Market Development Status: Emerging
This tool considers any market classified as “upper middle income,” “lower middle income,” or “low income” in the World Bank’s Country Income Classification Level as “emerging.” For the 2025 fiscal year, this is any economy with a gross national income per capita of $14,005 or less.
Data and rankings last updated October 2024. For a detailed explanation of factors and data sources used to calculate these Top Export Market Rankings, please see Our Methodology section.
Market Overview
As the largest consumer market with the highest GDP in South America, Brazil presents as a strong market for experienced U.S. exporters to tap into its diversified economy. Brazil’s environmental technologies and clean energy markets generated a combined $30.44 billion in revenues in 2022. The United States exported $1.1 billion in environmental technology goods in 2023. Water and wastewater treatment is the largest environmental technology sector for U.S. exports to Brazil, followed by air pollution monitoring and control, then waste management and recycling. The U.S.-Brazil Protocol Relating to Trade Rules and Transparency entered into force in 2022, modernizing the 2011 Agreement on Trade and Economic Cooperation by adding new commitments on trade facilitation, good regulatory practices, and a Joint Statement on Support for the Brazilian Ecological Transformation Plan. The United States and Brazil have not entered into a free trade agreement. In 2023, Brazil was the 11th largest export market for U.S. products and services, purchasing $40.2 billion in U.S. goods exports and $21.6 billion in U.S. services exports.
In 2023, Brazil’s Ministry of Finance announced its new Ecological Transition Plan, which has six priority areas: sustainable finance, circular economy, technological densification, bioeconomy, energy transition, and infrastructure and adaptation to climate change ̶ all aimed at combating the climate crisis with social justice, sustainability, job creation and increased productivity. Under the Ecological Transition Plan, Brazil hopes to create a regulated carbon market, an emissions trading system, a national sustainable taxonomy, and a national bioeconomy strategy, plus issue sustainable sovereign bonds, work on forest recovery/restoration and forest concessions, and publish a decree on reverse logistics for plastics, among other actions related to the circular economy.
Brazil’s Ministry of Finance launched a Sustainable Taxonomy of Brazil action at COP28 in December 2023. The Brazilian Sustainable Taxonomy defines sustainable economic activities in the country and aims to create conditions to attract public and private investments. The legislation is aligned with various international taxonomies, including the European Union’s, and is scheduled to be implemented in January 2026. It will define rules for agriculture, livestock, forest production, fishing, and aquaculture; extractive industries; transformation industries; electricity and gas; water, wastewater, waste management, decontamination; construction; transportation, storage, and shipping; and social services for quality of life.
According to Yale’s Environmental Performance Index for Environmental Health, the country continues to struggle with low air quality, sanitation, and poor drinking water. The Climate Action Tracker rates Brazil’s climate targets and policies as insufficient, indicating substantial improvements are required to meet the Paris Agreement’s 1.5-degree target.
In 2024, Brazil hosted the 15th Clean Energy Ministerial and the G20 Presidency in 2024. Brazil will host several more international environmental fora in the coming years, including the 30th United Nations Climate Change Conference in 2025. President Biden visited Brazil during the G20 conference in November 2024, the first time a sitting U.S. President visited the country in nearly 15 years. During the visit, President Biden and Brazil’s President Lula reviewed progress under the Partnership for Workers’ Rights, including empowering workers to participate in climate policy discussions and help ensure a just energy transition. President Biden also announced U.S. development financing to support the expansion of Brazil’s fiber optic network to serve an additional one million homes and 4,000 schools by 2027, and announced a new Brazil-U.S. Partnership for the Energy Transition to accelerate clean energy deployment, expand energy and mineral supply chain development, and decarbonize the manufacturing and industrial sectors. Adding to these important takeaways was the announcement of USD 50 million in investments for the Amazon Fund, a Brazilian initiative to protect the Amazon Rainforest.
In July 2023, U.S. Secretary of Energy Jennifer Granholm and Brazil’s Minister of Mines and Energy Alexandre Silveira announced their commitment on joint energy cooperation to drive private sector-led approaches on clean energy topics including carbon and methane management through the Clean Energy Industry Dialogue. Since then, the United States and Brazil have led action committees on clean hydrogen and carbon and methane management, including private sector roundtables, technical missions with site visits to the United States, and regulator-to-regulator discussions.
Market Opportunities
Air Pollution Monitoring and Control
Mobile Source Emissions Control: Brazil created the Programa de Controle da Poluição do Ar por Veículos Automotores (Proconve) ̶ a program to control vehicle emissions. Proconve aims to reduce emissions from automotive vehicles, define air quality patterns for urban centers, and create vehicle inspection and maintenance programs, among other objectives. Early phases of pollutant emissions reduction goals set in the program have been completed and Brazil is currently in the L7 phase, which aims to reduce gasoline and other toxic fuel vapors in the atmosphere. Effective January 2025, the L8 phase will bring more limits for emissions for light commercial and light passenger road vehicles and is equivalent to the Euro IV legislation. When implemented, this new standard is expected to reduce particulate matter and nitrogen oxide emissions and have an overall positive impact on human health. It will also increase demand for equipment and technology to capture pollutants in the vehicle system, and for particle identification and measurement instruments for use in vehicle inspections.
Key technologies and services in demand include:
- Continuous emissions monitoring systems
- Air quality monitoring stations
- Source emissions measurement technologies
- Ambient air quality monitoring equipment
- Emissions control technologies
- Particulate Matter (PM) control devices
- Flue-gas desulfurization equipment
- Fuel vapor control systems
- Analytical and laboratory testing goods and services
Air Quality Monitoring: Brazil continues to grapple with air quality management challenges, exceeding recommended air pollution limits set by the World Health Organization. Information regarding specific air quality and pollution sources is limited. In 2018, Brazil’s the National Environment Council passed Resolution 491, set air quality standards and defining an enforcement network of state and district-level environmental agencies to implement its policies. These air quality standards create opportunities for U.S. air quality monitoring technologies and services.
Key technologies and services in demand include:
- Air quality monitoring systems
- Continued emissions monitoring systems
- Fenceline monitoring equipment
- Ambient air quality monitoring equipment
- Source emission measurement technologies
- Air purifiers and filters
- Data analysis and visualization software
- Consulting services
Carbon Capture from Industrial Emissions: Brazil is a global leader in offshore carbon capture and sequestration. Brazil is home to one of the world’s largest operating carbon capture, utilization, and storage (CCUS) project in the oil and gas industry, the Petrobras Santos Basin Pre-Salt Oil Fields (Petrobras). More than 20 floating production storage and offloading with CCUS technology operate in over 2,000 meters depth and capture over 10.6 Metric tons of CO2 per year, and re-injects the CO2 for enhanced oil recovery. Petrobras continues successful CCS operations at its Santos Basin pre-salt resevoirs. The Brazilian National Oil and Gas Regulator (ANP) has recently made CO2 capture a new area of focus for research and development. Petrobras is preparing a pilot project for CCS from industrial emissions and seeking partnerships for a full-scale CCS hub. This pilot project aims to test developing geological aspects of CCS in a saline aquifer environment and will provide more technical data on storage sealing. Its findings will inform legislators and regulators on how to best build out a policy framework for such activities.
Key technologies and services in demand include:
- Carbon capture technologies
- Combustion systems
- Flue gas treatment systems
- CO2 utilization and removal technologies
- Membrane separation technologies
- Compression systems
Carbon Storage: Brazil has passed its first legal framework for carbon capture and storage (CCS) with the enactment of Federal Law No. 14.993/2024 on October 8, 2024. This law, derived from the Fuels of the Future bill, regulates the capture, transport, and geological storage of carbon dioxide (CO2), marking a significant step in Brazil’s decarbonization efforts. The National Agency of Petroleum, Gas, and Biofuels (ANP) will oversee CCS operations, issue regulatory standards, and grant 30-year renewable authorizations for these activities. The law also mandates operators to address emergencies, maintain records on carbon storage, and monitor CO2 storage and leakage, with the potential to generate carbon credits. While Brazil’s existing environmental framework covers CCS, this new law is expected to bring greater regulatory clarity and spur further detailed regulations.
In December 2024, Brazil enacted Law 15.042, creating the Brazilian Greenhouse Gas Emissions Trading System (SBCE), which establishes a regulated carbon market and sets limits on emissions, allowing companies that reduce emissions to earn carbon credits. The law divides the market into regulated and voluntary sectors, clarifies rules for REDD+ projects, and includes indigenous and traditional communities in carbon credit generation, with full implementation by 2030.
Key technologies and services in demand include:
- CO2 transportation pipelines and infrastructure
- Engineering, procurement, and construction of carbon management projects
- Environmental impact assessment consultancies
Waste Management and Recycling
Landfills and Waste Collection: In 2022, the amount of urban solid waste generated in Brazil was approximately 81.8 million tons, of which approximately 93% was collected. Sixty-one percent of urban waste went to landfills and 39% went to open dumpsites in 2022. Three quarters of Brazilian municipalities ̶ primarily those comprising wealthy states in the south and southeast regions ̶ had selective waste collection initiatives; however many did not reach the regions’ entire populations. In April 2022, the Brazilian government enacted the National Solid Waste Plan (Decree No. 11.043), establishing goals and mechanisms to modernize solid waste management in Brazil over the next 20 years.
Key technologies and services in demand include:
- Landfill design and engineering
- Bio-gas capture technologies
- Waste collection technologies
Recycling Infrastructure: Nearly 13.5% of the total urban solid waste generated in Brazil is made up of plastic particles, Brazil is one of the largest plastic waste producers in the world. Only 145,000 tons (1.28%) of this plastic is recycled. The New Credit Certificates for Environmental Reverse Logistics Compliance offers credit certificates to increase private investment in recycling. Additionally, the National Solid Waste Plan (Decree No. 11.043) set goals to increase recycling rates throughout Brazil by 48% by 2040, and forsees that half of the waste generated will be recovered through recycling, composting, bio digestion, and energy recovery ̶ including energy resources such as biogas and biomethane. As a result, there will be a high demand for waste disposal and sorting units, as well as innovative methods to improve selective waste disposal and collection.
Key technologies and services in demand include:
- Recycling facilities and infrastructure
- Sorting machines
Water and Wastewater Treatment
Municipal Water and Wastewater Treatment: Brazil’s sanitation regulatory framework, Law 14.026/2020, states that 99% of the population must have access to clean water and 90% to sewage treatment by 2033. Brazil manages water across 12 hydrographic regions, with the Amazon basin being the largest. Providing water and sanitation services is primarily the responsibility of Brazil’s 26 states and 5,570 municipalities. Law 14.026/2020 created a requirement for each Brazilian state to group its cities into regions for water and wastewater service provision. It is expected that this regionalization will enable states and cities to access federal financing resources and will make smaller municipalities more financially attractive for investment in network expansion. Since this new law was enacted in 2020, the number of municipalities served by private operators increased by 203% to a total of 1,648 cities, and nearly 60 auctions of municipal water and wastewater services took place in 19 Brazilian states, raising USD18 billion in contracted investments and grants. These investments are expected to increase access to potable water to 91% and wastewater service to 68% by 2033. The market expects that 24 new projects for water and wastewater concessions happen by 2025. According to the Brazilian government, more than USD $119.6 billion needs to be invested to reach the 2020 law target by 2033 ̶ mostly in the civil construction industry, followed by network infrastructure, equipment and machinery, among others.
Brazil is one of three countries selected by UN Water for the 2023 Country Acceleration Case Studies that recognize progress made toward the achievement of SDG 6 targets under the SDG 6 Global Acceleration Framework, an initiative that aims to deliver fast results and an increased scale towards the goal of ensuring the availability and sustainable management of water and sanitation for all by 2030. Through the innovation accelerator, the framework intends for new, smart practices and technologies to improve water and sanitation resources management and service delivery. U.S. exporters of such technologies should find demand in the Brazilian market.
Key technologies and services in demand include:
- Automation and digitization solutions as well as artificial intelligence and Internet of Things systems to identify water leakages
- Smart water meters as well as sensors and monitoring technologies
- Equipment for sludge management, removal and treatment, lifters, systems for sewage and effluent treatment, systems for odor control, measurement and control equipment for color, chlorine, turbidity
- Wastewater treatment systems that can be installed in remote communities
- Pumps, pipes, and valves
Water Efficiency and Reuse: Municipalities in Brazil have a high amount of nonrevenue water, with 40.3% of the water produced lost before it reaches faucets due to leaks, measurement errors, and unauthorized consumption. The total volume of lost water in 2021 was 1.9 trillion gallons, enough to fill 8,000 Olympic-sized swimming pools. In March 2023, the Brazilian Senate approved an amendment to existing legislation obliging water concessionaires to embrace non-potable water reuse, rainwater collection, and leakage reduction. The amendment requires concessionaires to identify and repair leaks and to conduct network inspections to curb illegal connections. It also encourages the use of rainwater and grey water reuse for non-potable uses.
Key technologies and services in demand include:
- Industrial and urban water reuse solutions
- Automation and digitization solutions as well as artificial intelligence and Internet of Things systems to identify water leakages
- Smart water meters as well as sensors and monitoring technologies
Market Challenges
Tariffs: U.S. companies should be aware of the direct and indirect costs of doing business in Brazil. Brazil imposes relatively high tariffs across a wide range of imported goods and services. While Brazil’s Most-Favored Nation applied tariff rate was 13.3% in 2021, its average bound tariff rate in the World Trade Organization is significantly higher at 31.4%, with a maximum bound tariff rate for non-agricultural products of 35%. The large disparity in bound and applied rates mean that U.S. exporters face uncertainty in the market and are susceptible to frequent changes in tariff rates. Brazil is a founding member of the Southern Common Market (MERCOSUR). Any good imported into Brazil (not including from free trade zones) is subject to payment of the MERCOSUR’s Common External Tariff (CET), which ranges from zero to 35% ad valorem.
Taxation: Companies exporting to Brazil are often subject to a number of federal and state taxes and charges on imports that can effectively double the actual cost of imported products in Brazil. U.S. companies may face difficulties navigating Brazil’s complex tax system, which includes multiple cascading taxes. In December 2023, Brazil’s Congress approved a tax reform bill that aims to improve the efficiency, fairness, and simplicity of the country’s tax system by consolidating multiple taxes into a single value-added tax. Reducing corporate income tax rates is intended to attract more investment and stimulate economic growth. The tax reform, once implemented in 2033, is expected to make it easier and more cost-effective for U.S. exporters to do business in Brazil.
Import Licensing and Import Bans: Brazil has both automatic and non-automatic import license requirements and procedures. There is a lack of clarity and transparency on the requirements which can create additional burdens for U.S. exporters. Brazil also restricts the importation of certain types of remanufactured goods (such as earthmoving equipment).
Regulatory and Standard Differences: Despite strong local demand for U.S. brands and products, the complex Brazilian regulatory may present challenges to exporters and there is not adequate and effective intellectual property rights enforcement. Additionally, Brazil’s unique standards are often dissimilar to the internationally-recognized standards commonly used in the United States. Having in-depth knowledge of local market trends and regulations is critical to successfully export to Brazil.
Competing Demands for Water: While parts of Brazil have plentiful freshwater, other areas experience water stress, including in the north. In drought conditions, competing demands for water from municipalities and hydropower, which generates three-quarters of Brazil’s electricity.
Learn More
ITA Resources
Environmental Technologies Industry Resources
Energy Industry Resources
Brazilian Government Resources
Environmental regulations and a functional system of enforcement are important drivers of demand for environmental technologies, incentivizing the investment in solutions to address environmental challenges in order to avoid the cost of non-compliance. In Brazil, the Ministry of the Environment sets national environmental policies and coordinates actions among various agencies.
Key entities and programs for U.S. exporters to note include:
Other Important Resources
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