Brazil is using an upcoming senior delegation to China as a chance to gauge whether Beijing will become a purchaser of Brazilian carbon credits. Carbon‑market secretary Cristina Reis told Reuters the talks aim to lay the groundwork for a bilateral carbon‑market agreement that officials hope to unveil at the COP31 climate summit in Turkey this November.
High‑level talks tied to broader coalition work
The Brazil‑China meetings will run alongside a multilateral gathering in Wuhan from September 14‑18. There, a coalition of carbon‑market jurisdictions that includes Brazil, China and the European Union – together covering roughly 42% of global emissions – is set to approve a work plan that seeks to gradually align and integrate their trading systems.
Reis explained that the Chinese side will also be evaluated as a potential buyer of internationally transferred mitigation outcomes (ITMOs), a type of carbon credit that counts toward nations’ official emission targets under the Paris Agreement. “If that happens, Brazil needs to be the first to offer high‑integrity credits,” she said.
Brazil’s regulated carbon market in the making
Currently, Brazilian carbon credits are sold only in voluntary markets, where companies purchase them to meet self‑imposed emissions‑reduction goals. Under legislation passed in 2024, Brazil is preparing a regulated carbon market that will require companies to buy credits to meet official decarbonisation targets and will enable the country to trade internationally through ITMOs.
Reis said the government originally planned to have a verification system for international trades in place between 2031 and 2035, but industry requests are now pushing officials to consider an accelerated timeline. “It is on the table,” she said. “Those evaluating the submissions consider that possibility viable.”
Coalition moves toward implementation
In addition to the bilateral talks, officials from Brazil, China and the EU are expected to approve a work plan for the carbon‑market coalition that was launched earlier this year. The coalition already has 11 members and is seeking further participation from developing nations.
Ana Paula Cavalcante, Brazil’s deputy secretary for carbon‑market regulation and methodologies, said the coalition’s mutual‑recognition of carbon assets could be achievable within a decade. “Both the coalition and the closer relationship with China can help scale up carbon markets and unlock investment flows for Brazil as it seeks to reindustrialise around new technologies,” she added.
Implications for Brazil’s economy and climate goals
If China becomes a buyer of Brazilian ITMOs, it could open a sizable new revenue stream for Brazil’s emerging carbon‑credit industry and bolster the country’s broader reindustrialisation strategy. It would also demonstrate the viability of high‑integrity credits from the Global South, encouraging further participation from other developing economies.
Stakeholders are watching the outcome closely, as successful negotiations could position Brazil as a leading supplier of credible carbon credits in the fast‑growing compliance market, while also supporting the nation’s climate‑reduction commitments.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
