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Brazil An emerging economy experiencing difficult times
Brazil's gross domestic product, which was 1.608 trillion US dollars in 2021 (expressed in current US dollars), makes it one of the world's largest economies. The country has the greatest wealth of biodiversity anywhere in the world, the biggest remaining area of rainforest and also, with the Amazon, the largest river by discharge volume.
In international peace and security policy, in world trade, and above all in global forest conservation and climate action, Brazil plays an important role. For a long time, the country was a model and a leader for the rest of Latin America, and it continues to have an eminent position. Brazil is actively involved in the BRICS association of countries (Brazil, Russia, India, China and South Africa) and in the G20, and is seeking to join the OECD.
Brazil's economic and social situation has been impacted by the consequences of the COVID-19 pandemic. Public debt has increased and low economic growth is predicted for the coming years. Supply constraints, rapidly increasing prices for raw materials and the resulting high inflation brought about by Russia's war of aggression against Ukraine are putting additional strain on the country.
German development cooperation with Brazil
Because of its key role in international politics, Brazil is an important global partner for the Federal Ministry for Economic Cooperation and Development (BMZ). Because of the country's strategic significance for climate action and for protecting the environment and conserving biodiversity, cooperation with Brazil aimed at fostering sustainable development is accompanied by a close political dialogue.
Brazil is a key partner for the development of renewable energy (for example what is termed green hydrogen). Meanwhile, the strong rise in deforestation and its national and global impacts are being observed with great concern. The BMZ has clear expectations in terms of visible and measurable progress in controlling deforestation, and it communicates these expectations in its dialogue with Brazil; the dialogue puts an emphasis on the fundamental principles of development cooperation.
The shared long-term overarching goal of Germany's development cooperation with Brazil is the protection of global goods and global values in line with the Paris Agreement and the 2030 Agenda for Sustainable Development. In keeping with the principle of leaving no one behind, disadvantaged population groups and the protection of human rights – especially the rights of indigenous peoples and traditional population groups – are a particular focus of German activities.
German-Brazilian cooperation focuses on the following core areas:
- Conserving nature and natural resources
Areas of intervention: forests, biodiversity
- Climate and energy, just transition
Areas of intervention: renewable energy and energy efficiency, sustainable urban development
In addition, the BMZ is also engaged in the fields of vocational education and training, and “green” financing.
In view of the country's own capacities, the main instrument on which German development cooperation with Brazil relies – apart from technical assistance and grants for Brazilian programmes and funds – is reduced-interest loans for measures to foster development.
In November 2021, Brazil received a commitment from Germany for new funding of up to 283.77 million euros. This commitment consisted of 257.5 million euros for Financial Cooperation and 26.27 million euros for Technical Cooperation.
Triangular cooperation Sharing experience
Brazil is an important partner for the BMZ when it comes to supporting joint development programmes in third countries; this is known as triangular cooperation. Such programmes focus on the sharing of experience between an emerging economy, an industrialised country and a third, poorer country.
For instance, Germany and Brazil are jointly supporting programmes in Africa, Latin America and the Caribbean – in fields such as environmental technology, decentralised energy generation and agricultural production.
As at: 19/01/2023