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Swedish pulp and paper in Brazil: The case of Veracel
Uppsala University, Humanistisk-samhällsvetenskapliga vetenskapsområdet, Faculty of Arts, Centre for Gender Research.
Sthlm Univ.
2006 (English)In: Ecological Debt, The Peoples Of The South Are The Creditors. Cases from Ecuador, Mozambique, Brazil and India, World Council of Churches, Geneva & Troika Press, Quezon City , 2006, 81-124 p.Chapter in book (Other (popular scientific, debate etc.))
Abstract [en]

Of all the natural forest that is lost every year, 94 percent are located in the tropics. Fast-growing wood plantations and pulp production constitute a major threat to the remaining tropical rainforests and to the local populations who depend on these forests to secure their livelihood.

The United Nations Food and Agriculture Organization (FAO) estimates that the global growth rate of tree plantations amounts to 45,000 km2 per year. Asia and South America accounts for 89 percent of the total growth. Brazil has by far the most tree plantations in South America and the majority of the plantations are situated in the south eastern states.

On 28 September 2005, President Luiz Inácio Lula da Silva inaugurated Veracel’s newly-constructed paper mill in the southern cone of the Brazilian state of Bahia. The pulp mill’s annual production capacity is currently 900,000 metric tons of pulp. It is expected to produce the cheapest pulp in the world.

The Nordic Investment Bank (NIB), the European Investment Bank (EIB), and the Brazilian Social and National Development Bank (BNDES) have contributed US$640 million of investments for the pulp mill. NIB contributed US$70 million and EIB US$80 million of this sum. The total cost of the under the current administration. Despite the political enthusiasm for the expansion of the pulp and paper industry in Brazil various movements and groups offer hard resistance against this expansion and environmental organizations from various states have formed a network, A Rede Alerta Contra O Deserte Verde (Alert Against the Green Desert Movement), in order to oppose the construction of pulp mills and the increase of eucalyptus plantations to supply the mills. Veracel owns 700 km2 of plantations. In addition, there are 230 km2 of plantations, which are owned by peasants and farmers contracted by Veracel. A part owner of Veracel is Aracruz, the Brazilian-Norwegian paper and pulp company. Aracruz owns 2,100 km2 and has additional agreements with peasants and farmers planting an area of 380 km2. The large economic consultant institution, Instituto Fundação Calmon, has stated that the potential of growth of the eucalyptus plantations in the region amounts to 15,000 km2. This would mean that, compared to their present size, the size of the plantations would increase several times. There have been some political attempts to legislate against the unrestricted expansion of the eucalyptus plantations. So far, however, the pulp and paper companies have succeeded in lobbying against such restrictions. The opposition against the industry states that the expansion of the pulp and paper corporations has to be limited since:

• The expansion of eucalyptus plantations forces local people- peasants, indigenous groups and Afro-Brazilian subsistence farmers- from their land.

• Pulp and paper corporations appropriate land that otherwise could have been used in the ongoing land reform.

• The plantations increase the price of land, thus making it harder for the state to buy land for land reform.

• The plantations have detrimental effects on agriculture in the vicinity and reduce water availability.

• The plantations obstruct the regeneration of the Atlantic rainforest and have negative consequences for the sensitive flora and fauna of the region.

• The paper and pulp industry generates few new jobs, despite the fact that huge state resources have been invested in this sector.

• The construction and operation of pulp mills have detrimental effects on the environment.

• The construction of the pulp mills attracts thousands of people to the region who do not have the right education to qualify for employment.

The network of environmental and human rights organizations that organizes the resistance against the expansion of the pulp and paper industry in general and Veracel specifically asserts that the ecological conditions have changed since the last Environmental Impact Assessment (EIA) was made. Therefore, the network demanded that a new EIA ought to be carried out before Veracel started construction of a paper mill. Veracel, and the corporations which owns it, Stora Enso and Aracruz, rejected this demand, however. The network is also critical of the fact that the technique used in bleaching the pulp will not be TCF or totally chlorine free. Instead of the TCF-technique, the elemental chlorine free process, ECF, will be utilized. The advocates of Veracel stress the employment opportunities created. This is, however, a contested claim. Most of the land where eucalyptus is grown was previously utilized for extensive cattle-raising. According to one of the most outspoken critics of the paper pulp companies, the priest José Koopmans, the eucalyptus plantations do not lead to any net gain in jobs when compared to cattle-raising and small-scale agriculture. Koopmans and organizations that represent farmers and landless peasants argue that plots where fruits of different kinds are cultivated lead to a significant increase in available jobs. They say federal and state investments should, therefore, be redirected from the pulp sector to small-scale agriculture. Indeed, considering the large sums invested, few vacant jobs were created at Bahia Sul’s and Aracruz’ plants. At the latest plant Aracruz built, 173 direct jobs were created. Taking into consideration the investments made, this shows that every vacant job costs US$3.3 million. Veracel’s plant will generate approximately 500 direct jobs. Another major problem with Veracel concerns its partnership with joint-owner Aracruz Celulose, the world’s leading producer of bleached eucalyptus pulp. The corporation, founded in 1968, has a long and conflict-ridden history. Local people and the network of environmental and human rights organizations fear that Veracel successively will adopt Aracruz’ methods and its inadequate dialogue with nongovernmental organizations (NGOs) and unions. The human rights organization FASE or Federation for Social and Educational Assistance argues that Aracruz has acquired land through false promises, threats and the destruction of sources of subsistence of the local people. FASE claims that there were about 40 indigenous villages in the area where Aracruz was active. After Aracruz had established all of its eucalyptus plantations in the area only three villages remained. In the beginning of October 2005, around 300 Tupinkim and Guarani Indians occupied the administrative center of Aracruz. The Indians demanded that the corporation return 1,100 hectares to them, which they claimed were part of their traditional territory. The Indians withdrew after authorities promised that a new demarcation of indigenous territory will be conducted. The pulp mills have resulted in further deterioration in the living conditions of the local people. The large water consumption needed for the mills made Aracruz redirect the courses of rivers in the region, thus decreasing local people’s access to potable water and fishing opportunities. The resistance against Aracruz has hardened substantially over the last years. There have been attempts to legislate against further expansion of the plantations and in 2002 the state parliament of Espírito Santo appointed a commission to investigate Aracruz’ behavior. Currently, hundreds of labor lawsuits have been brought against Aracruz. So far, however, Aracruz has succeeded in continuously expanding its activities. One reason for its success is the company’s well-developed political network. Aracruz is among the companies in Brazil which makes the largest donations to politicians. Its donations and contacts have paid off. All three of Aracruz’ plants have been inaugurated by presidents of Brazil and the country’s highest political stratum have supported Aracruz.

Place, publisher, year, edition, pages
World Council of Churches, Geneva & Troika Press, Quezon City , 2006. 81-124 p.
URN: urn:nbn:se:uu:diva-21864OAI: oai:DiVA.org:uu-21864DiVA: diva2:49637
Available from: 2007-01-05 Created: 2007-01-05

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