BRAZIL,S ECONOMIC GROWTH, INDIGENOUS RIGHTS, AND

C O N F I D E N T I A L SECTION 01 OF 04 SAO PAULO 000117

SIPDIS

SIPDIS

STATE FOR WHA/BSC, WHA/USOAS, WHA/PDA AND DRL
NSC FOR TOMASULO
SOUTHCOM ALSO FOR POLAD
USAID FOR LAC/AA
DOL FOR ILAB

E.O. 12958: DECL: 03/10/2018
TAGS: PHUM SCUL SOCI EAID ELAB ECON BR
SUBJECT: BRAZIL,S ECONOMIC GROWTH, INDIGENOUS RIGHTS, AND
FORCED LABOR

REF: A) 07 BRASILIA 2289 B) SAO PAULO 39 C) SAO PAULO
49

Classified By: Consul General Thomas White; reasons 1.4 (b) and (d).

Summary
--------------


1. (SBU) Despite the mostly encouraging news regarding
Brazil's rapid economic growth, new trade and industry
development is increasingly coming into conflict with the
country's indigenous communities. The demarcation of
indigenous lands allows for a degree of legal protection;
however, even when the federal government clearly demarcates
a territory for the sole use of the native Brazilian
community, infrastructure projects and agricultural
priorities often trump indigenous rights. The potential for
abuse of indigenous people through forced labor or debt
slavery is also a serious concern as indigenous lands come
into conflict with development. As Brazil's economy
continues to expand, policymakers will be forced to seek
greater balance between development and indigenous rights.
End Summary.

Demarcation: First Challenge
--------------


2. (SBU) Indigenous community contacts told Poloff that the
government's failure to demarcate indigenous lands clearly,
or in some cases at all, is the principal reason the
indigenous are so easily exploited (ref A). Brazilian law
provides indigenous people the exclusive beneficial use of
the soil, waters, and minerals on demarcated indigenous
lands, but indigenous activists complain that communities'
participation in government demarcation decisions is limited
and indigenous lands are not adequately protected from
outsiders who exploit their territories. According to a
variety of human rights contacts as well as the National
Indigenous Foundation (FUNAI),the government agency charged
with handling indigenous issues, non-indigenous persons
continue to engage in illegal mining, logging, and
agriculture, frequently damaging the environment and
wildlife, spreading disease, and provoking violent
confrontations. FUNAI acknowledges that resources available
to protect indigenous lands from encroachment are
insufficient.


3. (SBU) According to the Indigenous Missionary Council
(CIMI),a Catholic Church organization that researches and
provides assistance to Brazil's indigenous, at the end of
2007, 343 native areas had reached the final registration
stage of demarcation. The government was analyzing the
status of 247 additional communities, and 224 had yet to
enter the demarcation process. CIMI experts claimed that
FUNAI had yet to recognize at least 200 contested areas as
indigenous because of pressure placed on the GoB at various
levels by non-indigenous landowners. FUNAI President Marcio
Meira responded that many communities have yet to provide
evidence to their claims as required in order to move the
process forward.

Mining and Agricultural Conflicts
--------------


4. (SBU) According to Jordi Ferere, an activist who started
Sao Paulo's only native languages school, it is common
practice throughout Brazil for large landowners to bribe and
offer kickbacks to encourage judges to ignore clearly-drawn

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indigenous community borders and grant land concessions to
these developers. Carlos Alberto Ricardo helps lead an NGO -
"Instituto Socioambiental" (roughly translated as
"Social-Environment Institute" - ISA) - that strives to
protect both the environment and indigenous rights, and often
partners with individual communities and the Brazilian
federal government to help demarcate boundaries and advocate
for native and environmental initiatives (USAID has worked
with ISA on environmental protection in the past). According
to Ricardo, cattle ranchers are particularly intrusive in
expanding their property boundaries around the areas in the
Amazon with high deforestation rates. Noting that native
reservations in the Amazon are clearly demarcated compared
with the rest of Brazil, he attributed the high incidence of
cattle encroachment on indigenous lands to borders that are
difficult to detect or defend. Ricardo explained that some
of the reservations are so large even the indigenous that
inhabit the area have a hard time patrolling the boundaries
of their lands and keeping out zealous farmers.


5. (C) Professor Lucia Helena Rangel, a Catholic University
of Sao Paulo (PUC-SP) anthropologist and historian, claimed
that there are some politicians who have broad and diverse
business interests and are involved in allowing farmers to
encroach on native reservations. According to Rangel,
Senator Romero Juca Filho, a former FUNAI president,
erstwhile governor of Roraima State, and presently government
coalition leader in the Senate, is "the chief violator of
indigenous rights when business interests are at stake."
Rangel alleged that Juca, an author of a bill that would open
up indigenous reservations to mining companies, actually
hired mercenaries to intimidate, and at times even kill,
native Brazilians who inhabited areas that could be used for
agricultural expansion. (Comment: We have no evidence
corroborating this allegation, though indigenous activists
without exception label Juca as one of most actively
pro-business and anti-indigenous rights politicians. End
Comment.) On the other hand, ISA's Ricardo said that while
there are cases in which mining companies have unlawfully
entered native reservations, it is not rare for some
indigenous communities to invite mining interests to explore
within the native territories in return for part of the
companies' profits. He noted that when, as frequently
happens, the government fails to uphold the boundaries of
some of the reservations, some indigenous populations are
"realistic" and collaborate with the miners because they know
that they will not be able to force the companies out so they
might as well make some money for themselves.

Infrastructure Incursions
--------------


6. (SBU) Selma Gomes, Coordinator for Indigenous Peoples'
Programs at the NGO Pro-Indian Commission of Sao Paulo
(CPI-SP),stated that native communities in Sao Paulo, the
most populous and developed state, are particularly
vulnerable to development conflicts. Gomes pointed to a port
project between the coastal towns of Peruibe and Itanhaem as
a prime example of the "development versus native Brazilian"
dynamic. According to Gomes, businessman Eike Batista
offered a USD 3 billion plan to build what would be Brazil's
largest port in an area that FUNAI claims is an indigenous
territory inhabited by 340 members of the local Tupi-Guarani
people. FUNAI began studying the village's demarcation
request eight years ago and has petitioned the local
municipalities not to accept any sale in the region until the
boundary limits are defined. Gomes admitted that while the
cities have not yet sold the land, local politicians are

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pushing for the sale because the project would bring
thousands of jobs to their cities.


7. (SBU) Gomes noted that the Rodoanel (ring road around the
Sao Paulo metropolitan area) project is also of major concern
to the indigenous communities in the Paralheiros District in
the far south of Sao Paulo municipality. According to Gomes,
the ring road (ref C),a huge infrastructure initiative
designed to alleviate the municipality's severe traffic
congestion, would require the removal of at least two
indigenous villages. While FUNAI consulted with these
communities and supported their impact studies, she said the
state and city ignored these findings and construction is
under way.


8. (U) ISA is also active in trying to stop construction of
a hydroelectric dam, Paranatiga II in Mato Grosso State, in
an area that 14 indigenous groups consider sacred.
Additionally, the NGO is working on halting the building of
the downstream Belo Monte dam. In both cases, ISA is
providing legal advice to the indigenous communities.
According to human rights contacts, these two initiatives
represent only a fraction of the dozens of dams projected in
President Lula's "Light for All" program, a major federal
government social program designed to generate electricity
for sixteen municipalities in north-central Brazil. (Note:
"Light for All" is partially supported by funding from USAID.
End Note.) While the rural electrification is undoubtedly
needed, many of the proposed dams would infringe on areas
inhabited by indigenous Brazilians.

Forced Labor?
--------------


9. (U) In addition to the land rights issues, a November
2007 case highlights how the rush to develop new businesses
may overlook the rights of indigenous workers. According to
media reports, a Ministry of Labor (MTE) inspection group
responsible for investigating businesses accused of employing
forced labor found 820 indigenous Brazilian "slaves" working
at a sugar and ethanol mill during a surprise visit. The MTE
team promptly shut down operations in the Brasilandia, Mato
Grosso do Sul State plant after finding overcrowded and
unsanitary workers' dormitories. Additionally, the MTE
accused the employer of tax evasion and late payment of
wages. Inspectors found the mill itself to be full of
leaking pipes and fermenting sugarcane byproducts, apt for
the spread of bacteria. The MTE forced the company to
start paying its former employees immediately although FUNAI
reported that many of the laborers had returned to their
villages. Although the MTE acknowledges a historical pattern
of forced labor in the sugarcane field, business contacts
tell us that this is far from the norm in the ethanol
industry or in other sectors of Brazil's growing economy.
They indicate that if indigenous persons are used in forced
labor in some parts of the country, the phenomenon is
extremely rare. (Note: Business views contradict the
findings of the MTE whose mobile inspection teams released
5,877 forced laborers in 2007, 53 percent of which were
involved in sugarcane production. End Note.) Particularly
in the sugar and ethanol industry, business leaders note,
Brazil is moving rapidly towards mechanized harvesting,
reducing dependence on manual labor in the area most prone to
abusive practices.


10. (SBU) Professor Rangel commented that all too often,
native interests collide with sugarcane farmers, cattle
ranchers and logging and mining companies. She said she

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often hears complaints from her contacts about debt slavery
involving indigenous Brazilians in these industries, as well
as in cotton and rubber tapping, particularly in the Amazon,
which she also described as a region lacking law enforcement
oversight. Leonardo Sakamoto, Coordinator of Reporter
Brasil, the largest organization combating forced labor in
Brazil, noted that forced labor may affect indigenous
communities more than the general population as native
Brazilians may be less aware of their basic human rights.
Without significant economic alternatives, the indigenous are
frequently willing to work in poor conditions and get paid
minimal salaries, Sakamoto said. Marcos Terena, a native
Brazilian and director of the Indigenous Community Memorial,
Brasilia's national indigenous museum, said that the greatest
challenge the community faces today is a lack of
capacity-building and training opportunities. Such
vulnerabilities open indigenous regions for forced labor
exploitation. (Note: conflicts with the indigenous in Mato
Grosso do Sul State are more common than in other areas where
native Brazilians live. According to CIMI, 48 indigenous
were killed in the state in 2007, the highest number in
almost 30 years. End Note.)

Comment
--------------


11. (SBU) Brazil's indigenous communities lack the capacity
and political support necessary to check development and
encroachment on native lands. It would take more than
finalizing the demarcation of indigenous lands and excluding
unwanted economic actors from encroaching on their
territories; training the indigenous to work in
non-traditional sectors is vital for their communities to
survive. Additionally, while indigenous activists point to
some successes in stopping development projects, regardless
of land demarcation status, the reality is that the struggle
between industrialists and indigenous interests is going to
continue. The government needs to develop a more coherent
policy to protect and to balance the conflicting interests
and teach the indigenous to survive in this new environment.
Without taking these measures, Brazil's growing economy will
continue to destroy an important element of the country's
cultural heritage, its indigenous population. End Comment.


12. (U) This cable was coordinated with and cleared by
Embassy Brasilia.
WHITE