Brazil
Going backwards on green
Disclaimer: All Brazilian policy scores are Provisional. The current political situation in Brazil makes credible assessment of domestic environmental policy extremely difficult. We recommend unique caution in interpreting Brazilian data, which may reflect past, unenforced, or rapidly changing policies. We strongly welcome input to update and improve our data.
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Brazil is a case study of the green economy thrown into reverse. Up until January 2019, progress on environmental protection and social inclusion was steady, if unspectacular: new policies on welfare and inequality, some impressive achievements in tackling deforestation, and high-level commitments to the Sustainable Development Goals and international climate action. Indeed, Brazil pushed for a more ambitious agreement at the 2015 Paris climate talks, becoming the only large emerging economy to commit to absolute carbon reductions. But the 2018 election of Jair Bolsonaro has endangered this fragile progress.
Bolsonaro has overseen a rapid dismantling of existing green and inclusive policies across a broad range of fronts: conservation, pollution, inequality, corruption, support for indigenous groups, gender rights, fossil fuel subsidies, decarbonisation – the list goes on. Although some of his most controversial campaign promises have been dropped, including a mooted withdrawal from the Paris Agreement, Bolsonaro’s administration has been hostile to sustainability or social inclusion in almost any form.
Institutions and laws designed to fight deforestation have been gutted, environmental and social welfare schemes completely defunded (including several world-leading initiatives such as the Bolsa Verde PES scheme), oversight bodies and civic consultation processes abolished, climate change budgets slashed by 95%, indigenous lands opened up for mining.
Perhaps unsurprisingly, the Bolsonarao administration responded to COVID-19 initially by using the pandemic as an excuse to further deregulate polluting industries and support environmentally devastating logging, mining and agribusiness in the Amazon.
Brazil’s domestic policies carry global weight. A member of the BRICS group of large emerging economies, Brazilian policy ambition (or lack of) sets a trend for other developing nations, and as the sixth-largest emitter of greenhouse gases, Brazil’s cooperation is vital for international climate action.
But it is as a steward of the Amazon rainforest that Brazil’s national policies will have an outsized impact on the rest of the planet. The Amazon provides 20% of the world’s oxygen, acts as the planet’s largest carbon sink, and plays a decisive role in shaping worldwide weather patterns and temperatures. The Bolsonaro government’s reversal of a decade’s worth of progress on deforestation inside a few months therefore poses a global risk.
Policy Scores
Last updated 17 Nov 2020
Green COVID-19 Recovery
Brazil has been hit hard by COVID-19, but the initial economic response (stimulus worth approximately 12% GDP) has been seen as an opportunity to deregulate business and prop up existing industries rather than build a green recovery. Measures include relaxing restrictions on logging and mining in the Amazon, introducing a bill allowing illegal occupants to qualify for land deeds on protected reserves, and diverting approximately USD$30 million in funding from the National Climate Change Plan. Some greener initiatives announced include approximately USD$750 million in financing for wind energy, the creation of new financial mechanisms to issue green bonds for sustainable infrastructure, and access to USD$304 million of credit to support biofuel producers (conditional on retaining permanent staff, with preferential rates if staff stay for at least 12 months). Opportunities for green conditionality in support for brown sectors have been missed, as indicated by USD$600 million in loan guarantees to the airline industry.
Brazil has been hit hard by COVID-19, but the initial economic response (stimulus worth approximately 12% GDP) has been seen as an opportunity to deregulate business and prop up existing industries rather than build a green recovery. Measures include relaxing restrictions on logging and mining in the Amazon, introducing a bill allowing illegal occupants to qualify for land deeds on protected reserves, and diverting approximately USD$30 million in funding from the National Climate Change Plan. Some greener initiatives announced include approximately USD$750 million in financing for wind energy, the creation of new financial mechanisms to issue green bonds for sustainable infrastructure, and access to USD$304 million of credit to support biofuel producers (conditional on retaining permanent staff, with preferential rates if staff stay for at least 12 months). Opportunities for green conditionality in support for brown sectors have been missed, as indicated by USD$600 million in loan guarantees to the airline industry.
Governance
National green economy plan
The Plano Plurianual de Avaliação (2016) established some decarbonisation and SDG aspirations; however it also created new incentives for fossil fuel investment and failed to do much to curb deforestation. Government commitment to green economy remains weak, and its development strategy revolves almost exclusively around brown economic growth. The Bolsonaro government has shown no interest in decarbonisation.
The Plano Plurianual de Avaliação (2016) established some decarbonisation and SDG aspirations; however it also created new incentives for fossil fuel investment and failed to do much to curb deforestation. Government commitment to green economy remains weak, and its development strategy revolves almost exclusively around brown economic growth. The Bolsonaro government has shown no interest in decarbonisation.
Inclusive governance
Some public consultation on policy, and ambition to increase citizen participation – for example through new digital interactive platforms to promote participation and data transparency. However, since 2019 the Bolsonaro government has abolished most committees and commissions for civic consultation, and substantially weakened public policy oversight. No evidence of policies to support inclusive corporate governance.
Some public consultation on policy, and ambition to increase citizen participation – for example through new digital interactive platforms to promote participation and data transparency. However, since 2019 the Bolsonaro government has abolished most committees and commissions for civic consultation, and substantially weakened public policy oversight. No evidence of policies to support inclusive corporate governance.
SDG business strategy
UN Brazil has published some strategic guidance on SDGs for businesses, and an SDG Board reports to the President’s Office, but little concrete policy, and the attitude of the current government is largely hostile to the SDGs overall.
UN Brazil has published some strategic guidance on SDGs for businesses, and an SDG Board reports to the President’s Office, but little concrete policy, and the attitude of the current government is largely hostile to the SDGs overall.
Wealth accounting
Comprehensive economic data, but no mention of physical, natural or intangible capital; nor a particular focus on natural resources. Some limited wealth accounting work underway on water and forest accounts, in partnership with the World Bank’s WAVES programme.
Comprehensive economic data, but no mention of physical, natural or intangible capital; nor a particular focus on natural resources. Some limited wealth accounting work underway on water and forest accounts, in partnership with the World Bank’s WAVES programme.
Finance
Green finance plan
Some early discussions and announcements, but no effective frameworks or concrete policies. The few existing regulations designed to encourage green investment are poorly enforced, despite early green finance work by the Brazilian Banking Federation (FEBRABAN).
Some early discussions and announcements, but no effective frameworks or concrete policies. The few existing regulations designed to encourage green investment are poorly enforced, despite early green finance work by the Brazilian Banking Federation (FEBRABAN).
Green fiscal & monetary policy
Some internal auditing by the Ministry of Finance, but green fiscal policy overall remains weak. Some private sector and central bank monetary actions, for example the launch of Green Bond Guidelines by the FEBRABAN. Current government support or policy ambition is almost entirely lacking.
Some internal auditing by the Ministry of Finance, but green fiscal policy overall remains weak. Some private sector and central bank monetary actions, for example the launch of Green Bond Guidelines by the FEBRABAN. Current government support or policy ambition is almost entirely lacking.
Safe & accountable banks
Banco Central do Brasil has some requirements for banks to monitor environmental risks, and the banking association has begun to develop an assessment framework. Current stress test requirements include financial, social and environmental factors, but are only ad hoc and of limited effectiveness.
Banco Central do Brasil has some requirements for banks to monitor environmental risks, and the banking association has begun to develop an assessment framework. Current stress test requirements include financial, social and environmental factors, but are only ad hoc and of limited effectiveness.
Pricing carbon
No carbon trading in place, but some research was underway at the Finance Ministry. Brazil’s National Climate Change Policy, enacted in December 2009, aimed to promote the development of a Brazilian market for emissions reductions. However, the Bolsanaro government has signalled open hostility to climate policy in general and progress on carbon pricing is extremely unlikely.
No carbon trading in place, but some research was underway at the Finance Ministry. Brazil’s National Climate Change Policy, enacted in December 2009, aimed to promote the development of a Brazilian market for emissions reductions. However, the Bolsanaro government has signalled open hostility to climate policy in general and progress on carbon pricing is extremely unlikely.
Sectors
Green sectoral policy plan
Policies in place for a few high-impact sectors. National SDG Commission acts as a monitoring body for planning, however implementation and coordination is low and support for unsustainable projects continues. In addition the Bolsonaro government has massively weakened forestry policies, reversing a decade of progress in rainforest protection and agricultural reform.
Policies in place for a few high-impact sectors. National SDG Commission acts as a monitoring body for planning, however implementation and coordination is low and support for unsustainable projects continues. In addition the Bolsonaro government has massively weakened forestry policies, reversing a decade of progress in rainforest protection and agricultural reform.
Small business support
National policy for Micro-Small and Medium Enterprises transitioning towards sustainability, including training and skills development, but the program does not include fiscal and financial support. No clear legal form has been established for social enterprise.
National policy for Micro-Small and Medium Enterprises transitioning towards sustainability, including training and skills development, but the program does not include fiscal and financial support. No clear legal form has been established for social enterprise.
Carbon budgeting
Brazil has formally committed to a reduction of greenhouse gases of 43% below 2005 levels by 2030 – the only large developing economy to promise an absolute reduction in emissions. However, no quantitative carbon budget and no legally binding tools are in place to deliver this ambition. Furthermore, the current government’s active hostility to climate policy means further progress towards carbon targets is extremely unlikely.
Brazil has formally committed to a reduction of greenhouse gases of 43% below 2005 levels by 2030 – the only large developing economy to promise an absolute reduction in emissions. However, no quantitative carbon budget and no legally binding tools are in place to deliver this ambition. Furthermore, the current government’s active hostility to climate policy means further progress towards carbon targets is extremely unlikely.
Clean energy policy
Renewable energy already contributes around 80% of Brazil’s electricity supply – largely thanks to hydroelectric power. Current policy has goals for 2030 and 2050 but lacks detail; little or no policy to manage population displacement and environmental disruption from hydropower and biofuels – especially the additional pressure on deforestation from biofuel plantation. Decarbonisation of transport and buildings substantial contribution to energy emissions is not clear.
Renewable energy already contributes around 80% of Brazil’s electricity supply – largely thanks to hydroelectric power. Current policy has goals for 2030 and 2050 but lacks detail; little or no policy to manage population displacement and environmental disruption from hydropower and biofuels – especially the additional pressure on deforestation from biofuel plantation. Decarbonisation of transport and buildings substantial contribution to energy emissions is not clear.
People
Green jobs
There is a national plan for inequality reduction and insuring employment, with some detailed proposals. However, little policy directed at the creation of green jobs. Overall labour policies are heavily deregulatory, with labour rights diminished and unions weakened.
There is a national plan for inequality reduction and insuring employment, with some detailed proposals. However, little policy directed at the creation of green jobs. Overall labour policies are heavily deregulatory, with labour rights diminished and unions weakened.
Pro-poor policy
Some innovative programs have been developed in the recent past, such as the (abolished) Bolsa Verde scheme providing cash transfers to poor households in return for conservation work. The link between environmental issues and poverty is acknowledged in social welfare legislation, however funding and support for programmes has been slashed by current and previous governments. Future developments will need to be closely monitored.
Some innovative programs have been developed in the recent past, such as the (abolished) Bolsa Verde scheme providing cash transfers to poor households in return for conservation work. The link between environmental issues and poverty is acknowledged in social welfare legislation, however funding and support for programmes has been slashed by current and previous governments. Future developments will need to be closely monitored.
Participatory policymaking
The latest development strategy, the Plano Plurianual de Avaliação (2016) gives consideration to inequality reduction and inclusivity. However, the Bolsanaro government’s hostility towards gender equality, indigenous rights, and socially marginalised/minority groups undercuts these commitments. Policy has been rolled back – for example, transferring responsibility for certifying Indigenous territory from the National Indian Foundation to the Ministry of Agriculture, abolition of most committees and commissions for civic consultation, and substantially weakened public policy oversight. Requirements for impact assessment of policy is no longer clear.
The latest development strategy, the Plano Plurianual de Avaliação (2016) gives consideration to inequality reduction and inclusivity. However, the Bolsanaro government’s hostility towards gender equality, indigenous rights, and socially marginalised/minority groups undercuts these commitments. Policy has been rolled back – for example, transferring responsibility for certifying Indigenous territory from the National Indian Foundation to the Ministry of Agriculture, abolition of most committees and commissions for civic consultation, and substantially weakened public policy oversight. Requirements for impact assessment of policy is no longer clear.
Innovative social protection
Several innovative initiatives including Previdencia Rural, an old age pension provided to rural informal sector workers, the Bolsa Familia programme of conditional cash transfers for school attendance & vaccination. These programmes, and similar, are not supported by recent governments, and currently face being dismantled through funding cuts and cancelled several leading projects.
Several innovative initiatives including Previdencia Rural, an old age pension provided to rural informal sector workers, the Bolsa Familia programme of conditional cash transfers for school attendance & vaccination. These programmes, and similar, are not supported by recent governments, and currently face being dismantled through funding cuts and cancelled several leading projects.
Nature
Ocean & land conservation
Strategies in place for SDG14 and 15, but the Bolsanaro government has “systematically dismantled” environmental laws, radically rolled back forestry protection, slashed conservation budgets almost to zero, and dismantled protection agencies.
Strategies in place for SDG14 and 15, but the Bolsanaro government has “systematically dismantled” environmental laws, radically rolled back forestry protection, slashed conservation budgets almost to zero, and dismantled protection agencies.
Natural capital accounts
No official accounts; some limited pilot schemes unlikely to be expanded by the current administration.
No official accounts; some limited pilot schemes unlikely to be expanded by the current administration.
Natural capital committee
No current natural capital commission, or plans to create similar independent governance institutions
No current natural capital commission, or plans to create similar independent governance institutions
Nature-based fiscal reform
Some pilots of fiscal reform were underway, but the Bolsanaro administration has instituted an almost complete reversal of progress: for example, eliminating 95% of the Ministry of Environment’s budget for climate change related activities, and increasing subsidies for diesel.
Some pilots of fiscal reform were underway, but the Bolsanaro administration has instituted an almost complete reversal of progress: for example, eliminating 95% of the Ministry of Environment’s budget for climate change related activities, and increasing subsidies for diesel.