Lula’s Presidential Victory Is an Opportunity To Renew U.S.-Brazil Climate Cooperation
Lula’s Presidential Victory Is an Opportunity To Renew U.S.-Brazil Climate Cooperation
Following the election of Luiz Inácio Lula da Silva to Brazil’s presidency—and the passage of the Inflation Reduction Act marking the largest climate investment in U.S. history—a moment of truth for climate emerges for the most populous countries in the Americas right as leaders gather for COP27 in Egypt.
As the international community gathers for COP27 in Sharm El Sheikh, Egypt, two major developments in the Western hemisphere have created opportunities for climate progress.
In Brazil, the election of Luiz Inácio Lula da Silva in the October presidential runoff represents a potential change in direction for the country’s approach to climate. In his first speech to the nation, the president-elect vowed that “Brazil would resume its leading role in the fight against the climate crisis” and “fight for zero deforestation in the Amazon.” Brazil’s new government may be recommitting to decarbonizing its economy, but it is also caught in nearly a decade of economic stagnation. Pressure to respond to urgent social demands in Brazil will interact with international dialogues around democracy, human rights, and the environment—including international climate commitments.
In the United States, pressure to reclaim the mantle of leadership, especially around climate policy, has broken a policy logjam and unlocked historic new levels of climate funding. Congress has passed several substantial pieces of legislation—the Infrastructure Investment and Jobs Act (IIJA), the CHIPS and Science Act (CHIPS), and the Inflation Reduction Act (IRA)—that provide investment and incentives to accelerate the transition to clean energy, transportation, and climate-smart agriculture. These investments in climate, justice, and jobs have put the administration’s climate action commitment within reach, making it possible for the United States to cut greenhouse gas emissions to 50 percent to 52 percent below 2005 levels by 2030 in ways that could help advance global decarbonization.
Taken together, these strategic climate moments in the United States and Brazil present an opportunity to strengthen bilateral ties and address climate change together. Assertive climate leadership from the United States and Brazil could provide the new momentum that is needed as the world shifts its focus to implementation at COP27 and beyond.
To capitalize on renewed momentum for climate action in the United States and Brazil, the Biden and incoming Lula administrations should take steps to halt deforestation; advance clean energy transitions and industry decarbonization; and encourage climate leadership in multilateral fora.*
Boost U.S.-Brazil law enforcement and conservation cooperation to deliver on global forest commitments
This is a challenging moment for the Amazon. Deforestation has increased in recent years, as the Bolsonaro administration undercut the already limited capacity of Brazil’s environmental agencies to patrol the country’s vast expanses. A sense of perceived impunity for illegal deforestation has led to more fires and logging, as well as murders of Indigenous leaders, environmental advocates, and journalists who report on those responsible. Scientists have sounded the alarm that the Amazon is now at a tipping point, with an estimated 20 percent of the region becoming a carbon source rather than a carbon sink. If this trend spreads across the region, a 1.5 degree Celsius world is out of reach.
However, there are some promising developments. President-elect Lula recently committed to creating a ministry of Indigenous affairs and making progress to halt deforestation a national priority. At the same time, a judicial decision appears likely to reactivate the Amazon Fund. These actions would establish a new trajectory that would allow productive and impactful collaboration efforts.
The United States and Brazil announced a bilateral working group on law enforcement and deforestation, co-led by Special Presidential Envoy for Climate John Kerry; the Brazilian Minister of the Environment Joaquim Leite; and Minister of Justice and Public Security Anderson Torres at the Summit of the Americas in June 2022. This announcement included commitments to achieve measurable declines in illegal deforestation in the Legal Amazon and elsewhere in Brazil every year through 2028, when Brazil has committed to achieving net-zero deforestation.
The two governments should turbocharge the working group to address the drivers of deforestation and invest in conservation, sustainable development, and the rights for Indigenous communities who steward the forest. To motivate progress as a new Lula administration takes the helm, the working group should focus on:
- Combating organized crime and its role in deforestation. Halting deforestation in the Amazon requires understanding links to broader issues of violence, corruption, and insecurity in Brazil, including the role of complex national and transnational criminal networks operating across different illicit economies and committing environmental crimes. The United States should build on the work started by the interagency deforestation working group comprised of Federal Bureau of Investigation, Department of Homeland Security, Department of Justice, Department of the Interior, State Department, and the Environmental Protection Agency to provide financial and technical support for Brazil’s efforts to identify and disrupt the operation of organized criminal networks in deforestation. The working group could draw on the expertise of these and other U.S. technical and law enforcement agencies to strengthen Brazilian capacity to restore command and control of the Amazon through knowledge exchange with the corresponding agencies within the Brazilian government. These include the environmental police, Chico Mendes Institute for Biodiversity Conservation (ICMBio), and the Brazilian military—all of whom are tasked with various aspects of security and law enforcement in the Brazilian Amazon.
- Supporting Indigenous-led conservation. The Bolsonaro administration has consistently degraded the rights of Indigenous peoples in the Amazon, with critical implications for human rights and natural conservation. There is a growing body of evidence that Indigenous tenure has a positive effect on ecosystem integrity. Territories owned by Indigenous people comprise roughly 21 percent of global lands, but they harbor an estimated 80 percent of the world’s biodiversity. The Biden administration has sought to improve the U.S. government’s relationship with tribes, including through its America the Beautiful initiative, which set a national goal of conserving 30 percent of U.S. land and water by 2030 to address nature loss, climate change, and environmental injustice. This in many ways parallels President-elect Lula’s commitments and opens the door for collaboration on these efforts between the two governments. The upcoming COP15 for the Convention of Biological Diversity—set for December in Montreal—is a key moment to signal a shared commitment to protect Indigenous rights and support their stewardship of ancestral lands. Reversing course is critically important, for human rights and for biodiversity.
- Accelerating the expansion of the restoration economy. The United States and Brazil are two of the most forested and biodiverse countries, with significant potential to tap into nature as a climate solution. Brazil’s forest code mandates conservation and restoration in the Amazon and the country’s other biomes, and the country has set a goal of restoring 12 million hectares by 2030. The United States can support Brazil’s efforts to do just that through technical and financial assistance. The Partnership for the Conservation of Amazon Biodiversity (PCAB) is an existing framework for investing in restoration and sustainable businesses and value chains for products such as Brazil nuts and fish that rely on healthy ecosystems, and there is potential for restoration-focused partnerships elsewhere in the country that would benefit from United States and private sector support. There are also interesting opportunities to pursue parallel advances in building a restoration workforce, as the Biden administration works to grow its own carbon sinks through IRA and IIJA investments, and America the Beautiful.
In addition to these partnerships, the United States has opportunities to work domestically on policies and legal frameworks that help slow deforestation around the world. The Biden administration should pursue the following recommendations using its executive authorities and in partnership with Congress:
- Leverage U.S. policies that limit access to U.S. markets if commodities are linked to illegal deforestation. The expansion of agriculture, especially cattle production, is a major driver of deforestation in Brazil, as global beef demand has created incentives to undercut Brazilian environmental laws. The Brazilian government and civil society have developed tools to track compliance with the country’s forest code, but implementation has been challenging because many companies––including American corporations––by and large have not used this information to improve their supply chains. The Biden administration should work with Congress to limit the ability for products tied to illegal deforestation to enter U.S. markets. The FOREST Act—introduced by Rep. Earl Blumenauer (D-OR), Rep. Brian Fitzpatrick (R-PA), and Sen. Brian Schatz (D-HI), along with numerous cosponsors—provides one pathway to do just that: enact policies to limit access to U.S. markets if commodities are linked to illegal deforestation. Taking such an approach would align the United States with similar policies in the United Kingdom and European Union. The administration should also consider using existing customs tools available via free trade agreements —such as the USMCA—to verify that imported commodities are produced in compliance with laws in their countries of origin, which will also help determine the extent to which such products are transmitted through partner nations for sale in other countries. In addition, the administration should also consider pursuing new custom tools with Brazil to further address illegally sourced or taken production from entering U.S. markets. Finally, there are also sector-specific opportunities to address deforestation drivers such as mining. For example, the IRA provided $250 million to the Environmental Protection Agency to support environmental product declarations for construction materials and products, which can be used, in part, to ensure that commodities, such as steel, do not exacerbate deforestation.
- Support forest conservation and sustainable development with government-to-government funding. The Biden administration has recognized global forests as critical ecosystems essential to humanity and serving as important carbon sinks—the Amazon rainforest was identified as one of these ecosystems important to U.S. national interests—and outlined several strategies to halt deforestation through public investments in forest conservation and restoration; private sector partnerships to reduce the drivers of deforestation; and improved data collection, monitoring, and management capacity. The administration has committed to dedicate up to $9 billion by 2030 to provide support to developing countries to finance forest conservation projects. Proposed legislation, such as the AMAZON21 Act, would authorize $4.5 billion to enable results-based agreements with the government of Brazil and open the door to future appropriations that complement private sector and civil society efforts to protect and restore critical carbon sinks.
Advance U.S.-Brazil cooperation on decarbonization
Partnership opportunities between the United States and Brazil extend beyond conservation. Both countries have committed to rapid decarbonization in their respective broader economies—Brazil in particular will need to review and update its insufficient nationally determined contribution (NDC) to the Paris Agreement in order to craft an implementation plan that meets the country’s commitment and re-establishes global credibility moving forward. Hitting these targets requires Brazil and the United States—along with international partners—to create enabling regulatory environments and mobilize the public and private climate finance needed:
- Moving from dialogue to decisions on clean energy transitions. A whole-of-government(s) approach that enables private sector actions is critical. The launching of the U.S.-Brazil Clean Energy Industry Dialogue (CEID) is one welcomed action, helping advance investment in energy options such as offshore wind that are priorities for both countries. The CEID can also be a roadmap to identify and invest in opportunities for development that provide quality jobs and a green economy that is compatible with an Amazon rainforest that remains standing—and elevates the conversation to include public health, social equity, and food and water security in Brazil as well. To support this, the United States should not only direct the International Development Finance Corporation (DFC) to make Brazil—and the sustainable development of the Amazon—a top priority in its blended finance strategy, but should also use its leverage with the Inter-American Development Bank (IDB) to ensure the bank follows through on its commitment to make $50 billion available through 2026 in green financing to regional development partners. Financial instruments—specifically, multilateral and bilateral grants—should continue to be mobilized by the IDB, scaled up, and should have the full support of the United States for a balanced allocation of resources between adaptation and mitigation efforts. In particular, as the IDB works toward delivering $1 billion for the Amazon Initiative, it should explore investment opportunities modeled after the Just Energy Transition Partnerships (JETP), which seeks to deliver sustainable, equitable, and 1.5 degrees Celsius-aligned energy transitions in key countries and could be expanded to a broader set of countries in the Americas.
- Expanding First Movers in the Americas. The two countries could also find natural partnerships in expanding private financing and technical expertise that accelerates transitions to low-carbon technologies. The First Movers Coalition, announced at COP26 in Glasgow, is a coalition of companies using their purchasing power to create early markets for innovative clean technologies across hard to abate sectors—aluminum, aviation, chemicals, concrete, shipping, steel, and trucking—and accelerate transitions to low-carbon technologies. To date, the United States is the only government partner of the First Movers Coalition from the Americas. The United States should encourage the incoming Lula government to join the coalition and commit the Brazilian government, industries, and private sector to rapidly scaling low-carbon technologies and co-leading regional efforts—alongside the United States—to foster competition with current carbon-intensive industries as well as to decarbonize industries.
- Strengthening the technical foundations for climate-smart agriculture. Another opportunity for partnership is in the rapidly developing practice of climate-smart agriculture. Among the historic provisions in the IRA is nearly $20 billion for the U.S. Department of Agriculture (USDA) programs that incentivize agricultural practices that reduce emissions or sequester carbon. In addition, the bill provides funding for innovative feedstocks that reduce methane emissions from livestock as well as $300 million in USDA programs to quantify emissions and carbon sequestration on agricultural lands. CAP has recommended in the past that this type of research should form the basis for collaboration between the two countries to improve monitoring of the impacts of land use on climate—especially in regions such as the American Great Plains and Brazilian Cerrado, where significant soil carbon stores are under pressure from large-scale, intensive agriculture. When paired with cooperation to support enforcement of Brazilian environmental laws, like the forest code, this technology exchange could facilitate major positive shifts in agricultural production.
Pursue Brazilian climate accountability and leadership in multilateral fora
Brazil was once a regional leader with numerous initiatives within the Americas—such as the U.N. Stabilization Mission in Haiti in 2004—as well as a global player through active involvement in international organizations and alliances—such as BRICS—and in diverse debates on global governance like the Group of Twenty (G20). In his first speech to the nation as president-elect, Lula made clear that, “Brazil is back … Brazil is too big to be relegated to this sad role of a pariah in the world.” To meet this aspiration, Brazil should:
- Restore trust by leading on regional climate cooperation. Brazil should once again raise its regional and international profile by creating and leading a new regional climate cooperation initiative for the Americas. The region has a model for this type of collaboration in the Renewables in Latin America and the Caribbean (RELAC) initiative that sets a goal that at least 70 percent of electricity consumption in Latin America and the Caribbean come from renewable sources by 2030. This regional effort received pledges of support from the Biden administration at the 2022 Summit of the Americas to boost technical capacity and encourage more countries to join. A climate cooperation effort that goes beyond a regional clean electricity target could leverage the strengths and expertise of state and local governments, civil society, and business leaders to address drivers of deforestation in the Amazon and assist communities as they adapt to climate impacts across borders. The initiative would need to align itself with other high-level economic and security dialogues; be inclusive of members across the region; and not duplicate the essential role of the multilateral climate processes of the U.N. Framework Convention on Climate Change (UNFCCC). This kind of multi-stakeholder collaborative body—that takes on the challenges of the climate crisis as a bloc—would be a powerful commitment to climate leadership and action from Brazil. The United States should be among the first countries to join the effort and encourage regional allies and partners to join as well.
- Meet the OECD’s high standards for environmental protection and social justice. Brazil is under consideration for membership in the Organization for Economic Cooperation and Development (OECD). Member states should insist that Brazil meet the OECD’s high standards for environmental protection and social justice prior to granting membership. As a recent civil society open letter insisted, due diligence by OECD member states is an essential condition for Brazilian accession to the OECD to meet the shared values, vision, and priorities of member states and to ensure meaningful, measurable, and immediate change in Brazil’s treatment of the environment, climate, and Indigenous peoples. The Biden administration should work with Brazil in its efforts to meet these standards and support future accession if conditions are met.
U.S. and Brazilian collaboration on climate action is of utmost importance to achieve globally agreed-upon climate targets. Recent events in the United States and Brazil bring the promise of new opportunities for collaboration on halting deforestation; implementation of clean energy transitions and industry decarbonization; and climate leadership in multilateral fora. It is critically important that the Biden administration capitalize on this moment and follow through on its commitments to halt global deforestation, support ambitious conservation and clean energy progress, and serve as a reliable partner for Brazil as it works to meet its climate goals and regain trust as a global climate leader.
*Authors note: The Center for American Progress held several closed-door convenings with Western hemisphere, energy, climate, and development experts—as well as numerous follow-up consultations. These structured, forward-looking conversations—albeit informed by past experiences—helped shape CAP’s thinking on short- and medium-term public policy recommendations toward developing a renewed U.S.-Brazil climate partnership.
Ryan Richards is a former senior policy analyst at the Center for American Progress.
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Former Senior Policy Analyst, Public Lands
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International Climate engages U.S. and global leaders across sectors to support rapid, science-based emissions reductions and promote equitable climate policy.