Brazil has been growing modestly for several decades. There are many possible explanations for this. Among them, the low productivity and low competitiveness of the national economy, the low investment rate, the loss of dynamism and weight of the manufacturing industry and its limited participation in global value chains, mainly as a supplier of commodities. To grow more robustly and at higher rates, and to improve its indicators of inequality and well-being, Brazil will need to invest in new models and strategies for development and international insertion. The combination of sustainable and sustained growth, supported by economic, environmental and social pillars, needs to be part of this new agenda. But there are challenges ahead.

According to the International Energy Agency (IEA), the immediate common challenge is for world GDP to grow 40% by 2030 while limiting energy consumption increases to 10%. This is an ambitious goal, even if GDP is driven by less energy and carbon intensive activities, such as services and information technologies, rather than steel and cement production. This goal will require large efficiency gains, much greater than those observed in recent decades.

The most important result of the COP21 (United Nations Conference on Climate Change 2015) was the Paris Agreement signed by 195 nations, including Brazil, and aimed at reducing greenhouse gas emissions. The ultimate goal is to reduce the pace of global warming, so that by the year 2100 the planet’s average temperature will increase by less than 2°C. In this agreement, Brazil adopted ambitious Nationally Determined Contributions (NDC) contemplating absolute emission reduction targets of 37% by 2025 and 43% by 2030. Recently, Brazil signaled that it intends to achieve carbon neutrality by 2050 and demands the adoption of fair remuneration mechanisms for the environmental services provided by its biomes to the planet, in order to recognize the economic nature of conservation practices.

The COP26, to be held in Glasgow, Scotland, next November 2021, will be the stage for discussions and definitions of this environmental agenda, now with the participation of the United States, which, during the former Trump administration, had abandoned the Paris Agreement. China, too, has expressed interest in reinforcing this agenda by setting the goal of zero emissions by 2060.

The general trend is for the world to make alliances in the fight against global warming, linking the creation of more jobs to sustainable investments, facilitating the transition to a world free of greenhouse gas emissions. Climate change and the impact of greenhouse gas emissions pose enormous challenges for public and private policy makers and are increasingly central and urgent topics on agendas around the world.

While on the one hand the climate change poses challenges, on the other hand it offers unprecedented economic opportunities for Brazil because of its unique natural capital, including immense tropical and blue forests and other biomes, the wide availability of fresh water, its rich biodiversity and the wide potential for generating green energy and biofuels, essential elements for the transition to a low-carbon economy. The country’s immense potential to increase food production through sustainable technologies is also part of this agenda.

As the largest emitter of gases and consumers of carbon and with immense challenges to decarbonize its economy, clean up cities and waters and to be become a carbon-neutral economy by 2060, China will have to seek new and more ambitious solutions that add to its own ongoing efforts to adapt, transform and change. Actually, the climate agenda will be critical for China to increase its global economic influence and improve the well-being and quality of life of its population. Chinese companies, many with a growing global presence, will need to adapt to new market practices, increasingly strict environmental regulations and new consumer demands. That will also require enormous efforts and the search for new and innovative solutions.

Considering the huge challenges and ambitions, China will need to work with allies in the field of climate change and sustainability in order to accelerate the transition to a carbon-neutral economy, meet the country’s needs and commitments, as well as the demands of its consumers. Brazil is perhaps the country best positioned to cooperate with China on this agenda.