There are lies, damned lies and statistics, as Disraeli memorably observed. Brazilian senator Katia Abreu, interviewed for Business Week in New York on the latest steps in the debate around Brazil’s Forest Code, was a veritable blur of figures, all of them huge:
- $100 billion dollars of losses to Brazilian farmers if a proposed deforestation amnesty didn’t pass as part of a reformed Forest Code
- 173 million hectares of land likely to be taken out of production as Brazilian farmers are forced to reforest
It went on and on.
Is this true? More to the point, why would the readers of Business Week be interested in an arcane debate over Brazilian environmental law?
Some context. Brazilian legislators are currently debating a reform of its Forest Code. The name is misleading: it actually sets out the environmental obligations of all private landowners, especially farmers. Parts of the law date from the 1930s, and all parties agree that it needs to be updated, but that’s about as far as agreement goes. For two years now Forest Code reform has been one of Brazil’s hottest political issues and the debate is moving towards a close, with some defining votes scheduled over the next few weeks. Since Brazil is both an agriculture and a biodiversity superpower, with much of that biodiversity on farms and ranches, this is a big deal for conservation and the Forest Code debate is being followed around the world.
Senator Katia Abreu is a leader of the ruralistas, a farming lobby which has waged a campaign to weaken environmental regulations on farmers. The details are complicated, but revolve around obligations to keep certain areas of farms in native habitat. However the votes go these obligations will remain in some form, which means that in international context even a revised Forest Code will be an advanced regulatory framework for farming, in environmental terms. But there is one major unresolved issue: a deforestation amnesty, being pushed hard by the ruralista lobby.
The salient question is why Senator Abreu feels obliged to go to New York to give an interview to Business Week on a very Brazilian debate, and the answer is bound up with the deforestation amnesty.
This is only partly a political debate; it also reflects a cultural shift in Brazil. In last year’s presidential election, the Green Party candidate, Marina da Silva, won almost a quarter of the vote, mainly in the cities where three quarters of Brazilian live. In a process that has parallels to recent US history, Brazil’s rural population is falling fast, as land ownership consolidates and economic opportunities in Brazil’s increasingly dynamic cities pull people off the land.
The result is a political and cultural fracture in Brazilian agriculture between modernizing and traditionalist wings. Traditionalists feel insecure, undermined as the rural population declines, misunderstood by an increasingly urbanized country, and angered by the refusal of many of their compatriots to buy into the traditional line that environmental considerations should take second place to the rush for development. They find it difficult to understand, for example, why many supermarket chains in Sao Paulo are demanding deforestation-free beef.
The modernizers tend to be larger farmers and ranchers, with capital, technology and close links to the agribusiness companies they sell to and source from. More than anything else they want clarity about their environmental obligations, so they can get compliant as quickly as possible. They are very wary of a deforestation amnesty: they know how it will immediately be used as a cudgel by American and European competitors to damage Brazil’s image in the cut-throat commodity markets they operate within. Plus they don’t like being played for suckers: most of them have made serious efforts to get into Forest Code compliance and spent serious money in the process. If a deforestation amnesty goes through, they wasted their time and resources.
That’s why Senator Abreu is in New York. The modernizing wing of Brazilian agriculture both attracts international investment and is itself a major investor in agriculture around the world. Investor opinion in New York has impacts all the way down to Brazilian farms, and Senator Abreu, no fool, knows that perfectly well. She knows the hostility the idea of a deforestation amnesty meets with in Manhattan, and the need to shift opinion there as well as in Brasilia.
So the only thing she can do is justify the amnesty in terms of the economic hit it would allegedly represent to Brazilian farmers if it doesn’t pass, since that’s the kind of argument she thinks investors will understand. But the sources of her figures aren’t clear, and Disraeli would certainly have something witty to say about them: the 173 million acres allegedly lost to production if an amnesty doesn’t go through would represent almost three times the total area of soy in Brazil, Brazil’s biggest crop in terms of planted area. Such wild exaggerations are characteristic of the ruralista approach.
The real issue here is that Brazil is successfully intensifying production and has been for years: the ethanol industry is a textbook example of how to expand planted area over pasture, and the soy industry is now following the same path. There are places the Conservancy is working, such as Paragominas in the Amazonian state of Para, where output is being increased at the same time as smart conservation is preserving biodiversity. The idea that the only way to expand production is by expanding planted area has long passed its sell-by date: the modernizers know the way forward is sustainable intensification. Far from representing an economic hit to farmers, not passing a deforestation amnesty gives exactly the right signal.
It rewards compliance, intensification and the most efficient use of land, and encourages farmers to increase returns by focusing more on yields and efficiency, as well as expanding planted area more carefully and responsibly, channeling expansion into areas that have already been cleared.
There are many other things one could say in response to Abreu’s scaremongering, such as pointing to the wide array of subsidized credit lines available for farmers needing to get into Forest Code compliance, or the fact that the majority of Brazilian farmers are smallholders, who all parties agree should be dealt with more leniently when deforestation limits are applied.
But perhaps the key observation is that Brazil’s rather impressive new president, Dilma Roussef, appears to understand the central issue perfectly well: any amnesty carries within it the seed of another. The precedent it sets will encourage all farmers to ignore any limits on land clearance in the revised Code, and lobby for another amnesty in the future. Even the modernizers, reluctant to be played for suckers a second time, will think twice. In other words, the worst possible outcome for Brazil’s international image, the competitiveness of its agricultural exports, the productivity of Brazilian farmers, and specific agricultural sectors in Brazil, like ethanol and soy, which have made painful choices and moved towards greater environmental responsibility in recent years. With Brazil’s national interest in such direct play, and the international spotlight about to fall on Brazil with the Rio +20 conference scheduled for 2012, the World Cup for 2014 and the Olympics for 2016, even if the amnesty passes in Congress a presidential veto looks the most likely outcome.
(Image: Southern Bahia forest cover on the Nova Angelica farm, Bahia, Brazil. Image credit: © Gilbert Tiepolo)