VZCZCXRO6555
PP RUEHHM RUEHPB RUEHTM RUEHTRO
DE RUEHBR #0028/01 0081355
ZNY CCCCC ZZH
P 081355Z JAN 09 ZDK
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC PRIORITY 3261
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUEHRG/AMCONSUL RECIFE 8893
RUEHRI/AMCONSUL RIO DE JANEIRO 7077
RUEHSO/AMCONSUL SAO PAULO 3318

C O N F I D E N T I A L SECTION 01 OF 03 BRASILIA 000028 
 
C O R R E C T E D COPY - PARAGRAPHS RENUMBERED 
 
SIPDIS 
 
DEPT FOR OES/EGC - T.TALLEY AND D.NELSON 
 
E.O. 12958: DECL: 01/08/2019 
TAGS: SENV ENRG KGHG EAID EFIN BR
SUBJECT: WORKING WITH BRAZIL ON CLIMATE CHANGE - AN 
OPPORTUNITY 
 
REF: (A) BRASILIA 1666 (B) BRASILIA 1159 
 
BRASILIA 00000028  001.4 OF 003 
 
 
Classified By: Deputy Chief of Mission Lisa Kubiske, Reason 1.4 (b) and 
 (d) 
 
¶1.  (C) SUMMARY.  Brazil has a central role in the climate 
change arena, not only because it controls 70% of the Amazon 
rainforest, but also because it plays a pivotal role in the 
on-going UN Framework Convention on Climate Change (UNFCCC) 
negotiations.  USG efforts to have India and China assume 
binding targets under the UNFCCC may hinge on the Government 
of Brazil (GOB),s position in these talks.  For this reason, 
Mission Brazil suggests that the USG start an active campaign 
to allay the GOB,s concern about the effect that any 
eventual agreement will have on its ability to promote 
economic growth or about the possibility that a post-Kyoto 
agreement will expose them to potential trade sanctions or 
other punitive measures.  Allaying the GOB,s concerns on 
this front will make it possible for the GOB to take a more 
helpful position in these negotiations. 
 
¶2.  (C) Now is a propitious time and the USG has the tools to 
shift the GOB toward a more helpful position in the UNFCCC 
negotiations.  These tools include working with forward 
leaning state and local governments, facilitating technical 
assistance in forest management, and creating opportunities 
for more technology transfer.  END SUMMARY. 
 
BRAZIL IS KEY IN THE FIELD OF CLIMATE CHANGE 
 
¶3.  (SBU) Brazil has a dual importance in the field of 
climate change.  First, massive deforestation has made 
Brazil, who has about 70 percent of the Amazon Forest in its 
territory, the fifth largest carbon emitter since 1950. 
For this reason, Brazil,s management of its tropical forests 
will have a marked impact on the climate. 
 
¶4.  (SBU) Second, the GOB has honed to an art the ability to 
block international negotiations when it disagrees with an 
outcome.  Brazil,s potential spoiler role could undermine 
USG,s efforts to convince China and India (both non-Annex I 
countries to the UNFCCC) to take on emissions reductions 
targets.  Brazil has strenuously opposed non-Annex I 
countries assuming reduction targets, citing the &common but 
differential responsibilities8 clause in the UNFCCC. 
 
WHAT ARE BRAZIL,S PRIMARY INTERESTS? 
 
¶5.  (SBU) Growth, growth, growth.  President Luiz Inacio Lula 
da Silva and his team have made economic growth the 
centerpiece of his second term (2006-2010).  Lula wants to 
bring a modicum of economic prosperity to his base:  the 
approximately 20 million people living in the Amazon region 
and the over 100 million more living in or near poverty in 
the rest of the country.  A heightened emphasis on growth at 
the expense of environmental concerns was led to the 
departure in May 2008 of former Environment Minister Marina 
Silva (considered an inflexible, absolutist on key 
environmental issues) and her replacement by the more 
pragmatic Carols Minc.  The GOB does not consider climate 
change an immediate threat to Brazil, and is not willing to 
sacrifice other priorities to address the problem. 
 
¶6.  (SBU) The GOB sees several areas of concern in the 
negotiations of the post-Kyoto framework.  The GOB fears that 
there will be trade sanctions imposed on those countries that 
do not meet emissions reduction targets.  They are worried 
that the Europeans would like to use a punitive regime to 
implement reductions.  Moreover, they suspect that Europe 
(and to a lesser extent the United States) would use such 
trade sanctions as a non-tariff barrier to undermine Brazil 
and third world competitors.  Since approximately 80 percent 
of Brazil,s emissions result from deforestation, Brazil 
would need to have confidence that it could adequately 
control the rate of clearing before it could agree to binding 
international targets.  The jump in deforestation figures for 
the 2007/2008 period shows that the government,s grip over 
the Amazon remains weak (REFTEL A). 
 
¶7.  (SBU) The GOB is also concerned by proposals for a 
sectoral approach.  GOB officials believe the sectoral 
approach could lead to significant constraints on the 
Brazilian economy.  Here again the GOB sees the hidden hand 
of competitors in the developed world, where the mature 
industries are looking for ways to impede the rise of new 
competitors in the developing world. 
 
 
BRASILIA 00000028  002.4 OF 003 
 
 
¶8.  (SBU) Brazil has looked favorably on other aspects of the 
climate change discussions that either do not threaten or 
could even boost economic growth.  Thus, the GOB presses hard 
for technology transfer and financial assistance to the 
developing world.  It also has promoted its Amazonas Fund, 
where international contributors provide Brazil with funding 
) but with no strings or oversight ) to help conserve the 
Amazon Forest (REFTEL B). 
 
THREE POSSIBLE SCENARIOS 
 
¶9.  (C) Brazil could take one of three approaches to the 
ongoing UNFCCC negotiations: 
 
- The Spoiler:  This is GOB,s current approach, which is to 
seek to prevent developing countries from assuming binding 
international obligations. 
 
- The Passive Partner:  The GOB is willing to have China and 
India assume binding obligations, but does not use its 
influence to accomplish this end. 
 
- The Active Ally:  The GOB works with the USG to establish 
mechanisms to constrain emissions by developing countries. 
 
While it would be ideal to have the GOB working side-by-side 
with the USG in the international negotiations on a 
post-Kyoto agreement, it is more important that the GOB does 
not block a deal satisfactory to the USG. 
 
FIRST A REASSURING CAMPAIGN 
 
¶10.  (C) A critical element for changing the GOB,s approach 
to the negotiations is convincing them that the new regime, 
whether through overall emissions targets or by sectoral 
means, will not impede the GOB,s drive to expand the 
economy.  The USG and Europeans should launch a campaign in 
Washington, Brasilia, and in European capitals (to the 
Brazilians) to convince the GOB of this important point.  The 
USG should also reach out to other stakeholders such as state 
and local governments, civil society groups, and opinion 
makers who can help allay the fears of the federal 
government. 
 
THE TIME IS RIGHT FOR COOPERATION 
 
¶11.  (C) With adequate assurances over their prospective 
economic growth, we are at a propitious time move the GOB to 
a Passive Partner or even an Active Ally role in these 
negotiations.  Minister Minc has signaled willingness for 
Brazil to take a more ambitious approach toward climate 
change.  Minc is close to the President,s powerful Chief of 
Staff, Dilma Rousseff, which could enhance his ability to 
influence the results of inter-ministerial debate.  At the 
same time, Under Secretary for Political Affairs Everton 
Vargas (who has the lead within the Ministry of External 
Relations (MRE) on climate change) is expected to leave in 
February 2009 to become the Brazilian Ambassador in Germany. 
Under Secretary Andre Amado is taking over climate change 
negotiations for the MRE.  This change may provide the USG 
with a greater opportunity to influence the GOB position in 
the upcoming UNFCCC negotiations.  This opportunity is 
particularly important because the MRE, rather than the 
Ministry of the Environment (MMA), has retained the dominant 
role within the GOB on these negotiations. 
 
¶12.  (C) Equally important is the divide between the more 
forward leaning state governors of the Amazon region and the 
federal government.  The governors have been working on 
climate change and environmental initiatives that are more 
aggressive than those of the federal government.  Their 
efforts demonstrate a growing sentiment within Brazil that 
more can be done to combat climate change.  These governors 
could be potential partners with the USG in efforts to 
influence the GOB's position. 
 
SUGGESTED ACTION PLAN 
 
¶13.  (C) USG and other developed nations have several tools 
at their disposal to encourage the GOB to adopt a more 
helpful approach in these negotiations.  The USG should help 
to the GOB to address its economic concerns by providing 
technology transfers/sharing (such as with energy efficiency, 
clean energy, or biofuels); and financial assistance.  The 
USG could start by building on existing mechanisms, such as 
the 2007 biofuels MOU, but the USG should also look for new 
opportunities to continue and expand these endeavors. 
 
BRASILIA 00000028  003.4 OF 003 
 
 
 
¶14.  (C) The USG should simultaneously take action to 
persuade influential players in Brazil,s elite circles to 
weigh in for a more constructive approach.  These players 
include state government leaders, national legislators, the 
business community, Non-Governmental Organizations, opinion 
leaders, and prominent scientists.  This outreach could be 
accomplished through existing ties (such as those that the 
Mission has developed with the governors of the nine states 
in the Amazon region); building relationships between 
Brazilian legislators, scientists, and business leaders and 
their US counterparts; promoting and facilitating exchanges 
between Brazilian and US experts; and increasing contact and 
communication with opinion leaders and Brazilian NGOs with a 
focus on the compatibility of US and GOB interests in climate 
change negotiations. 
 
¶15.  (C) The USG should also leverage its technical, 
scientific, and economic resources to help the GOB tackle its 
deforestation problem.  This could be accomplished by 
facilitating technical exchanges with the U.S. Forest 
Service, the National Park Service, the U.S. Fish and 
Wildlife Service, and the Bureau of Land Management with an 
aim of helping strengthen Brazil,s ability at the national, 
state and local levels to manage better its forests in a 
sustainable manner.  The US could also provide financial 
assistance and scientific and economic analysis to help the 
GOB better understand current trends in deforestation and the 
likely impact of any policy changes. 
 
¶16.  (C) Finally, the USG should continue to promote state 
and municipal activities to reduce deforestation.  Helping 
these governments could produce positive results that could 
be replicated elsewhere in the region. 
 
SOBEL