The Paraguayan Chaco, a vast expanse of dry thorn forest long considered the nation’s last frontier, was cleared at a rate of 2,000 hectares (4,942 acres) a day by loggers and ranchers in October and November of last year, a record pace of deforestation that many experts believe could lead to large-scale desertification of the region over the next two decades.

Guyra Paraguay, a leading Paraguayan environmental group that uses satellite data to track land clearing, estimates that Paraguay’s Chaco will have lost 250,000 to 300,000 hectares (620,000 to 740,000 acres) in 2014 when year-end figures are tallied, a deforestation rate that is among the highest in the world.

The group blames a combination of high beef prices, land speculation and misguided government policy for the destruction of the wilderness, which is home to one of Latin America’s last uncontacted indigenous groups as well as rare fauna such as the lowland tapir (Tapirus terrestris), the giant armadillo (Priodontes Maximus) and the jaguar (Panthera onca).

“We are losing biodiversity as well as the region’s capacity for agricultural productivity at a tremendous speed,” says Alberto Yanosky, executive director of the Asunción-based Guyra Paraguay. “By 2035, there may be no forest left. Yet I hear Paraguayan politicians say that nature is but an obstacle to further development for livestock and crop production.”

The Paraguayan Chaco is part of the Gran Chaco, which covers some 725,000 square kilometers (280,000 sq. miles), with over half in Argentina, a third in Paraguay and the rest in Bolivia. The largest dry forest and second largest forested area in South America after the Amazon, it often is referred to as “a green hell” on account of temperatures that regularly surpass 38 degrees Celsius (100 degrees Fahrenheit) and scant rainfall that in some areas rarely exceeds 200 millimeters (7.9 inches) annually.

Yet the heat, drought and poor roads have not stopped Paraguayan and foreign investors from pouring into the spiny forest to develop it for cattle ranching. In the process, the Paraguayan Chaco is being transformed at breakneck speed. Woodlands are cut. The topsoil, with nothing to bind it, blows away in harsh northern winds. The remaining soil fails to absorb the meager rains and sand dunes rise up where forest once stood, at times covering the roads in especially denuded areas along the border with Bolivia.

Broken biological corridors

The unregulated forest clearing, which has spawned illegal cutting in several national parks, is not only destroying the region’s long-term potential for livestock and crop production, experts say. It also is dismantling biological corridors for iconic species including the jaguar and the Chacoan peccary (Catagonus wagneri) and putting huge strains on the uncontacted Ayoreo people, hunter-gathers who have roamed the Chaco for centuries. With little ancestral land left, the Ayoreo are being driven out of isolation and onto private lands. Violent clashes between them and settlers have erupted.

Much of the blame for those problems lies with raw economics, experts say. For Brazilians, Argentines and Uruguayans with excess capital, the cheap land prices in Paraguay’s Chaco are attractive. So are the low taxes and the unenforced regulations. They can move their cattle operations there and, with land prices in Paraguay also rising quickly, develop ranches for resale.

But Paraguay’s government is also to blame for heavily promoting the region without ensuring adequate environmental safeguards, the experts say. Last February, President Horacio Cartes made a direct pitch to Brazilians at a Paraguay-Brazil business forum in Asunción.

“Use and abuse Paraguay because this is a moment of opportunities,” he said in what was widely understood to be a reference to development of the Chaco, among other places.

Then in November, as land in the Paraguayan Chaco was being cleared at record rates, the Paraguayan government made another pitch, this time in a business supplement in Britain’s Observer newspaper. Agriculture Minister Jorge Gattini touted the “cheap but productive land in the Chaco for cattle, sugarcane and soybean.”

Paraguay’s beef exports rank eighth in the world, last year bringing in US$1.25 billion—the country’s second biggest foreign-exchange earner behind soybeans. But, even with its beef production concentrated in the Chaco, Paraguay’s government could ensure better protection by improving implementation of a 1973 law that requires landowners to set aside 25% of each parcel to protect forests and watersheds, experts say.

Improved set-asides needed

“At present, most landowners set aside the worst land they have,” Yanosky says. “The ideal is to preserve production while insisting that the land set aside is that which truly protects forests and preserves biological corridors for plant and animal species.”

Rossana Scribano, a researcher at the Development Institute, a nonprofit Asunción-based think tank, warns that ineffective government policy combined with the rapid deforestation of the Chaco bodes ill for Paraguay in an era of climate change. Already, she says, the region is experiencing more intense droughts in the summer and heavier rains and flooding in the winter months of May and June, with rivers more frequently overflowing their banks.

“Given what we’re already seeing and the predictions of the IPCC [the UN Intergovernmental Panel on Climate Change], there are going to be real reductions in the production of cattle and of milk, as well as of subsistence crops such as corn and beans in the next 30 years, as temperatures soar and water becomes more scarce in the Chaco,” Scribano says.

She adds that the government must begin taking adaptation steps, such as rainwater retention and silvopastoral ranching to better conserve water and soil while minimizing the space needed for cattle grazing.

“The threat to the Chaco from climate change in terms of both production and biodiversity losses is already upon us and will only become more severe with the passing of time,” Scribano says. “We are going to need new policies to adapt and new legislation to halt the disappearance of the remaining forests if we are to begin dealing with it.”