Opinion – Rodrigo Tavares: Lula, Alckmin and green industrialization

If the Lula government succeeds, it will leave a strong mark on the social agenda. But if it works out very well, it will also leave a legacy in the country’s green industrialization. The transition period has been an inventory of stumbles, elbows and pent-up tempers. But the time has come to roll up our sleeves.

First the story. Brazil began its industrialization late. In 1785, with the industrial revolution awakening in England, the colony was banned from producing manufactured products. But then we had Barão de Mauá, Getulio, Juscelino and many others who contributed to the acceleration of industrial growth. In recent decades, however, the debate around industrialization has become ideologized, serving to polarize decisions.

The Lula government will be distracted if it focuses the industrialization agenda on antiquarian discussions about nationalization, nationalization or protectionism. The focus should be on Brazil’s green industrialization, which aims to decouple economic growth from negative environmental externalities, maximizing the application of clean energy, green industrial production and clean technologies. It is in line with the Industry Recovery Plan presented recently by the CNI (National Confederation of Industry).

Two regions stand out out there. The European Union, the most ambitious, adopted in 2019 the colossal European Ecological Pact, aiming to achieve climate neutrality by 2050. The pact encompasses all sectors of activity, from transport, agriculture, food, industry and infrastructure. But Africa has also taken important steps, supported by several UN agencies. It is moving from conferences, reports and regional working groups to concrete green industrialization projects.

There are positive signs coming from South Africa, Mozambique, Nigeria and Morocco, from where I write. Last year, the “Tatwir Green Growth” program was launched to support the emergence of new green industrial sectors and reduce industrial pollution. And this year, a partnership was signed with the United Nations Organization (United Nations for Industrial Development) based on a roadmap for the decarbonization of industry and the mobilization of green funds, which is progressing without major delays. Next year, the government should announce the creation of a US$ 2 billion (R$ 10.4 billion) fund to help decarbonize its industry.

Brazil’s green industrialization will be slow if all the work is centered on the Ministry of Industry and Commerce or if it is limited to isolated initiatives, such as a program to promote green hydrogen or the issuance of ‘green’ sovereign debt backed by environmental plans. The Lula government could be more ambitious and efficient.

Although the nomination of his vice president as minister is a gesture fraught with risks, as I described in a recent article, Lula will be able to take advantage of Alckmin’s choice to make it clear that green industrialization is an inter-ministerial, transversal and presidential effort. He will play in dozens of ministries, from Finance to the Environment. It will require the ability to design public policies that can be properly funded, implemented and evaluated (the quadrunvirate of quality public administration).

Certainly the policy operates on a logic of lowest common denominators and not optimal scenarios. Furthermore, the dismantling of the Bolsonaro government was so significant that our expectations for the Lula government need to be guided by the increased difficulties on the ground. But the government would need to create an instance above the ministries that oversees and implements green industrialization. Something inspired by the PAC (Growth Acceleration Program) or the PPI (Investment Partnership Program).

Decarbonization necessarily presupposes a strong investment program in multiple sectors —such as energy, agriculture, industry, infrastructure— to be carried out in conjunction with state governments.

The excessive number of parties in Brazil and the need to form broad fronts and compose with Congress results in greasy governments characterized by silos, personalization and lack of accountability. But some public policies cannot be isolated or exclusive to specific folders. The trend in countries such as Germany, France or South Africa is concertation and coordination, as I highlighted in this article about the Ministry of the Environment.

Public policies are increasingly horizontal rather than vertical. Lula needs to look forward, not just to what worked in the past. A positive sign? If it doesn’t go to Davos in three weeks, then let the Brazilian delegation be led by Alckmin. It will be a good forum to present a green agenda.