The issuance of green bonds (Green bonds, which finance environmental projects) abroad by the Brazilian government is limited by the spending ceiling, said today (12) the president of the Central Bank (BC), Roberto Campos Neto. He said he believes that demand for this type of paper has the potential to soar in the coming years, but he warned that the execution of the projects is coming up against the federal spending limit.
“Brazil can issue green bond at ease, but how much will I be able to spend on green projects? Because this is also under the roof”, asked Campos Neto at the international seminar Sustainable Agribusiness in Brazil, in Lisbon. The event is promoted by the Foreign Affairs and National Defense Committees of the Senate and Chamber of Deputies.
The BC president said he believed that green bonds would not cannibalize demand for other Brazilian government bonds issued on the international market, such as Brazilian foreign debt securities. “Green bonds are in very high demand and have everything to grow”, he commented.
cryptocurrencies
The seminar also dealt with cryptocurrencies (encrypted digital currencies), whose mining (emission) consumes large amounts of energy by computers and is seen in some countries as an environmental problem. According to Campos Neto, Brazil imports more than it produces this type of asset, to the point that purchases affect the trade balance, since when purchases of bitcoin started to be registered as imports in the BC methodology.
According to Campos Neto, cryptoactives are more used in Brazil as an investment tool (applications to make money pay off), but he did not rule out that the use of digital currencies as a means of payment increases in the country. “We’ve seen in other countries that, when [a proporção de criptoativos] from 4% to 5% of investment, it is now used as a means of payment. We are at an earlier stage in Brazil,” he added.
The rapporteur of the bill that regulates cryptoactives in Brazil, senator Irajá (PSD-TO), participated in the seminar as panel mediator. The congressman said that he intends to guide the proposal next week to be voted on by the Senate Economic Affairs Committee.
carbon market
Campos Neto said that central banks need to be better prepared for the transition to a green economy. This is because climate issues tend to increasingly affect inflation and monetary policy, such as higher food prices resulting from crop failures and rising energy costs.
“The energy banner went from less than R$ 2 to R$ 14.40 due to lack of rain. Climatic issues affect monetary policy”, he declared. The BC president also asked banks, public and private, to lend more resources to environmental projects.
In relation to the carbon credit market, Campos Neto defended the development of a global exchange system, which distributes costs between producers and consumers. “The carbon load today is greater on those who produce than on those who consume it. if [esse tema] is not equated, some input producers will stop producing with this carbon load. The consumer will have to stop consuming or consume more expensively”, he warned.
The BC president criticized the imposition of taxes on carbon dioxide emissions, as some countries proposed at the 26th United Nations Conference on Climate Change (COP26). According to him, a global and functional market will know how to finance projects more efficiently than governments.
