Analysis: Brazil's Green New Deal: Lula promises environmental policy overhaul

SAO PAULO, Oct 27 (Reuters) - Brazilian presidential frontrunner Luiz Inacio Lula da Silva is vowing an environmental overhaul of government policy on a scale rivaling the proposed U.S. Green New Deal, according to his senior advisers, campaign documents and Workers Party policy papers.

The big question, if he clinches a win in Sunday's election, is whether the leftist former president can muster the political will to fund such ambitions.

With plans to grant new protected status to half a million square km (193,000 sq miles) of the Amazon rainforest, fight deforestation, subsidize sustainable farming and reform Brazil's tax code to usher in a green economy, Lula may have to pick his battles.

As a mission statement, the environmental proposals from Lula and his advisers mark a departure from the policies of right-wing President Jair Bolsonaro and a dramatic update to the priorities of Lula's own Workers Party (PT) in recent decades.

Although Lula's 2003-2010 presidency effectively reduced destruction of the rainforest, he embraced traditional industrial development with little regard for emissions. On his watch, a state bank funded the beef industry's push into the Amazon and the state oil firm developed vast new oil reserves.

Now Lula and his advisers have embraced the transition to a green economy as a focus of their state-driven development policies, joining a wave of left-wing leaders prioritizing climate policy in the region, including in Chile and Colombia.

As the struggles of newly elected presidents there have highlighted, however, implementing such a transformative agenda is easier said than done. In the United States, the progressive Green New Deal languished in Congress, while President Joe Biden adapted some of the ideas for his climate agenda.

Marcio Astrini, the head of environmental lobby group Climate Observatory, said Lula's proposals were a promising blueprint, but added: "Whether it will happen in practice is another matter."

Lula's former Environment Minister Izabella Teixeira called the sweeping campaign proposals "a tremendous undertaking," adding: "Everyone is asking me, 'How will they carry this out?'"

By contrast, Bolsonaro's campaign has said little about his environmental proposals for a second term. He has rolled back protection of the Amazon since 2019, allowing deforestation there to soar to a 15-year high. The presidential press office did not respond to requests for comment.

A representative of his right-wing Liberal Party said they had no way to comment on the issue.

Congresswoman-elect Marina Silva, Brazil's most prominent environmentalist, compared Lula's plans for restoring strong institutional protection of the rainforest to a "post-war recovery effort" after Bolsonaro's legacy.

CONGRESSIONAL BARRIERS

Even if Bolsonaro narrowly misses re-election, as polls suggest, his congressional allies' strong showing in the general election this month could cause trouble for Lula's agenda. Bolsonaro's allies are close to an outright majority in both the Senate and the lower house of Congress.

Lawmakers' leverage over Brazil's tight federal budget could make it hard for Lula to follow through on even his most basic proposal: stepping up environmental law enforcement to combat deforestation in the Amazon.

Lula has pledged more staffing and funding for environmental enforcer Ibama and parks service ICMBio, but both rely on the congressional budgeting process.

He might have a freer hand with executive orders to address roughly 570,000 sq km of "undesignated territory" in the Amazon, which belongs to the federal government but has not been set aside for any principal use. Such areas are especially vulnerable to criminal loggers, miners and land grabbers.

A Lula government would seek to set aside that land as indigenous or nature reserves, said Silva, the former minister.

Although such formal designation would bring greater consequences for illegal deforestation, enforcement would still require new resources from the federal budget.

Congress would also be key to the PT's plans to overhaul the Brazilian tax code, imposing higher levies on polluting industries and lower rates for "green" activity like sustainable agriculture or electric cars.

PT Congressman Nilto Tatto said Lula would aim to win broad support from lawmakers in the powerful farm caucus, which accounts for roughly half of Congress.

Although most agribusiness leaders have lined up squarely behind Bolsonaro, Tatto said he believed farmers were growing more attuned to the consequences of climate change as extreme weather damages crops.

A Lula administration plan to offer subsidized "green" farm loans to plant on already open pasture, a bid to reduce deforestation, could also help win over the agriculture lobby.

FOREIGN AID

Lula might have an easier time winning over international allies, as several European leaders have signaled an eagerness to collaborate on renewed preservation of the Amazon.

"If the world is willing to help, keeping a tree standing in the Amazon may be worth more than any other investment," Lula told reporters in August.

Tatto and other advisers said Lula will almost certainly act quickly to restart the Amazon Fund, which used contributions from Norway and Germany for preservation efforts until Bolsonaro halted activities in 2019, citing unspecified irregularities.

Lula is also seeking an alliance with other rainforest nations like Indonesia and the Democratic Republic of Congo to pressure rich countries to fund forest preservation. A senior aide has proposed a regional summit on the Amazon next year.

Brazil in general will be more engaged in international climate diplomacy, Tatto said, and may even create climate tsar position similar to that of U.S. Climate Envoy John Kerry.

($1 = 5.3088 reais)

Reporting by Jake Spring; Additional reporting by Lisandra Paraguassu; Editing by Brad Haynes and Alistair Bell

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Global Climate & Environment Correspondent, based in Brazil. Interests include science, forests, geoengineering, cryosphere, climate policy/diplomacy, accountability and investigative reporting. His work on environmental destruction under Brazil’s President Jair Bolsonaro received awards from Covering Climate Now and the Society of Environmental Journalists. Previously based in China, he is fluent in Portuguese and Mandarin Chinese.