Sustainable finance
The Sustainable Finance axis comprises a set of fiscal, tax, credit, regulatory, and financial measures to encourage the allocation of public and private resources into sustainable, innovative, and inclusive activities, reducing environmental and climate risks. Its purpose is to increase investments in economic activities and technological solutions aimed at reducing environmental impact, paving the way for sustainable development.
One of the most structuring measures of this axis is the creation of a regulated carbon market in Brazil. Through the development of a bill involving the productive sector and civil society, it was possible to build a proposal that places Brazil at the forefront of the effort to decarbonize the economy, combined with investments in research and development and protection of traditional communities.
Through actions involving the Ministry of Finance, the Central Bank (Bacen, in Portuguese), the Securities and Exchange Commission (CVM), and the Private Insurance Superintendence (Susep, in Portuguese), among other institutions, regulatory changes are being developed to stimulate the allocation of resources into sustainable projects.
The ETP is also creating a Foreign Exchange Protection Program (the Eco Invest Brazil) to attract productive investments, creating a safe environment for investors and reducing the risk of exchange rate volatility. The aim is to promote investment opportunities in Brazil by attracting external savings.
Recently, with the unprecedented issuance of sustainable sovereign bonds, Brazil raised US$2 billion (approximately R$10 billion in reals), a value that was reversed into the Climate Fund, operated by BNDES, and which will also enable investments in activities related to ecological transformation with competitive interest rates.
Axis 1: Sustainable finance
- Carbon pricing: mandatory carbon market (cap-and-trade system) and institution of a carbon tax.
- Issuance of sustainable sovereign bonds and opening room for the private sector to issue corporate thematic bonds.
- Competitive credit for decarbonization and technological innovation (Brazilian Climate Fund).
- Definition of a Sustainable taxonomy.
- Financial regulations to channel resources towards sustainable projects and transparency rules (disclosure) on climate risks and environmental footprint.
- Tax reform with sustainability elements, such as selective tax and eco-friendly IPVA.
- Regulations that provide clarity on climate risks for investors in the capital market (example of a measure with a resolution from CVM, from October 2023.
- Sustainability markers in the public budget.
- Measures for raising funds by states and municipalities linked to sustainability.
- Foreign exchange hedge platform for green projects.