If "sanctioned" means giving approval to something, does this mean we are giving approval to deforestation?
"Sanctioned" is a very interesting word because it does in fact have two meanings that are almost the opposite of each other:
1) Give official permission or approval for (an action). 2) Impose a penalty on.
In this question, "sanctioned" is the best answer choice based on definition 2. There are very few words like this, with two opposite meanings, and they are just a part of the idiosyncratic nature of the English language. Another example would be "cleave" which can mean both to separate and to hold together.