Jair Bolsonaro, the far-right president of Brazil, has signed a decree that – according to him – will create a national carbon market and limit CO2 emissions. Climate Watch ranks Brazil sixth in climate pollution globally.
“In this still new green economy market, Brazil emerges as a powerhouse,” Bolsonaro said to the audience of Global Carbon Market Congress on May 26. While the government-sponsored event was streamed online, it was not open to the press.
However, critics claim that, in addition to being unclear, the measure does not address deforestation in the Amazon rainforest, which is Brazil’s largest climate issue.
According to Bolsonaro’s order, unnamed industries can enter data on the CO2 footprint in a registry and then propose an emission reduction curve in 180 days. They can then have the deadline extended for another six months.
“The measure is ineffectual. It establishes a registry system but fails to set deadlines,” said Gustavo Pinheiro, an advisory board member at Glasgow Financial Alliance for Net Zero. “It is a voluntary regulation, as it does not generate any obligation.”
According to Brazilian NGO Climate Observatory, deforestation causes around half of the country’s climate pollution. A study published by the Nature Journal reported that the Eastern part of the Amazon forest is no longer a carbon sink but has now become a carbon source.
“If the high-profile issue of deforestation is not tackled effectively it’s going to be difficult for Brazil to attract investment to the carbon market,” said Graham Stock, a strategist for BlueBay Asset Management.
And while Brazil made the commitment to decrease its CO2 by 43% from 2005 to 2030, its carbon emissions increased by 9.5% in 2020, while globally greenhouse gas emissions have decreased by nearly 7%, Climate Observatory wrote. The Amazon deforestation increased by 22% in 2021.
Building an efficient carbon market is necessary for nations to push companies to act more boldly on decarbonization. The real need for Brazil though is to take immediate measures on stopping vast irresponsible deforestation in the Amazon – the biggest climate and environmental crime in our century.