Credits for rural sustainability
In a podcast interview by GT de Infraestrutura, Gustavo Pinheiro, from iCS, talks about the need for banks to review the criteria of rural credits, which very often finance deforestation
The deforestation in the Amazon is a focus around the world as would be expected. Among the many measures that are required to confront it, is the need for banks to progress with the strictness of their criteria for rural credits, which very often finance a large part of this destruction. The GT Infraestrutura podcast spoke about the subject with the participation of Gustavo Pinheiro, the coordinator of the iCS Low Carbon Economy portfolio. According to him, a large portion of the money lent by banks has been used to finance deforestation or for infrastructures that do not make economic or social sense for the region, in addition to producing devastating environmental impacts.
“The credit for the development of the Amazon has never financed the development of the region. It is as if it has never been decolonized. Brazil is no longer a colony of Portugal, but the Amazon has become a colony of the rest of the country, a place where we only invest if it is to take undue advantage,” he says.
The Central Bank (BACEN), only in 2021, has already opened three public consultations on the subject, for example, in order to try to incorporate some stricter criteria to the system of analysis of the rural credits and to discover whether the area financed for agricultural activity is or is not within an area of conservation or indigenous land.
GT Infraestrutura sent a letter to BACEN during public consultation no 82/2021, together with eight other organizations, with notes so that the criteria effectively help to combat deforestation and the consequent effects of climate change in all the Brazilian biomes. The document asks, for example, that the agricultural and cattle breeding financing offered by the Central Bank, including for other banks to lend to producers, answers to transparent and clear criteria of sustainability. Read about the document here.