Who is profiting from the "development" that led to these fires?

Amazon forest burned out - Ricardo Moraes / Reuters

In response to the global fury at these fires, Brazilian President Jair Bolsonaro has played up his nationalist rhetoric: What right does the rest of the world have to tell us what to do with our forests? But this is not about foreigners telling Brazilians what to do with their natural resources. This is about people around the world standing up for the Amazon’s globally vital ecosystems in solidarity with indigenous people who call those forests home.

The most recent report from the Intergovernmental Panel on Climate Change made clear that the global food system is a significant contributor to the climate crisis, to the tune of nearly one-third of all emissions. Most of that is from what climate experts call “land use change,” when, for instance, formerly biodiverse Indonesian peatland is converted into plantations for oil palm destined for the bellies of cars in the form of biodiesel fuel or the bellies of people in the form of processed foods. Or when carbon-rich rain forest is cleared to make way for cattle or soy destined for industrial meat operations around the world. Land-use change is on hyperdrive as the Amazon burns.

There are as many as 80,000 fires blazing in Brazil, more than half of them in the Amazon. The Brazilian minister of the environment may be tweeting that the fires are driven by “dry weather, wind, and heat,” but experts disagree. “The blazes are surging in a pattern typical of forest clearing, along the edges of the agricultural frontier,” Science magazine reported. This deforestation has been encouraged, in turn, by Bolsonaro, who has repeatedly said the Amazon should be open for business—for mining, logging, and agricultural purposes.

But this isn’t just about one rogue head of state. To get to the underlying forces of much of the world’s deforestation, from the lush Amazonian rain forest or the carbon-rich peatlands of Indonesia, you need to follow the money: Who is profiting from the development that led to these fires?

Earlier this year, the U.S-based nonprofit Amazon Watch, which has worked closely with indigenous groups in South America for 20 years, published an analysis showing that “foreign investors have enormous influence over what happens in the Brazilian Amazon … Big banks and large investment companies play a critical role, providing billions of dollars in lending, underwriting, and equity investment.”

These investors have helped stoke the growth of the beef and soy industry in Brazil, irresponsibly and inexorably, regardless of their intention, putting the Amazon in the crosshairs of agribusiness. In recent years, Brazil has emerged as the world’s largest exporter of beef and soy. Brazil accounts for roughly 20 percent of the global beef-export market. Together, Brazil and its nearest rival, the United States, account for 83 percent of the global soy export; its biggest markets are found in the EU and China. (As trade wars intensify between the United States and China, observers worry that demand for these Brazilian products will only grow.) Cattle ranching accounts for 80 percent of rain-forest destruction in Brazil, according to the Yale School of Forestry. As the soy-export market grows, so does demand for land to grow the commodity—another key driver of deforestation.

In its research, Amazon Watch found that just a handful of global financial companies have been profiting from these exports. The global agribusiness giants Archer Daniels Midland (ADM) and Bunge dominate Brazil’s soy-trading market. Their major shareholders include Vanguard, State Farm, BlackRock, State Street, and T. Rowe Price. Collectively, these financiers own more than $9 billion of investments in these two companies. The privately held U.S.-based Cargill and Netherlands-based Louis Dreyfus are the other two companies that dominate global grain trade. As for the banks providing lines of credit to these agribusiness giants, five provide the lion’s share: BNP Paribas, JPMorgan Chase, Barclays, Bank of America, and Citigroup. Together, these banks “provided more than a billion dollars in credit apiece,” according to Amazon Watch.

The major Brazilian beef companies—JBS, Marfrig, and Minerva—also have significant investments from foreign sources. JBS, for instance, has investments from Capital Group, BlackRock, Fidelity Investments, and Vanguard, while three banks—Santander, JPMorgan Chase, and Barclays—provided the company with nearly $1.2 billion in underwriting in the past five years.

Global companies do more than simply provide financing for agribusiness interests in Brazil. Consider the U.S.-based investment firm Blackstone (not to be confused with BlackRock), owned by a mega-donor to both Senate Majority Leader Mitch McConnell and President Donald Trump. According to The Intercept’s Ryan Grim, Blackstone has been a major force behind huge agribusiness and infrastructure projects in Brazil, including a controversial highway and a major port—all in former rain-forest areas and all to expand agribusiness export markets. “Blackstone has also launched two funds dedicated to buying farmland in Brazil and other South American countries,” Grim stated in his newsletter.

And yet Blackstone has tried to spin itself as climate-conscious, issuing a statement to The Intercept that read, in part, “Blackstone is committed to responsible environmental stewardship.” Similarly, earlier this year, the BlackRock CEO Larry Fink urged his fellow executives to think beyond the bottom line. “Companies must demonstrate their commitment to the countries, regions, and communities where they operate,” wrote Fink, “particularly on issues central to the world’s future prosperity.” Meanwhile, Fink has exulted the “significant opportunities” for investors in Brazil. And after Bolsonaro’s election, he announced the expansion of BlackRock’s operations in the country. (Keep in mind this is a regime that has openly celebrated the country’s two-decade-long military dictatorship, has called land defenders “terrorists,” and lamented ecological land protections that “hinder development.”)

Other companies doing business in Brazil have publicly pledged to address deforestation in their sourcing, but reporting on the ground raises questions about whether these commitments are being realized. Cargill, for instance, has “pledged to eliminate deforestation” and ADM has committed to “no deforestation” in its “most critical supply chains.” But the advocacy group Mighty Earth reported as recently as July 2019 that Cargill’s trading is “closely associated with deforestation.” And just last year, the grain-trading giants Cargill and Bunge were fined millions for buying soy from land that had been embargoed for illegal deforestation in Brazil. “The bad business practices of these leading actors send signals that their suppliers can continue to violate the law and continue to be rewarded with access to global markets,” Christian Poirier of Amazon Watch told me.

I stopped eating beef decades ago, inspired by the concern for biodiverse hot spots and the evidence that industrial beef wastes precious land and other resources to grow feed for livestock, not for people. As the climate crisis worsens, dialing down demand for industrially raised meat is certainly crucial. But so is upholding the rights of indigenous peoples who protect the Amazon; exposing financial institutions that profit from rain-forest destruction; and condemning elected officials bankrolled by these institutions. Consumer action and regulation are needed to ensure that companies don’t just make nice-sounding climate pledges but actually change their business practices up and down their supply chains.

 

(*) Anna Lappé is the Author of Diet for a Hot Planet

 

The Amazon Cannot Be Recovered Once It’s Gone

The fires blazing in Brazil are part of a larger deforestation crisis, accelerated by President Jair Bolsonaro.

ROBINSON MEYER - AUG 24, 2019
The fires have been particularly bad in the state of Amazonas.REUTERS / UESLEI MARCELINO

The Amazon is burning. There have been more than 74,000 fires across Brazil this year, and nearly 40,000 fires across the Amazon, according to Brazil’s National Institute for Space Research. That’s the fastest rate of burning since record-keeping began, in 2013. Toxic smoke from the fires is so intense that darkness now falls hours before the sun sets in São Paulo, Brazil’s financial capital and the largest city in the Western Hemisphere.

The fires have captured the planet’s attention as little else does. The Amazon is the world’s largest and most diverse tract of rainforest, with millions of species and billions of trees. It stores vast amounts of planet-warming carbon dioxide and produces 6 percent of the planet’s oxygen.

So the Amazonian fires—which have been blazing for weeks and notoriously received less coverage than Notre Dame’s burning roof— seem like a potent symbol of humanity’s indifference to environmental disorder, including climate change.

But climate change is not the primary cause of the wildfires. Unlike, say, most California blazes—which are sparked by accident and then intensified by climate change—the Amazonian fires are not wildfires at all. These fires did not start by lightning strike or power line: They were ignited. And while they largely affect land already cleared for ranching and farming, they can and do spread into old-growth forest.

So the two scariest numbers for understanding the fires are this: There are 80 percent more fires this year than there were last summer, according to the Brazilian government. This surge in burning has accompanied a spike in deforestation in general. More than 1,330 square miles of the Amazon rainforest have been lost since January, a 39 percent increase over the same period last year, according to The New York Times.

Why are these figures so important? Because Brazil’s political leadership has changed in the past year. On January 1, Jair Bolsonaro, a far-right populist who has openly pined for his country’s authoritarian past, was sworn in as president. During his campaign, he promised to weaken the Amazon’s environmental protections—which have been effective at reducing deforestation for the past two decades—and open up the rainforest to economic development.

Now he is making good on that promise. The three Brazilian states with the worst spikes in fire this year are all governed by Bolsonaro’s allies, according to Richard Black, a former BBC journalist and the current director of the nonprofit Energy and Climate Intelligence Unit. The states governed by Bolsonaro’s political opponents have actually seen a decline in fires. And according to allegations by the global news site OpenDemocracyleaked documents show that Bolsonaro’s government intends to strategically prevent conservation projects in the Amazon.

But recognizing that the fires are a political problem as well as an environmental one does not make solving them any easier. Bolsonaro has found success in part by casting himself in opposition to the rich global North. When asked about the fires, he implied that environmental NGOs were behind the burning. After President Emmanuel Macron of France called the fires a crisis, tweeting that “our house is burning,” Bolsonaro co-opted his words, accusing him of a “misplaced colonial mindset.”

That cynical attack points to the difficulty of a remedy. The Amazon rainforest does, in some sense, belong to Brazilians and the indigenous people who live there. But as a store of carbon, it is fundamental to the survival of every person. If destroyed or degraded, the Amazon, as a system, is simply beyond humanity’s ability to get back: Even if people were to replant half a continent’s worth of trees, the diversity of creatures across Amazonia, once lost, will not be replenished for roughly 10 million years. And that is 33 times longer than Homo sapiens, as a species, has existed.