Can you introduce the Brazilian Development Bank (BNDES)?

FM: The BNDES is the main long-term financing agent in the Brazilian market. We work to develop sustainable projects that promote economic growth, a fair transition to a low-carbon economy and job generation. The BNDES has a long history of supporting the mineral sector in Brazil, implementing new greenfield projects, capacity-building projects and acquisition of equipment. We also provide investment in the logistics infrastructure necessary for the mining sector. In the past, working together with private sector and state mineral research, we have supported investments in explorations bodies, promoting the development of important mineral regions in the county.

PD: We view mining as an essential driver of sustainable development, especially in the more isolated regions of the country. When mining arrives in regions that have difficulty attracting other investments due to a lack of infrastructure or qualified labor, it kickstarts the development of that region. Additionally, we see mining as an essential provider of inputs for various industries. Worldwide, there is an understanding that the growth of mining is essential both for the energy transition and food security. Food security is a particular issue in Brazil due to our dependence on imported fertilizers.

Can you describe the BNDES’ partnership with IBRAM?

FM: We built a partnership with the main entities representing the mining sector, focusing on structuring financing mechanisms that can fill existing gaps and support mining projects in Brazil. The goal is to support companies in the exploration or development phase of mines, which is in the phase of greater risk exposure and low access to investment capital. Access to credit for small and medium-sized companies is limited, and there is great interest in making these projects viable.

PD: We created a network called Invest Mining, which brings together multiple actors to promote both direct financing mechanisms and regulatory improvements, including access to the Brazilian Stock Exchange, to ensure that mining has a greater insertion in the capital and financing market in Brazil. Smaller projects provide the most significant potential to diversify Brazilian mining production and expand our knowledge of our underground and mineral potential.

Can you discuss the launch of a critical minerals financing fund?

FM: We intend to launch it preliminarily at the next COP and, finally, during the PDAC in 2024. The investment thesis is not yet confirmed, but the main target will be the development of critical minerals.

We aim to develop the value chain of the minerals, seeking partnerships and generating a value-added product within Brazil.

What role does geopolitics play in investment?

PD: Global geopolitics today is a critical factor in the investment landscape. China plays a significant role in bringing competitiveness to the sector and leading certain movements within this highly competitive environment. Beyond financing for sustainable development, our biggest challenge is communicating to the world that Brazil is one of the best places to allocate capital for responsible, sustainable mining development.

The president calls Brazil’s new industrial policy, which is currently being developed and launched, neo-industrialization. We seek to develop mining companies that respect the environment and society, with lower greenhouse gas emissions and higher technology. As a development bank, we must make it clear to the world that Brazil is prepared to receive investments and carry out processes in a responsible way. Security is essential for foreign capital, and Brazil provides the security that allows for the minimum desired return for investment.

What is your strategy for the near future?

FM: Historically, the BNDES has a share of around 2% of Brazil’s gross capital formation, and currently, we are disbursing around 0.7% of the Brazilian GDP. The main goal for the next two years is to triple the support of BNDES for investments in the mineral sector. We aim to support the investment forecast of US$50 billion in the Brazilian mining sector.

The focus is on four main goals: supporting Brazil’s iron ore operations, prioritizing the development of critical minerals projects, developing exploration bodies projects and diversifying the Brazilian mineral production.