Brazil will require an estimated $200 billion (BRL 1 trillion) investment to reach its 2030 climate goals, according to a new study released by the World Economic Forum.
That’s over $100 Billion USD more “in climate transition investments than the country is currently on track to receive by 2030.”
Finding Pathways, Financing Innovation: Tackling the Brazilian Transition Challenge, published in collaboration with Oliver Wyman, provides insights “to business and public sector leaders about the Brazilian reality concerning climate goals and highlights local market challenges and opportunities.”
It also shows how Brazilian enterprises “can influence and contribute to the global carbon neutrality agenda.”
Kai Keller, Lead, Regional Strategy and Partnerships, World Economic Forum, said:
“Brazil and other developing economies face different climate challenges compared to the rest of the globe. For example, Brazil’s agricultural sector plays a relatively outsized role in its climate footprint compared to developed economies. Meanwhile, its energy and transport sectors contribute much less. Policymakers, business leaders and industry experts need to come together to help Brazil attract the investment needed to successfully reach their climate targets.”
Guilherme Xavier, Partner and Head of Climate and Sustainability Latam, Oliver Wyman.
“Brazil enjoys a privileged position to become a global hub of green solutions for other countries. On the other hand, the country has important challenges to reduce its emissions and realize its potential. For this to happen, the country needs to establish robust financing structures, such as the development of sustainable financial instruments, the mobilization of private investments and access to international resources for climate change.”
Brazil has committed to “reducing its greenhouse gas (GHG) emissions by 37% by 2025 and by 50% by 2030, based on 2005 levels, with the ultimate goal of achieving carbon neutrality by 2050.”
With these commitments in mind, the study highlights “the particular challenges Brazil faces in financing its 2030 climate goals and suggests potential solutions to closing these financing gaps.”
Key recommended solutions include:
- Developing new financial tools and robust financing structures, such as green, social, sustainable and sustainability-linked bonds, to facilitate climate investments.
- Policymakers providing clear targets, supporting measures and certainty for industry leaders to move forward with their climate transition strategies.
- Mobilizing private funding by tailoring decarbonizations pathways and developing a green taxonomy that fits conditions on the ground in Brazil, following the example of the European Union and countries such as China, Colombia and Mexico, which have already done this.
The whitepaper provides more specific decarbonization pathways “for different industries in Brazil and includes related financing options.”
These can be used by business leaders, policymakers and others “to help Brazil reach its climate goals by 2030.”
For more details on this update, check here.
