Brazil President’s Saudi Go to Reveals Want For Stronger Ties

By Eduardo Campos Lima

The go to of Brazil’s president to Riyadh on Nov. 28-29 with a delegation of ministers and businesspeople confirmed that he needs to strengthen ties with Saudi Arabia and is relying on its participation in tasks, particularly these involving inexperienced vitality.

After an occasion that gathered Brazilian and Saudi authorities and enterprise leaders on Wednesday, Luiz Inacio Lula da Silva invited the Kingdom to be “Brazil’s companions” within the vitality transition that has been happening within the South American nation.

“If Saudi Arabia is an important nation within the manufacturing of oil and gasoline, in 10 years from now Brazil will likely be referred to as ‘the Saudi Arabia of inexperienced vitality’,” Lula stated in his speech.

Mining and Power Minister Alexandre Silveira introduced in the identical assembly an summary of Brazil’s vitality endeavors, and initiatives wherein Saudi traders can participate.

The day gone by, he met with Saudi Power Minister Abdulaziz bin Salman and signed a memorandum of understanding geared toward bettering cooperation between the 2 nations.

The MoU encompasses tasks in varied fields, together with oil and gasoline, electrical energy, vitality effectivity, petrochemicals, hydrogen, renewable vitality and the round carbon economic system. The settlement additionally contains tutorial partnerships for joint analysis involving vitality.

“We’re in Saudi Arabia demonstrating Brazilian management within the vitality transition and looking for to additional develop our relationship with the nation,” Silveira stated, including that one of many go to’s targets was to draw traders.

The Saudi authorities had already introduced in 2019, throughout former President Jair Bolsonaro’s tenure, a plan to speculate $10 billion from its sovereign fund in Brazilian tasks. A lot of them are anticipated to be associated to inexperienced vitality and infrastructure.

“Brazil has nice progress potential in all segments of renewable energies. Photo voltaic vitality, wind energy and biomass vitality already make up a big a part of the Brazilian complete vitality manufacturing, however they’ll attain a a lot greater degree,” Jose Roberto Simoes Moreira, an engineering professor who coordinates the College of Sao Paulo’s renewable vitality program, advised Arab Information.

In 2022, virtually half of Brazilian vitality got here from renewable sources. Photo voltaic and wind energy have been accountable for 90 % of the enlargement in vitality manufacturing in 2023.

“These vitality sources have been accountable for preserving the system protected and practical. We’ve been working close to the restrict. With out the enlargement in renewable vitality, Brazilians would have issues,” Simoes Moreira stated.

Particularly within the northeast of the nation, the place most photo voltaic and wind crops have been carried out over the previous few years, there may be nonetheless room for brand spanking new tasks on land. Many entrepreneurs have already developed plans for offshore wind crops.

“They’re costlier and current further implementation challenges, however in Europe they’ve been quite a few. In Brazil, that’s solely the start,” Simoes Moreira stated.

Enhancing the Brazilian vitality system additionally requires the enlargement of its vitality distribution infrastructure.

The biggest shopper market is within the southeast, which is much from the vitality models within the northeast, stated Simoes Moreira.

“It’s essential to additionally spend money on the enlargement of transmission traces. The present ones are on the verge of full operation,” he added.

Osmar Chohfi, who heads the Arab-Brazilian Chamber of Commerce, stated one of many sectors wherein many joint tasks may be carried out by Saudi Arabia and Brazil is inexperienced hydrogen.

“Brazil has a terrific alternative to play the position of a strategic companion of Saudi Arabia. However to ensure that that to occur, it’s essential to provide you with well-conceived tasks led by corporations with high-quality governance and with a protected rules system,” he stated in a press release.

Chohfi recalled that Saudi Arabia has the purpose of turning into a carbon-free nation by 2060, so it has been investing closely within the growth of recent energies.

The biggest inexperienced hydrogen plant on the planet, which is being constructed within the Pink Sea, is a part of that effort.

“In Brazil, Saudi traders cannot solely participate in tasks involving renewable energies, but in addition in initiatives related to carbon credit in an effort to compensate emissions in the course of the transition course of,” Chohfi stated.

Relating to oil and gasoline, Simoes Moreira stated Brazil nonetheless has nice potential not solely in vitality manufacturing, but in addition within the petrochemical trade.

Moreover vitality, different MoUs have been signed between Embraer, a number one plane producer in Brazil, and the Saudi authorities, Saudi Arabian Army Industries, and Saudi airline Flynas.

The Brazilian delegation additionally mentioned infrastructure tasks with its Saudi counterparts. Ports and Airports Minister Silvio Costa Filho introduced to enterprise leaders alternatives regarding Brazilian ports, which can be partially privatized.

Lula has been on the lookout for funds for his Development Acceleration Program, a complete public works initiative that can embody a number of sorts of public works within the subsequent few years.

Measures to boost bilateral commerce have been additionally mentioned between Lula and Crown Prince Mohammed bin Salman.

In 2022, commerce between Brazil and Saudi Arabia reached $8.221 billion. Brazil purchased primarily hydrocarbons and fertilizers ($5.297 billion), whereas the Kingdom largely purchased halal protein ($2.924 billion). The 2 leaders imagine that commerce might attain $20 billion by 2030.