At the meeting between President Luiz Inacio Lula da Silva (Workers’ Party) and President Xi Jinping, to be held between Thursday (13) and Friday (14) in Beijing, China, the Brazilian should negotiate with the Chinese to buy – named carbon credits from Brazil – compensation for Pollution from the Asian country.
In 2021, China was responsible for 31% of emissions of carbon dioxide, the main greenhouse gas. This information is from a study conducted by the International Federation of Scientists for the Global Carbon Project released during the 26th United Nations Conference on Climate Change (COP26).
A survey by Moss, the nation’s first carbon exchange, estimates that the market in the region has the potential to attract $45 billion within a decade.
In the carbon market, the objective for sale is to remove greenhouse gases from the atmosphere. Because of its ability to produce clean energy and reforestation, Brazil has an advantage in generating credits of this kind. Therefore, it is a potential resource for countries that need atmospheric pollution compensation.
Each country sets a specific number of greenhouse gas emissions over a period of time, and if it exceeds the agreed-upon value, it buys the remaining quotas from countries with credit. These quotas are enshrined in environmental treaties such as the Paris Agreement or the Kyoto Protocol.
During COP27, in 2022, the National Bank for Economic and Social Development (BNDES) launched a program to capture carbon credits in Brazil. The state-owned bank has issued two public invitations to bids for Brazilian companies, which have selected 20 energy and energy conservation projects to receive public investment.
In July 2022, Brazil signed a bilateral agreement with Japan to promote the carbon credit market. The two countries were the first to sign a Protocol of Intent in this regard since the approval of Article 6 of the Paris Agreement, which deals with the topic, signed in 2021, at COP26.
In addition to recognizing the carbon market as an essential tool for reducing greenhouse gases, the countries, at that time, emphasized the importance of creating bilateral investment opportunities in green projects to treat solid waste in order to generate clean energy and reduce methane emissions. . The intent will be to help countries achieve their internationally set targets for carbon balance.
In January, Lula said he would have to impose a “carbon credit” on rich countries.
Brazil has already regulated this market, through a decree published last year, and it also has an agreement with Japan, whose economy is one of the largest in the world.
When he meets Chinese President Xi Jinping in Beijing, Lula is expected to try to persuade China to buy the equivalent of US$10 billion (or R$50 billion) annually in the carbon credits that Brazil generates.
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