Development Co-operation Report 2012 Lessons in Linking and Development © OECD 2012

PART I Chapter 1

Brazil’s journey from the Earth Summit to Rio +20

by Izabella Teixeira Minister of the Environment,

The 1992 Rio Earth Summit brought about a cultural shift as citizens and governments alike became increasingly aware of the need to protect the environment as economies progress. The summit led to the formulation of legal and institutional frameworks to protect the environment, and we have seen improvements in many environmental indicators, such as the banning of lead in and a significant increase in natural protected areas. Nonetheless, we are still failing to mainstream environmental issues across sectoral policies and programmes and environmental quality is worsening in many areas. The lack of a coherent approach has had clearly negative impacts, one of the most obvious examples being the persistence of subsidies for fossil-fuel-based energy in many countries. The author of this introductory chapter draws on lessons from her own country, Brazil, which has made significant strides towards . She calls for a focus that: links the environment and the economy; considers medium and long-term needs and challenges; and recognises the diversity of countries, their differing levels of development and the inequalities of wealth distribution among nations. Such an approach, however, is not a natural market tendency – specific public policies will be needed if we are to green our economies.

39 I.1. BRAZIL’S JOURNEY FROM THE EARTH SUMMIT TO RIO +20

On Brazil’s initiative, in June 2012, the held Rio +20, a follow-up conference to the 1992 UN Conference on Environment and Development (UNCED, also known as the Earth Summit). Part of the intention was to assess what has been achieved against the promises nations made at the 1992 Earth Summit to move towards global, sustainable development. In this opening chapter for the Development Co-operation Report 2012, I look back at the progress the world has made towards sustainable development over the past 20 years, before looking forward at the obstacles we must still overcome. I use my own country – Brazil – to illustrate both progress and challenges.

What progress have we made since the 1992 Earth Summit?

In rich and poor countries alike, people are now aware of the need to protect the environment.

Perhaps the most extraordinary development that has occurred in the past 20 years has been the cultural change among the world’s citizens. In rich and poor countries alike, people have become aware of the need to protect the environment as economies progress and of future generations’ entitlement to the same resource base enjoyed by current generations.

Legal and institutional frameworks to protect the environment Most countries have developed legal and institutional frameworks to regulate, monitor and enforce environmental norms. Although the strengthening of institutional capacities remains a challenge in many quarters, a minimum set of rules has been put in place to regulate the way individuals, firms and the broader economy use a country’s natural resources. Globally, numerous conventions and agreements have also been adopted and commitments have been made to provide technical co-operation and assistance in areas as varied as , oceans, the ozone layer, resources, and .

Environmental conservation In terms of environmental conservation, there has been remarkable progress since the 1992 Rio Conference in many areas. UNEP’s recent report Towards a Green Economy documents many environmental indicators that demonstrate significant improvement (UNEP, 2011). Examples include: the near elimination of ozone-depleting substances worldwide and a parallel reduction in the risk of depletion of the stratosphere’s ozone layer; the expansion of natural protected areas, with resulting increases in the conservation of portions of the world’s biodiversity; improvements in air and water quality in many regions; elimination of lead in gasoline, with resulting avoidance of over 1.2 million premature deaths per year (of which 125 000 are children); and reductions in deforestation levels.

40 DEVELOPMENT CO-OPERATION REPORT 2012 © OECD 2012 I.1. BRAZIL’S JOURNEY FROM THE EARTH SUMMIT TO RIO +20

What still needs to be done? Despite this progress, the world is experiencing a worsening of environmental quality in many areas and sectors, not least the disturbing threats posed by climate change. The incidence and amplitude of extreme weather events have been steadily increasing; more vulnerable and fragile species and ecosystems – such as wetlands, mangroves and corals – have been diminishing and deteriorating in quality; water has become scarce in more places; and the number of species threatened by extinction has increased (OECD, 2012). A number of challenges to the implementation of sustainable development were poorly assessed in 1992 or have proven more complex than expected. It is only in recent years that we have seized opportunities to improve social welfare by distributing resources more fairly, as well as to boost positive environmental impact from policies aimed at eradicating . Yet, complex political economy drivers are still often protecting vested interests. The private sector is the effective driver of growth, and while better organised dialogue and strengthened partnerships between governments and the private sector have proven to be effective, these partnerships are still insufficient tools for sustainable development. The 1992 Rio Earth Summit recognised that natural resource management – including conservation – is a development issue that requires an economic approach. Countries have taken advantage of many so-called “win-win opportunities”, including energy efficiency and conservation, improved industrial and agricultural practices, sustainable forest management, new technologies and many others. It made sense to concentrate efforts on these “low-hanging fruits”. But now that these relatively straightforward and isolated actions have been initiated, we must concentrate on mainstreaming environmental issues within countries’ economic agendas, as well as in broader national development agendas.

The most crucial failure has been our inability to mainstream environmental issues across sectoral policies and programmes.

This is perhaps the most crucial area of failure since 1992: the failure to mainstream environmental issues within sectoral policies and programmes. Many sector ministries have “washed their hands” of dealing with environmental issues, arguing that this is the role of ministries in charge of the environment. The result of this disjointed thinking is sector-specific policies and programmes with clearly negative impacts, one of the most obvious examples being the persistence of energy subsidies in many countries. This is similar to what has been observed with regard to social protection and inclusion: the fact that these agendas are led by ministries specifically created to address social problems makes social justice and inclusion less prominent in other agendas and programmes. The cross-cutting nature of both social and environmental issues calls for a high level of co-ordination and co-operation among ministries. While global and economies continue to grow, relatively little has been done to ameliorate the impact of production and consumption patterns on natural resources. Without significant changes in these patterns worldwide, the future is clearly not promising as far as the planet’s sustainability is concerned. Yet, while changes are required, it is also clear that individuals’ aspirations towards higher living standards – particularly in developing countries – remain absolutely legitimate.

DEVELOPMENT CO-OPERATION REPORT 2012 © OECD 2012 41 I.1. BRAZIL’S JOURNEY FROM THE EARTH SUMMIT TO RIO +20

Towards an inclusive green economy What can we learn from Brazil?

Brazil achieved the first MDG – to halve levels of extreme poverty – in 2006, almost a decade before the target date.

Brazil has made significant strides towards sustainable development. This is the result of years or even decades of steady efforts to put the national economy on a more sustainable growth path, while addressing key social challenges, consolidating the democratic regime with well-functioning institutions, and dedicating major efforts to the conservation and protection of the country’s rich natural resource base. Brazil’s average per capita income, which was stagnant for 20 years (rising from USD 9 520 in 1980 to only USD 9 960 in 2002) grew to USD 12 690 in the nine years between 2003 and 2011 with President Lula at the helm. Brazil achieved the first Millennium Development Goal (MDG) – to reduce extreme poverty to half of its 1990 value – in 2006, almost a decade in advance of the 2015 target date. More importantly, the per capita income of the poorest 20% of the population rose at rates higher than 8% per year, allowing Brazil to reduce extreme poverty by half every five years. Lastly, between 2006 and 2012, deforestation rates in the Amazon fell from the average levels observed when the monitoring started in 1988 – 18 500 km2/year – to 6 200 km2/year in 2012, an all-time low. Brazil has also been at the forefront of technological developments that may be relevant to other countries in the common endeavour to promote sustainable development. The most significant and well-known of these are in the energy sector. Seventy-one per cent of Brazil’s power comes from hydropower plants. While fossil-fuel sources supply the majority of the remaining demand, wind and biomass are catching up at a rapid pace. Subsidies are essentially nil for both power and fuels, and the prevailing ones are either channelled to very distant areas in Brazil, or they support programmes for energy efficiency and renewable energy. The famous Ethanol Programme, which currently receives no subsidies from the government, has helped improve air quality in significantly while also reducing carbon emissions from transport.* A similar programme is now supporting the expansion of biodiesel production by providing tax and financial incentives to producers. The price ratio between a TOE (tonne of oil equivalent) of biodiesel compared to conventional diesel narrowed from 46% to roughly 10% between 2005 and 2010, and today they are essentially being produced at the same cost. Beyond the energy sector, Brazil has also proven to be a world leader in agriculture, both in its levels of production and agricultural research. Brazil has developed an agricultural sector programme to support the implementation of its National Climate Change Programme, involving the recuperation of degraded pastureland, implementation of agro- silvo-pastoral systems, zero tillage, an ambitious programme of biological nitrogen fixation, and an also ambitious reforestation programme. Most of these actions derive from important applied agricultural research sponsored by the Brazilian agricultural sector. While Brazil took early advantage of its low-hanging fruit and continues to have a very clean and carbon-efficient economy, continuing to take advantage of such win-win

* Brazil’s 37-year-old ethanol fuel programme is based on the most efficient agricultural technology for sugarcane cultivation in the world. In 2010, the US Environmental Protection Agency designated Brazilian sugarcane ethanol as an advanced thanks to its 61% reduction of total life-cycle greenhouse gas emissions.

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opportunities will require renewed efforts, political will and ingenuity. The country will have to devise mechanisms to balance the benefits and costs of the sustainable use of its immense natural resource richness. As the economy grows, the middle class expands, and poverty is at last eradicated, it is natural to expect a steady increase in Brazil’s consumption, with all the accompanying positive and negative externalities. An inclusive green economy must direct consumption towards greener goods and services and provide for a more just and prosperous society. Yet this will represent not only a social and political accomplishment; a cultural process will also need to be undergone, and this will take time to be absorbed by the larger .

The way forward It will be a challenge to define and agree on a new structure that links the environment and the economy, that considers medium and long-term needs and challenges, and that recognises the diversity of countries, their differing levels of development and the inequalities of wealth distribution among nations. However, it is a challenge we must rise to; we only have one planet, and it is increasingly integrated and bound together. It must be our common objective and obligation to ensure that the planet remains prosperous, united and integral in terms of its natural resource base. While countries will naturally defend the interests of their own people, a high degree of solidarity is required. Both the 2008 financial turmoil and the climate-change crisis have induced greater mainstreaming of environmental issues within the economic and political agendas of many countries. Rio +20 has provided the opportunity to rethink the nature of economic growth and to find ways of structuring a new economy which produces greener goods and services based on new consumption patterns. Such an economy will generate jobs, income and social well-being consistent with a growing global population, while addressing increasing aspirations for “traditional” consumption. Although these issues need to be recognised as a top priority by rich countries, we are all interested in and responsible for safeguarding our (only) planet.

Today, ministers of finance have a much bigger stake than they did in 1992.

Today, ministers of finance have a much bigger stake than they did in 1992 in view of the real threats posed by climate change, as well as the cost implications of the world “turning green”. The concept of an inclusive green economy offers the opportunity to reconcile economic growth with social and environmental objectives. It is an instrument that can reorient current economic growth towards sustainable development, based on technological progress that also guarantees that social and environmental themes will be given the same priority as economic objectives. Nonetheless, an inclusive green economy is not a natural market tendency and the majority of the numerous existing options for economic growth are not compatible with sustainability. Specific public policies will be needed if we are to green our economies.

We will need specific public policies to green our economies.

DEVELOPMENT CO-OPERATION REPORT 2012 © OECD 2012 43 I.1. BRAZIL’S JOURNEY FROM THE EARTH SUMMIT TO RIO +20

References OECD (2012), OECD Environmental Outlook to 2050: The Consequences of Inaction, OECD Publishing, Paris. United Nations Environment Programme (UNEP) (2011), Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication, UNEP, Nairobi, www.unep.org/greeneconomy.

44 DEVELOPMENT CO-OPERATION REPORT 2012 © OECD 2012 From: Development Co-operation Report 2012 Lessons in Linking Sustainability and Development

Access the complete publication at: https://doi.org/10.1787/dcr-2012-en

Please cite this chapter as:

Teixeira, Izabella (2012), “Brazil's journey from the Earth Summit to Rio +20”, in OECD, Development Co- operation Report 2012: Lessons in Linking Sustainability and Development, OECD Publishing, Paris.

DOI: https://doi.org/10.1787/dcr-2012-8-en

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