USAID Spurs Population Relocation in Northeast Brazil

September 25, 2007

The U.S. Agency for International Development (USAID) and the Brazilian government have devised a five-year $227 million plan to preserve the latifundia land tenure structure and to control the poverty-stricken rural peasants and workers of Brazil's northeastern sugar zone.

In Pernambuco, the northeast's major sugar-producing state, 80 percent of the 1.3 million people are illiterate and suffer from the host of physical and social ills which usually accompany illiteracy. Their misery is tied to the antiquated sugar industry (founded in the 16th century) which produces at the 19th century rate of 40 tons of cane per hectare. Forty-six large sugar mills control at least 38 percent of the land, 47 percent of the cane supply and produce all the exported sugar. The mills are owned by about 150 families, who in effect control the region's principal source of income. It is these conditions that fueled the organizing efforts and demands of Francisco Julio's peasant leagues until the 1964 coup jailed their leaders.

Although Pernambuco has lost its position to So Paulo as Brazil's leading sugar producer, it continued to produce about 700,000 tons per year and employs 170,000 peasants and workers. Brazilian governments have long aided the northeastern sugar industry, guaranteeing a 7 percent return and making large loans to companies investing in mills during the 19th century. In the present century, federal government subsidies, preferential taxation, export priorities, protection from southern competition and, most recently, slower minimum wage increases have sustained the industry.

Since 1962 the United States government has taken special interest in the northeastern sugar zone, supplying $65 million per year to the Northeastern Development Superintendency (SUDENE). U.S. refiners are annually importing over 200,000 tons of Pernambuco raw sugar at premium quota prices (its share of the redistributed U.S. Cuban sugar quota).

The current USAID-Brailian government program in the northeast has three goals: (1) rationalize the sugar industry; (2) diversify the economy; and (3) retrain and absorb the workers and peasants dislocated by (1) and (2). The Executive Group for the Rationalization of the Northeastern Sugar Agro-Industry (GERAN) was created in 1965 to reach the first two goals. At its head sit the presidents of Brazil's agrarian reform and development institutes and the president of the sugar and alcohol institute. GERAN will utilize $135 million of Brazilian funds to modernize 34 of Pernambuco's large mills and close the other 12. Some 14,528 families left unemployed by the modernization will be resettled on 37-acre plots where they will grow cane for the mills.

This strategy was tried in the 19th century when, in an effort to avoid the consequences of the abolition of slavery, the government encouraged central mills to buy their cane from independent cane growers. But the central mills found themselves compelled to buy up the small cane plantations to insure a steady supply of cane. The result was today's latifundia: at least 20 of Pernambuco's large mills began with this 19th century government aid. Under the present plan eventual control over the small growers by the large mills can be anticipated.

In achieving diversification of the economy, GERAN plans to relocate another 9,783 dis-employed families on 50-acre plots to raise livestock, food crops, and raw materials for new industries. But since the fertile, flat irrigated lands have already been planted in sugar cane and the modernized mills will require even more cane plantings, one wonders if these mall farmers will rise above the subsistance level.

Underlying the final goal -retraining workers and peasants -- is the recognition that only five-eights of the displaced families can be relocated on the land as small farmers. About 30,000 workers will be retrained for agricultural, industrial and commercial activities, while still another 10,000 displaced workers will be put to work moving and settling the relocated families.

Most intriguing in this retraining are the Public Works and Occupational Training Centers (COPTO). A two year program directed by Brazilian military officers -colonels, captains and first sargeants- COPTO will give agronomy instruction during the first year to 23,000 sons of those families receiving land parcels. In addition, it will provide a five-week basic training course in physical conditioning and vocational skills. A special COPTO program will give more intensive training to form leaders for public work projects. COPTO's second year is officially undiscussed. But according to Brazilian informants, it involves military and intelligence training in anti-guerrilla activities.

The USAID and other U.S. government agencies have participated in GN from its inception, when at least one Pernambuco-based U.S. government officer was reported "on loan" to the GERAN staff. U.S. funds are financing the preliminary studies and U.S. project assistants will maintain liaison between GERAN, COPTO and USAID. U.S. administrative assistants will work with the Brazilian military in COPTO's creation and operation, while Peace Corps volunteers will serve as vocational instructors in agriculture and construction equipment courses.

U.S. planners and policy-makers have played and will continue to play a major role in the design of GERAN-COPTO. Brazilian government agrarian reformers, despite their two agencies, never dreamed of relocating 80,000 peasants. The scheme reminds one of population control by "rural pacification" and "strategic hamlets" in Nicaragua in the 1920's, the Philippines in the'40's and '50's, and Vietnam in the'60's. The United States and Brazilian governments are reinforcing the sugar-mill owners' control of the zone, while providing sops in the form of land parcels and social services for the rural workers and peasants. The governments' confidence in the effectiveness of the program can be measured by the need for COPTO's second year. GERAN-COPTO is one of the largest, if not the largest single project receiving U.S. aid in northeast Brazil. But GERAN-COPTO does not reform the status quo, rather it strengthens it and provides short-run measures for controlling popular opposition to that status quo.

GERAN-COPTO is still in the early planning stages. Many more plans for the impoverished northeast have reached publication than completion. Pernambucots "reform-minded," liberal archbishop, Don Helder Camara, has already said that one of the northeast's chief problems "is the failure of the Executive Group for the Rationalization of the Sugar Industry" (NY Times, 2/6/68). But the GERAN-COPTO program reveals the U.S. and Brazilian government plans for "agrarian reform" in the northeast.

Tags: Brazil, USAID, Sugar, latifundia

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