VZCZCXRO0513
PP RUEHRG
DE RUEHSO #0117/01 0701434
ZNY CCCCC ZZH
P 101434Z MAR 08
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC PRIORITY 7981
INFO RUEHBR/AMEMBASSY BRASILIA PRIORITY 9128
RUEHAC/AMEMBASSY ASUNCION PRIORITY 3333
RUEHBU/AMEMBASSY BUENOS AIRES PRIORITY 3085
RUEHMN/AMEMBASSY MONTEVIDEO PRIORITY 2638
RUEHLP/AMEMBASSY LA PAZ PRIORITY 3743
RUEHCV/AMEMBASSY CARACAS PRIORITY 0690
RUEHBO/AMEMBASSY BOGOTA PRIORITY 1658
RUEHSG/AMEMBASSY SANTIAGO PRIORITY 2334
RUEHRG/AMCONSUL RECIFE PRIORITY 4033
RUEHRI/AMCONSUL RIO DE JANEIRO PRIORITY 8627
RUEAIIA/CIA WASHDC PRIORITY
RUEHC/DEPT OF LABOR WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEAWJF/DEPT OF JUSTICE WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEHC/SECSTATE WASHDC PRIORITY 7982
RHMFISS/CDR USSOUTHCOM MIAMI FL PRIORITY

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 
 
SAO PAULO 00000117  002 OF 004 
 
 
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 
 
SAO PAULO 00000117  003 OF 004 
 
 
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 
 
SAO PAULO 00000117  004 OF 004 
 
 
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