Brazil touts climate credentials as Amazon deforestation falls — but draws criticism over oil bet

Brazil’s first-ever minister for indigenous peoples says South America’s largest country is seeking to swiftly restore its climate credibility and prevent the Amazon from hitting a calamitous tipping point.

Since returning to office in January, leftist Brazilian President Luiz Inácio Lula da Silva has made rapid progress in a relatively short space of time to reverse a trend of accelerating devastation in the world’s largest tropical rainforest.

Lula came to power pledging to put a stop to the damage done during far-right President Jair Bolsonaro’s four-year term and the latest data suggests the rate of deforestation in Brazil’s Amazon has fallen to its lowest level in six years.

It’s welcome news for Lula, who has promised to achieve zero deforestation in the Amazon by 2030 and is seeking to repair his country’s environmental reputation. The government, however, has received criticism over its plans to open new oil fields near the mouth of the Amazon River.

“Currently, we are experiencing a moment of reconstruction,” Brazil’s Sônia Guajajara told CNBC on the sidelines of an event in London hosted by The Caring Family Foundation.

“We are rebuilding all the rights of indigenous peoples. It is a challenge because we do need to rebuild the infrastructure that we have,” she added, according to a translation.

This includes repairing the environmental agency IBAMA and the indigenous affairs agency FUNAI, Guajajara said, after Bolsonaro reduced staff and pushed for more farming and mining on protected lands.

The Amazon is critical in absorbing the planet’s carbon dioxide — making it a vital bulwark in the fight against climate change. Roughly 60% of the rainforest is located within Brazil, a country that is the world’s sixth-largest emitter of greenhouse gases.

Guajajara said Lula was “very committed” to speaking out and demonstrating to the world that the country is taking steps to reduce deforestation and poverty and helping in the fight against the climate crisis by protecting the Amazon. She added that the U.N.’s COP28 climate conference later this year would allow Brazil to showcase its achievements on the international stage.

Lula reportedly said last month that Brazil would be going to COP28 to demand that wealthy countries pay their fair share to both protect the rainforest and to help the population that lives there.

“The entire world now is looking at the Amazon — so this commitment of President Lula to put the Amazon as a priority can obviously increase the funds to halt deforestation and increase protection but also it is a commitment to help reduce destruction,” Guajajara said.

One area that threatens to undermine Lula’s climate achievements is fossil fuels, the burning of which is the chief driver of the climate crisis.

Brazil’s energy ministry announced last month that it planned to invest 335 billion Brazilian reals ($66.5 billion) into the oil and gas sector in the coming years, saying the program prioritizes the resumption of investments “to guarantee energy security” by prospecting new fields.

The ministry wants state oil company Petrobras to pursue oil off the country’s northern coast, a project that has sparked protests from environmental campaigners.

Lula’s chief of staff Rui Costa has previously said he does not believe the country’s efforts to accelerate the energy transition while pushing for Petrobras to pursue new oil frontiers reflects a paradox.

“There is no contradiction,” Costa said in a radio interview, Reuters reported on Aug. 16. “It’s in the name — it is an ecological and energy transition.”

Txai Surui, an indigenous leader and activist from the Brazilian Amazon, welcomed the trend of falling Amazon deforestation but criticized Lula’s administration for its willingness to potentially develop offshore oil.

“For me, this is not morally acceptable,” Surui told CNBC. “How are you doing agreements about deforestation and all these things and yet you want to explore [for oil]?”

Surui said she hoped Brazil’s government would not pursue offshore oil near the mouth of the Amazon River and instead look to follow Colombia’s example after the neighboring country’s left-wing government announced that it would not approve any new oil and gas exploration projects.

Remarkably, voters in Ecuador passed a historic referendum in mid-August to prohibit drilling for oil in a protected area of the Amazon. The vote, which was celebrated by climate justice advocates across the globe, came as a blow to President Guillermo Lasso, who had said oil drilling revenues would be essential to fund the transition to a sustainable economy.

“To talk about the Amazon today is to talk about a global issue,” Surui told CNBC, citing the rainforest’s role as a vital carbon sink. “And we still have a long way to go” in the battle to save it, Surui said.

Brazil is currently in the grip of unusually hot temperatures at the beginning of spring, with the mercury hitting 40 degrees Celsius (104 Fahrenheit) in eleven Brazilian states in recent days.

A study published in Nature Sustainability in June warned that extreme events combined with rising stress levels could mean ecosystems collapse much sooner expected. Indeed, the research said the Amazon rainforest may reach its so-called tipping point several decades before the time predicted by U.N. climate scientists.

Tipping points are thresholds at which small changes can lead to dramatic shifts in Earth’s entire life support system.

Asked whether she felt this devastating scenario felt like an imminent prospect, Brazil’s Guajajara said, “I think so. I think we are really facing an emergency.”

“There is no space for the denial of what’s happening. We no longer just have signs; we can see extreme events showing us what is happening,” Guajajara said.

“What we need are actions which avoid us reaching this tipping point. So, it is a time for everybody to act. People need to act, companies need to be more responsible and governments need to change their stances.”