Neves, B. Paez, L. Painter, A. Ramos, M.C. Rosero-Peña, M. Schmink, P. Sist, H. ter Steege, P. Val, H. van der Voort, M. Varese, Zapata-Ríos (eds.) United Nations Sustainable Development Solutions Network, New York, USA. 48 pages.

Staal, A., Tuinenburg, O.A., Bosmans, J.H., Holmgren, M., van Nes E.H., Scheffer, M., Zemp, D.C., Dekker, S.C. (2018). Forest-rainfall cascades buffer against drought across the Amazon. Nature Climate Change. 8: 539-543.

Staal, A., Fetzer, I., Wang-Erlandsson, L., Bosmans, J.H.C., Dekker, S.C., van Nes, E.H., Röckstrom, J., Tuinenburg, O.A. (2020). Hysteresis of tropical forests in the 21st century. Nature Communications. 11: 4978.

Survival International. (n.d.). Available at: [Accessed 17.11.2023]

Welch, C. (2021). First study of all Amazon greenhouse gases suggests the damaged forest is now worsening climate change. The National Geographic. Available at: [Accessed 17.11.2023]

WWF (2010). Amazing Discoveries in the Amazon: New Species Found Every 3 Days Over Last Decade. Available at: [Accessed 17.11.2023]

WWF (2022) Living Planet Report 2022 – Building a nature positive society. Almond, R.E.A., Grooten, M., Juffe Bignoli, D. & Petersen, T. (Eds). WWF, Gland, Switzerland. Available at: [Accessed 17.11.2023]

Zimmer, K. (2019). Why the Amazon doesn’t really produce 20% of the world’s oxygen. The National Geographic. Available at: [Accessed 17.11.2023] 

Chapter 5

The Power of Giants

Not all economic and financial actors are equally influential. Our globalised economies contain a considerable concentration of influence and power, possibly putting Earth’s future in the hands of but a few.

In today’s globalised economies, collaborations and networks often place some actors in more central and influential positions. Such actors, in both the corporate world and the financial sector, could use their influence for a just and safe transition towards sustainability.

Keystone actors: corporate market concentration

The dominance of a few companies is clear in sectors that impact the world’s oceans, the atmosphere, vast biomes and other aspects of our living planet. For example, four companies control 84% of the agricultural pesticides market. Thirteen companies control up to 40% of the largest and most valuable global fish stocks. And over 70% of the world’s greenhouse gas emissions since 1988 can be linked to only 100 companies.

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Transnational corporations like these, so called keystone actors, are typically influential beyond their specific markets – they set global standards that subsidiaries and competitors need to follow, and they influence both national and international policy.

Financial giants: asset managers, index providers, and central banks

Since the global financial crisis in 2007–2008, a shift in investments has taken place, from actively managed funds to passively managed index funds. From 2006–2018, almost US$3.2 trillion was taken out of actively managed equity funds, and US$3.1 trillion flowed into index equity funds.

That shift primarily benefited the “Big Three” passive asset managers: BlackRock, Vanguard, and State Street, which are becoming ever-larger shareholders of publicly listed companies all over the world.

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While the Big Three and other large asset managers do not own the shares they hold, they do exert the voting rights attached to the shares. They also engage in meetings to discuss corporate strategy with the top management of companies in their portfolios. As such, they are “financial giants” with an ever-growing influence in economic sectors of critical importance for both people and planet.

As these giants hold shares in virtually all publicly listed companies and industries, their long-term returns hinge not only on individual firms but on the economy as a whole – something that should constitute an incentive to use their influence to reduce planetary pressures.

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The shift towards investments in index funds also put index providers, who determine which companies are part of the respective indices, in a central position. Decisions made by index providers have big impacts on the financial sector, as could be seen, for example, after Chinese companies were included in big benchmark indices in 2017. As a result of the inclusion, the inflow of foreign capital into Chinese markets is estimated to be up to US$400 billion over the next decade. A mere 33 index providers hold a combined market share of over 70%. 

Central banks and financial supervisors have been gaining attention as key actors in shifting the financial sector towards contributing to international climate ambitions and the Sustainable Development Goals. Tasked with maintaining price and financial stability, central banks have also started to explore the implications of environmental threats beyond climate change, focusing primarily on potential impacts on macroeconomic stability from biodiversity loss.

From insight to action on a changing planet

Central banks, asset managers, index providers, and “keystone actor” corporations are centrally placed and can help create and shape markets in ways that have deep impacts on our living planet and the climate system. Engaging with such influential economic and financial actors offers possibilities, but transparency, accountability and strengthened regulation will be key to securing outcomes that benefit sustainability ambitions and a just transition.

It all connects: the financial sector puts pressure on the climate system and the biosphere; in turn, it is exposed to risks by a changing planetary reality. Financial giants need to address both sides of this loop.