Brazil’s highway auction spurs export hopes but indigenous concerns | Current Affairs in Trade and Economy

Sao Paulo, Brazil – A recent auction sale of a stretch of the so-called “soybean highway” in Brazil – along which millions of tons of grain are transported each year – has boosted hopes that the soybean export boom will continue. countries will receive another welcome boost.

But the July 8 auction on the St. Paul’s Stock Exchange that saw private consortium Via Brasil win the bid to administer a 1,009 km (626-mile) route of the BR-163 highway also raised concern among local indigenous groups.

Critics say the highway concession does not adequately address the costs of mitigating environmental impacts and constitutional commitments to indigenous rights in the South American nation.

“We are not against the rod itself,” said Melillo Denis, a lawyer for the Kabu Institute, which represents 12 indigenous peoples of the Kayapo tribe in the region bordering the highway. “But there are some socio-environmental issues,” Denis told Al Jazeera.

Soybean production

Brazil is the largest soybean producer in the world and today its BR-163 Highway is one of the most important raw material corridors in the country.

Millions of tons of grain from the country’s midwest agricultural center are transported by truck along the highway each year to Amazon river ports, before being shipped abroad, mainly to China and Europe.

But the highway is also notorious for its illegality and synonymous with illegal deforestation, wild cat mining and wildfire fires every year in the cities that ride it, crimes that affect neighboring indigenous communities.

Brazil’s BR-163 highway, built by the military in 1973, crosses what remains of the Amazon rainforest near the city of Novo Progresso, in the state of Para, in this photo from the 2005 file [File: Reuters]

For years, it was also famous for its frightening conditions, with more than 4,000 trucks stopped for more than a week in 2017 due to heavy rains that made part of the then paved road impassable.

Opened in 1976, during Brazil’s military dictatorship, the last 51 km (31 miles) stretch of the BR-163 was paved in 2019 during the first year of far-right populist Jair Bolsonaro’s presidency.

Bolsonaro, a former army captain, is widely criticized by the international community for presiding over the rapidly growing deforestation of the Amazon and what defense groups say is an unprecedented rollback of indigenous rights.

At home, however, it counts soybean truckers and growers among its most loyal supporters and remains very popular in the region on the side of the highway.

In an email to Al Jazeera, a spokesman for the Brazilian infrastructure ministry said that paving the highway “was enough to make life easier for truck drivers, reducing transportation costs by about 26 per cent. and makes the raw materials produced in Brazil more attractive on the foreign market ”.

As for opposition to the highway concession, the spokesman wrote: “The whole process for any concession made by the Ministry of Infrastructure is marked by transparency and legal certainty, fundamental points to attract the investors “.

He added that the BR-163 was just one of 71 transport infrastructure goods that have been leased to the private sector since 2019.

These are common

Highway bids to attract private investment have been very common in Brazil, a country of continental size that relies heavily on trucks to transport supplies across states, but roads are often poorly maintained.

And with the country’s public accounts in the red, the Bolsonaro government has made infrastructure concessions a top priority.

The auction site extends for 1,009 km (626 miles) from the soybean town of Sinop in the agricultural superstate Mato Grosso to the port of Miritituba in Itaituba, in the Para State of the Amazon.

Via Brasil will also be responsible for road maintenance, repairs and development for 10 years and will build three toll booths on the deal sold at auction, according to local media.

Supporters of Brazil’s infrastructure and agricultural sectors say the recent auction will help boost the country’s grain exports, which reached a record 82.9 million tonnes last year.

In addition to the concession of the highway, a separate “Soybean Railway” project is also awaiting approval, part of a push to consolidate Brazil’s northern ports as the country’s main international grain distributors, which the government says it makes exports more competitive.

Indigenous rights

But indigenous reserves and forest conservation areas in the region on the far side of the highway have suffered from a sharp increase in invasions by illegal foresters, ranchers and miners in recent years.

And in Brazil, large infrastructure projects such as roads or hydroelectric dams that affect neighboring indigenous lands can only move forward if companies and the state consult with communities and present plans to mitigate them against any negative effects.

Neighboring indigenous groups have received highway-related payments as part of a plan to address environmental impacts from 2010 to last year, but the second phase from 2020 to 2024 has not yet been defined, mainly due to of disagreements with the government.

A child is riding a bicycle passing a line of blocked trucks along the BR-163 highway in Lucas do Rio Verde, Mato Grosso state, in September 2012. [File: Nacho Doce/Reuters]

A federal judge recently suspended the auction because of important lawsuits over environmental impacts, but that decision was overturned.

Despite the highway concession announced this week, questions about who will make the payments and how much they will be total remain unclear.

“The problem is that the costs to assist (the requests of) indigenous communities have not been defined,” Ubiratan Cazetta, a federal prosecutor, said of the highway concession.

He said that without this clear definition of costs, a game of guilt between the state and the concession society could develop, which could last for years, during which indigenous peoples would not have access to resources to mitigate any environmental effects.

“We are not against development,” said Doto Takak-Ire, a representative of the Kayapó indigenous tribe, whose land is less than 50 km from the highway. “But the Brazilian government is breaking the law.”

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