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DE RUEHBR #1426/01 3421220
ZNR UUUUU ZZH
R 081218Z DEC 09
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 0036
INFO ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RHEHNSC/WHITE HOUSE NATIONAL SECURITY COUNCIL WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHRG/AMCONSUL RECIFE 0021
RUEHRI/AMCONSUL RIO DE JANEIRO
RUEHSO/AMCONSUL SAO PAULO

UNCLAS SECTION 01 OF 03 BRASILIA 001426 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SENV EFIN EAID KGHG BR
SUBJECT: BRAZIL: NEW LEADERSHIP GIVES GREEN LIGHT TO CREATING A 
TROPICAL FOREST CONSERVATION ACT PROGRAM 
 
(U) THIS CABLE IS SENSITIVE BUT UNCLASSIFIED AND NOT FOR INTERNET 
DISTRIBUTION. 
 
 
 
¶1.  (SBU) SUMMARY.  The Government of Brazil (GOB) on November 30 
informed the U.S. Government (USG) that it wants to establish a 
debt-for-forest program under the Tropical Forest Conservation Act 
(TFCA).  The GOB submitted specific changes it wanted to make in 
the proposed text of an agreement creating such a program, which 
draft text the USG had submitted in October 2008.  This step 
forward follows a changing of the guard near the top of the 
Ministry of External Relations.  Now, the GOB - not just the 
Environment Ministry - is favorable toward creating a TFCA program 
and is eager to finalize the text and bring the program to life.  A 
successful conclusion of the TFCA negotiations could be helpful for 
the bilateral relationship in general and specifically with respect 
to the anticipated negotiations of a forest credit/offset agreement 
under U.S. climate change legislation now in the U.S. Congress. 
END SUMMARY. 
 
 
 
¶2.  (SBU) On November 30, the Government of Brazil (GOB) through 
its Embassy in Washington informed the U.S. Government (USG) that 
it would like to establish a program under the Tropical Forest 
Conservation Act (TFCA) and provided detailed changes they would 
like to see in the draft text presented by the USG in October 2008. 
Shortly afterwards, in a December 2 meeting about climate change 
the Ministry of External Relations' (MRE) Under Secretary for 
Policy, Ambassador Vera Machado, raised the matter of a TFCA 
agreement with Charge d'Affaires, a.i. Lisa Kubiske.  Machado 
indicated that the MRE thought a TFCA agreement was important and 
wanted to conclude it soon.  Earlier in November, the MRE's new 
Secretary-General (or Deputy Minister) Antonio Patriota had told 
the Charge that the GOB wanted to establish a TFCA program and 
promised to have a detailed response, with their suggested changes, 
by November 30. 
 
 
 
¶3.  (SBU) COMMENT.  Deputy Minister Patriota, who just assumed 
office a month ago, and Ambassador Machado, who arrived less than a 
year ago, are key new faces handling bilateral and multilateral 
matters filling the senior ranks of the MRE.  Previously, the GOB's 
response to the USG's TFCA proposal, which had been prepared by 
staff many months ago, just sat on the desk of Patriota's 
predecessor.  While the TFCA matter has come up from time to time 
with Minister of External Relations Celso Amorim, it seems that 
Amorin has been content to let the Deputy Minister handle the 
matter.  His previous Deputy Minister chose not to send the USG a 
response even though the Ministry of Environment had been pushing 
hard to do so.  In contrast, Patriota within his first month 
presented a clear signal that the GOB wants at TFCA program and 
provided a detailed response to the draft text.  Moreover, the MRE 
through Machado is now pressing the USG to move quickly.  The 
recent changeover in the senior positions at the MRE have opened 
the door for better ties and greater cooperation with Brazil, not 
just with environmental matters, such as in the case of the TFCA, 
but also in a variety of other areas.  END COMMENT. 
 
 
 
NEXT STEPS 
 
 
 
¶4.  (SBU) Science Counselor met on December 2 with the MRE's 
Director of the Environment Division, Fernando Coimbra, and his 
deputy Pedro Andrade (who will soon replace Coimbra, at least on an 
acting basis) to discuss next steps.  Coimbra recognized that now 
the MRE at the political level was behind concluding a TFCA 
agreement.  He said that for the GOB the best way to proceed would 
be to receive written comments back from the USG to the suggest 
changes, indicating what was acceptable and what was troublesome or 
not possible.  With that information, the MRE, which leads in these 
negotiations, would hold an inter-ministerial meeting to decide how 
to respond.  After that, the USG and GOB could hold negotiations, 
either by videoconference or, even better, face-to-face.  Coimbra 
felt strongly that this two-step approach was better than going 
directly to a videoconference or face-to-face meeting. 
 
BRASILIA 00001426  002 OF 003 
 
 
¶5.  (SBU) The Environment Ministry is eager to go forward because 
they want to start up conservation programs in the tropical forests 
of the Mata Atlantica, as soon as possible, and also for concern 
that continued repayment of the debt might reduce the amount of 
funds available below the US$20 million level under consideration. 
We understand the Finance Ministry is supportive of having a TFCA 
program, though they would have preferred to include the entire 
debt to the United States and not just US$20 million. 
 
 
 
¶6.  (SBU) Assuming that both sides come to acceptable language for 
the TFCA agreement, the GOB would have one more step to take, i.e., 
submit it for approval to the Senate for fast-track approval. 
Ordinarily, a bilateral agreement such as the TFCA would need to be 
approved by both chambers of the Brazilian congress.  However, 
during the September 2008 negotiating session, the GOB identified a 
way to configure the agreement as essentially a financial 
arrangement, which means it would only need to go to the Senate and 
on a fast-track procedure.  The GOB estimated that it would take 
approximately three months for the Senate to approve the 
arrangement.  With Senate approval, then the TFCA could then enter 
into force. 
 
 
 
KEY SUGGESTED CHANGES 
 
 
 
¶7.  (SBU) The specific changes requested by the GOB have already 
been provided to the State Department, the Treasury Department, and 
USAID.  Patriota summarized for the Charge in a brief non-paper the 
main amendments requested, which are: 
 
 
 
- the resources should be directed to Brazilian tropical forests 
that do not currently benefit from international cooperation, 
namely, the Mata Atlantica (along the east coast), the Cerrado (in 
the central-west), and the Caatinga (in the north-east); 
 
 
 
- the resources should go to "Brazilian" non-governmental 
organizations (NGOs), governmental agencies and other appropriate 
local or regional entities (NOTE: Almost all the NGOs operating in 
Brazil are "Brazilian," including The Nature Conservancy, World 
Wildlife Fund, etc.  END NOTE.); 
 
 
 
- the agreement should stipulate how the U.S. Government will 
declare that the Brazilian debt has been paid (The GOB is proposing 
that USAID issue a document called a "quittance" as a written 
acknowledgement (receipt)discharging the GOB after each installment 
is paid); 
 
 
 
- changes should be made in the criteria for composition of the 
board. 
 
 
 
COMMENT 
 
 
 
¶8.  (SBU) A sea change within the MRE's decision makers has now 
cleared the way to proceed forward in establishing a TFCA 
agreement.  The suggested changes are not trivial and will require 
careful analysis by the USG.  Nonetheless, the new goodwill 
unveiled by the GOB and the USG's long-standing support for a TFCA 
program in Brazil provide a solid basis for going forward, 
understanding that, in the end, it simply might not be possible 
The ramifications of the TFCA negotiations will likely be felt in 
other areas.  The GOB team working on the TFCA agreement will is 
also the same one handling work on bilateral and multilateral 
environmental issues.  Most notably, this GOB team will probably be 
 
BRASILIA 00001426  003 OF 003 
 
 
basically same as that team that will handle negotiations of a 
bilateral agreement on forest conservation, offsets and credits, as 
called for in the draft climate legislation in the U.S. Congress. 
That climate change agreement will involve several magnitudes 
larger sums.  Success with the TFCA negotiations would be a helpful 
start to those subsequent negotiations.  Furthermore, the TFCA 
matter is one of the first matters to come up for Deputy Minister 
Patriota and his team, as they try to improve relations with the 
United States.  We should give it our best efforts to try to 
successfully conclude those negotiations.  END COMMENT. 
 
 
 
KUBISKE 
KUBISKE