BRASILIA, July 15 (Reuters) - Brazil's Treasury and its Securities and Exchange Commission (CVM) are gearing up to launch a new investment vehicle operating as an investment fund consortium to boost early-stage sustainable ventures, a senior Treasury official said.
In an interview with Reuters, Rogerio Ceron said the new vehicle is aimed at financing the structuring of projects aligned with ecological transformation, following a similar format of private equity funds (FIPs) and receivables investment funds (FIDCs).
Ceron stressed that better-than-expected inflation data in the U.S. solidify a much more favorable outlook for the global economy, with positive implications for Brazil, which has recently witnessed a steep currency weakening and a rise in interest rate futures.
"It is a matter of time for things to become fully normalized," said Ceron.
His remarks follow signals from Finance Minister Fernando Haddad and President Luiz Inacio Lula da Silva regarding the government's commitment to fiscal responsibility, which have led to a partial recovery in local assets.
GREEN PLAN
The Treasury secretary said the new investment vehicle would be tied to a green project structuring credit line, first announced in February as part of a broad program to attract private investments as Lula seeks to bolster Brazil's position in the environmental and climate agenda.
According to Ceron, the notice for this credit line auction is expected to be released in September. The released resources will assist financial institutions in creating the new structured investment funds.
The government had previously stated that the line would have a 12-year term, with a grace period for principal and interest repayment of up to seven years, which Ceron said is essential due to the long-cycle nature of such projects.
This will be the second credit line out of four planned under the so-called EcoInvest program, following the Treasury's notice last week for a blended finance auction, which will offer public capital to green projects primarily funded by private funds.
This line excludes wind and solar energy projects and transmission lines, as these sectors are deemed mature and no longer require government support, said Ceron.
According to the Treasury secretary, if the leverage for the blended finance line reaches around ten times, a government contribution of between $1 billion and $2 billion could generate financing of $10 billion to $20 billion.
"This opens the possibility for private financial institutions to access medium and long-term funding for productive investments, which was previously only accessible through public banks," he said.
(Reporting by Marcela Ayres; editing by David Evans)
