104
5 Brazil Between Bioeconomy Barons and Grassroots Agroecology
Second, through the creation of Petrobras Biofuels, the government began to
engage directly with biofuel production, a degree of government-controlled vertical
integration that had not happened before in the sector. Third, the government started to
increasingly shape the bioeconomy by determining how biofuels should be produced,
through a growing number of social and ecological requirements. Clear examples
have been the incorporation of smallholders to reduce social exclusion, the stricter
prohibitions on forced labor, and the phasing out of sugarcane field burning—all
these century-old problems which the private sector had never tackled voluntarily,
and which previous governments had not bothered to sufficiently address until the
emergence of an environmentally scrutinized bioeconomy. Finally, the state started
taking increasing advantage of its position as the leading financier of biofuels to
impose conditions for credit, as seen in the sugarcane zoning policy and the Social
Fuel Seal.
Even if, in recent years, large agricultural interest groups have prevailed in loosening restrictions, on the whole the Brazilian bioeconomy—and particularly its
biofuel sectors—provide a good illustration of a “return of the state” to the fore,
after a period dominated by neoliberal policies of deregulation and privatization in
the 1990s. Non-state actors surely lobby for biofuel production and other nascent
bioeconomy sectors behind the scenes, but mainly through the medium of public
policies. This practice in itself does not conflict with the observation that (domestic)
public institutions have been the key sine qua non cause of biofuel expansion in
Brazil.
5.2 Allocation and Access: Analyzing Institutional
Performance
5.2.1 Allocation Patterns: Who Owns, Does, and Gets What
Brazil remains one of the most unequal countries in the world, and Latin America is
the most unequal region of the globe (UNDP 2019). Despite reductions in economic
inequality due to social inclusion policies in the 2000s, in Brazil the wealthiest 10%
of the population still get as much as 55% of the country’s total income (UNDP 2019,
p. 107). Its Gini coefficient
14 on income remained as high as 0.53 on average between
2010 and 2017 (UNDP 2019).
15 The index on land ownership inequality reached
0.87 in 2018, worsening from 0.85 in 2009 (IBGE 2009; Oxfam 2019). The 2017
rural census showed that family farming constituted 77% of Brazil’s approximately
5 million rural properties but occupied only 23% of the farmland. In turn, largescale agribusiness held 77% of the farmland—a gradually decreasing number of
14 For a comparison, the coefficient for income inequality in most African countries is below 0.50,
and as low as 0.25–0.30 in Northern Europe (UNDP 2019).
15 This was already a decrease from 0.59 in 1998 (Lustig et al. 2013).
5 Brazil Between Bioeconomy Barons and Grassroots Agroecology
Second, through the creation of Petrobras Biofuels, the government began to
engage directly with biofuel production, a degree of government-controlled vertical
integration that had not happened before in the sector. Third, the government started to
increasingly shape the bioeconomy by determining how biofuels should be produced,
through a growing number of social and ecological requirements. Clear examples
have been the incorporation of smallholders to reduce social exclusion, the stricter
prohibitions on forced labor, and the phasing out of sugarcane field burning—all
these century-old problems which the private sector had never tackled voluntarily,
and which previous governments had not bothered to sufficiently address until the
emergence of an environmentally scrutinized bioeconomy. Finally, the state started
taking increasing advantage of its position as the leading financier of biofuels to
impose conditions for credit, as seen in the sugarcane zoning policy and the Social
Fuel Seal.
Even if, in recent years, large agricultural interest groups have prevailed in loosening restrictions, on the whole the Brazilian bioeconomy—and particularly its
biofuel sectors—provide a good illustration of a “return of the state” to the fore,
after a period dominated by neoliberal policies of deregulation and privatization in
the 1990s. Non-state actors surely lobby for biofuel production and other nascent
bioeconomy sectors behind the scenes, but mainly through the medium of public
policies. This practice in itself does not conflict with the observation that (domestic)
public institutions have been the key sine qua non cause of biofuel expansion in
Brazil.
5.2 Allocation and Access: Analyzing Institutional
Performance
5.2.1 Allocation Patterns: Who Owns, Does, and Gets What
Brazil remains one of the most unequal countries in the world, and Latin America is
the most unequal region of the globe (UNDP 2019). Despite reductions in economic
inequality due to social inclusion policies in the 2000s, in Brazil the wealthiest 10%
of the population still get as much as 55% of the country’s total income (UNDP 2019,
p. 107). Its Gini coefficient
14 on income remained as high as 0.53 on average between
2010 and 2017 (UNDP 2019).
15 The index on land ownership inequality reached
0.87 in 2018, worsening from 0.85 in 2009 (IBGE 2009; Oxfam 2019). The 2017
rural census showed that family farming constituted 77% of Brazil’s approximately
5 million rural properties but occupied only 23% of the farmland. In turn, largescale agribusiness held 77% of the farmland—a gradually decreasing number of
14 For a comparison, the coefficient for income inequality in most African countries is below 0.50,
and as low as 0.25–0.30 in Northern Europe (UNDP 2019).
15 This was already a decrease from 0.59 in 1998 (Lustig et al. 2013).