IDB and Banco do Brasil launch multi-million dollar Amazon biodiversity and climate action scheme

To support sustainable development and address environmental challenges in Brazil’s Amazon states, the Inter-American Development Bank (IDB) and public bank Banco do Brasil have signed a letter of intent setting the stage for a USD 250 million financing program. The initiative is part of a broader Conditional Credit Line for Investment Projects (CCLIP) worth up to USD 1 billion.

The “Bioeconomy Program for the Amazon-BB Amazon BID-Banco do Brasil” is a collaboration with the bioeconomy pillar of the IDB’s Amazonia Forever program, which aims to holistically promote sustainable development in the Amazon region.

The program has two core components. First, it will support the development of bio-enterprises and rural producers within Amazonian bioeconomy value chains. This component will be financed by the IDB and the Green Climate Fund, underscoring the importance of sustainability and climate action in the region.

The second component will finance projects to generate renewable energy and improve connectivity between urban, rural, and forested areas in Brazil’s Amazon states, with a focus on the most remote locations. This part of the program aims to accelerate the energy transition and reduce connectivity challenges, particularly in rural and forested areas still dependent on fossil fuels, by promoting the use of solar energy.

A critical aspect of this program is the technical assistance provided by the IDB. It will play a key role in training local stakeholders and helping to prepare and improve bioeconomy projects. This support will ensure that sustainable practices are integrated into every facet of the program.

Tarciana Medeiros, president of Banco do Brasil, emphasized the dual benefits of this funding:

“This funding is intended to support initiatives that generate income and reduce carbon emissions by combating deforestation, conserving biodiversity, using land and natural resources responsibly, and restoring degraded areas”.

The letter of intent also aligns with the goals of the Green Coalition, launched in August in Belém, in northern Brazil. This coalition brings together 20 development banks and international partners, with contributions from the Latin American Association of Development Finance Institutions (ALIDE) and the Brazilian Development Association (ABDE). Its goal is to facilitate financial solutions and favorable conditions for the growth of local economies in the Amazon, and to promote socially, environmentally, and economically sustainable projects.

IDB president Ilan Goldfajn emphasized the far-reaching impact of the initiative: “In addition to boosting the forest economy and improving connectivity and the use of renewable energy, we will use this project to promote the sustainable business of bio-enterprises in the Amazon and organize the commercial promotion of products in the region. These actions aim to create economic alternatives for the population of the Brazilian Amazon states, which is one of the main pillars of Amazonia Forever.”

Banco do Brasil has submitted a request for approval of the program to the Brazilian Foreign Financing Committee (Cofiex). This committee, which operates under the Planning Ministry, is responsible for evaluating and approving projects financed with foreign resources and guaranteed by the federal government. The application is expected to be evaluated in December.