Brazil partners with largest climate finance alliance

Sao Paulo/London — Brazil on February 27 2024 announced it would partner with the world’s biggest financial climate coalition to turbocharge funding for clean energy and efforts to restore nature, such as reforesting the Amazon rainforest.

Brazilian development bank BNDES will partner with the Glasgow Financial Alliance for Net Zero (GFANZ) — a global coalition of asset managers, banks and insurance firms — to mobilise public and private financing.

The tie-up echoes some existing initiatives to help countries, such as a $20bn programme in Indonesia to phase out coal, although Brazil’s announcement does not come with the multibillion-dollar investment commitments.

BNDES president Aloizio Mercadante declined to give a value of the expected investment or a timeline for its launch, but told reporters that the government would act with “urgency”.

The announcement comes amid President Luiz Inacio Lula da Silva’s bid over the next two years to take a central role in leading global climate efforts by hosting the Group of 20 (G20) largest economic powers in 2024 and the United Nations COP30 climate summit in 2025.

GFANZ co-chair Mark Carney, a former Bank of England governor, likened the programme to a “more comprehensive” version of the Just Energy Transition Partnership (JETP) financing efforts to phase out coal in Vietnam, Indonesia and SA. JETP is backed by the US and other wealthy nations with public and private financing, including multilateral development banks.

“This is just much more comprehensive across the whole economy as opposed to just energy and it’s moving forward as opposed to dealing with stranded assets,” Carney said on the sidelines of a green finance event in Sao Paulo.

Carney and Mercadante said the investment platform would be used to expand Brazil’s already vast renewable energy sector and projects such as the Arc of Reforestation that aims to restore 60,000 square kilometres of degraded or destroyed Amazon rainforest.

Reuters