International Economics

<< N°155

Issue Q3 2018  
Overcoming the financial barrier to a low emission development strategy in Brazil  
E. L. La Rovere
This paper presents two low GHG emission scenarios for Brazil up to 2050, and discusses the impact in the implementation of a deep decarbonization scenario of a financial device allowing for decreasing capital costs of mitigation investments. Specifically, we consider (i) a governmental plan scenario assuming the achievement of NDC targets up to 2030 and the extension of current policies up to 2050; and (ii) a deep decarbonization scenario leading to a national GHG emission pathway compatible with an international effort targeted to stabilize the global temperature at 1.5?°C above pre-industrial levels. We present a comparative analysis of the scenario results for key economic and social indicators, and simulate the adoption of a new financial device allowing to decrease capital costs of low carbon investments in Brazil. Our conclusions highlight the potential of innovative financial mechanisms to foster the transition to a low carbon society in developing countries, as illustrated in the case of Brazil. Abstract

Climate change mitigation ; Low emission development strategies ; Deep decarbonization ; Climate finance ; Innovative financial devices ; Brazil ; Keywords
Q54 ; P45 ; P18 ; P43 ; Q43 ; JEL classification
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