Impact Policy Tracker Policy

EcoInvest Brazil



EcoInvest Brazil, created in 2024 through Law No. 14.995, is a national programme housed within Brazil’s Fundo Clima and designed to mobilise foreign capital and reduce currency risk - one of the main barriers to scaling green investment in emerging markets. Coordinated by the Ministry of Finance and the Ministry of Environment and Climate Change, the programme aims to channel BRL 27 billion (USD ~5.2 billion) into Brazil’s ecological transition.

EcoInvest addresses both the cost of capital and foreign-exchange volatility through four complementary credit lines: (i) a blended finance facility that provides concessional local-currency funding via competitive auctions; (ii) an FX liquidity line offering temporary buffers to companies with dollar-denominated debt and revenues denominated in Brazilian reais; (iii) a derivatives pipeline that expands access to long-term FX hedging instruments through partnerships with the IDB and the Central Bank; and (iv) project-structuring support to build a pipeline of bankable sustainable projects.

In its first year, EcoInvest has already demonstrated significant mobilisation capacity. The first auction attracted BRL 7 billion (approximately USD 1.30 billion) in blended finance and is expected to mobilise around BRL 45 billion (approximately USD 8.35 billion) in sustainable investments over 24 months, with nine banks approved to operate. The second auction - focused on restoring degraded land - mobilised BRL 30 billion (approximately USD 5.57 billion) and will restore 1.4 million hectares across all Brazilian biomes - an area roughly nine times the size of London - through ten winning banks with nationwide coverage.

Highlights

  • Exchange Rate Protection as a Core De-risking Mechanism: Exchange-rate volatility has long been one of the main obstacles to climate investment in emerging economies. In Brazil, most green projects generate revenues in Brazilian reais, while foreign investors raise their capital in dollars or euros, meaning that currency depreciation can quickly erode returns. EcoInvest directly addresses this mismatch by offering long-term FX protection tools, including 10-year derivatives intermediated by the Brazilian Central Bank through an agreement with the IDB and distributed to local financial institutions. These instruments - combined with blended-finance subsidies - reduce the cost of hedging, allow banks and funds to embed minimum FX protection into investment structures, and secure more predictable USD-denominated returns. By transforming Brazil’s currency risk into a manageable, priced, and investable component, EcoInvest enables foreign investors to finance large-scale restoration, clean energy, and bioeconomy projects without taking on unhedged currency volatility.

Government’s Role:
Market Participant


Country:
Brazil

Policy Type:
Funding Programmes

Year: 2024

Responsible Institution:
Ministry of Finance (MF) and the Ministry of Environment and Climate Change (MMA)

Additional information:
EcoInvest Brazil [OECD]
EcoInvest Brazil: Foreign private capital mobilization and currency hedging program

Funding Programmes

What are funding programmes?

Funding programmes - which provide financial resources in the form of grants, loans, equity, and guarantees - can be used by governments and public institutions to address financing gaps and attract private sector participation, often through dedicated funding windows, government-backed funds, and public-private partnerships, towards businesses that place social and/or environmental impact at their core. By doing so, they help grow a pipeline of mission-oriented organisations capable of addressing systemic challenges while contributing to inclusive and sustainable economic development.

This support can take various forms: capital provided directly to enterprises to meet early-stage or growth financing needs; investments channelled through intermediary funds to reach a broader range of businesses; or blended finance models where public or philanthropic actors absorb higher risks to make investments viable for private investors. The design of these mechanisms is often catalytic, helping to build investor confidence, promote financial inclusion, and strengthen the resilience of social enterprises across diverse sectors and geographies.