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CPI/PUC-RIO’s study shows that the energy sector led growth and that climate mitigation accounted for 80% of total tracked resources.  

International climate finance for Brazil reached US$ 5.1 billion per year in 2021-2022. This is according to the new study by Climate Policy Initiative/PUC-RIO (CPI/PUC-RIO), which highlights a 84% increase in financing compared to 2019-2020. The study “International Climate Finance Tracking for Brazil” quantifies international financial flows destined for climate action in the country between 2021 and 2022, and compares them to figures from 2019 and 2020. 

“Foreign capital is essential to complement domestic financial sources in the transition to a low-carbon economy. The tracked flows show positive signs regarding the country’s ability to attract international resources for the climate agenda. While international climate finance grew by 28% in all regions of the globe between 2019-2020 and 2021-2022, international climate finance for Brazil grew by 84% in the same period”, explains Joana Chiavari, research director at CPI/PUC-RIO.  

To identify trends in international climate finance for Brazil, the study highlights the region of origin of the financial flows, the type of institution that allocated the flows, the financing instrument used, the sector benefiting, and the climate objectives. 

Western Europe was the main provider of international climate finance for Brazil in 2021-2022, accounting for 50% of the tracked resources (US$ 2.6 billion/year). France stood out as a leader in international climate finance, accounting for 13% of the total (US$ 674 million/year). Of this amount, 47% was mobilized by French bilateral development finance institutions and 26% by commercial financial institutions.  

Regarding the source of funds, the study shows that public sources accounted for 58% of international climate finance for Brazil in 2021-2022, representing US$ 2.9 billion/year. Private sources mobilized 42% (US$ 2.1 billion/year), more than four times the amount registered in 2019-2020. 

“The Brazilian government has adopted a series of initiatives to create favorable investment conditions for foreign capital to finance projects aligned with the national climate agenda, such as the Brazil Climate and Ecological Transformation Investment Platform (BIP), the Foreign Private Capital Mobilization and Currency Hedging Programme (Eco Invest Brasil), and the issuance of sustainable sovereign bonds. Understanding the current status of climate finance is crucial to measuring the impact of these initiatives and increasing their effectiveness,” explains Chiavari. 

More than half of the international climate finance tracked was allocated to the energy sector (53%), with a focus on solar and wind power generation projects (80%). Compared to 2019-2020, finance for energy grew by 165% in Brazil in 2021-2022, from US$ 1.6 billion/year to US$ 2.6 billion/year. These numbers exceed the global trend of a 53% increase over the period.  

“The Brazilian electrical matrix is already mostly composed of renewable sources, and we stand out globally for our ability to produce with low greenhouse gas emissions. The mobilization of international finance creates favorable conditions for attracting energy-intensive industrial investments for green manufacturing,” Chiavari points out. 

The Agriculture, Forestry, Other Land Use, and Fisheries (AFOLU) sector, despite being responsible for almost three-quarters of Brazil’s Greenhouse Gas (GHG) emissions, received only 11% of international climate finance. In particular, the forestry subsector received US$119 million/year, only 2% of the international finance tracked in 2021-2022, far below its potential.  

In relation to the climate objective, finance with an exclusive climate mitigation objective made up 80% of the total tracked 2021-2022. Meanwhile, projects dedicated exclusively to adaptation received only 5% of the total tracked.  

“Climate adaptation received predominantly public funding, following the global trend. This shows that there is room for growth in international private finance for adaptation in Brazil,” says Chiavari.  

The tracking of international climate finance in Brazil follows a methodology based on CPI’s international experience in tracking climate finance flows worldwide for over 10 years. 

To download the study, click here

About Climate Policy Initiative  
Climate Policy Initiative (CPI) is an organization with international expertise in finance and policy analysis. CPI has seven offices around the world. In Brazil, CPI has a partnership with the Pontifical Catholic University of Rio de Janeiro (PUC-RIO). CPI/PUC-RIO works to improve the effectiveness of public policies and sustainable finance in Brazil through evidence-based analysis and strategic partnerships with members of the government, civil society, the private sector and financial institutions.  

For more information, please contact  
Camila Calado Lima  
camila.lima@cpiglobal.org  
+55 86 99966-0560   

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