LONDON (Reuters) -Brazil plans to issue its first ever green bond, its head of public debt operations said on Thursday, as the government seeks to use the environmental agenda to attract investment.
“Unfortunately it took Brazil a little longer than it took our peers,” Luis Felipe Vital, head of public debt operations at the Brazil National Treasury told an event.
“But we are sure we will have very interesting things to announce in the future.”
In early 2021 under the government of then-President Jair Bolsonaro, the Treasury said it would build a framework for issuing an ESG sovereign bond, referring to a bond based around environmental, social and governance criteria.
Most governments sell such debt in the format of a green bond, where the funds are used for environmental projects.
The project failed to move forward, at a time when Bolsonaro’s environmental policy was criticized globally.
New President Luiz Inacio Lula da Silva’s victory in October is expected to give the environmental agenda a boost as the leftist leader seeks to embrace the transition to a green economy as a focus of a state-driven development policy.
Even before taking office at the start of the year, Lula promised an ambitious environmental overhaul, with plans to grant new protected status to half a million square km (193,000 sq miles) of Amazon rainforest, fight deforestation, subsidize sustainable farming and reform Brazil’s tax code to bolster the shift to a greener economy.
“Brazil does give a lot of importance for the environment components,” Vital said at event organised by think tank OMFIF.
“So we are looking forward to be back in the market in a bond related to that.”
Brazil’s last foreign debt issue took place in June 2021, when it raised $2.25 billion.
(Reporting by Yoruk Bahceli, with additional reporting from Marcela Ayres in Brasilia; editing by Dhara Ranasinghe and Deepa Babington)
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