Richard Edwards

The World Bank has handed Brazil a $1.3bn loan in an effort to encourage one of the world’s biggest polluters and most popular low-cost sourcing destinations to clean up its act.
 
Brazil, which has become a magnet for companies looking to source from the commodity-rich country in recent years, has some of the most bountiful resources of any nation on earth.

However, the country, which is home to one-third of the world’s tropical rain forests and the largest reservoir of fresh water, has been dogged by ethical questions over the continuing deforestation of the Amazon.

Successive crackdowns by a Brazilian government keen on attracting foreign investment have failed to bring an end to persistent deforestation – which increased in 2008 for the first time in four years – but it’s hoped the new cash injection will force the country to take serious action.

Speaking exclusively to Sustainable Sourcing, Rene Duvekot, CEO of Miami-based sourcing advisory firm Duvekot Corporation, said he believed that the World Bank’s influence in the country could prove to be a turning point.
“It surprises me that Brazil is receptive to foreign funds for this purpose, so it appears that the country is finally getting serious about protecting its natural resources, especially the Amazon rain forest,” he says. “It’s refreshing that a foreign organisation (World Bank) will be looking over Brazil’s shoulders.”

For those organisations already sourcing from the country, Brazil’s action also offers proof of the country’s willingness to improve its patchy sustainability record. “Brazil has made enormous progress in making manufacturers adhere to higher standards, and the growing numbers of ISO certifications (both 9 and 14) is a testament to that,” Duvekot says. “For buyers a key concern is assurance of continuity, and buyers are increasingly requesting proof of supplier compliance with local (Brazilian) working and environmental regulations.”

However, the loan has already caused controversy, with some environmental groups expressing fears that the new money will be used to finance a number of controversial projects – including the building of several large dams in the Amazon basin.

The World Bank, however, insists that the loan will be handed out in two installments, with the second tranche of $500m being paid only when a series of project goals have been hit.

Next month, the iHollywood Forum will host a “Hollywood Goes Green conference, at which sustainable solutions will be discussed with studio chiefs who are under pressure to cut costs.

The news is likely to be welcomed by some of the silver screen’s biggest stars, many of whom are actively involved in environmental campaigns.

“While celebrities have long been environmental activists, studios and production companies have been cautious about adopting the green philosophy as it applies to their business operations,” said Zahava Stroud, of iHollywood Forum.

Many studios already have departments dedicated to reducing their carbon footprints, although the biggest challenge remains cutting down on the emissions caused by large-scale, but often temporary film sets.