Europe and Brazil: together to expand the climate fund and boost green investments across the country

At COP30, BNDES with MMA and three European public development banks (AFD, KFW and CDP) signed a Letter of Intent to scale up the Fundo Clima the country’s main financing instrument for climate action with a focus on projects that deliver social and environmental impact.

The National Bank for Economic and Social Development (BNDES) and the Ministry of the Environment and Climate Change (MMA) signed a Letter of Intent with Kreditanstalt für Wiederaufbau (KfW), the Agence Française de Développement (AFD Group), and Cassa Depositi e Prestiti (CDP), providing for a contribution of BRL 6.17 billion (EUR 1 billion) to the National Climate Change Fund (Fundo Clima). Together they are joining forces to make the Fundo Clima a key engine of Brazil’s ecological transition, in line with the national Climate Plan and Paris Agreement commitments.

The initiative will finance investments in sustainable mobility, clean energy, forest restoration, bioeconomy, climate-resilient infrastructure and water management, with a focus on the North and Northeast. The Letter of Intent establishes an innovative financial mechanism for the Fundo Clima, within the Brazil–EU cooperation framework, to support projects that reduce greenhouse gas emissions and strengthen climate adaptation. To implement it, the three institutions formed a syndicate as part of JEFIC, a network of European development banks dedicated to co-financing and mobilizing capital.

European partners plan to mobilize up to €1 billion (KfW: €500M; AFD: €300M; CDP: €200M) in sovereign loans to capitalize the Fund. Final financing agreements will be signed after internal due-diligence and approval procedures, expected by September 2026.

An important milestone in international climate cooperation

The ceremony, held on November 12 at the BNDES Pavilion during COP30 — in the presence of Aloizio Mercadante (President, BNDES), João Paulo Capobianco (Executive Secretary, Ministry of Environment – MMA), Rémy Rioux (CEO, AFD Group), Christiane Laibach (Executive Board Member, KfW) and Paolo Lombardo (Director for International Development Cooperation, CDP) — marks an important milestone in international climate cooperation. It sends a clear message: climate finance can be ambitious, equitable and action-oriented, while improving people’s lives and protecting ecosystems.

“The contribution of European development institutions to the Fundo Clima demonstrates the strength of this Brazilian government instrument within the global ecological transition agenda. Strengthening ties between Brazil and the European Union is part of President Lula’s broader strategy to expand our country’s diplomatic and economic relations with the rest of the world,” said BNDES President Aloizio Mercadante.

Contact Presse :

Andrea Cordeiro Souza - andrea.souza@bndes.gov.br

Clara Cezar - cezarc.ext@afd.fr

Santiago Giraldo – giraldos@afd.fr