Brazil talks to TPG and Brookfield about $4 billion climate finance
Brazil is in discussions with global investors, including TPG and Brookfield, to raise almost $4 billion for climate projects. This comes as the country ramps up its green finance campaign ahead of hosting COP30 in November.
The move, led by the state development bank BNDES is the latest effort by the government of President Luiz inacio Lula da Silveira to encourage private sector investment into the climate agenda for Latin America's biggest economy despite rising fiscal pressure.
Tatiana Rosito is the Brazilian Secretary for International Affairs in the Finance Ministry. She said, "We are speaking with some of the largest asset managers, such as Brookfield and TPG, and other potential partners, to see if they could be part of the fund."
According to two sources familiar with the matter who requested anonymity due to the nature of the discussions, the plan will be formally announced in August and include a public investment call. BNDES is expected provide seed capital of 5 billion reais (906.3 million dollars) as part of this plan.
Sources said that BNDES is in early stage talks with dozens domestic and foreign firms to gauge interest. The sources said that selected managers would be required to raise three-times the amount committed by BNDES, bringing the total funding up to 20 billion reals ($3.63 billion).
BNDES has not responded to a comment request.
Brookfield and TPG, two of the largest investors in low-carbon projects and companies, work closely with Alterra. Alterra is the world's biggest private climate investment fund.
Alterra was officially launched in Dubai, 2023 during the COP28 Climate Talks. The United Arab Emirates Government committed an initial $30 billion. Brookfield and TPG both run funds that are seeded by Alterra, which can invest in Brazil.
BNDES has also approached firms such as BlackRock, which is the largest asset manager in the world with assets of more than $12 trillion, Just Climate, Lightrock, a growth private equity investor, and local firms like Patria Vinci, and Perfin.
All refused to comment.
Some richer countries have cut back on development funding, including those under the administration of Trump's climate-skeptic U.S. president.
Brazil has already released sovereign bonds which tie the use proceeds to its sustainability agenda. The Eco Invest Brazil Program aims at reducing the risk associated with projects, such as currency volatility to make it easier to attract private investors.
Last year, the government also launched its Climate and Ecological Transformation Investment Platform. This platform connects investors to projects in various sectors such as forest conservation, energy storage and greening heavy industries.
One source said that the money raised by the capital call will not only be used to support emerging industries but could also be used to support mature industries such as solar and wind power.
Asset managers are expected to submit proposals by the end October. The source said that the final selection will likely take place in the first quarter 2026 and capital will be ready to deploy by mid-year.
(source: Reuters)
