{"id":50021043,"date":"2019-01-22T15:24:26","date_gmt":"2019-01-22T15:24:26","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=21043"},"modified":"2023-03-12T22:40:17","modified_gmt":"2023-03-12T22:40:17","slug":"21043-brazilian-government-split-on-land-ownership-law","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/justice\/21043-brazilian-government-split-on-land-ownership-law\/","title":{"rendered":"Brazilian government split on land ownership law"},"content":{"rendered":"

China\u2019s state-owned Chongqing Grain Group caused quite a stir in 2010. On traveling to Brazil alongside then President Hu Jintao, the company declared<\/a> it would invest US$300 million in soybean production in the western state of Bah\u00eda.<\/p>\n

The project was one of a series of promised investments and a sign that Brazil and China were integrating more closely. Brazil\u2019s response, however, put a dampener on the plan.<\/p>\n

That year, the Federal Attorney General’s Office (AGU) restricted the purchase of large tracts of land by foreigners, arguing that the new regulation preserved national sovereignty in a strategic sector of the economy<\/a>.<\/p>\n

Since then, pressure to reform the law has only increased and investors and some politicians now hope the new Brazilian government could overturn the AGU\u2019s ruling. However, they face mounting opposition from nationalist factions and environmental groups who say relaxing the law could expose precious biomes to deforestation.<\/p>\n

Chinese pressure<\/h2>\n

Pressure to open the land market comes mainly from China. Growing demand for food and the ongoing US-China trade war<\/a> have led to increased Chinese imports of commodities from its other major trading partners. China is the largest purchaser of Brazilian soybeans. Demand for its other farming products is also growing. China is already the lead importer of Brazilian beef and pork<\/a>.<\/p>\n

The ability to buy land in Brazil would enable Chinese grain dealers to control production lines, eliminate middlemen and keep costs down.<\/p>\n

The foreignisation of land is a process of devastation. It begins in the name of increasing productivity, increasing wealth, and stimulating development, but the money does not stay here<\/p><\/blockquote>\n

\u201cBrazil has lost US$100 billion dollars in investment from around the world in recent years because of this ban,\u201d said Charles Tang, president of the Brazil-China Chamber of Commerce and Industry (CCIBC).<\/p>\n

Tang, who will soon travel to the capital Bras\u00edlia to raise this issue with President Jair Bolsonaro\u2019s representatives, added: \u201cThe entire world wants to attract capital and Brazil has granted itself the luxury of rejecting it.\u201d<\/p>\n

Others, however, believe ending foreign land ownership restrictions would be catastrophic for the country as it would facilitate the destruction of natural resources, displace rural communities and generate conflict.<\/p>\n

\u201cThe foreignisation of land is a process of devastation. It begins in the name of increasing productivity, increasing wealth, and stimulating development, but the money does not stay here,\u201d said Bernardo Man\u00e7ano Fernandes, a geography professor at Paulista State University (UNESP).<\/p>\n

Man\u00e7ano, who leads a research group on foreign land ownership, said only landowners and investors will profit from a change in the law, while rural communities would live an impoverished and precarious existence.<\/p>\n

\u201cIt is a dependent and exploitative model that does not have any benefits for the local population,\u201d he said.<\/p>\n

Cerrado threatened<\/h2>\n

The final text of the bill, proposed by Newton Cardoso J\u00fanior of the Brazilian Democratic Movement (MDB), lifts all restrictions on the sale of land to foreign companies, except in the Amazon. The law requires 80% of land in the world\u2019s largest rainforest to be set aside as preservation areas.<\/p>\n

The Cerrado will be most affected because it is not declared as national heritage in the Brazilian constitution<\/p><\/blockquote>\n

Foreign companies would only be permitted to own a 49% stake in a company with land in the Amazon, according to the law. However, there would be no restrictions on land purchases for concessions such as electricity generation and mining.<\/p>\n

The Cerrado, a near 200-million hectare savannah that extends across central-western Brazil, is where agribusiness is expanding most. It stands to feel the biggest impacts from a change in the law, according to Lorena Iz\u00e1 Pereira, a researcher at UNESP.<\/p>\n

\u201cThe Cerrado will be most affected because it is not declared as national heritage in the Brazilian constitution,\u201d she said.<\/p>\n

Sovereignty versus credit<\/h2>\n

The greatest resistance to foreign land sales in the new government comes from President Bolsonaro himself, who campaigned on a nationalist ticket strong on anti-Chinese sentiment<\/a>. Congresspeople who spoke to Di\u00e1logo Chin<\/em>o say Bolsonaro believes that ending the restrictions would undermine national sovereignty.<\/p>\n

However, the agribusiness caucus, which was one of the strongest political forces to back Bolsonaro\u2019s campaign, supports changing the current law.<\/p>\n

Cardoso J\u00fanior said conversations with the Ministry of Agriculture on changing the law have already begun and that he will resume negotiations in February. Agribusiness-allied government representatives and economy minister Paulo Guedes could change the president’s mind given the scope for new investment, he added.<\/p>\n

<\/p>\n

\"brazilian
Newton Cardoso J\u00fanior, in the centre, in the centre, during the election for new a leader of the party (Fabio Rodrigues Pozzebom\/Ag\u00eancia Brasil)<\/figcaption><\/figure><\/p>\n

<\/div>\n

\u201cIf international capital is to finance something, there must be guarantees. And this guarantee may be the land itself.\u201d<\/p>\n

Since domestic sources of funding are more expensive, external credit for agribusiness could be a bargaining chip in negotiations with the president, Cardoso J\u00fanior said. But he admitted it may be a tough sell for Bolsonaro.<\/p>\n

\u201cWe need to present to him an option that is legally secure but which also guarantees sovereignty,\u201d Cardoso J\u00fanior said. \u201cI believe he could still overturn restrictions if he thinks there is no threat [to it].\u201d<\/p>\n

In light of current restrictions, foreign companies have refrained from investing large sums in Brazil\u2019s land market. But aided by Brazilian law firms, some have managed to exploit legal loopholes or shareholder agreements that guarantee access to land.<\/p>\n

However, this creates uncertainty and prevents companies from officially declaring land.<\/p>\n

In one of his first acts as president, Bolsonaro transferred the power to demarcate indigenous and quilombola lands to the Ministry of Agriculture. Many interpreted the move as a concession to agribusiness and a grave threat to communities.<\/p>\n

\n

6<\/p>\n

\n
\nnew cabinet members have military backgrounds
\n\n <\/div>\n <\/div>\n

According to Richard Torsiano, a former director at the National Institute of Colonisation and Agrarian Reform (INCRA), the government is already preparing to overturn the restrictions.<\/p>\n

Yet nationalistic military factions within government \u2013 six of the 22<\/a> new cabinet ministers were appointed from the barracks \u2013 oppose the new law.<\/p>\n

Tang said that if the restrictions are overturned, Chinese investment in land could be worth up to US$2 billion per year, eventually rising to $10 billion.<\/p>\n

According to Cardoso J\u00fanior, forestry has the potential to bring in investment of US$30 to $40 billion to Brazil if uncertainty on the land issue is resolved.<\/p>\n

\u201cWe want to see Brazil opening its doors to investment and creating jobs. If there is stability on the land question, the country will receive a lot of investment. Today the rural sector is strategic for the country.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Environmentalists and communities fear the consequences of changing 2010 foreign ownership regulations<\/p>\n","protected":false},"author":50000003,"featured_media":50021049,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[50039900],"tags":[13887,544,559],"hashtags":[],"country":[50000021,20000110],"class_list":["post-50021043","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-justice","tag-conflict","tag-finance","tag-land-rights","country-brazil","country-china"],"acf":[],"yoast_head":"\nBrazilian government split on land ownership law | Dialogue Earth<\/title>\n<meta name=\"description\" content=\"Environmentalists and communities fear the consequences of changing 2010 foreign ownership regulations\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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