Seven Federal States and the Federal District Concentrate 80% of the GDP

And nevertheless Pará is the champion of economic activity.

About 80% of the Gross Domestic Product (GDP) of Brazil is generated by only eight of the 27 states of the Federation, concentrated in São Paulo, Rio de Janeiro, Minas Gerais, Rio Grande do Sul, Paraná, Bahia, Santa Catarina and the Federal District.

The concentration of the GDP in eight regions reduced by 1% (from 79.7% to 78.7%, equivalent to R$ 23.7 billion (USD 10.8 billion) between 2002 and 2006, while the Northern Region increased by 0.4%.. São Paulo alone realizes some 34% of the Brazilian GDP.

The survey of the IBGE also shows the per capita GDP in the regions. At this moment, the Federal District still has the highest GDP per capita (USD 17,090), almost three times the national average (USD 5,767) and well ahead of São Paulo with USD 8,885 and Rio de Janeiro with USD 8,043.

Pará, with all its minerals (iron ore, gold, diamonds, bauxite and whatever you want) letting his soil be robbed for a pittance, Pará with its obviously inexhaustible stock of hardwood illegally cut down and disappearing, Pará with its abundance of fish in its inner waters but ransacked scot-free, Pará does not belong to the above mentioned list of Prime Producers, Pará has just officially an insignificant share in Brazil’s GDP.

Nevertheless Pará is the undisputable leader. A sad leadership. Ranking No. 1 at the list of slave labour.

Pará remains at the top of the list of slave labour in Brazil. According to the Ministry of Labour and Employment (MTE), just this year, the Special Group for Mobile Labour Inspection held 28 operations throughout the state, during which 592 workers who were in conditions similar to slavery were “freed”. Above that a 1.000 bookings for misconduct were issued and for more than R$ 1.6 million (USD 730,000) payments for compensation and arrears of wages cashed.

The MTE calls attention to the growing rates of slave labour in states that until then, did not appear on that list. Among them, Goiás and Alagoas.

According MTE, this scenario is directly linked to the expansion of the sugar cane industry, a major protagonist in the international market for bio-fuels. And in the southern region of the country, an increase in the number of enslaved labourers is detected in fazendas which grow pine, a species widely used for reforestation. In both cases, the indecency is that slave labour is being used to support activities theoretically sustainable, for which the basic principles as respect for the environment and concern for the social aspect should be fundamental.

'Methanol is a 'clean' energy in regard to the environment. But we need it also to be clean in the sense of respect for those who work in the production of it", said the president of the Sindicato Nacional dos Auditores do Trabalho (National Association of Labour Prosecutors), Rosa Campos Jorge.

To prosecutor Jonas Moreno, the increase in the number of ‘freed’ labourers reflects the intention of the Brazilian government to step up the enforcement actions to repress this rank injustice.



In other words there are still a lot of slaves out there to be ‘freed’.

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An irreversible trend - It's the economy, stupid!

In Brazil energy products derived from sugar cane were responsible for 16% of the total energy supply in 2007, holding the second position in the total of consumed energy, surpassing for the first time hydraulic power, which supplied 14,7% last year, according to preliminary data released in the balance by the Empresa de Pesquisa Energética (EPE), Brazilian’s Energy Research Company. The fossil-oil and derivatives remained in first place as an energy source, with a 36,7% stake.

The energy consumption rose with 13,5 million tonnes and of this more than 70% was from renewable sources. Once again, renewable energy of sugar cane grew most with 41,4%. The share of renewable energy in the matrix of Brazilian energy increased from 44,9% in 2006 to 46,4% in 2007.

The number of vehicles using bio-fuel exceeded five million in April 2008.

According to the chairman of EPE, the domestic consumption of energy, which takes into account any final energy consumption by individuals, companies and processing, grew 5,9%, more than the GDP, which advanced 5,4%. Of that total, according to him, there was an increase of fuel consumption with a 7,3%, against a 5,4% increase of electric energy, compared with 2006.

“For the first time energy supply from cane sugar exceeded hydro electric energy and became the second source of the Brazilian energy matrix, after fossil oil. I believe it is an irreversible trend” the president of EPE stated. At the end of the presentation of the energy balance of 2007 he defended the production of Brazilian ethanol, saying: “In Brazil, we have sufficient soil to increase the production of ethanol without affecting the production of food”, when asked about the criticism that the production of ethanol affects the prices of food in the world market.

Obviously so far so good. Brazil is a world example for renewable (green) energy resources, thanks to President Lula’s cuddling of his darling pet, promoting his fads and fancies with pride and little essential knowledge during all his official international visits with potential buying countries. Stubbornly fighting off his critics as even his Latin American colleagues call him a traitor.

It is a fact, the country’s emergence is partly accelerated by bio-fuels as bio-fuels have become the vanguard of the green-tech revolution. For politicians and corporations the trendy way to go as most of the damage created by bio-fuels is less direct and less obvious.
Indeed only a tiny portion of the Amazônia region is being torn down to grow the sugarcane that fuels most Brazilian cars. The shocking explosion of deforestation is a result a subtle chain reaction: Farmers in the USA are selling one-fifth of their corn to ethanol production, so US soybean farmers are switching to corn, as a result Brazilian soybean farmers are expanding into cattle pastures, so Brazilian cattlemen are displaced to the Amazônia.

Amazônia rain forest pushed back by large areas of soybean fields in the state of Mato Grosso

So far Lula’s ‘green’ positioning on bio-fuels is correct. Sugar growers here have a greener story to tell than do any other bio-fuel producers. They provide 45% of Brazil's fuel (all cars in the country are able to run on ethanol) on only 1% of its arable land. They've reduced fertilizer use while increasing yields and they convert leftover bio-mass into electricity. With the slogan: "Grain is good for bread, not for cars. But sugar is different." their trade group expects production to double by 2015 with little effect on the Amazônia.

So far, they are right. Corn ethanol and soy bio-diesel produce about twice the emissions of gasoline. Sugarcane ethanol is much cleaner, and bio-fuels created from waste products that don't gobble up land have real potential. So, obviously the Amazônia region is safe.

But take a look at the Cerrado, south of the Amazônia region, an ecological jewel in its own right.

Map of the Cerrado eco-region. The limits of the eco-region are marked in yellow.

Photo: NASA

The Amazônia gets the ink, but the Cerrado is the world's most bio-diverse savannah, with 10.000 species of plants, nearly half of which are found nowhere else on earth, and more mammals than the African bush. You can watch toucans and macaws, find puma tracks and admire a carnivorous flower. The Cerrado's trees aren't as tall or dense as the Amazônia ones, so they don't store as much carbon, but the region of some 2 million km2 (50 times the Netherlands) stores its share. Or should we say ‘stored’ its share, as it is transforming by the march of progress - first into pastures, then into sugarcane fields.

Caracteristic vegetation in the Cerrado

But also in another way sugarcane is a shady business. Sugarcane is a typical product from the slave era and that is exactly what it still is.

In 2007, the federal government freed 3.131 “sugar cane” slaves. In the same period the Brazilian Bank for Development released 3,6 billion USD for projects of the sector.

The Cerrado near "The three lakes" - Mato Grosso do Sul

Almost daily there are stories in the news papers about rescue of sugarcane labour (including children) working under - what is now euphemistically called – a “degrading situation”, but in fact is just pure and simple slavery.
But let us just have a look at one:

In March 2008 the papers headlined, after the Ministry of Labour and Employment visited the premises of a company called Brenco (Brazil Renewable Energy Company, note that this Brazilian company has an English name and you will see why):
- Workers of Brenco are living in precarious housing
- Investigating Brenco ends with 17 labourers freed and 140 “slave” contracts terminated

Brenco is commanded by the former president of Petrobras, Brazil’s giant state-owned petroleum company, Henri Phillipe Reischtul.
Brenco has, among its shareholders, the former US President Bill Clinton, James Wolfensohn, former World Bank chairman, Steve Case, former America Online (AOL)-Time Warner, and Vinod Khosla, multimillionaire Indian rooted in the United States who founded the Sun Microsystems. Not by any means the ordinary slave driver you should expect.

But the story does not end here. In August 2008 Brenco reached the headlines of the news papers another time:
The BNDES (Brazilian’s Bank for Development) releases 1,2 billion USD to deploy four units of sugar cane processing in Mato Grosso, Goias and Mato Grosso do Sul (all Cerrado states). In all, the units will install 15 million tonnes of sugar cane grinding capacity per season, producing 1,4 billion litres of alcohol. And the market could sell up to 220 MW of energy through cogeneration. The project has an estimated investment of 1,8 billion USD, with the BNDES entering with 2/3, although, the BNDESPar should get only some 15% to 20% of the shares of the venture. According to the bank, the venture will generate 8.400 jobs and will run a fully mechanized harvesting.



In regard to the “progressive social policy” of a President who was a militant union leader first, do you understand this? No? Neither do I.
But Clinton himself gave us the answer to this apparent contradiction when he was campaigning for US president in 1992: "It's the economy, stupid!"

Note:
For this post I used some text extracts from the article in Time Magazine “The Clean Energy Scam” by Michael Grunwald published March 27, 2008. The story and facts relating to slavery I took from the websites of Leonardo Sakamoto and Repórter Brasil. Both websites are worth visiting, although unfortunately they are only in Portuguese.

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