Brazil's Bndes development bank launched a new reforestation program that has earmarked R1bn ($180mn) in credit for companies to plant native tree species.
The new line of credit can be used for a broad range of forestry-related industries and is not limited to projects in the Amazon basin. The program will also fund agro-forestry projects for the production of fruit, nuts, coffee and other products.
Of the total funding available for the program, R456mn will come from the Bndes' Climate Fund and the remainder from a line of credit targeting environmental protection.
Interest rates for the loans will be capped at 2.5pc/yr for a maximum of 300 months. The bank will not lend more than R100mn to a single project.
The new line of credit is in line with the government's goal of replanting 12mn hectares of native vegetation by 2030.
Climate authority
President Luiz Inacio Lula da Silva said the country will create a climate authority and technical-scientific committee to "support and coordinate the federal government's actions to combat climate change."
"Our focus needs to be on adapting and preparing to face weather phenomena," Lula said, without adding details on the authority nor the committee.
The announcement comes as Brazil is facing droughts and fires in several regions. The drought throughout the country is the worst in 75 years, according to the national center for monitoring and alerts for natural disasters Cemaden. The drought in the Amazon basin specifically is the worst in 45 years.
Southern Rio Grande do Sul state was also ravaged by floods in late April-early May.
"We are experiencing a perverse combination of factors that are creating this situation," environment minister Marina Silva said. "Climate change is changing the rainfall pattern, the dry and flood periods, as you are seeing. Sometimes it rains too much, sometimes it rains too little."
