‎Investments in Brazil

New economy for Brazil: green recovery could increase GDP and create jobs

Sawmill worker jobs innovation

Innovation in industry and quality infrastructure are ways to create jobs.

To act to mitigate and adapt to climate change is to act to save millions of lives. As are actions to save Brazil's economy and combat inequality in a scenario of socioeconomic crisis aggravated by the Covid-19 pandemic, which has claimed more than 100 thousand lives. The pandemic also ended 7.8 million jobs until the month of May, according to the IBGE. Hunger and poverty kill. Everything is urgent, the crisis will not be temporary and, therefore, how to decide which investments to prioritize in the coming years? In a country with Brazil's problems, is the climate at the top of the list?

Should Brazil prioritize the transition to a low carbon economy in the next decade? How to do this? Low carbon economy means the adoption of technologies and infrastructures that emit less greenhouse gases, are less polluting, more modern and resilient to extreme events. The word transition is not allegorical: it means moving to a new, more sustainable economic model, avoiding generating negative social, environmental or economic impacts in the process. Among the most awaited transitions, the migration to an economy less dependent on fossil fuels should be counted, fostering social inclusion. In climate diplomacy, this effort was called "just transition".

The study “A New Economy for a New Era: Elements for building a more efficient and resilient economy for Brazil” shows how Brazil has a lot to gain and practically nothing to lose by adopting green and low carbon growth as a route of out of the economic recession in which it finds itself.

More jobs, greater economic growth.

According to the study, a green economy will make Brazil grow more in the next ten years than the current development model, the so-called business as usual (BAU). The low carbon measures would result in an additional cumulative increase of the Brazilian Bruno Domestic Product (GDP) of R $ 2.8 trillion by 2030, which is equivalent to one year of the GDP of Belgium or Argentina.

The green recovery would generate 2 million more jobs than business as usual in 2030, comparable to four times more jobs than those currently in the oil and gas sector in the country. These jobs would be generated mainly in the industry and services sector. In the agriculture sector, we would see an increase in specialization and more qualified jobs.

Instead of disruption, prioritization.

In addition to the economic benefits, the study shows that there is a path of stones for the transition to a cleaner, fairer and more resilient economy. The green recovery need not be disruptive, but only a prioritization of good practices that are already available and could gain scale. Brazil is well positioned in at least three sectors to increase its productivity, competitiveness, efficiency and job creation. All of this reducing greenhouse gas emissions. The three sectors are:

Quality infrastructure: Infrastructure projects, which are extremely necessary to develop and generate jobs in the country, need to integrate sustainability criteria. This means expanding access to financing for structuring projects, as the international market is increasingly moving away from high-risk projects, and requires the installation of an infrastructure more resilient to the impacts of climate change. To have an idea of ​​the magnitude of investments of this type, it is worth remembering that approximately R $ 180 billion was spent on response activities and / or recovery of infrastructure damaged by extreme events between 1995 and 2017 in Brazil.

Industrial innovation: Industry is one of the sectors capable of transforming the economic recovery plan into an opportunity to modernize more deprived regions in the short and medium term, through access to energy and decentralized markets. There are opportunities for innovation to be explored in the sectors of renewable energy, transportation, biofuels and construction using Brazilian technologies. In the green recovery scenario, the industrial sector can create at least 1.1 million more jobs than the current development model.

Sustainable agriculture: The agricultural sector is currently responsible for 1 in every 3 jobs in the country and 22% of the Brazilian GDP. However, it is the subject of questions about its correlation with the rates of deforestation.

in the main biomes of the country. To remain competitive in the international market, the sector needs to grow out of this practice. Investment in the recovery of degraded areas is one way. An unprecedented analysis of the study shows that recovering 12 million hectares of degraded areas, a goal assumed by Brazil, can generate a return on investment of R $ 19 billion in ten years, with revenues of R $ 742 million.

Sustainable agriculture is an opportunity to create jobs in rural areas.

A green recovery with measures in these three sectors may make Brazil less unequal, more competitive and with a productive system free of deforestation. This is crucial to avoid risks to the country's reputation abroad and to expand access to international financing and private investments.

An unprecedented opportunity, our Brazilian Lawyers can help with your investment with companies, Real Estate and any other ways.

The recovery of the Brazilian economy is a central issue in the current public debate. Some important names in the country's economic thinking started to argue the need for a green recovery in the last month. A letter signed by former finance ministers and former presidents of the Central Bank argued that the economic recovery must also take into account the risks of climate change. The presidents of three large commercial banks have launched a joint plan for sustainability in the Amazon. All of this is interconnected with the debate that is taking place on the international stage, with investors showing increasing concern with environmental criteria in financing. Please contact our Brazilian Business lawyers to help with your project.

The study shows that a green economic recovery places Brazil within a global trend. Countries like Germany or the European Union bloc are debating or approving proposals for green growth. Even before the pandemic, studies have shown this. For example, the New Climate Economy initiative identified a $ 26 trillion increase in net profit in the world by 2030 compared to business as usual.

Brazil needs to be part of this trend to become more competitive and inclusive. What this study brings is evidence that shows how much Brazil can gain by adopting a green and sustainable growth route as a way out of the crisis aggravated by Covid-19. It also reveals that the current model is not necessarily the best option to warm up the economy and make it more competitive, inclusive and productive. There is a debate about the future that we want.

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Investment for the viability of nascent companies

Goal

Investment for the viability of start-up companies that have a prototype or are already starting the traction phase

Companies that can access Companies that have an MVP (minimum value product) already validated with potential paying customers or that are in the initial phase.

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Up to 3 months.