Workshop III: Seizing Business Opportunities – Investing in Eco-friendly Markets and Sustainable Business Practices
14 June 2016, São Paulo
In cooperation with our local partner, the Brazilian Business Council for Sustainable Development (Conselho Empresarial Brasileiro para o Desenvolvimento Sustentável, or CEBDS), the Emerging Markets Dialogue (EMD) on Green Finance launched the study Leveraging a Water Efficient Economy – Opportunities for Companies and Financial Institutions in Brazil.
The objective of the study, that was conducted by SITAWI, was to identify business and investment opportunities in water-saving technologies for both companies and banks in order to increase the engagement of the private sector in the transformation towards a water-efficient and more sustainable Brazilian economy. It revealed that the estimated share of annual water conservation through the adaptation of the scrutinized 14 technologies amounts to 19% of the water consumed by the industry (equivalent to 2.3bn cubic meters) and 3% of water consumed by agriculture (2.1bn cubic meters). These numbers correspond to an annual saving of R$ 11.6bn (EUR 3.2bn). In order to exploit the full potential of these technologies, investments of approximately R$ 49bn (EUR 13.5bn) are required. R$ 25bn of these investments effectively represent attractive investment opportunities for financial institutions, based on an analysis of average capital expenditure, water break even costs and the investment gap for each technology.
The study was presented during a workshop that comprised more than 70 representatives from Brazilian financial institutions and companies, as well as local and international experts. Based on the findings of the study, the event served to provide a platform for the participants to discuss the financial viability of different water management technologies and related investment opportunities.
The study and workshop are part of a project on Natural Capital & Finance in Brazil that was initiated in 2014 by GIZ’s EMD Green Finance and CEBDS’ Technical Working Group for Sustainable Finance. The objective of the project is to build awareness and capacity of finance professionals to incorporate natural capital considerations into their lending and investment decisions and risk management models. Activities include the development of open-source financial tools, a series of thematic capacity building workshops, and are backed by research papers such as this report. The project is commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ).