Brazil:
Tree monoculture promotion mechanisms and opposition
In order for vast extensions of industrial
plantations to be viable in Brasil direct interactions where established
between the government, companies, banks, universities, media,
as well as with international and financial institutions, producers
and buyers. A broad political orchestration resulted in the creation
of a number of mechanisms related to legal, taxation, financial,
technical, scientific, agrarian and logistic support. In the same
manner articulations opposing those policies increased as monocultures
expanded.
Initially forest policy sought to define
a conjunction of techniques capable of managing the utilization
of forest resources. The first forest regulation in Brasil dates
to 1934 with the first Forestry Code that defines some protected
areas but also includes the possibility of substituting forests
for tree monocultures.
In 1965, through Law 4.771 a second
Forestry Code was adopted, which included
new categories of conservation units. In this same context, Law
5.106 of September 1966, regulated tax incentives for reforestation,
benefiting physical and legal entities contributing to income
tax. Physical entities could discount from aggregate income (used
to calculate income tax) all costs deriving from the activity
up to a limit of 50% of income. Legal entities could deduct the
value of costs incurred from the activity in up to 50% of due
tax. In 1970 a modification passed through decree–law 1.134 (16/11/70)
allowed the contributor to discount up to 50% of taxes due, to
invest in forestry instead of deducting expenditure costs from
the value of taxes due.
During the first decades of the 20th
century some states established forestry departments linked to
the Ministry of Agriculture and in 1967 Decree- Law 289 established
the Brazilian Institute for Forestry Development (IBDF for the
abbreviation in Portuguese) under the Ministry of Agriculture.
In order to promote economic growth
large investments where made in scientific and technological development.
In 1967 the first generation of professional foresters graduated
from a course supported by an agreement between the IBDF and FAO.
In 1968 the Institute for Forestry Research (IEPF) was established
through a joint initiative between the Higher School of Agriculture
Luiz de Queiroz (ESALQ- USP) and the companies Champion, Duratex,
Rigesa, Suzano and Madeirit. The objective of IEPF was the development
and dissemination of technology in the forestry sector with funding
for carrying out research with resources from the public sector
through financial incentives for reforestation.
Financial support from the State, through
the National Development Bank (BNDE), made it possible for leading
pulp-producing companies to benefit from Decision Nº 196/68 for
installation and/or augmentation projects that exceeded a production
capacity of 100 tonnes a day and that ensured self sufficiency
in the supply of wood equivalent to at least 50% of estimated
need. As from 1972 priority was given to incentives for projects
with a production capacity exceeding 1000 tonnes per day, but
accepting that this aim could be achieved in two stages of 500
tonnes each.
The proliferation of sectoral executive
groups led to the creation, in 1969, of the Industrial Development
Council, integrated by representatives from the economic ministries,
the armed forces, BNDES, Bank of Brazil and representative
private sector institutions such as the pulp and paper group that
was given the function of formulating and coordinating the orientation
guidelines of the expansion of this sector.
The stage of greatest financial incentive
for tree plantation took place during the 1970’s and up until
the mid 1980’s with the Second National
Development Plan. According to this plan the aims that had to
be achieved between 1974 and 1979 for pulp and paper production
represented an increase of 85% and 28% respectively.
The BNDE action plan for the period
1974-78 included support to large pulp projects so that the sector
could reach a level of production higher than
2.5 million tonnes in 1978.
The Sectoral Incentives Fund (FISET)
established by Decree- Law 1376/74 provided the principal source
of tax incentives between 1974 and 1988, providing long-term loans
at reduced interest rates and allowing deductions in income taxes
for investments in reforestation projects.
The National Pulp and Paper Plan (PNPC)
was launched in 1974, with the aim of establishing 4 million hectares
of tree plantations. To achieve this, a programme was approved
for the establishment of 30 “forestry districts” –areas selected
for avoiding the dispersal of forestry resources. A division
was established between pulp production and energy production
sub districts. The minimum area demanded was 1000 hectares
per project and the proximity to the industries was also taken
into account. Industries having their own wood supply from
plantations were privileged. In order to ensure large contiguous
areas, the government would promote the establishment of plantations
in defined areas.
Other incentive modalities provided
to private companies were the exemption of Import Tax and of the
Tax on Industrialized Products, in addition to stimulating the
expansion of export-oriented products.
The Second National Pulp and Paper Plan
adopted in 1987 established the expansion goals until 1995 (imports
of equipment, new reforestation and export of production). The
projected expansion of pulp production implied an increase from
3.5 million tonnes per annum to 6.6 million/tonnes/per annum.
In addition to large scale financing
from BNDES, another financing and capitalization mechanism, mainly
for pulp companies was provided by loans from international institutions
like the International Finance Coorporation (IFC) of the World
Bank. Raising resources in the international market included a
number of operations with commercial banks, like in the case of
Aracruz Cellulose with the Den Norske Bank (Norway), Citibank,
J.P. Morgan, Chase Manhatan, and the New York stock exchange.
The National Forest Programme (PNF for
the Portuguese abbreviation) was created in 2000 within the Environment
Ministry and placed under the responsibility of the National Forest
Programme Directory. The programme was implemented with resources
coming from the national Treasury and external financial and technical
cooperation, principally from the International Tropical Timber
organisation (ITTO), the Pilot Programme for the Protection of
Tropical Forests (PPG7), the Global Environment Facility and the
governments of Japan, the Netherlands and United Kingdom.
From 2004 to 2007 one of the goals of
the PNF was the expansion of the plantation area through the planting
of 800,000 hectares in small and medium sized properties and 1.2
million hectares in corporate programmes.
A number of financial sources for the
establishment of tree plantations were created, the main ones
being: BNDES-FINEM (Direct financing for investments), PRONAF
Florestal (coordinated by the Ministry
of Agrarian Development since 2002), PROPFLORA (coordinated by
the Ministry of Agriculture since 2002).
Other additional funding sources were
regional forestry funds like FNO Floresta (northern region), FCO
Pronatureza (central west region), FNE Verde (North East region).
Among other financial stimuli favouring
tree plantations are the National Programme of Agrarian Credit
as part of the National Plan of Agrarian
Reform of the Agrarian Reform Ministry which derives from a loan
agreement with the World Bank.
Having succeeded in creating such a
broad set of mechanism for the viability of monocultures, the
companies make strong investments in electoral campaigns of candidates
of all parties and in this way secure parliamentary support as,
for example, with the Parliamentary Front for Forestry as well
as with the ruralist parliamentary group.
Of more recent origin, another strategy
promoting the expansion of tree plantations in Brazil is that
of carbon credits, originating in the Kyoto Protocol. One of the
primary markets that negotiates these credits is the Brazilian
Carbon Market (MBRE) –a joint initiative of BM&F (stock exchange)
and the Ministry of Development, Industry and Trade.
Another potencial market in Brasil is
that of biofuels based on cellulose that is already attracting
investments for research.
There are also some proposals for introducing
changes to the Forestry Code (at the National Parliament) aimed
at reducing the area of legal reserve in the Amazon from the current
80% to 50% in areas that have already been logged. In the remaining
30% property holders could plant exotic species.
Initiatives that oppose industrial monoculture
tree plantations
The expansion of
tree monocultures has been accompanied by a
number of articulations aimed at restricting the planted areas,
stopping the expansion and even stopping large-scale plantations.
The following are some of the restrictive
actions:
* state legislation such as law 6.780/01
of Espirito Santo State that prohibits eucalyptus plantations
aimed at the production of pulp until an Ecological Economic Demarcation
has been concluded and promulgated. Yet the Supreme Federal Court
left it without effect in June 2002.
* laws that guarantee the territorial
rights of traditional peoples like the Quilombolos (decree- law
4887/ 03) can also limit the possession of lands in the hands
of pulp companies.
* the articulation of civil society
networks that have been organised to generate awareness on the
impacts of monocultures, to denounce, to put pressure on the government
and companies, to propose alternatives to the prevailing development
model amongst other actions. Among these are the following: the
Network against the Green Desert, the National Agroecology Articulation,
the Brazilian Network for Environmental Justice and the Brazilian
Network on Multilateral Financial Institutions.
*civil society participation in public
hearings for the presentation or expansion
of industrial projects. Public hearings condition the approval
of industrial investments; however, in practice they do not decide
on anything.
*complaints to the Public Ministry,
to international institutions, legal actions.
* in several regions of the country
occupations by rural social movements have taken place on lands
planted with eucalyptus, principally by the Landless Workers Movement
demanding Agrarian Reform whilst questioning the productivity
and the social function of these large estates (in line with articles
185 and 186 of the Brazilian Constitution).
*There has also been a strong articulation
of civil society to demand from BNDES that it complies with its
function as a public bank and that it establishes policies of
openness, dialogue and transparency regarding its investments,
that it defines more appropriate social and environmental criteria
to diminish social inequities within the Brazilian population
and that it stops investing in private projects of agribusiness,
like in the pulp and paper sector in line with the 2007 “BNDES
Platform”.
By Daniela Meirelles and Alacir De´Nadai,
FASE-ES, email: fases@terra.com.br
