Brazil-China ‘Beef Alliance’ is a model for other Big Economies

Source: World Economic Forum

• As Brazil renews its efforts to lead on climate action, there’s growing recognition in China about the impact its commodity demand is having.
• The ‘Beef Alliance’ joins food giants and civil society groups to set criteria for Brazil’s beef exports that limit deforestation and land conversion.
• This initiative will drive system-wide change across one of the world’s largest cattle-trade relationships and is a model for other big economies.

Brazilian President Luiz Inácio Lula da Silva’s visit to China last week was an important sign of renewed cooperation between two of the world’s largest emerging markets, particularly following the previous few years which did little for international relations. Important in the context of international geopolitics, but significant too for the planet, with moves that could signpost a more positive future for some of the world’s most important ecosystems.

Going with the aim of working with Beijing to “balance world geopolitics,” the Brazilian president was welcomed with open arms by President Xi as his “good old friend.”

In a shift away from the US-centric focus of his predecessor, Lula used the trip as an opportunity to highlight multilateralism. He took a swing at the dominance of the dollar in international finance, visited the telecommunications company Huawei – subject to US sanctions – and left Beijing having signed more than a dozen agreements worth billions of dollars.

What was notable was how many of the deals had a heavy emphasis on renewable energy, low carbon technology and green finance, showing that both countries are ever more serious about moving to a more sustainable economic model.

Focus on forests

With Lula’s presidency, Brazil has renewed its efforts to lead on global climate action, and the two countries released a joint statement which is encouraging in its scope. While castigating wealthy countries for breaching their promise on climate finance to the developing world, they also detailed their areas of cooperation in the interests of reaching global climate goals, with a welcome focus on forests: “We intend to engage collaboratively in support of eliminating global illegal logging and deforestation through effectively enforcing their respective laws on banning illegal imports and exports.”

This of course is just the start, and the ultimate success of such deals will depend on well-functioning traceability systems and the ability to enforce them. But there are positive signs there too, with the close involvement of civil society groups who are well-positioned to hold the corporate giants to account.

Underlying these moves is the very welcome news that pressure for change is coming from Chinese and Brazilian industrial associations and, ultimately, it’s the relationship between them and the private sector that could serve as a model for other trade relationships around the world.

China and Brazil’s influence over developing nations cannot be overstated. By combining governmental legitimacy with commercial reality, they will give countries watching the confidence to forge similar deals, and with the lessons learned along the way, can provide a smoother path for those countries that follow.

There is growing recognition among the Chinese leadership and government of the impact that its demand for commodities has created and it is taking steps towards positive change – good news for tropical forests, and by extension the world.

China sees Brazil as its most important strategic partner in Latin America, and the relationship is a key component of Beijing’s foreign policy. A strong trade relationship between the two has always been logical, with huge demand in China for the raw materials and agricultural products that Brazil produces.

But until now, China’s growing appetite for agricultural commodities – soy and beef in particular – has come at a cost to the planet. Take just one of those: beef. More than half of China’s beef imports come from Brazil, which in 2022 sent 55% of its exports to China – that’s more than 10% of Brazil’s total beef production. This in turn plays a role in increasing land conversion and deforestation across vast swathes of the critical Amazon and Cerrado biomes.

With the establishment of a “Beef Alliance” between beef importers and exporters from the two countries, that should be about to change.

The new agreement, facilitated by the Tropical Forest Alliance, brings together food giants and civil society groups who will set criteria for Brazil’s beef exports which strictly limit the deforestation and land conversion involved in production.

This initiative will drive system-wide change across one of the world’s largest cattle-trade relationships, and could be a model for other big economies across the world. It has the potential to finally put a stop to the destruction of some of the world’s most biodiverse biomes that play a crucial role in combatting climate change.

Positive signs

Lula’s visit resulted in an extensive list of tangible commercial deals, including with food producers that committed to the Agriculture Sector Roadmap to 1.5°C, signed at COP27. Therefore, there are positive indications that under President Lula’s leadership, with its focus on sustainable development, the pendulum could swing in a new direction for forests.