Latin America continues to act on climate, green bonds continue to boom, Brazil’s deforestation continues to spread
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May 26 – June 1, 2017
In the face of reports suggesting President Trump’s impending withdrawal from the Paris Agreement, world leaders continue to stand firmly behind climate progress. Former chairman of the Intergovernmental Panel on Climate Change, Rajendra Pachauri said this week that Mexico has a “unique opportunity to push forward a model for combating climate change that may be an international benchmark” due to its leadership role in Latin America and close proximity to the U.S. Meanwhile, Chilean President, Michelle Bachelet, expressed the importance of bilateral and multilateral solutions to our social problems saying she hoped the U.S. would “continue to support organizations such as the United Nations, the World Trade Organization, and the different structures that [emerged] after World War II to provide stability.” Peru’s Environment Minister, Elsa Galarza, recently presented the proposed Law on Climate Change to the Peruvian Congress—a historic milestone for the country. The draft law proposes to consolidate and integrate the various aspects of government involved in tackling climate change, thereby making efforts to address disaster management, adaptation, and other issues more efficient. It also provides guidance and certainty for agencies at the national, regional, and local levels of government. Galarza commented that the bill puts Peru in compliance with its commitments to the Paris Climate Agreement. (Terra 5/31/17, Ministerio de Medio Ambiente 5/23/17)
The World Bank plans to issue US$ 2 billion in green bonds to finance environmentally friendly projects in Peru. The International Finance Corporation (IFC), a member of the World Bank and the largest global development institution focused on strengthening the private sector in developing countries, will be leading this initiative in Peru. The IFC issued Peru’s first green bond three years ago for US$ 12.8 million with the local investor Rímac Seguros. Economy and Finance Minister Alfredo Thorne emphasized the importance of further developing the reforestation industry in Peru through the usage of green bonds. With the help of the World Bank, the Norwegian government, and Peru’s Interamerican Financial Bank, the Ministry of Economy and Finances has already begun to develop reforestation projects in attempts to grown this industry. (Gestion 5/27/17)
Despite ongoing political turmoil, Brazil is set to sell a record US$5 billion of green bonds this year. According to the Climate Bonds Initiative (CBI), proceeds from the bonds will be used primarily for sustainable agriculture and infrastructure projects. Globally, the green bond market is expected to almost double this year, reaching US$150 billion. In Brazil, green bonds have raised $1.76 billion this year, led by a $1 billion sale of seven-year debt by the country’s development bank. Sean Kidney, chief executive officer of the CBI said, “There’s not enough capital in Brazil now to reach its transition to a green economy, and green bonds are an opportunity to attract money for it.” (Bloomberg New Energy Finance 5/29/2017)
Earlier this month, Argentine President Mauricio Macri and his Chinese counterpart Xi Jinping signed an agreement to finance the construction of two nuclear power plants with a combined installed of roughly 2,000 MW in the providences of Buenos Aires and Rio Negro. One of the plants would share a 550-kilometer border with Chile and be situated some 600 kilometers from the Aysén region. In response, the Union of Patagonian Assemblies, the Union of Assemblies of Chubut, and the Union of Assemblies of the Kurru Leufu (Black River) issued a letter this week addressed to the Chinese Ambassador to Argentina, Yang Wanming, baring the title “In Patagonia NO". The letter expresses an outright rejection of the “unconscionable, arbitrary and illegal decision by the Argentine government allied with Chinese imperialist interests.” The letter further urges the Chilean government to abstain from making energy agreements with Argentina as long as they continue to propose projects that endanger communities and natural resources in the region. (El Ciudadano 5/29/2017)
Chile could generate 100 percent of its electricity with renewable sources by 2050, according to the Director of the National Energy Commission, Andrés Romero. Improving conditions for storage technologies and falling prices for clean energy could help displace fossil fuels in the grid, leading the country to surpass its existing goal to reach 70 percent renewable generation by 2050. “In the next four years, we’re probably going to ask ourselves why 70 percent,” commented Romero. Both goals include large hydroelectric power in the category of “renewable”, which many NGOs contest is not necessary. They argue that Chile could generate 100 percent of its energy in 2050 from non-conventional renewable resources (excluding large hydro). Romero believes that Chile will meet its current non-conventional renewable energy goal of 20 percent by 2025 five years early. (El Mercurio 6/1/17, Cambio Climático Chile)
One of the most biodiverse rainforests in the world, the Atlantic Forest in Brazil, lost 290 square kilometers of vegetation from deforestation—an increase from 57.7 percent from the previous year, making it the largest area lost in the last ten years. From 2015 to 2016, logging and planned fires destroyed 122.9 square kilometers, 207 percent more vegetation than the previous year, mostly in the northeast section of Brazil’s Atlantic Forest in the state of Bahia. The once dense forests are being cleared to make pastures, develop forestry operations and produce coal, as well as to replace with the invasive eucalyptus tree for paper production. The biodiverse Atlantic Forest of Brazil has already lost 88 percent of its original vegetation and 30 percent of the rivers running through this rainforest no longer support life because of the contamination caused by deforestation practices. (Efeverde 5/30/17)
Honduran water experts together with local government officials from the Municipality of San Jose Chiltepec in southwestern Mexico will train local residents on water management practices to protect the region’s rivers and aquifers. The training will take place at a three-day gathering in early June and residents will come away with the knowledge and skills necessary to sustainably manage their natural resources in collaboration with sanitation programs to keep local rivers free of contamination. Community-based management of water resources is especially important now as high temperatures are greatly affecting water quality and availability the region. The Honduran water specialists called on surrounding municipalities to also participate in this gathering that will teach them about the management of water—the principal ingredient for the preservation of life and the human race. (TV Bus 5/30/17)
This week's blog features contributions from Meredith Brown.