Financial Times (Reino Unido) – Brazil's election and the threat to environmental protection

Financial Times (Reino Unido) – Brazil's election and the threat to environmental protection

Lauro Marins

For decades, Brazil played a prominent role in the international climate arena.

Host of the Eco '92 conference, Brazil was the birthplace of the UN Framework Convention on Climate Change and the UN Convention on Biological Diversity. Twenty years later at the Rio+20 conference, the country helped bring the Agenda 2030 discussions to life, paving the way for the UN Sustainable Development Goals.

Home to about one-third of the world's remaining rainforests, as well as other vital natural carbon sinks such as the cerrado, Brazil is pivotal in the fight to stabilise global temperature rises.

Up to a third of the annual carbon mitigation needed to keep global temperature rises in check could be achieved by addressing deforestation and forest degradation.

According to the Brazilian government's satellite space research institute, the INPE, the country slashed its annual deforestation rate by 83 per cent between 2004 and 2012. However, in recent years the rate has been creeping up and, despite a fall last year as the economy slumped, deforestation is now greater than the 2012 low.

Protecting Brazil's valuable natural resources has been an all-but-absent conversation in this year's national elections. Indeed, none of the candidates has made any specific mention of climate adaptation, and very few have laid out a position on stopping deforestation.

There have even been demands to relax environmental regulation to stimulate economic growth, including a proposal by Jair Bolsonaro, the far-right candidate who is leading opinion polls, to pull out of the Paris Agreement. Such a move would cancel the country's climate goals, representing a massive step back for Brazil from its leadership role over the past decade.

One of the key regulations at risk is Brazil's Law to Protect Native Vegetation, known as the Forest Code. This regulation is a key target for candidates wanting to make environmental regulations more "flexible", and to appease the country's agribusiness lobby and other opponents of environmental legislation.

This is not an appropriate solution for Brazil.

The world is already on a journey towards a green economy. Brazil has a lot to gain from the transition.

Rich in natural biodiversity, it is well poised to tap into innovative business models that value natural capital, such as those looking to green, plant-based plastics from the Amazon's rich biodiversity. A green growth strategy would be the most logical path for the country to overcome its recent recession and build competitiveness.

A weakening of environmental policy would increase financial risk and uncertainty among the private sector by ignoring global investor and consumer demand for low-carbon and deforestation-free products. This could have a severe impact on the economy, given that Brazil is one of the world's biggest exporters of agri-commodities.

Indeed, concern over deforestation is growing, with more and more investors establishing investment and lending policies that take it into account. In 2018, 650 institutional investors with assets of $87tn asked companies to disclose how they are managing the direct and indirect risks posed by deforestation through the CDP (formerly the Carbon Disclosure Project), of which I am the executive director for Latin America. In 2015, the world's largest sovereign wealth fund, Norway's Government Pension Fund Global, dropped 11 companies from its portfolio over deforestation concerns.

In an article published in February this year, Adam Kanzer of Domini Impact Investments LLC, a CDP signatory, highlighted investors' fiduciary duty to protect forests and human rights, and the critical role they have to play in ensuring that capital is allocated responsibly for the long term.

The same trend is true for companies. In 2017, about 87 per cent of global companies saw opportunities associated with addressing deforestation, while 73 per cent reported having a commitment to reduce or remove deforestation from their supply chains.

There is a large and growing market for deforestation-free commodities — a market any new government should be ready and willing to embrace.

Across the globe we can see vital signs of citizens, cities, states, companies and investors taking action where their world leaders will not.

No longer is it politically feasible to vote for laws that are harmful to the environment, indigenous people and rural workers. By wilfully ignoring the demands of such non-state actors, the Brazilian government would find itself at odds with the real economy, and losing out in the long-run.

We want instead to see Brazil's newly elected president and congress join the world in implementing the Paris Agreement and UN SDGs. A vital first step to this is to maintain and strengthen the country's forest protections.

In a recent report, Climate Change: Risks and Opportunities for the Development of Brazil, the Brazilian Coalition on Climate, Forests and Agriculture laid out a 28-point plan for the 2018 election candidates to implement the land-use revolution the country needs.

The results of this month's elections could have major consequences for the political future of Latin America's biggest country and for the world's largest tropical forest and other vital natural resources.

Often referenced as the country of the future, we hope to see Brazil unlock the mindset of the past and continue to position itself among the leaders of the 21st century.

Failing to do so will threaten its long-awaited development and ability to tackle the economic crisis that grips the country.

The journey to the new climate economy has started but Brazil must keep up with the pace of change.

- Lauro Marins is executive director of Latin America, CDP