Pulping the South:
Industrial Tree Plantations in the World Paper Economy
Ricardo Carrere and Larry Lohmann

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Chapter 7

Brazil: The Eucalyptus Pulp Giant

Many people think of Brazil as an enormous, half-empty country, where the impact of a few hundred thousand hectares of eucalyptus must be minimal. This impression is mistaken. As in other countries, eucalyptus plantations in Brazil are not located on land no one wants, but rather are concentrated in the most populated coastal zones, close to the ports from which pulp is exported abroad. Plantations and pulp mills can be found from the extreme southern province of Rio Grande do Sul to Par and Amap in the extreme north. They have a great impact not only on land, vegetation and water, but also _ more importantly for us _ on people and their livelihoods.

Brazil has had long experience in planting eucalyptus for charcoal production and conifers for pulp. Indeed, the country's largest plantation area is still occupied by eucalyptus charcoal plantations. As late as the mid-1960s, however, the area planted with exotic species was relatively small and concentrated mainly in the state of Sao Paulo, where wood consumption was highest and where deforestation had necessitated expensive imports of raw materials from elsewhere in Brazil.

The situation changed radically after a military dictatorship came to power in 1964. New policies favouring large-scale capital were implemented, forming part of a modernization strategy seeking to gain the Brazilian economy access to the international scene (Goncalves 1992). A new forestry code was also developed, and fiscal incentives were given to promote tree plantations. Large plantations quickly sprang up in many regions of the country, in many cases without the developers having much idea of what the wood planted would finally be used for (Knight 1991b). Poor location and poor maintenance led to the loss of many plantations. Of the six million hectares planted under the government incentive system, only 2.3 million hectares of eucalyptus and 1.6 million hectares of pines survived (Bazett 1993). Years later, however, the pulp industry was able to take advantage of these extensive sources of raw materials _ although to what extent is unclear, since in 1994 the total pulp plantation area was estimated by industry sources at only between 1.2 and 1.5 million hectares (three-fifths of which was eucalyptus) (Associaao Nacional dos Fabricantes de Papel e Celulose n.d., Higgs 1994).

Despite the apparent anarchy in the plantation sector, the military government clearly aimed to establish a large export pulp industry. A late-1960s package of tax breaks promoting the import of pulping machinery was followed by the National Paper and Pulp Plans I (1974) and II (1979/80). The industry became one of the main beneficiaries of the government's developmentalist policy (Goncalves 1992, Goncalves et al. 1994).

A National Economic Development Bank (BNDE) resolution meanwhile gave priority to financing huge projects with a daily pulp production capacity of 1,000 tonnes or more. Such lending arrangements, of course, also favoured gigantic plantations. Indeed, loans were to be made available for mill construction only in those cases in which half of the fibre required was already available (Goncalves et al. 1994). In addition to investing public funds in the pulp industry, the state also played a central role in establishing institutional and legal conditions necessary for developing tree monocultures and in spreading the idea that pulp projects would guarantee regional development and progress wherever they were set up (Miranda 1993a). In some cases state companies and cooperative ventures between the state and private capital have also been involved (see below).

The new pulp businesses were situated mainly in the east and north of the country. Such locations, since they made it possible for factories to be sited near large raw-materials sources, allowed the industry to take advantage of economies of scale and integration. They also enabled the industry to avoid the large-scale popular resistance to pollution which would have resulted if factories were sited near major urban centres. By building mills near the coast, finally, the industry was able to keep transport costs to export ports low (Goncalves 1992).

An apparent success

Brazil first began producing pulp and paper on a considerable scale in the 1950s, when pulp production reached 280,000 tonnes. During the 1960s, production reached 780,000 tonnes, but it was in the 1970s that the sector really took root. In 1980, more than three million tonnes was produced, with short-fibre eucalyptus predominating over long-fibre conifer pulp. In the 1980s, the industry's motor became export pulp production, as total output rose to four million tonnes. By 1994, Brazil was supplying 50 per cent of the world's eucalyptus pulp (Goncalves et al. 1994, ABECEL n.d.). Today Brazil is regarded as home to the outstanding examples of large, industrial fast-growing tree plantations and ballyhooed as the 'leading supplier of eucalyptus market pulp in the 1990s', shipping nearly two million tonnes abroad each year (Know-How Wire 2.1993, ABECEL n.d.). The country harbours the second-largest area of such plantations in the world and boasts pulp production costs among the lowest anywhere (Shell/WWF 1993).

This enormous expansion of the pulp sector, ironically, has taken place in a country with a per capita paper consumption which remains well below the world average. While yearly per capita paper consumption in the US is 332 kilogrammes and in Switzerland 216, Costa Rica 55 and Argentina 45, in Brazil it is only about 28 (PPI 7.1995). The majority of the Brazilian people have not benefitted from increased paper consumption; nor have significant numbers of new jobs been created by the industry. The people as a whole, instead, have suffered a series of negative environmental and other effects.

This prompts a question: in what sense can Brazil's massive pulp and plantation development be considered a success? To try to answer this question, this chapter will examine the history, claims and records of five of the most frequently-praised of the country's pulp operations _ Aracruz, Bahia Sul, Monte Dourado, Celulose Nipo-Brasileira (CENIBRA) and Riocell _ which, among them, produce 90 per cent of Brazil's bleached eucalyptus pulp exports.

Aracruz

Aracruz is the world's largest producer of bleached eucalyptus kraft market pulp and operates the world's largest pulp mill. In 1978 it inaugurated its first 400,000-tonne-per-year plant (later enlarged to 500,000 tpy) and in 1991 the second, which produces a further 500,000 tonnes (Willums and Goluke 1992). Aracruz's production is aimed primarily for export, with Europe as the main destination, followed by the United States and Japan. The company accounts for more than half of Brazil's pulp exports, or more than 850,000 tonnes (Miranda 1993a, ABECEL n.d.).

Aracruz's mills feed off its extensive eucalyptus plantations in the states of Esp!rito Santo and Bahia, where the company has achieved increasingly rapid growth rates through the selection and cloning of the fastest-growing species and the individual trees best suited to the needs of industrial processes (that is, those with the least bark and branches). Wood consumption per tonne of pulp produced was thus reduced from 4.5 to 4.1 tonnes between 1985 and 1991 (Swann 1993). At the same time, average tree growth in the plantations has gone from 25 to 35 cubic metres per hectare per year (Willums and Goluke 1992).

Although ostensibly a highly-successful private undertaking, Aracruz was in fact conceived and developed through direct and indirect state assistance. One of Aracruz Florestal's original 1967 partners was the ECOTEC consultancy company, which not only pressed the government into approving fiscal incentives for plantation forestry, but also advised the government of Esp!rito Santo state to promote the activity. ECOTEC also recruited entrepreneurs to back the business and chose the location of the plant. In 1974, the government approved a decree allowing the establishment of an 80,000 hectare afforestation project in Esp!rito Santo. One of the signers of this decree was the then Minister of Mines and Energy, Antonio Dias Leite Jr. _ an ECOTEC partner (Goncalves et al. 1994).

Established in 1968, the plantations soon fell victim to disease. Aracruz responded by sinking large resources into research on seeds of a variety of provenances, becoming a recognized authority on the subject of plantations from the 1980s onwards (Goncalves et al. 1994). By the middle of the 1980s, meanwhile, the company had acquired so much land in Esp!rito Santo that the state government was forced by the public to come to a 'gentlemen's agreement' with the company to prevent it from buying more land. This resulted only in Aracruz's investing in 80,000 to 100,000 hectares of new territory in the neighbouring state of Bahia. A newly-enacted Forest Development Programme, moreover, allowed the company and the state to promote eucalyptus planting on the land of third parties (CEPEDES/CDDH 1992, FASE 1993). As of 1994, Aracruz owned 1.86 per cent of the territory of Esp!rito Santo, commanding in all 203,000 hectares in Esp!rito Santo and Bahia. Of this total, 132,000 hectares had been planted with eucalyptus (IBASE 1994b, Aracruz 1996).

Aracruz Cellulose was set up in 1972 and Aracruz Florestal became its subsidiary. The first shareholders were a widely-varied group of banks, petroleum firms, construction companies, and other businesses, none of which had any previous experience in pulp production. Among them was the Lorentzen group (one of the few which is still a major shareholder in the company). To boost its expertise, Aracruz formed an association with the Swedish Billerud company, which had some experience in eucalyptus pulp manufacture and which took responsibility for marketing 50 per cent of Aracruz's production in Europe (Goncalves et al. 1994).

Then, in 1975, the state's BNDE agreed to contribute US$337 million, in the form of loans and share purchases, to the construction of Aracruz's first mill. The financial package, granted on exceptionally favourable terms, was the largest ever offered to a private company. The Brazilian state became the main shareholder in the company, with 40 per cent of the shares, followed by British American Tobacco with 30 per cent, and in all provided 55 per cent of the support needed to build the mill. Without this state support, the plant could never have been constructed (Goncalves et al. 1994).

Following further BNDE loans to increase plant capacity, a privatization process got under way in 1985, ending in 1989 with the sale of the majority of state-held shares. Current main shareholders are Souza Cruz (a subsidiary of British American Tobacco), the Lorentzen Group, and the Safra Group, with 28 per cent each; the holdings of BNDE (now renamed BNDES) have been reduced to 12 per cent. According to the research findings of FASE and IBASE, two major Brazilian non-governmental organizations (NGOs), while privatization 'represented a good deal for those groups assuming control of the company', it was an 'absurd move' from the point of view of the state, which thereby abandoned its strategic position in a lucrative undertaking, handing the taxpayers' inheritance over to the private sector (Goncalves et al. 1994).

Aracruz, perhaps more than any other big pulp producer, has taken seriously the need to respond to pressure from the environmental movement _ above all through publicity. The firm's directors played a leading role, through the Business Council for Sustainable Development, in preparing big business for the Rio Earth Summit in 1992. This resulted in a book, Changing Course, which was distributed to delegations of all participating governments before the conference. The company's environmental publicity has been widely disseminated, both by the company itself and through the Business Council for Sustainable Development, as well as by journalists and researchers. Aracruz has also supported the London-based non-governmental International Institute for Environment and Development in a large study on the 'sustainable paper cycle' (IIED 1995).

In its publicity, the company claims not only that it uses 'clean' industrial processes. It also asserts that it has planted eucalyptus only in areas where the natural forest was cleared before its arrival. The firm stresses, in addition, that it is making every effort to conserve remaining native stands. It states that 27 per cent of its land has original forest cover and that for every 2.4 hectares of eucalyptus one hectare of natural forest is preserved. To counteract forest defence campaigns, Aracruz highlights the fact that it has always used wood from its own plantations or has bought eucalyptus wood from farmers provided with free seedlings by the company (Willums and Goluke 1992). At the same time, it states that its plantations do not compete for land used for agriculture or other activities (Know-How Wire 2.1993). Perhaps no one has promoted this image better than Sargent and Bass in their book Plantation Politics (1992). After describing the panorama of desolation in Esp!rito Santo and Bahia, these authors go on to say that 'Aracruz Celulose S.A., with government support, took control of much degraded land within the tattered fragments of natural forest, and has established major eucalyptus plantations. In doing so, it has begun to improve the local environment and social conditions'. So successful has Aracruz publicity been, indeed, that in 1991 the company was officially singled out by the United Nations for its 'rigorous commitment' to sustainable development (IBASE 1993a).

This chorus of praise, however, has little factual foundation. The actual effects of Aracruz's tenure have been deleterious both to local people and their livelihoods and to the soil, water and forests of the region.

First, the enormous area bought by the company beginning in the 1960s was not, contrary to company claims, empty: thousands of indigenous people and subsistence farmers lived there. In order to overcome local resistance to the takeover, mainly from black communities and small agricultural producers who had recently migrated from other states, the company used a strategy in which physical violence was joined to symbolic violence. Land purchases were made through two people: a military officer and a local black leader, a combination which had an especially clear meaning given the dominance at that time of the military dictatorship (Miranda 1993b). Approximately 7,000 families are said to have been removed, through violence and coercion, from the areas Aracruz occupied, including several thousand people who received no compensation (FASE 1993, Valarelli 1992, IAD 7/8.1992). Crucial to these expulsions was the negligence or collaboration of local authorities, including the then governor of Esp!rito Santo state, Artur Gerardt, who later became president of Aracruz (FASE 1993).

In 1967, recalled Jos Luis Ramos, the head of Caieira Velha village, Aracruz, with the support of the state government, felled large areas of forest and planted eucalyptus across the region, including on our land. In a little time, this company destroyed around seven Tupiniquim villages, expelling us, and today we are surrounded by a sea of eucalyptus in three discontinuous areas. Now there is no forest or game left. The valley's rivers disappeared following the planting of the eucalyptus (Miranda 1993c).

Three principal options were left to the people expelled: emigrate to other rural areas; move to a life of underemployment in the favelas or shanty towns of cities; or work for the company, mainly on the plantations. Aracruz plantation work, however, has been described as near-slave labour, with conditions so dangerous and unhealthy that few workers can remain on the job more than ten years. Over 50 per cent of those who have worked on the plantations long-term suffer from serious work-related health problems as a result of their tasks. While they have the right to medical treatment, it is rare that they can ensure that they are given it, since the doctors are also Aracruz employees. The company tends to dismiss long-term plantation employees without compensation, replacing them with younger people (Inyaku 1993). The abundant reserve army of unemployed _ whose numbers have been swelled by the crisis of another export monoculture crop, coffee; by the company's dispossession of local people; and by migrants attracted to the Aracruz 'development centre' _ meanwhile helps keep salaries low.

Yet opportunities for even low-paid, health-endangering jobs have become limited as tree harvesting and other plantation work have become increasingly mechanised (IBASE 1994b). During the first months of 1993 alone, Aracruz dismissed 20 per cent of its employees, reducing the workforce from 7,000 to less than 6,000, with forestry jobs being most affected (Inyaku 1993). In 1993, the indigenous people who lost their land to Aracruz started a new battle to get it back.

Aracruz attempts to divert attention from its record by advertising itself as having voluntarily built several recreation centres, schools, vocational training centres and health centres, at a cost of over US$15 million. What the company does not mention, however, is that as part of the plant expansion project, the BNDES both demanded that Aracruz reinforce social structure in the regions where it operates and provided 80 per cent of the total funding required to do so (Goncalves et al. 1994).

Aracruz's claim that it does not usurp agricultural land is contradicted by, for example, the way the firm has bought land in Bahia previously dedicated to small-scale cultivation of mamao, a local fruit. Although a company director suggested that mamao production was in decline, it had in fact provided a viable livelihood for local farmers (Goncalves et al. 1994). In general, the company's insistence that its activities are compatible with agriculture makes little sense given its propensity for buying precisely the best agricultural land on the ground that it makes mechanization easier. Aracruz owns a full 15 per cent of the plains in Esp!rito Santo (FASE 1993).

On the environmental side, meanwhile, Aracruz has been accused of having felled and burned more than 50,000 hectares of forest during its first phase of tree-planting (FASE 1993, Miranda 1993c, IAD 7/8.1992). It has also been fined by IBAMA, Brazil's environmental protection agency, for planting eucalyptus in protected areas. Rogrio Medeiros, National Coordinator for the Environment of the National Federation of Journalists, who has been monitoring Aracruz's activities since its beginnings, states that 156 streams have disappeared in the region during that period and that wells are drying up in a number of areas; even a river, the San Domingos, has stopped flowing. In the words of Joao Pedro Stedile of the Landless Workers Movement, '50,000 people in the area used to eat fish every day. Now they eat fish no more; some fishermen have stopped fishing because there are so few fish to catch' (IAD 7/8 1992).

The Tupiniquim Indians, meanwhile, found that soils on land returned to them after having been used for eucalyptus planting did not return to their old levels of agricultural productivity, having become sandy. Indiscriminate use of the herbicides Goal and Roundup and the ant killer Mirex have been blamed for the wholesale poisoning of regional animals (FASE 1993). (Since 1993, apparently, all major pulp companies have used Mirex-S, a less harmful piretroid, instead of Mirex, an organochlorine [Fanzeres 1995].)

According to the local NGOs Centro de Estudos e Pesquisas para o Desenvolvimento do Extremo Sul da Bahia and Centro de Defesa dos Direitos Humanos, Aracruz has in addition been 'constantly fined' for industrial contamination. Local people have testified that near the factory it is nearly impossible to breathe. The majority of the people working in the factory probably have no nasal mucous left . . . Air pollution emitted by Aracruz reaches distances of more than 100 kilometres, depending on the wind (CEPEDES/CDDH 1992).

The Pulp Industry Workers Union (SINTICEL) has accused Aracruz of incorrect management of both water-borne and airborne emissions (FASE 1992). Local activists claim that chemical releases into the Atlantic have killed and poisoned both fish and vegetation (IAD 7/8.1992).

Aracruz's newly-professed concern with implementing 'clean' industrial processes cannot be expected to lead to consistent environmental results, moreover, if it consists mainly in an interest in profit margins. When the company incorporated new technology for non-chlorine pulp bleaching in late 1993, it was simply responding to foreign consumer demand for chlorine-free pulp. A company directive stated that 'without the new technology, we would lose sales of 150,000 tonnes of pulp on the international market' (IBASE 1993b). It is for this reason that the firm runs three different types of industrial process among its four production lines. One uses chlorine gas, two others are elemental chlorine free (ECF) and only the newest one is totally chlorine free (TCF) (Fanzeres 1995).

Small wonder that in May 1992, on the eve of the Earth Summit, the Brazilian NGO Forum, together with representatives from other sectors of society, organised a public event denouncing the 'Aracruz farce' and criticizing a proposal to present the company's activities as a model of sustainable development. At the same time, Greenpeace symbolically closed the port of Portocel, the company's export port, as a sign of protest against the environmental and social damage it had inflicted during pulp production, including its destruction of native forest (FASE 1993, Bruno 1992). As one research team concluded, Aracruz assumes the image of protector of the environment, but its eucalyptus trees have dried streams, destroyed the local fauna, impoverished the soil, impeded the regrowth of native plant species, and drastically reduced the area available for cultivating basic foodstuffs (in a country where many people die of hunger). This is not to mention land concentration and the expulsion of the rural population, which has contributed to increasing the urban population and the degradation of living conditions in the cities. Where is the sustainable development here, we might ask (Goncalves et al. 1994)?

Bahia Sul Celulose

Bahia Sul Celulose was set up in 1984 by one of the main business conglomerates in Brazil, the Suzano Group, and the state-owned Companhia Vale do Rio Doce. Suzano, with interests in many areas, is owner of the Suzano Paper and Pulp Company, one of the main integrated paper-producing concerns in the country and involved also in wood, publishing, and graphics. Previously, Suzano Paper and Pulp had produced pulp only for its own paper mills; Bahia Sul was its first venture into export pulp.

Bahia Sul's shareholders include Suzano (CSPC), which today holds 35 per cent of the shares; Companhia Vale do Rio Doce (CVRD), with 29 per cent; the National Economic and Social Development Bank (BNDES), with 26 per cent; and the International Finance Corporation (IFC) of the World Bank, with three per cent. However, voting rights have always rested with Suzano and CVRD, who hold 55 and 45 per cent of the ordinary shares.

Total investment came to US$1.5 billion, with the company benefiting from 10 years of low-interest BNDES loans worth $387 million, all of which had a three years' grace period. Bahia Sul also obtained $33 million from Citibank and $83 million from Manufacturers Hanover Trust. The IFC role in the enterprise, by signalling support from the World Bank, served to make it easier to obtain funds from other sources (Goncalves et al. 1994).

Bahia Sul Celulose has the capacity to produce 500,000 tonnes of bleached eucalyptus pulp and 250,000 tonnes of printing and writing paper per year. Some 45 per cent of its pulp is earmarked for the firm's own paper mills, another 45 per cent for export and the last 10 per cent for the domestic market (CEPEDES/CDDH 1992). Half the export pulp goes to Asia and another quarter each to North America and Europe. Three-fifths of the company's paper production is also shipped abroad, half of it to North America and equal parts of the rest to Europe and the Middle East (Goncalves et al. 1994). The company ranks fifth among Brazil's pulp exporters.

The decision to locate the company in Bahia was motivated largely by the existence there of extensive eucalyptus plantations. Suzano, a pioneer in eucalyptus pulping, had exhausted its expansion possibilities in Sao Paulo state and wanted more pulp. CVRD, which was already embarking on joint ventures in the pulp sector, and which held 100,000 hectares of eucalyptus in Bahia originally planted for charcoal for the steel industry, made an ideal partner (Higgs 1992a, 1992c).

The CVRD plantations were the result of a government incentive policy promoting tree-planting in the central southern region of Brazil. At the end of the seventies, land prices rose in those regions and plantation companies moved into southern Bahia, where large areas of cheap or deforested land were becoming available in the wake of highway construction and the associated unsustainable logging. The objective was less to set up productive enterprises than simply to get hold of the subsidies that were being poured into the plantation sector. In 1982, the state of Bahia became the second largest afforested region in the country (Miranda 1992). All the conditions for a large export pulp mill were then available: abundant raw materials, cheap land, a cheap workforce, transport infrastructure and a nearby port in the city of Vit"ria.

Today Bahia Sul Celulose owns 114,000 hectares of land, divided between 68,000 of eucalyptus, 34,000 of native forest and 12,000 occupied by infrastructure works. The company plants an additional 1,000 hectares annually and since 1992 has also promoted tree-growing by small farmers on their own land in order to broaden the resource base with a view to future expansion of the plant (Goncalves et al. 1994, Higgs 1992c).

Like Aracruz, Bahia Sul Celulose presents itself as a defender of nature and blames the poor for environmental degradation. The hunting practiced by local people to supplement their poor diet, for example, is treated in the company's literature as an 'ecological crime' which the firm is heroically striving to curb. An industry journalist reported approvingly in 1992 that 'environmental considerations were important both in the location of [Bahia Sul's] plant and in its construction':

Apart from Bahia Sul's conservation of 30 per cent of its forest land for native species and its planting of 20,000 such trees annually, extensive studies were produced prior to construction to assure the aquatic environment was safe. Features of the mill include oxygen delignification, primary and secondary effluent treatment and biomass energy production (Higgs 1992).

Such statements are misleading. They ignore the fact that, before the region was opened up to 'development', local people had been using natural resources in a far more responsible manner than the company is using them today (Miranda 1992). They are also contradicted by the fact that Bahia Sul used only an exceptionally low 7.2 per cent of its total mill construction costs on contamination control equipment (Goncalves et al. 1994), as opposed to the approximately 20 per cent figure common in industrialized countries (CEPEDES/CDDH 1992).

Also unmentioned are other socioeconomic dangers the Bahia Sul installations pose for the region as a whole, such as those related to dependence on a single monoculture. In the case of cacao cultivation in Bahia, this dependence led to repeated crises attributable to climatic irregularities, pests, and falling international commodity prices over which local producers had little control. Overdependence on monocultures of eucalyptus may bring similar problems. The reduction in size of the state's agricultural area has already forced it into greater dependence on costlier food imports from other regions, with negative repercussions on the quality of life of the worse-off (CEPEDES/CDDH 1992, Miranda 1992).

To make way for Bahia Sul, in addition, the families from nearly 8,000 small properties in the region were driven from their land. Evictees who became forestry employees are now by and large worse off than small producers who managed to keep their properties (Goncalves et al. 1994).

Nor has Bahia Sul proved to be an efficient creator of new jobs. Each one of the existing 5,500 jobs at the company has required an investment of between US$226,000 and $338,000 _ much of the capital deriving ultimately from public funds. According to a study conducted by local NGOs (CEPEDES/CDDH 1992), an alternative development project (based on diversified agriculture) with a similar level of investment could generate 150,000 jobs at a cost of a mere $8,300 each. In the forestry sector, the company employs only one person per 45 hectares, while agricultural activities give work to at least 18 per hectare; mamao production requires 1.5 workers per hectare (CDDH 1993). In spite of company propaganda, moreover, many of the jobs which have been provided have not gone to local people, who are often not well enough qualified (Miranda 1992).

Living and working conditions have hardly improved, either. The large numbers of people attracted to the Bahia Sul site by the company's advertisements for construction workers precipitated an exaggerated rise in housing rents. For labourers who lodged alone, living conditions were dreadful. Rooms measuring three by four metres lodged six or more workers, with one toilet per 32 men. Family problems were exacerbated by extended separations. Some 5,000 workers lived in such conditions over a three-year period, with the population around the construction site occasionally surging as high as 13,000. The resulting strikes delayed completion of the plant. Inmigration also contributed to the collapse of health, education, drainage, housing and security infrastructure. New shanty towns sprang up, and poverty, violence, crime, disease and prostitution increased (CEPEDES/CDDH 1992, CDDH 1993, Goncalves et al. 1994).

Trade unionists have meanwhile pointed to high unemployment and underemployment and at poor working conditions in the forestry sector (Miranda 1992). The transport system used for both the construction works and forestry areas has been denounced as degrading and dangerous. Workers have been treated as livestock and transported in the back of lorries, a practice which has led to frequent injuries. Bahia Sul has also damaged local fishing and tourism livelihoods (CEPEDES/CDDH 1992).

A megaproject of the Bahia Sul variety implies enormous concentrations of capital, land and political power. As it generates little employment in relation to the level of investment, little of this capital and power ever finds its way down to society's deprived. As a result, large firms such as Bahia Sul come to wield disproportionate political clout and the states in which they are located run the risk of suffering from a modern 'feudal' syndrome in which large holders of land and capital become 'lords' who attempt to dictate policy. Before Bahia Sul even started up, official complaints were being aired about the use of company funds in election campaigns (CEPEDES/CDDH 1992). Years later, an advance payment of taxes by Bahia Sul was used by the Bahia government to surface the roads most used by the company's lorries (Miranda 1992c). In 1989, in a parallel with events in Esp!rito Santo, the state government of Bahia was belatedly forced, in reaction to the company's buildup of 'feudal' power, to demand that the firm suspend acquisition of new lands.

The environmental problems caused by Bahia Sul Celulose are also significant. In southern Bahia, where the company is located, only some 60,000 hectares survive of a forest which, in 1930, covered a million and a half hectares. These remnants are part of the Mata Atlantica, an endangered forest at least as rich in biodiversity as the Amazon rainforests (CEPEDES/CDDH 1992). The eucalyptus used by Bahia Sul threatens the survival of this forest mainly because it takes over crucial areas which would otherwise have regenerated into native forest. Unless these areas are allowed to regrow, the strict conservation of a few tiny areas of untouched Mata Atlantica forest _ which, for public relations purposes, Bahia Sul takes great care to say it supports _ has little meaning.

Bahia Sul's eucalyptus plantations are also affecting both the quantity and the quality of local water. Inhabitants of the town of Veracruz, for example, have declared that, as the result of a nearby eucalyptus plantation, several wells have dried up and they have had to dig down a further three metres in order to find water. Insecticides, fertilizers, and herbicides used on the plantations, in addition, contaminate watercourses, taking their toll on aquatic fauna. The inhabitants of the fishing community of Caravelas have gone to the courts to demand an investigation into a recent reduction in crabs and other species, which has been linked to the use of agrochemicals (CEPEDES/CDDH 1992). Local residents fear that water contamination from Bahia Sul's industrial plant will only add to the problems.

CENIBRA

The first eucalyptus plantations were established in Minas Gerais in the 1940s by the Belgo-Mineira Company, for charcoal. They expanded enormously from the late 1960s onwards (particularly in the 1970s), due largely to state subsidies. Plantations were set up by Florestas Rio Doce (created by the state and the CVRD in 1968) and the steel company Acos Especiais Itabira (ACESITA) as well as many independent tree growers, the aim being to supply the pulp, iron and steel and cement industries with raw materials or energy. Minas Gerais state became home of the largest eucalyptus plantation area in Brazil (M. T. Goncalves 1995).

By 1970, Japan was CVRD's biggest customer. In 1972, CVRD signed an agreement with the Japan-Brazil Pulp Resources Development Co. (JBP) to set up a jointly-held company called Celulose Nipo-Brasileira, or CENIBRA, to produce eucalyptus kraft pulp for export, half of which would go to Japan. CVRD held 51.5 per cent of the shares (JATAN 1993). JBP, the minority shareholder, was in turn over 36 per cent owned by Japan's bilateral foreign 'aid' agency, the Overseas Economic Cooperation Fund. Other JBP shareholders included Oji Paper (nearly ten per cent); Jujo Paper, Honshu Paper and Itochu (over eight per cent each); Tokai Pulp, Daishowa Paper, Hokuetsu Seichi Paper Mills, Mitsubishi Paper Mills, Daio Paper, and Sanyo Kokusaku Pulp (over 3.5 per cent each); and, with smaller stakes, Kanzaki Paper, Daiko Paper, Chuetsu Pulp, Nippon Kakou Sheisi, Abegawa, Kishu, Sanko, Juban and Mishima (M. T. Goncalves 1995).

In 1974, when CENIBRA began operations, its pulp mill was supplied with wood from Florestas Rio Doce, the CVRD subsidiary. At the same time, another firm called Florestas Nipo-Brasil, or FLONIBRA, was created, with the aim of acquiring an additional 400,000 hectares of land for pulp plantations in Bahia and Esp!rito Santo. In 1984, the 155,000 hectares which had actually been acquired _ including 88,000 planted with eucalyptus and 48,000 given over to 'conservation areas' _ were passed to the control of CENIBRA Florestal, the firm now responsible for supplying the CENIBRA mill with pulpwood and energy (Goncalves et al. 1994). Some 4,600 people are employed on the CENIBRA Florestal lands. Among other tasks, they plant 6,000 hectares of eucalyptus per year (JATAN 1993).

CENIBRA's pulp mill, which employs around 1,300 people, has increased production from 116,000 tonnes in 1978 to 376,000 in 1993, and plans to double that figure have already been approved (JATAN 1993, Goncalves 1995). In all, 80 per cent of the company's pulp goes for export (50 per cent to Japan and 30 per cent to Europe and the US), making the firm Brazil's second-ranked pulp exporter after Aracruz (JATAN 1993, Miranda 1993a).

The firm's inland mill in Minas Gerais is able to compete with coastal export pulp operations such as Aracruz only because it has the use of a high-quality railway belonging to CVRD. When the plant came on line, the railway was improved and adapted to pulp transport (Goncalves et al. 1994). The company is also able to keep costs down through being co-owner, together with Aracruz, of the Portocel port, a specialist pulp-exporting installation (Knight 1991b). In 1975, moreover, CENIBRA received US$128 million in state financing. This was supplemented by another $14 million in 1976, $16 million in 1981 (to reduce energy consumption), $6.6 million in 1982, and $15 million in 1985 (Goncalves et al. 1994).

CENIBRA's claim to green credentials comes in the form of a five-year strategic plan developed in 1991 to assure 'sustainable development' (Higgs 1992d). As a result of this plan, 240 hectares of pine and eucalyptus surrounding the plant were to be enriched with local species in order to encourage the return of other indigenous species. In addition, some 1,000 hectares of native forest were to be preserved, while company land on the banks of the Rio Doce was to be reforested with native species. At CENIBRA's mill, meanwhile, the plan called for company-monitored measures to control effluents, as well as initiation of production of chlorine-free pulp.

Several aspects of this plan call for comment. First, the planting of indigenous species and the preservation of a few areas of native forest (the latter, far from being a voluntary measure, is a legal obligation) are essentially cosmetic measures to pacify local people increasingly concerned by the advance of eucalyptus, as well as environmental groups in the North. (They may also limit, to a small extent, the risk of pests.) Second, effluent-treatment systems were installed only in 1988 _ 11 years after the mill came on line _ and only after heavy pressure from local people (Goncalves 1995). Their installation thus hardly demonstrates trustworthiness on environmental matters. Similarly, chlorine-free bleaching techniques began to be used only as a result of demand from the European Community, and are used exclusively with pulp destined for the European market (JATAN 1993).

As with Aracruz's and Bahia Sul Celulose's 'greenwashing' efforts, moreover, CENIBRA's 'sustainable development' plan artfully fails to mention a number of destructive realities about the company's operations. One such reality is the way CENIBRA's projects and those of other companies such as CVRD, ACESITA and Belgo Mineira concentrate vast swathes of land in a few hands in a process often marked by violence. According to JATAN (1993), for instance, FLONIBRA 'used whatever methods were available to acquire land for its plantations': sometimes it purchased land at above market prices; at other times residents were chased away with violence. It also often resorted to deception; for instance it would first move a FLONIBRA insider onto land adjacent to the farmer's land and set up a local conflict; then a third party would be sent in who would act as a 'mediator' between the two and offer to purchase the farmer's land.

FLONIBRA is also reported to have felled secondary forest used by indigenous people, obliging them to emigrate to nearby towns (JATAN 1992).

As elsewhere in Brazil, the concentration of land with good soils in a few hands has undermined subsistence agriculture and led to increased urban migration and the weakening of autonomy and local social ties (Guerra 1992, M. T. Goncalves 1995). Wage labour, meanwhile, has proved an inadequate substitute for small-scale farming in both economic and cultural terms. As one worker said, 'the salary that we earn does not go very far . . . it is only enough to survive on' (M. T. Goncalves 1995). As a result of large plantations taking over agricultural areas, Minas Gerais has had to import food from other regions. As the holdings of plantation firms accumulate, moreover (ACESITA, for example, has 250,000 hectares, Belgo Mineira 100,000 and CENIBRA 155,000), the dependence of local towns on a few businesses grows, and the influence of such companies on decision-making processes increases. One result is yet more industrial projects and tree plantations (Guerra 1992, JATAN 1993).

CENIBRA's relationship with its workers, meanwhile, has been authoritarian and exploitative. While, according to one interviewed worker, wages were initially good and there was a strong trade union, salaries declined considerably after CENIBRA stepped in to manipulate union elections through pressure and fraud. The company also dismissed unionized workers and started contracting out both industrial and forestry tasks to other firms. This move, aimed at reducing costs, resulted in even lower wage levels and a smaller worker population, making unionization even more difficult (M. T. Goncalves 1995). Working conditions are often inadequate, with many plantation chainsaw operators suffering from nervous disorders and other health problems (JATAN 1993).

CENIBRA is also moving into contract farming through the Fazendeiro Florestal programme, operated in conjunction with a state agency, through which seedlings, fertilisers and ant poison are provided to individual farmers if they plant eucalyptus on their own land. This allows the company to increase its forestry base in a way other than through simple acquisition of land. The farmers are contractually obligated to sell CENIBRA wood at the 'market price', which is established by the company itself (Goncalves 1995).

The environmental impacts of CENIBRA plantations include destruction of native forests and loss of biodiversity (Guerra 1992, JATAN 1993, M. T. Goncalves 1995). Fertile agricultural land has also been taken over. Not only does CENIBRA not restrict its plantations to 'degraded' land; it also plants, contrary to its stated policy, on pronounced slopes (Guerra 1992).

Soil ecology has also been affected. Because the thick layer of plant material associated with plantations cannot be mineralised rapidly by microorganisms, organic acids are formed and calcium, potassium and magnesium ions are replaced by hydrogen ions in the upper layer of the soil. This implies a lower pH, which affects the availability of nutrients to plants. The long term productive capacity of the soil is endangered and it is not known how much longer the same land can keep on producing eucalyptus wood (Guerra 1992). Tree bark, which, according to FAO, contains the best part of the nutrients taken from the soil by the tree, is removed from the site and used in the pulp mill for energy generation, further reducing soil fertility (JATAN 1993).

Local people have observed, moreover, that the rate of replacement of underground water tables has slowed. This is attributable to the increased surface runoff associated with plantations and with eucalyptus's high water consumption. Finally, the use of pesticides such as Aldrin and Mirex has resulted in the contamination of soils and watercourses, with proven high fish mortality (Guerra 1992). The company has even begun to spray herbicides from the air, endangering local agriculturalists (Goncalves 1995).

Environmental impacts at CENIBRA's pulp mill have been equally serious. The first complaints of water pollution date from 1977, the year the plant started up, and have been continuous ever since. Yet only at the end of 1986 did the company formally commit itself to installing an industrial and sanitary effluent treatment system, giving itself a 30-month deadline. Since 1990, CENIBRA has submitted monthly reports to the appropriate state agency, but without making them public (Goncalves 1995). Although scientific data on air pollution around the pulp mill is unavailable, JATAN members visiting the plant in 1992 remarked that 'we couldn't avoid noticing the horrible smell present in all of the plant and we felt sorry for the people who had to work there' (JATAN 1993).

Jari and Companhia Florestal Monte Dourado

In 1967, United States shipping magnate Daniel Ludwig paid the Brazilian military dictatorship US$3 million for 1.6 million hectares of tropical forest on the Jari River near the frontier with French Guyana. A year later he began planting vast homogenous masses of fast-growing trees for pulp. Ludwig's pulp mill, constructed in Japan and taken by sea to the chosen site, was finally installed in 1979.

Ludwig's project was similar to others in Brazil, except for the species chosen. This was Gmelina arborea, a tree indigenous to Indonesia, and was a failure. In addition to the problems normally experienced with eucalyptus and pine (leaf-cutting Atta and Acromyrmex ants), the gmelina was afflicted by the fungus Ceratosystis fimbriata, which not only delayed tree growth, but also reduced the quality of the pulpwood (Higgs 1993b, Shell/WWF 1993). These difficulties caused the company great losses, as by 1978 it had already planted 64,000 hectares of gmelina (Shell/WWF 1993). From then on it began to plant a pine (Pinus caribaea var. hondurensis), which had already been tried in the area.

In 1982, when Brazil was moving towards democracy and Ludwig could no longer count on support from the military establishment (Sargent and Bass 1992), he decided to sell Jari to a consortium of 23 Brazilian companies, led by the CAEMI group, who acquired 40 per cent of the shares (IBASE 1993a). The BNDES supported the operation through a US$180 million loan (Shell/WWF 1993). One of the main new shareholders was AMCEL (Amap Florestal e Celulose S.A.), owner of some 90,000 hectares of pine plantations near the plant (Knight 1991b).

The latter were of great importance to the company. As its own existing plantations were so unproductive, it had no other raw material sources to rely on until its new pine, and then eucalyptus, plantations matured (Knight 1991b). At present the firm owns some 90,000 hectares of plantations, which are mainly eucalyptus and pine, with a 2,000 hectare remnant of gmelina. Eucalyptus now dominates, 60 per cent from selected clones and 40 per cent from seed. More trees are being planted at a rate of 13,500 hectares per annum (Higgs 1993b).

Jari's mill _operated by Companhia Florestal Monte Dourado_produces 300,000 tonnes of pulp annually, 55 per cent of which is long fibre and 45 per cent short. Some 65 per cent is exported to Europe, 14 per cent to the US, and another one per cent to increasingly important markets like Japan, Indonesia, Korea and China (Shell/WWF, 1993).

Jari has not lagged far behind its fellow firms in attempting to 'greenwash' its activities. As journalist Richard Higgs writes, 'Jari is very proud of its almost surgical blending of plantation species in among the predominant and thriving natural forest' _ a practice which helps 'to prevent the spread of pests and disease', something of which the company has bitter experience _ and maintains reserve areas and carries out research into native species which may be of economic use. Like other pulp firms, Jari has also recently displayed much concern about chlorine pollution, although this concern had lain dormant for 14 years before 1992, when European consumers began calling for non-chlorine-bleached pulp (Higgs 1993b). Jari's own public relations efforts have received a boost from Paulo de T. Alvim, a leading Brazilian agricultural planner, who has claimed that the Jari plantations reduce global warming because they grow, whereas the tropical forest that had occupied the site previously had been in equilibrium with the atmosphere, neither absorbing nor emitting carbon (Fearnside 1993).

Such claims conceal a great deal more than they reveal. For example, although the company is legally obliged to preserve 50 per cent of the native forests it controls, it has already felled around a third of them in order to supplement shortfalls in gmelina with species such as Jacaranda copaia, which in 1982 made up around 20 per cent of its wood supply. Some 1,200 hectares of the forests Jari claims to be protecting are being felled each year (Shell/WWF 1993), mostly for energy generation and for the expansion of its plantations (Fanzeres 1995). In 1992, Brazil's official environmental conservation organization, IBAMA, rejected the company's request to cut 5,000 hectares of dense forest which it wanted to replace with plantations (IBASE 1993a). Felling such native forests, of course, has resulted not only in loss of native trees but also in loss of habitat for a very large number of other species.

Other environmental problems centre on the project's continuing reliance on monoculture. Forestry experts never tire of pointing out Ludwig's serious mistake in choosing gmelina as his plantation species (Sargent and Bass 1992, Shell/WWF 1993). This 'error', however, is merely one instance of a much more general problem which foresters seem far less eager to acknowledge, and which the current Jari project also exemplifies: namely, that in a large-scale monospecific plantation of any fast-growing species, a fungus, virus, insect, or other animal which can find food may well be able to decimate the entire plantation in a short time.

Pest infestation, moreover, was only one of the environmental problems afflicting the Jari project. When the gmelina felling rotation was shortened to three to four years to avoid fungus attacks, nutrients began to be extracted from the soil at a higher rate. It is estimated that most of the potassium and phosphorus will have disappeared from the estate by the end of the 21st century (Shell/WWF 1993). Meanwhile, soil compaction and erosion has resulted from the use of heavy forestry machinery (Sargent and Bass 1992).

Nor has the company shown itself to be particularly concerned about water and aquatic life. Effluents from the plant are eliminated by the simple traditional procedure of dumping them directly into the Jari river. This has resulted in fish kills downriver from the plant. The fertilisers and the agrochemicals used by the company also contaminate local watercourses (Shell/WWF 1993). Jari's 'environmental answer' to its energy needs, meanwhile _ a hydroelectric dam on the Jari river (Knight 1991b, Higgs 1993b) _ would destroy one of the most beautiful and historic sites of Amap state, Cachoeira Santo Antonio (Fanzeres 1995).

The claim that Jari's plantations help alleviate global warming, finally, has been convincingly refuted by scientist Philip M. Fearnside (1993), who points out that 'the much greater standing biomass of the forest [replaced by Jari] as compared to the plantation means that the effect of Jari is emission rather than removal of atmospheric CO2'.

Jari's public relations exercises also conceal a pattern of widespread social abuse. When it was first set up, the company had to invest in a great deal of social infrastructure in order to attract the huge forestry and industrial workforce it needed. Some 3,000 housing units were built, as well as four schools, a 1,100-bed hospital, clinics, supermarkets, a radio station and 11,000 kilometres of roads (Higgs 1993b). Despite these investments, however, 'work-crew contractors were notorious for their treatment of workers brought in from the poor north-eastern states'. This was reflected in a constant turnover of staff at all levels, which reached rates of 200-300 per cent per year (Sargent and Bass 1992).

After the company changed hands, new social problems emerged. Between 1988 and 1993 the number of workers fell from 8,000 to 4,500. In the forestry sector, many workers were replaced with machines. Many migrants were thus left unemployed in a region with few other potential employers. In the service sector, meanwhile, the company began to pass the responsibility for hospital, school and restaurant management onto local and federal authorities (Higgs 1993b). Having attracted a large number of workers and their families to work on the project in its initial stages, in other words, Jari then shunted off the long-term costs of their welfare onto the state. According to a local journalist, 'the legacy of the Jari project has been a shanty town in the middle of the jungle' (M. A. Goncalves 1995).

Riocell

Riocell, in the far southern state of Rio Grande do Sul, was created in 1975. The firm is owned by KIV, made up of Klabin, Votorantim, and the Iochpe finance company. Klabin is the world's 52nd-largest pulp and paper firm in sales. Votorantim, the country's biggest private conglomerate, took over the powerful Simao company in 1992. Holding interests in cement, aluminium and other metals, it has recently thrown itself into pulp and paper as well, becoming in 1994 the 65th biggest firm in the sector in the world (Higgs 1992b, Marcus 1993a, PPI 9.1995).

In 1975, Riocell bought its pulp mill from the Norwegian firm Borregaard, which had closed the plant earlier in the year as a result of public protests against the pollution it had caused since its construction in 1972. Apart from this factory, which is located in the city of Guaiba on the right bank of the Guaiba river 15 kilometres from the centre of the large city of Porto Alegre, the company owns 71,693 hectares of land, 53,000 of which are plantations (Schinke 1992b, Marcus 1993a). Riocell produces some 300,000 tonnes of bleached eucalyptus pulp each year and is the main pulp producer for the Brazilian rayon industry. The firm shares third place in Brazilian bleached eucalyptus pulp production and export with Monte Dourado (Jari), and is in the process of expanding its plant to a capacity of 700,000 tonnes per year. It has its own terminal in the port of Porto Alegre (Higgs 1992b, Knight 1991b).

In recent years Riocell has responded to both domestic and foreign environmental pressures with various 'green' claims. Klabin, for example, invites visitors to view company operations 'so they can see for themselves that we are not cutting down the rainforest'. Alfredo Lobl, a Klabin director, has stated that of the 330,000 hectares owned by the company, some 100,000 are preserved as native forests. 'We support environmental education programmes for 18,000 school children', Lobl adds (Marcus 1993a). Another Klabin director, Celso Foelkel, has insisted that 'rather than plant huge tracts of monocultural eucalyptus, the company has tried to integrate its growth as far as possible into the countryside ... nobody can say Riocell has a green desert' (Higgs 1992b). Riocell, like other Brazilian manufacturers, has also begun to produce non-chlorine-bleached pulp.

These 'environmentalist' moves, however, simply make a virtue of commercial necessity and hardly reflect a thoroughgoing commitment to change. It is the difficulty of finding large contiguous tracts of land for planting in Rio Grande do Sul, for example, and not a policy to 'fit into the area', that has forced Riocell into a pattern of dispersed holdings across the region. Similarly, it is pressure from the European market, and not a determination to be socially responsible, that is pushing the company into non-chlorine bleached pulp. Explains director Alfred Freund: 'We decided to go this way [elemental chlorine-free pulp production] because we're market oriented. Europe's our main market and Germany's important to us' (Higgs 1992b). To discover where Riocell's priorities really lie, it is necessary to examine other aspects of its record.

When the firm began operating in 1975, it claimed to have invested US$100 million in an effluent treatment system. According to environmentalists, however, the company installed a sludge treatment unit only in 1987 (AGAPAN 1992), and in 1992, it was still being accused of dumping more than 60 tonnes of organochloride compounds yearly into the Guaiba river, which provides the drinking water for Porto Alegre (Schinke 1992b).

In 1992, the company, facing heavy opposition from environmentalists and others in its attempt to secure official approval to double its production capacity, tried to bribe a local government official who was opposing the expansion. Failing, it went on to tell the state governor that if he did not approve the project, the company would move to another state. The governor finally passed the project when the state government received a US$170 million loan from the Inter-American Development Bank for the decontamination of the Guaiba river basin (Schinke 1992a). Interestingly, Riocell had financed several studies at the local university which showed that fish bred in water contaminated with effluent from the plant had developed serious genetic abnormalities (AGAPAN 1992).

Other planned projects

Among the other plantation and pulp projects under development in Brazil are the following:

* CELMAR, with a eucalyptus pulp production capacity of 420,000 tonnes to be located in Maranhao, is a partnership of the Risipar group (an association of Votorantim with Ripasa), with 55 per cent of the capital; CVRD, with 30 per cent; and the Japanese Nissho Iwai Corporation, with 15 per cent. Some 80 per cent of the firm's output will go to the foreign market, and 60 per cent of the funding will come from the BNDES, the World Bank and Japanese companies (Mat!as 1994).

* FLORAR, sited near Maranhao's Carajas railway, has among its partners Aracruz Celulose, CVRD, and various Nordic companies. The firm's pulp mill will have a production capacity of 500,000 tonnes of bleached eucalyptus pulp, 80 per cent of which is to be exported (Mat!as 1994).

* CELPAV, a Sao Paulo plant, was acquired half-built from the BNDES in 1988 by the Votorantim group. The mill a production capacity of 280,000 tonnes of bleached eucalyptus kraft pulp, half of which is slated for export. The company draws its raw materials from the plantations of the Votorantim group itself, which amount to some 45,000 hectares (Marcus 1993b).

* Champion Celulose, a subsidiary of the North American giant Champion International, which has had a presence in Brazil since 1959, is now installing a new pulp and paper plant in Amap . The project involves the acquisition of 200,000 hectares of land, half of which to be planted with eucalyptus (M. A. Goncalves 1995). By 1993 the firm had already planted 25,000 of the 50,000 hectares of eucalyptus destined to feed the plant (Knight 1991b). According to local sources, these plantations are replacing a rare Amazonian instance of cerrado, the native scrubland of central Brazil. Characteristic problems associated with land takeovers and expulsion of small farmers are reportedly occurring (Fanzeres 1995).

* Veracruz Florestal, created in 1992, is a subsidiary of the powerful Odebrecht S.A. holding, which is involved in civil construction, petrochemicals, industrial assembly, aviation, naval construction, and agrobusiness (Goncalves et al. 1994). Based in Bahia, it aims to produce some 600,000 tonnes of bleached pulp per year, with a raw material base of 62,000 hectares of eucalyptus monoculture. The first 41,000 hectares were acquired through an exchange of lands between Veracruz and CVRD. Veracruz has been implicated in deforestation since it was founded (Faillace and Miranda 1993).

Conclusions

The forests and rainforests of Brazil, with their enormous biodiversity and valuable woods, are rapidly disappearing. Yet the resources invested in studying how to manage them sustainably are ridiculously small. Instead of exploring the immense diversity of environmental and socioeconomic realities in Brazil, experts are channeled into studying and promoting uniformity in large-scale cultivation of coffee, cacao, sugar, soya _ and fast-growing tree monocrops.

In addition, the state is pouring billions of dollars into developing the export pulp sector and its enormous industrial exotic eucalyptus and pine plantations. These plantations, which are often held up as a triumph of private-sector development, would not have been possible without massive direct and indirect state intervention in the form of fiscal incentives, soft loans, support from BNDES and similar agencies, and the involvement of the state's Companhia Vale do Rio Doce. The coercive power of the state has also been extremely useful in transferring the land of indigenous peoples and small farmers who have no title to their property into the hands of large forestry concerns. Finally, the 1964-1984 military dictatorship's develop-mentalist vision of 'progress' filling 'empty spaces' has been critical in enlisting popular support for large pulp and plantation projects advertised as bringing progress to the 'backward' regions of the country. It is no coincidence that the period of greatest growth in Brazil's forestry sector was precisely this 20-year period.

The plantation development hailed in this way as 'progress', however, has benefitted only a minority. Concentration of land and power, migration, social disruption, a worsening of the quality of life, and long-term environmental degradation have been the results for Brazil as a whole. Environmental arguments adopted by pulp and plantation businesses cannot entirely hide this reality, though they do succeed in confusing public opinion both nationally and internationally.