Na entrevista para o Wilson Center, o economista e empresário Denis Minev discute as alternativas sustentáveis para o desenvolvimento da Amazônia. E sugere envolvimento da comunidade internacional para viabilizar o sonho de tantas gerações: a Bioeconomia, a mais coerente e mais sustentável saída para a região, para a floresta amazônica e também para o Brasil. As condições para tanto, entretanto, não estão colocadas. Por isso precisamos de investimentos robustos, não para financiar aviões-tanque para apagar queimadas, elas acontecem no mundo inteiro, e sim para gerar uma economia de longo prazo, sustentável e justa.
Confira a entrevista, em inglês:
Para acessar a versão em português utilize a ferramenta de tradução disposta no site enquanto a tradução oficial do BAA ainda não está disponível
Interview with Denis Minev
This interview has been edited and condensed for clarity
To begin, can you please describe briefly the intertwined challenges you see in Manaus and the Amazon region that are related to Covid-19 and deforestation? How do you think the two crises are influencing and will influence each other?
Covid-19 is striking the Brazilian Amazon with incredible speed. Manaus had its peak in late april and by mid-May the virus had already killed more than 0.15 percent of its population (if we consider excess deaths over normal). The disease is now moving to the interior and to other states in the region. It seems to me that our society is not very conducive to social distancing, so even closing commerce will not reach the level of social distancing necessary to avoid a catastrophe. the only good characteristic of the region is its demography in terms of age: we are generally a very young population, while COVid-19 strikes with more deadliness in older populations.
As COVid-19 leaves in its wake financial stress, state and municipal governments will have to make choices on what to cut and what to keep. Indebtedness will grow as state revenues plummet: early indications are of around a 30-45 percent decline for the month of May 2020. I suspect in this scenario no government will choose to maintain strong investment in environmental protection.
A second effect is that many people have left Manaus because of economic closures. In my view, it is likely that cities may lose some importance, at least temporarily, to the countryside, as livelihoods dry out and businesses fail. Anecdotally, boats are leaving Manaus for the interior full and returning empty. What all these productive people will do in the interior is unclear, but i suspect it cannot be good for deforestation.
Additionally, Manaus has historically acted as a magnet for entrepreneurs from the interior, who find a lot of opportunities in this mostly industrial and commercial city. Opportunities in Manaus are in industry and services, and so they generally have nothing to do with the forest, and hence have no impact on deforestation. As Manaus loses some of its economic power, it is likely many people will undertake enterprise in the interior, where the most promising opportunities are generally related to land use.
Can you tell us a bit about your career in state government, and about the organizations you founded?
I worked at the State government of Amazonas from 2007 to 2009 as Secretary for Planning and economic development, a period when Amazonas had a GDP growth rate above 10 percent per year and deforestation rates were falling by almost 50 percent. The year 2009 remains the best year on record for fires and deforestation in the state of Amazonas.
We implemented sensible policies that discouraged deforestation for cattle breeding and encouraged highly productive activities in deforested areas, such as fish farming. We also connected some forest products with industries in Manaus, the most notable example being a Michelin tire factory in Manaus using local rubber. We doubled investment in research and development in Amazonas in three years, despite a budget shortfall caused by the 2008 international crisis. We also initiated relations with California for what would eventually become the governors’ Climate and Forests (GCF) task Force, an important subnational initiative to tackle climate change.
After leaving the state government and going back to the private sector, i remained involved in some causes, including through cofounding two NGOs: the Fundação Amazonas Sustentável and the Museu da Amazônia.
The Fundação Amazonas Sustentável is a foundation created to protect stateprotected areas. It is simple for the government to establish a protected area on paper; it is another story altogether to truly make it protected. We set up partnerships with companies (Bradesco Bank, Coca-Cola, Samsung, and my company, Bemol, among many others) to create incentives for populations living within protected areas to become their defenders. We do so by helping improve living conditions through sustainable economic activities. We have been quite successful so far; many of our protected areas are in the arc of deforestation, the area most likely to be deforested; we have been working in these areas since 2008 and there has been no significant instances of deforestation in any of the protected areas we help manage, which cover an area equivalent to 150 thousand sq km (the size of illinois).
The Museu da Amazônia is an institution established in a protected area near Manaus focused on education, science, and tourism. It is supposed to be a place for children in Manaus to be exposed to the forest and learn its wonders. it is supposed to be a place where tourists can come and see the fish, the insects, all the wonders of the forest. And it is supposed to be a place where science is developed as well. We are open and growing, at least we were until Covid-19.
You have described deforestation as a “by-product of a bad system.” Can you explain this idea further?
Deforestation is a problem, in my view, that you cannot tackle by itself. You have to look at it from four perspectives: the environmental perspective, of course, but also the economic, social, and political perspectives.
I like to recount a story from 2007. I was secretary for planning of Amazonas, and a city in the neighboring state of Pará called Tailândia (nothing to do with thailand) was identified as the worst deforester in the Amazon. There was great international outrage (as there is from time to time) and the military was sent there to fix it (as it is from time to time). With the military in the streets, the people of the city initially revolted but then were pacified by force; when the military left (as it eventually has to) everything there went back to normal.
What really happened? It is a city of 30,000 people whose main economic activity is lumber mills. All the lumber processed is illegally extracted from neighboring forests. These neighboring forests have no title, mostly belonging to the federal government or with unclear (and many times multiple disputed) owners. Everything that went on in that city was illegal or informal. Commercial establishments have no title to the land they are on, pay no taxes, exist only physically but not in the “books.” Many people have no government-issued ID. People there sell goods and food in the market with no permit to do so. Very few people pay income taxes (most of those who do are municipal employees).
In such a situation, there can be no wealth accumulation, no long-term prosperity. There can only be short-term gain. illegal deforestation not only makes sense in this situation, it thrives where there will be no consequences; there is a real economic incentive to deforest. The mayor, elected by the people, will support the people’s economic activities as they exist. So you have political, social, and economic aspects that have to be deconstructed in order to truly tackle deforestation. Anything else is
temporary and costly. I am sad to say that in 2020, much remains the same.
How can we make deforestation not make sense? The quick answer, to me, is to start to formalize the economy. Make sure people exist economically, have ids, have bank accounts. These seem like simple things, but bureaucracy sometimes forces people to go get permits in Belém, the state capital that is 300km away (and this is close by Amazon standards) and wait there for days. People cannot afford to do that, so they don’t.
In my view, in the formalization process, the most important issue, but also a very controversial one, is to get people property rights over the land. There is significant literature, from ronald Coase to Hernando de Soto, showing how property rights change economies for the better. If one has title to the land, one can start to accumulate capital, one can guarantee a loan, one is responsible for it. Of course, the flip side is that one also has rights to use part of the land (20 percent in current Brazilian law). Additionally, many environmentalists worry that giving property rights will encourage land invasions or reward bad behavior. Though that may be true, i see no other solution to the deforestation problem. There may also be more legal deforestation in the short term, as the forest becomes more valuable economically, but legal deforestation is such a small slice of the total that i believe it unlikely to overtake the current total tally. the alternative is a sequence of short-term repressive measures, intermittent international pressure and condemnation, and continuous and permanent poverty. no one in the Amazon should accept it.
Part of the consequence of a bad system is that you mostly attract bad players and drive away good ones. For example, i know of no significant businessperson in the state of Amazonas that has earned a significant portion of his or her money from activities related to the forest. The people involved in forestry activities in Amazonas, as i see them, can be divided into three groups: the foreigners who do it for an ideal (e.g., Mil Madeireira or Precious Woods), the local dreamers (who live at subsistence level), and the illegal foresters.
In order to attract good businesspeople, there have to be clear rules, good land titles, and long-term, stable perspectives. I have financed two startups that have tried to engage in sustainable forestry in the region; both have failed, amid enormous bureaucratic challenges and senseless laws.
From that experience, i learned that one cubic meter of generic wood in Manaus today fetches either r$100 (for illegal wood) or r$700 (for legal wood). Despite the enormous difference, the only type available is illegal. Why? Why do people choose to do it illegally and earn seven times less?
The answer unlocks the system. to dissolve the problem of deforestation, forest dwellers have to see the value of being legal
(i believe they do already today) and they have to see a path to being legal (i believe they do not today). Making the Amazon a formalized economy is the task of a generation. The unfortunate news is that we are not moving in that direction today. No one seems to be ready to have this conversation while polarization abounds.
For international policymakers and international NGOs concerned about the Amazon, what do you see as the most promising policy levers for incentivizing good behavior in the current economic and political climate?
As i mentioned previously, the politics of fighting deforestation in the current system are not favorable. The people of Tailândia will pressure their mayor. The mayor of Tailândia will pressure the governor. International pressure in the opposite direction may be temporarily effective, but then the international community moves on to the next shiny emergency (north Korea, Covid-19, african immigration, civil war in Syria), and everything goes back to normal.
That is why i think there are issues that are not acrimonious, where cooperation may be more productive. For example, science. Everyone (including the mayor of tailândia and the governor of Pará) agrees more knowledge and more knowledgeable workers will make for a better future. But we have never chosen to truly invest in doing science in the Amazon. Every government has paid lip service to it, but has not done it truly, not when you look at the numbers. For example, INPA, Brazil’s national institute of research in the Amazon, has an annual budget that is now less than $15 million. It has never been significantly higher. No one will do true research with such a budget. We should be spending a hundred times more: $1.5 billion is not an enormous sum internationally. And that amount would change the Amazon.
Let me do quick math with $1.5 billion. One Phd in SteM (science, technology, engineering, or math) at the state university in Manaus has a cost of approximately $60,000. So, $1.5 billion would produce 250,000 Phds (many more than are needed). The state of Amazonas today has less than 5,000 Phds in all areas.
Of course, this is just a mental exercise, many more investments would be needed, but it gives us the magnitude of the challenge.
Then, and only then, could the Amazon be called on to develop a biotech industry or to try to engage in a green revolution. That is because a green revolution has nothing to do with the natural resources you have, but everything to do with the people you have. The people we have in the Amazon today will not execute a bio-based economic strategy. We have not paid the table stakes to play this game. It is nice to hear the world argue about what the Amazon should do, but suggestions need to be within the realm of possibility and not pipe dreams. I believe that is one thing the international community can help us with: turn what seems like a dream today into reality.
The results long term would be much better than sending us fire-fighting airplanes. But i do understand that an international community and NGOs fueled by fundraising may not find that topic to be emotionally-riveting enough to move voters or impassion donors.
What about for NGOs or private entities such as business groups in Brazil? what are most promising opportunities at present?
It has to be attractive for private players to invest in sustainable activities in the Amazon. It is not; the evidence of it is that there are no mid-size companies successfully investing in anything sustainable related to the forest. There are many pilot projects; we have been doing pilot projects forever, and they never gain scale. Pilot projects will not change the system. They will not render deforestation useless.
This is of course a complex argument, not easily translated into a tweet. NGO’s and private entities hoping to get engaged should take the time to understand the system; i believe, in general, they have not.