Brazil´s forest cover more than 65% of its 8.5 million square kilometers. Brazil had 3.2 hectares of forest per capita. About 90% of the contry´s forest cover is in the Amazon. Given these abundant forest resources, there continues to be considerable divergence in the costs and benefits as perceived by local, national, and global interests. Our knowledge of the process and underlying causes of deforestation in Brazil is still inadequate to devise an effective policy and implementation strategy. Hence, a policy of completely protecting all of the Amazon while neglecting Brazil´s other forests – a stance that international environmental community persuaded the World Bank to adopt in 1991 Forest Policy – was not the right policy. The challenge is to ensure that all of Brazil´s forests serve a variety of interests, including timber production for broad-based and sustainable development, and that those forests that are most endangered receive attention in conservation.