Brazil’s current development model, characterized by intensive use of natural resources and environmental degradation, has caused serious social and economic consequences. Additionally, the country faces the impacts of environmental degradation (extreme weather events, scarcity of natural resources, loss of biodiversity, reduced agricultural productivity…), that affect the poorest populations more severely.

In response, Brazil is actively engaging in the transition to a low-carbon economy. At COP28, in Dubai, Finance Minister Fernando Haddad has launched the Brazilian Ecological Transformation Plan (ETP). This Plan seeks to shift economic, technological and cultural paradigms towards sustainable development based on sustainable relationships with nature and its biomes. To achieve this, strong public and private investment – in sustainable infrastructure, clean technologies, and new production models – will be paramount.

However, achieving this ambition comes with significant challenges, particularly in maintaining external competitiveness. As it moves towards a greener economy, Brazil must ensure that its policies and investments do not compromise the competitiveness of its products in global markets, or create macroeconomic imbalances that could jeopardize the sustainability of these efforts.

In partnership with the Ministry of Finance, and in cooperation with CEPAL and IPEA, AFD is developing a GEMMES economic modelling tool to test policy instruments capable of promoting a just and green transition. 

The GEMMES Brazil model will serve to evaluate the impact of public policies, specifically the ones on the Ecological Transformation Plan, with a special focus on their long-term consequences for economic growth, employment, macroeconomic stability, and climate/environmental variables. Indeed, for a successful green transition, Brazil needs comprehensive and coordinated policies that not only cut emissions but also support socioeconomic development, protect the environment, and ensure macroeconomic stability. 

GEMMES is an empirical structural macroeconomic model capable of identifying the specific dynamics of open developing countries. The model is built in partnership with local authorities and research institutes to guarantee that the tool is coherent with the country's needs and to assure that the partners are capable of using and improving independently. It is a monetary model that allows policymakers to test different policy instruments and identify the financial mechanisms and the consequences of these policies in different contexts. 

After developing a preliminary model calibrated with Brazilian data, the project team will refine the tool by incorporating the specific characteristics of Brazil’s sectoral, macroeconomic and financial framework: 

• The model needs to account for the dynamics of interest and exchange rates and their impact on private investment and employment, as well as the fiscal and macro-financial constraints and the capacity of public investments in green infrastructure to drive a new ecological transformation plan.
• The model will also bring a sectoral approach to provide detailed estimates of the impact of climate measures and sectoral policies in the medium- and long-run, considering different domestic and international scenarios, as well as their capacity to strengthen strategic productive chains and promote structural change towards an economy less dependent on natural-resource exploitation.

The project will result in a tool that models the macro-financial framework of the Brazilian economy, clearly identifying the mechanisms that determine interest rates and exchange rate dynamics, along with their impact on real variables (such as private sectoral investment decisions, exports, imports and market structure).

Throughout the project, the research team will organize workshops to ensure that the model responds to the specific needs of the Ministry of Finance, and training sessions will take place so that public policy analysts can use the model effectively to evaluate policy measures. Several publications, including one final book, are also expected.

As part of the revival of participatory forums dismantled under the presidency of Jair Bolsonaro (2019–2022), this project is an action-research initiative focusing specifically on the implementation of the Brasil Participativo platform. Launched by the Brazilian government in the summer of 2023, this platform aims to facilitate citizen contributions to the creation and improvement of public policies. It was developed using the Decidim web environment — a digital participation platform that, as of 2023, was being used in 30 countries and by 240 institutions.

This project was selected under AFD's call for research proposals on “Commons and Citizen Participation”, which invited proposals exploring how commons contribute to democratic practices and citizen participation; the interactions between commons-based actors and public institutions; and the capacity of commons to shape public action.

The project is part of AFD’s research program on the commons and will contribute to ongoing reflections on the “commons-based approach” — a framework closely tied to issues of democracy and citizen engagement, as it seeks to establish shared, operational governance of the complex challenges faced by public authorities, in partnership with citizens.

This action-research project aims to:

• Analyze the Brasil Participativo initiative over the 2023–2025 period through the lens of the commons approach — focusing in particular on its governance, use, and user-generated contributions;
• Formulate recommendations on the development and governance of the platform, in order to embed principles derived from the commons approach.

Various federal public actors will be involved in the research activities, using a sector-specific approach. Through this sustained dialogue throughout the project, the ambition is to foster stronger connections between public institutions and civil society actors — especially groups that have traditionally been excluded from participatory processes, such as women, people of color, and Indigenous communities.

The project will be carried out by a multidisciplinary team, bringing together academics and civil society actors with expertise in social movements, state–society relations, digital commons, and digital participatory arenas. Public institutions will be involved from the very beginning of the project.

The methodology will combine both qualitative and quantitative approaches — including interviews, document analysis, participant observation, and user data.

The project will lead to:

• Publications, including a final report, research papers, and policy briefs;
• Communication materials co-produced with public institutions and civil society actors;
• The creation of dialogue spaces through co-construction workshops and seminars.