Green Bonds and Amazon Forest Financial Products
good afternoon
it’s a pleasure to be with all of you
today
of course i should probably also start
with welcome to 2020.
what an extraordinary time that we are
living in and one that we could never
have predicted as the start of our year
that we would be faced with a global
pandemic
of course the warnings have been there
we have been told that this is
uh a highly likely scenario to play out
in our lifetime but of course we heard
the warnings
and got on with our life but we are now
faced with
a global pandemic crisis which has
put us on the back foot and made us
quickly realize
that we as humanity are not prepared for
such crises
of course if we’re not prepared for a
global pandemic
then how can we possibly be prepared
for future crises one that has been
looming
in the backdrop to this pandemic
climate change climate change and the
warnings around it
have been with us for decades
but we continue to look past it
and get on with our daily lives get on
with our business as usual
and work as we do
but this is one that we will have to pay
attention to
one that will make future pandemics more
likely
extreme weather events more common and
in fact
what we are experiencing now and in the
future will be the norm
and we as humanity in order for us to
survive
what is going to be the century of
volatility
we need to learn quickly how to adapt to
what is already
the extreme events that we are
experiencing
and how we move into the future more
sustainably
now backdrop to all of that is
something very exciting that despite the
challenges that we are faced with
and are currently experiencing now and
of course
the feeling of hopelessness that we all
may be having right now
we should also look at the
positivity behind all of this the
opportunity
that we have before us sustainable
finance
has been an emerging theme in the
backdrop
to these challenges in the last decade
we’ve seen
a huge rise in the demand from the
investment community
on providing investments that are going
to
work towards the solutions we need to
address climate change and other
environmental
and social challenges the poster child
to the sustainable finance agenda
has been the green bond green bonds
being a debt instrument
where all of the financing is used
for climate change and environmental
solutions
so things like renewable energy if we’re
talking about our energy systems
water infrastructure that takes into
account resilience to ensure
better quality and quantity of our
resources
in light of drought low carbon transport
and our land use systems are also areas
of focus
in fact every major sector of our global
economy
is the focus and being able to
transition those sectors
to ones that contributes to a greener
more sustainable economy
is what is currently developing
in the last 10 years we have seen the
rise of green bonds
from as little as 3 billion us dollars
to now a total of 800 billion
outstanding ever so more closer to the 1
trillion
mark of a global green bonds market
this is a huge opportunity before us
why because we have access to capital
that we’ve never had before huge amounts
of institutional capital hundreds of
trillions
potentially cheaper sources of capital
for us to finance
this urgent transition that we must make
a transition that will bring resilience
and a low-carbon future for humanity
and most importantly better integration
of our natural resource environment more
responsibility
and care and sustainable management of
our natural resources
and the environment as we go
this is the opportunity
if we look at brazil brazil
is a huge economy and it is one that is
most
well known for its agribusinesses
brazil has huge potential
in leading the world on sustainable
agriculture production
at scale in the last decades
brazil has been pushing the frontier
on technological innovation in its
agribusinesses
it has been trying to work towards
better regulation in the agri-business
environment
to ensure minimal impact on the
environment
most notably the amazon
of course there is a tremendous amount
of work that still needs to be done
but if we look at what brazil has before
is
it has the ability to produce more
with less a model that no other country
has been able to
work towards perfecting it is a
opportunity that is
allowing for us to let lessen the
pressure
on our need to continue to expand into
the amazon environment
degraded pasture lands being able to
integrate agroforestry systems
and being able to take those
opportunities and connect those
the international investment community
is where we need to focus our intentions
food security is going to be critical
in the decades ahead and is susceptible
and vulnerable
to climate risks and it is also
the rising demand for food
as the population moves towards 9
billion in 2050
we must think creatively we must be
smart
in the way in which we produce our food
with brazil being the largest producer
of agri
for the world in order for it to meet
that new economic opportunity
for rising food demand it must be able
to produce sustainably
and also at scale so how can we
package the technological innovation
on moving towards sustainable agri
practices
if we look at brazil’s potential in a
publication
earlier this year brazil’s investment
roadmap to sustainable agriculture
it was identified that over 160 billion
us dollars
exists of investment opportunities today
to help brazil transition in this
dimension
of course there is also the regulatory
environment and what
many do not realize is to the extent of
brazil’s regulation
in the agribusiness in the land use
space
more explicitly this of course
also needs to be where we can match
the investments in compliance to those
regulations
we need to utilize sustainable finance
as an incentive to transition the
agribusiness towards sustainable
practices
with the rising demand coming from the
investment community internationally
for having greener investments this
presents brazil’s
agribusiness with an opportunity
by packaging sustainable agri production
activities
into green bonds or other types of
labeled
debt products that match the appetite
of investors for green this presents a
new source of capital potentially
cheaper capital
for brazil’s agribusiness to transition
and scale up in sustainable agriculture
of course in the backdrop of all of this
is the amazon
and with all of the attention that we
have seen particularly in the last two
years given the
forest fires that brazil’s amazon has
been
experiencing better management
of those impacts is in its urgency
the amazon is one of the last remaining
lungs of the earth in its tact and we
must be
responsible and take care to ensure the
longevity
of its natural resource services not
only to brazil’s economy
but also to the world
by inducting sustainable agriculture
production at scale in brazil that
allows for harmonization
within the amazon and less pressure on
deforestation
utilizing existing land mass
with producing more with less
as the journey continues we must
with urgency look to implement
sustainable agriculture practices and
brazil
is the place to start
of course brazil is not the only country
in the world
that is faced with the need to preserve
its natural resource
environment if we look across southeast
asia
indonesia malaysia for example
all of those areas are also critically
under threat
and so as the world embraces
this new paradigm this new century of
volatility
we must be able to move the capital and
the investments in the right direction
to help us be able to adapt
and be able to mitigate these risks
going back to the opportunity for brazil
this is a call for action and action
from the investment community
the producers the governments
and also civil society to recognize
that there is an opportunity to be had
and that what we need to do is to be
able to start putting our minds
and putting those investments into the
market
together so that we can realize the
potential