Forests and Supply Chains in Trouble as “Trump of the Tropics” Could Win Brazil’s Presidency

Brazil’s presidential election on October 28 could prove damaging for the Amazon - and global companies’ commitments to ensure sustainable supply chains - as the far-right presidential candidate’s rhetoric suggests he could reverse years of progress protecting the vulnerable, but extraordinarily important, rainforests.

Deemed the “Trump of the Tropics” by Brazilian journalists, candidate Jair Bolsonaro has pledged his administration would scrap the ministry of environment, open indigenous territories to mining, relax environmental law enforcement and licensing and ban international NGOs from the country. He has also said Brazil would follow in the United States’ footsteps and withdraw from the Paris Agreement.

Edson Duarte, Brazil’s environment minister, warned a Brazilian newspaper that Bolsonaro’s presidency would embolden a wave of illegal miners to purge rainforests without fearing consequences.

“The increase of deforestation will be immediate,” Duarte told O Estado de S.Paulo. “I am afraid of a gold rush to see who arrives first. They will know that, if they occupy illegally, the authorities will be complacent and will grant concordance. They will be certain that nobody will bother them.”

Regulations that become far more lax would be devastating for indigenous peoples living in the Amazon. Brazilian indigenous communities would not only be powerless to watch as miners and loggers exploit their land, but they would also risk extinction because of the threat of disease.

Meanwhile, the political polarization in Brazil would also make it even more difficult for companies that source raw materials from Latin America’s largest economy. “In good times, Brazil’s operating environment presents unique supply chain challenges,” concluded a BCG study last year. “As the country continues to grapple with an ailing economy and political turbulence, these challenges are even more daunting.”

Bolsonaro, who served in the army from 1971 to 1988 during Brazil’s military dictatorship, defended the regime’s initiatives to build roads and hydroelectric dams in the rainforest despite displacing and killing thousands of indigenous Brazilians along the way. He has promised “not to give the Indians another inch of land.”

That attitude is in sharp contrast to what NGOs such as the Environmental Defense Fund (EDF) advocate. EDF, for example, has advised companies to seek cooperation, not confrontation, when dealing with Brazil’s indigenous populations.

Beyond disregarding the Brazilian constitution by disrupting indigenous peoples’ property, Bolsonaro’s complicity would also have wider-reaching environmental consequences. Only 2 percent of the Amazon’s deforestation occurs inside the roughly 13 percent of indigenous lands. Non-indigenous lands are deforested and exploited substantially more than the indigenous lands currently protected by the government.

Bolsonaro’s election would only accelerate the increasing trends of deforestation in Brazil. From 2005 to 2015, Brazil made strong advances toward limiting deforestation in the Amazon, enacting new policies that enforce environmental regulations, funding environmental government agencies and welcoming international NGOs. The improvements were not long lasting, however, as deforestation has skyrocketed in the last couple of years thanks to law changes and budget cuts to the same environmental and indigenous agencies that slowed down deforestation a decade prior.

In March, Brazil’s Supreme Court accepted revisions to deforestation laws, effectively granting billions in amnesty to those found guilty of illegally deforesting. The Forest Code, as environmentalists call it, “awards the guy who deforested” and “invites deforestation,” Nurit Bensusan, policy coordinator at a Brazilian NGO, Instituto Socioambiental, told the Guardian.

The ministry of environment and the federal science budgets were cut 43 percent and 44 percent, respectively, amid a paralyzing economic recession in Brazil. The budgets may also have been a reflection of agribusiness lobby groups’ growing voice in the Brazilian government.

Of the 513 members in the Brazilian Chamber of Deputies, 249 received $18.3 million in official donations during the 2014 election from companies and people who have committed environmental crimes.

The meatpacking industry, key players in the Amazon’s degradation, also played a role in the 2014 elections. JBS, the world’s largest meat producer and major influencer in Brazilian politics, donated a record $108.6 million to finance campaigns. Notably, JBS was rocked by the “Cold Meat” scandal in March, when a three-year probe from Brazil’s environmental agency discovered the meat titan bought 59,000 cows ranched in areas illegally deforested.

If elected, Bolsonaro would continue down the path of his predecessor President Michel Temer. The current president has been accused of being cozy to the powerful beef caucus in Brazil’s lower chamber. Temer appointed one of its members to the minister of justice, halted indigenous land demarcations and agreed to reverse license requirements in large agricultural areas so meat giants could strip the Amazon for pasture. Temer currently has an approval rating of as low as 4 percent in some polls.   

The stakes to save the Amazon from further deforestation are extremely high. Studies suggest the Amazon, nearly twice the size of India, absorbs an estimated 2 billion metric tons of carbon dioxide per year.

The United Nations released a harrowing report, coincidentally the same day as Brazil’s October 7 general election, warning of an irreversible 1.5 degrees Celsius increase by 2030-2052 if drastic measures are not taken to prevent further climate change. A crucial way to minimize harm and slow down that timeline is to preserve the Amazon, one of the world’s largest absorbers of carbon.

Bolsonaro nearly captured the presidency outright during the first-round election, winning 46 percent of the vote - five points away from the majority. He holds a commanding lead over left-leaning Fernando Haddad, who gained 29 percent of the vote on October 7.

This year’s presidential election has been far from normal. Bolsonaro spent the last month of his candidacy in the hospital after being stabbed at a campaign rally. Despite being bed-ridden by an infection, he has maintained his strong lead in the polls, and even received a boost after the assassination attempt.

Haddad, on the other hand, is a fresh face on the campaign trail who just announced his candidacy a month prior to the October 7 general election. Leftist candidate Luiz Inacio “Lulu” da Silva, the widely popular politician and former president of Brazil, was campaigning from a jail cell for months while he awaited the verdict of a 10-year corruption charge for accepting bribes from construction companies. The charge was upheld - and extended to 12 years - and effectively ended his campaign. Lulu hand-picked Haddad to run instead. The campaign’s strategy has done its best to link the two, saying a vote for Haddad is a vote for Lulu. At any political rally for the left, you can hear swarms of people chanting “Haddad is Lulu, Lulu is Haddad.”

Lulu’s corruption charges merely scratch the surface in Brazil, a country that has been no stranger to politicians accused, convicted and impeached from office due to accusations, and then being found guilty, of corruption. The latest marquee corruption scandal in Brazil began to unravel in 2014, when “Operation Car Wash” found that executives at the state oil company Petrobas had accepted bribes from construction companies in exchange for rewarding large contracts. The investigation has led to the arrests of more than 150 people.  

The country’s corruption record, the alarmingly high crime rates, the slow economy and the failure of its neighboring Venezuela has all created a political landscape for Bolsonaro to thrive - and if elected, his policies could create countless headaches for companies that have pledged to ensure the most responsible and sustainable supply chains possible in the coming years - yet rely on Brazil for raw materials and ingredients such as soy, coffee, beef and even sugarcane-based ethanol.

Impacts on business aside, the impact on Brazilian society cannot be downplayed. Anthony Pereira, the director of Brazil Institute at King’s College London, may have stated it best in Time’s article titled “Jair Bolsonaro Loves Trump, Hates Gay People and Admires Autocrats. He could be Brazil’s Next President.”

“This is probably one of the biggest tests Brazil’s democracy has faced,” wrote Pereira.

Multinationals' promises of supply chain transparency and sustainability will be tested, too.

Image credits: Senado Federal/Flickr; CIAT/Flickr