New plan aims to transform Brazil’s economy into a model that embraces social and environmental responsibility.
Brazilian impact investors have welcomed a ten-year plan intended to generate a more than tenfold increase in capital allocated to the sector.
Last week, Brazil launched a public consultation to evolve its National Impact Economy Strategy (Enimpacto) ahead of assuming leadership of the G20 next year and hosting of COP30 in the Amazonian city of Belem in 2025.
“With these high-profile international events where public policies will be developed and adopted, the world’s focus will be on Brazil,” Ricardo Ramos, Executive Director at non-profit Aliança pelo Impacto, told ESG Investor.
Brazil’s Enimpacto aims to provide a blueprint for other nations in Latin America to emulate, with one of the national strategy’s objectives being to increase impact investing in country from US$11 billion to US$120 billion.
The public consultation aims to gather feedback for the macro-objectives, goals and actions of the five ‘axes’ (pillars) that make up Enimpacto’s Ten-Year Plan 2023-2032.
The five pillars include: expanding the supply of capital to the impact economy; increasing the number of impact businesses; strengthening intermediary organisations; promotion of an institutional and normative macro-environment favourable to the impact economy; and coordination between federal states and municipalities to promote the impact economy.
Ramos explained that, due to the geographical footprint of Brazil, it has a different administrative structure to other countries. As a result, its governance extends to states and municipalities, each with their own responsibilities and budgets.
“Therefore, [Enimpacto] isn’t limited to the federal government but extends to these regional levels as well,” he said, adding that the national strategy intends to include representatives from states and municipalities to ensure they play a key role in the decision-making process.
The public consultation was launched on 20 October and will remain open for feedback until 20 November.
The evolution of the plan from the former Strategy of Impact Investments and Businesses, launched by the Brazilian government in 2017, to the new Enimpacto, established by Decree no. 11.646/23, marks a “significant moment” for Brazil.
“This name change is not merely semantic, but symbolic,” according to a statement by the Brazilian Ministry of Development, industry, Commerce and Services. “It represents a profound transformation in our economic understanding.”
According to the Ministry of Development, Brazil is moving from a “vision restricted” market to an economic model that embraces social and environmental responsibility.
“It’s worth noting that very few countries in the world have a national strategy for the impact economy established by the government,” said Ramos.
“In Brazil, we must focus on investments that have a positive impact on both business and society,” he said, adding that investments in climate mitigation alone are not sufficient to address the risks to the country’s economy posed by climate change and biodiversity loss.
“If we compare Brazil to Europe, we are lagging behind in terms of impact investment,” he said. “Our challenge is to grow the impact economy, not just in terms of knowledge but also in mobilising more resources and capital for this purpose.”
Under President Luiz Inácio Lula da Silva’s administration, however, Brazil’s national strategy for the impact economy has garnered significant traction, demonstrated by the recent decree.
“The importance of the national strategy has now been re-established, giving it even more power and connecting it with more government organisations within Brazil.”
Ramos noted that the Global South has a vital role to play promoting impact investment and delivering on the UN’s Sustainable Development Goals (SDGs), particularly SDG 11, focused on sustainable cities and communities.
“When discussing social problems and climate issues, many of the opportunities to overcome both are in the Global South, including Brazil.”
Aliança pelo Impacto was created in May 2014. The Alliance represents Brazil in the Global Steering Group on Impact Investing – GSG, which is an organisation based in the UK whose mission is to foster the global ecosystem of impact investments and businesses.