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Can the Amazon survive the Brazil economic boom?

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Robin Lustig | 11:24 UK time, Friday, 24 June 2011

Just a short post to say I'm deep in the Brazilian state of Mato Grosso, heading for the Amazon rainforest.

The plan is that next week, together with the BBC's economics editor Stephanie Flanders, we'll be broadcasting a series of reports on Radio 4, BBC-1 and online, in which we'll be looking in some detail at Brazil's extraordinary emergence as a major global economic power.

Is the growth sustainable? What's the environmental cost, particularly here in the Amazon, where there are still major concerns about deforestation and the potential impact of rapidly expanding agricultural production on global climate patterns.

And what about the 50 million Brazilians who still live below the poverty line? Are they seeing any of the benefits of this economic bonanza?

What about the woman I met just outside Rio de Janeiro, whose house has been bulldozed to make way for a new highway that's being built ahead of the 2016 Olympics?

What about the shanty town dwellers who live in the shadow of Rio's prime football stadium, now being rebuilt to be ready for the 2014 World Cup?

Yesterday I met a farmer here in Mato Grosso who was the happiest farmer I've ever come across. The farmers around here are major producers of soya, which is a main ingredient in animal feed - nearly half of Brazil's soya is exported to the rapidly growing market in China. Soya prices are now at record levels; what's more, the soil and climate here are so good that farmers can get two crops a year out of the same piece of land. In between the two crops, they plant cotton (and yes, cotton prices are also at record levels), and they graze cattle before selling them on to meat processors who turn them into beef for burgers.

All being well, my reports will be on air on The World Tonight next Wednesday and Thursday, and do listen out for Stephanie Flanders's pieces as well, on Radio 4 and on BBC TV news.


  • Comment number 1.

    The original BRIC acronym originated with Jim O’Neill, a Goldman Sachs economist. He analyzed the emergence of these countries as economic powerhouses. Over the intervening 10 years, this term has come to symbolize the growing power of the world’s largest emerging economies & their potential challenge to the developed G7 economies. At the same time, it remains unclear to what extent the BRICS countries represent a cohesive unit.
    In the course of the last decade, the share of world GDP of the 3 main emerging economies — Brazil, China and India — has DOUBLED. Not only have the emerging economies surged, they have also become increasingly interconnected.
    The surge of the emerging economies has been all the more marked since the recent global financial crisis. From Sao Paulo to Istanbul to Jakarta there is a buzz that reflects recent achievements and projects much more.
    Brazil has overtaken G-7 members Italy & Canada to hold the seventh spot.
    As impressive as has been the positive contribution of the emerging economies to global economic growth, quite unimpressive has been their generally negative contribution to global governance. The current state of global governance, of course, is not the fault of the emerging powers. The resistance comes from the established powers. American obstructionism is the biggest obstacle. The floundering economies of the euro zone are causing havoc with the IMF with its privatization and austerity measures. This is why I much prefer Mexico's Carstens to LaGarde.
    The emerging economies formed the G-22 under the combined leadership of Brazil, China, India and South Africa, which effectively, to the great consternation of Washington and Brussels, literally destroyed Western trade hegemony. After this “victory,” however, the G-22 morphed & while US-EU leadership has indeed been wanting. What BRIC now needs to learn is how to say to the big powers: "Oh, no you don't!" while saying, "We can do it on our own!" When this happens, watch out.
    All being well, I look forward to your report on The World Tonight next Wednesday and Thursday, and I will listen to Stephanie Flanders's pieces as well, on Radio 4 and on BBC TV news.

  • Comment number 2.

    It occurred to me that you may be talking specifically about the Amazon damning. Recently, "Amazon Watch" & its legal partners the "InterAmerican Association for Environmental Defense" petitioned the Organization of American States’ Human Rights Division to take Brazil to court over the Belo Monte Dam.
    The 11,200 megawatt hydroelectric power station will be built over a portion of the Xingu River, a tributary of the Amazon River, located in Para State - one of Brazil’s largest Amazon jungle states. The area would cause displacement to some indigenous communities (to create the reservoir). The Brazilian Govt has been denounced, called on the Inter-American Commission on Human Rights (IACHR) to declare human rights violations & cancel the project.
    On Brazil’s side, NO tribal lands will be flooded, anywhere, but 20,000 people will be forced to relocate because of the flooding required to build Belo’s reservoir. However, some river dwelling tribes have said that the dam would threaten Xingu tributaries like the Bacajá River, among others, possibly causing them to dry up.
    The major national indigenous group, called the National Indian Foundation, or FUNAI, agreed that Ibama & Belo Monte’s owners, the private consortium Norte Energia, were in compliance with the environmental & social requirements set forth before the installation permit was issued. Amazon Watch claims that was not the case. A Para state public attorney also filed an injunction against the dam. Injunctions against hydroelectric power in the Amazon are COMMON, with Belo being served 9 times. Each case was OVERRULED by a higher court. Norte Energia is responsible for paying for the property that will be flooded, & either building or finding a new & similar property for the displaced homeowners.
    Indigenous rights are part of the Brazilian Constitution & international agreements such as the American Convention on Human Rights & UN Declaration on the Rights of Indigenous Peoples. Former president Luiz Inacio Lula da Silva said that foreign entities should stay out of Brazil’s business in the Amazon, citing sovereignty over the region to which I would add The Brazilian's Govt careful & humane regard for its people. Around 85% of Brazil’s electricity is powered by hydroelectric dams, making Brazil’s energy cost the cheapest of all large countries...and personally I think this is the reason American organizations are so ready to contest Brazilian progress instead of learn from it.

  • Comment number 3.

    What we do know is that "developed" countries have not really changed the conditions for the poor either. The "trickle down" theory never worked and never will. It is a shell game played by politicians who want to appear empathic. The money-lenders always want control and care little about anything but profit. Self-supporting indigenous peoples are not consumers and therefore do not contribute to the profits of others. Highest use is always determined by profit. Capitalism has changed to Consumerism. big business and consolidated wealth dictate the opportunities of others. Economic history is just that, history. The modern model is simply resting on that shadow for convenience. The poor are less patient with the proposals that their conditions will change in a generation or two. It is more difficult to protest from a grave.

  • Comment number 4.

    Brazil - a wonderful country, a fascinating people, a total shambles.

    I emigrated to the Brazilian Amazon four years ago. The so-called Brazilian Cost referred to by Stephanie (custo Brazil) is the result of the systemic corruption and meaningless bureaucracy which everyone from the President downwards has to deal with on a daily basis. It is this that hamstrings the country now and it is this that will bring it to its knees when the temporary boom is over, in around 4-5 years time or less.

    There is no hope of improvement without a fundamental overhaul of the political, legal, social and fiscal systems, and unfortunately there is no evidence of the existence of the will, the means or the ability to make this happen: on the contrary, the country´s growing wealth seems to be generating more - not less - ignorance and corruption, and hubris reigns.

    The solution of course is education, but this will take much longer than the short time available if the country is to avoid falling into the pit of social unrest and violence it is so energetically digging for itself.

    p.s. Glad to see the BBC is finally taking Brazil seriously.


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