GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia

Chapter 8history of expanding into the Amazon – facilitated by industrysubsidies, poor property protection, and institutionalweakness. Brazil has only recently begun to try tocorrect incentives and halt deforestation, but with mixedresults. It is too early to say whether Brazil will be able tocontrol deforestation successfully, especially if doing sorequires slowing the growth of core industries. However,to do so it needs to make significant progress in imposingrule of law and creating market incentives to enhance thesustainability of these industries.3.1 Background on ranching and agriculture in theAmazonThe rapid growth of ranching and agriculture in Brazil,due to growing domestic and international demand forbeef and soybeans, is the leading driver of deforestationin Brazil.12 To ensure that the recent decline in Amazondeforestation (see Figure 1 above) continues and to reduceGHG emissions in the long run, increases in ranchingand agricultural productivity, payments for avoideddeforestation, domestic and international consumerpressures, and more consistent environmental law enforcementare needed.Much of the expansion of beef production (along withleather and other cattle-derived products) has beenin the Amazon region, and it is estimated that 70% ofarea deforested there is converted to cattle pastureMuch of the expansion of beef production (along withleather and other cattle-derived products) has been inthe Amazon region, and it is estimated that 70% of areadeforested there is converted to cattle pasture (McAllister2008b, 10,875).13 From 1995 to 2006, Brazil’s cattleherd grew by 10%, from 153 million to 169 million headsof cattle. However, “[w]hile outside the Amazon regiontotal numbers decreased by 4 million head, inside numbersincreased by almost 21 million, to 56 million headin 2006” (Greenpeace 2009, 13). During this period, theAmazonian states of Mato Grosso, Pará, and Rondôniaincreased their cattle stock by 36%, 111%, and 120%, respectively.Meanwhile, ranches in Amazonian states haveincreased in size by 90% (ibid.), a result both of the lowprice of available land and the opening up of new landsthrough illegal logging (Margulis 2004). Increases in cattlehead and ranch area correspond to alarming deforestationnumbers: By 2007, Mato Grosso had lost about38% of its original forest area, Rondônia 39%, and Pará20% (Greenpeace 2009, 14-15).143.2 Systemic problems create incentives for deforestationThe relationship between deforestation and the expansionof beef and agriculture in the Amazon involves asystem of perverse incentives provided by the Brazilianfederal and subnational governments, as well as domesticand international consumer behavior. These perverseincentives encourage expansion into the Amazon in spiteof the problems expansion creates. They include weakproperty rights, subsidized credits and tax exemptionsfrom the Brazilian government, weakness of federal andstate agencies, and collusion between state agencies, cattleranchers, and soy farmers. Together, these factors reducethe ability of the federal and subnational states toenforce environmental laws.Like most policy areas in Brazil, environmental governanceis decentralized: The federal Ministry of theEnvironment enacts norms and broad policy, but stateenvironmental agencies have considerable policy andadministrative autonomy. Combined with their relativelylow capacity and periodic collusion with illegal deforestationactivities, decentralization poses risks to theAmazon: Hochstetler and Keck (2007, 151) characterizeAmazonian politics as one of “state absence,” in whichelites refuse to crack down on illegal logging becausethey benefit from the revenues from beef and agriculturalexports.15 Even where the state is present, it maybe unable to enforce environmental laws. Indeed, therehave been several cases of corruption in state agencies:In December 2008, the Federal Ministério Público (PublicProcuracy) charged 33 people – including the formerSecretary of the Environment for Pará – with traffickingin illegal wood in Pará (“Ex-secretário…” 2008). Otherreports indicate that corruption is endemic in Amazonianstate environmental agencies (Hochstetler and Keck2007; Luíse 17 March 2011; McAllister 2008a).Corruption and weak state capacity lead to high ratesof impunity for environmental crimes in the Amazon.Although Brazil’s Ministério Público has constitutionalautonomy and both enforces environmental laws androots out corruption in federal and state environmentalagencies (McAllister 2008a), it cannot always ensurethat punishments for environmental transgressions arecarried out: A 2009 study by the Amazonian Institutefor Man and the Environment (IMAZON) think tankin Belém, Pará, found low rates of punishment for illegaldeforestation in the Amazon’s extensive network ofenvironmentally protected areas, due to the inefficiencyof the police and court system (Barreto et al. 2009). Inthis context, ranchers and farmers often have incentivesto increase production by expanding their landholdings,rather than investing in productivity increases.Expansion of landholdings is also due to lack of effectiveland titling, which when combined with low levelsof environmental law enforcement on the Amazoniandeforestation frontier, worsens deforestation by depressingincentives to invest capital in productivity and raisingincentives to expand horizontally – into neighboringfallow pastures or virgin forests (Barreto et al. 2008).This process exacerbates the problem of illegal and oftenviolent land seizures on the Amazon frontier: Land grabbersinvade and deforest public and unclaimed lands (terrasdevolutas) – as well as the lands of the small settlers,whom they expel – and falsify titles to them.16 In 2009,the Brazilian federal government enacted a program ofAmazonian land titling, part of a larger effort to reducedeforestation by identifying property owners who may be12 In the 2000s, Brazil became theworld’s largest exporter of beef.Beef exports grew over 450% involume and 385% in value from1994 to 2005 (McAllister 2008b,10,875). In 2008, agriculture andranching (including both productionand distribution) accountedfor 25% of Brazil’s GDP, and 36%of Brazil’s total exports (Greenpeace2009, 3). That same year,Brazil accounted for 31% of theglobal trade in beef, and 36% ofthe global trade in soybeans – andits share in each is expected toincrease to 61% and 40%, respectively,by 2018 (ibid., 2).13 Nepstad et al. (2006, 1599) estimatethat “more than 80% of theBrazilian Amazon could sustainprofitable cattle production.”14 Margulis (2004) traces themicro-processes by which cattleranching drives illegal Amazondeforestation: Loggers enter virginforest, build roads, and remove thevaluable timber. They then sellthe land to cattle ranchers. Withoutthe possibility of selling theland on to cattle ranchers, loggers’incentives to deforest would begreatly reduced (Margulis 2004,XVIII).15 “’[I]nstitutional weakness’ and‘absence of the rule of law’ oftencited by studies of the ‘failure’ toenforce environmental standardsor pursue miscreants is not anaccident of recent settlement butrather a strategy deliberately pursuedby powerful operators in theregion for which a more robuststate geared to maintaining lawand order would be highly inconvenient”(Hochstetler and Keck2007, 153).16 Falsification of land titles is widespreadin Brazil, especially in theAmazon, and known as grilagem,after grilo, the Portuguese word forcricket. Sometimes, land grabberswrite a false title, and then place itin a jar with crickets. The cricketschew on the paper, and this makesthe land title look old, so that landagency bureaucrats are less likelyto suspect that the claim is false.88