in Brazil, Norway

Brazil: The double role of Norway in conserving and destroying the Amazon

With apologies for stating the bleeding obvious: If REDD is going to work, it has to reduce deforestation. It also has to respect Indigenous Peoples’ rights. So why is Brazil, which claims to be serious about stopping deforestation, planning to build the world’s third largest hydropower dam?

The Belo Monte dam is planned to be built on the Xingu River and would result in the eviction of tens of thousands of Indigenous Peoples.

As the World Rainforest Movement points out in the article below, Norway is playing a bizarre double role in Brazil. The Norwegian government is the biggest donor to the Amazon Fund, which is all about conserving the Amazon. Meanwhile, the partly state-owned* Norwegian company Norsk Hydro is expanding its aluminium production operations in Brazil – an industry that requires large amounts of electricity. “What one hand gives, the other taketh away,” writes International River’s Zachary Hurwitz, “while Norway buys green credibility by donating to the Amazon Fund, it also invests in aluminum production at some of the dirtiest mines in the entire world.”

The Amazon is, of course, a big place. It may be possible to build a dam, no matter how destructive, and still achieve reduced deforestation targets simply by reducing deforestation elsewhere in the country. However, it is not possible to build the Belo Monte dam without bulldozing Indigenous Peoples’ rights. Hurwitz notes that “With the possible approval of a law that would allow for hydroelectric dams and mining on indigenous and protected lands, Belo Monte will be just the first in this next phase of Amazonian destruction.”

Brazil: The double role of Norway in conserving and destroying the Amazon

World Rainforest Movement Bulletin 154, May 2010.
Norway is a major donor of the Amazon Fund, the Brazilian Development Bank’s fund that receives donations from governments, multilateral institutions, big NGOs and companies to fund forest conservation projects with the alleged aim of reducing emissions of greenhouse gases resulting from deforestation. The contribution of donors is recognised with diplomas that are nominal, non-transferable and do not imply equity rights or carbon credits to offset.
In clear contradiction with the above, the Norwegian government is investing in bauxite mining and aluminium production in the same Amazon forest it claims to protect. Norwegian state-owned* company Norsk Hydro ASA -Europe’s third largest aluminium maker- has recently signed an agreement to take over Vale do Rio Doce’s aluminium businesses in Brazil.
The agreement implies –among other things- that Norsk Hydro will take control of Brazil’s Paragominas, one of the largest bauxite mines in the world, and gain 91 percent ownership in Alunorte, the world’s largest alumina refinery. At the same time it will get 51 percent in the Albras aluminium plant and 81 percent ownership in the CAP alumina refinery project. (1)
The Norwegian government cannot ignore that bauxite mining, its refining into alumina and smelting to make aluminum metal are highly destructive processes, including deforestation, contamination, displacement of local communities and severe impacts on livelihoods and health. At the same time, some of those processes –particularly deforestation- are significant contributors to global warming. Additionally, it is a well known fact that aluminium smelting is a highly energy-intensive process, with electricity representing about 20% to 40% of the cost of producing aluminium.
That implies the need for vast amounts of cheap energy. Norsk Hydro and the Norwegian government know perfectly well that in Brazil such energy can only come from large-scale hydroelectric dams.
Those types of massive dams have been and are being built in the Amazon region and it comes as no surprise that the Brazilian government has recently approved the controversial Belo Monte dam, aimed at feeding industrial processes such as aluminium with the low cost energy they require.
With an estimated cost of over US$ 16 billion, the Belo Monte massive dam project on the river Xingu would flood 516 sq km of forest land though estimations say that all in all 1,522 sq km would be affected, leading to the displacement of some 20,000–40,000 people.
Belo Monte would be the third largest dam in the world and most of the funding would come mainly from the Brazilian government’s financing (as much as 80%) through public funds (public pension funds and money from the National Treasury) (2). It is important to highlight that 25% of all electricity in Brazil is consumed by nine mining and energy companies -Alcoa, ArcelorMittal, Camargo Corrêa Energia, CSN, Gerdau, Samarco, Vale do Rio Doce and Votorantim- and that some of these same companies want the Belo Monte dam for expanding their extractive operations.
Quoting International River’s factsheet on the Project: “Belo Monte is being proposed as a renewable energy project and an important part of the country’s commitment to reduce emissions by 38% by 2020. Yet reservoirs in tropical forests like the Amazon can themselves be significant sources of greenhouse gas emissions due to decomposing vegetation. According to Philip Fearnside, Brazil’s foremost expert on reservoir emissions, Belo Monte is unlikely to be a standalone project due to its low generating capacity in the dry season. Fearnside therefore assumes that the Barbaquara Dam – a much larger storage dam – will be built upstream. According to Fearnside, during the first 10 years of operation, the Barbaquara and Belo Monte dams combined would have emissions four times higher than an equivalent fossilfuel plant.”
Such a massive flooding would bring about the displacement of thousands of local people whose lands and livelihoods would be lost forever. Up and downstream impacts of the dam would also have heavy impacts on local populations who might have to migrate in search of work, competing for few low-payed jobs in outside towns and villages.
The indigenous peoples of the Xingu have for many years been leading a strong campaign in defense of their river and lands: “We have already suffered many invasions and threats. When the Portuguese came to Brazil, we indigenous people were already here, and many died, many lost their enormous vast territories, we lost many of the rights that we had, many lost parts of their culture, and other tribes disappeared completely. The forest is our butcher shop, the river is our market. We do not want the rivers of the Xingú to be invaded, and our villages and children to be threatened, children who will grow with our culture”, stated Cacique Bet Kamati Kayapó and Cacique Raoni Kayapó Yakareti Juruna, representing 62 indigenous leaders of the Xingu basin, in a declaration after the Belo Monte Dam Auction.
“We do not accept the Belo Monte hydroelectric dam because we understand that it will bring more destruction to our region. We are not thinking only about the locale where they want to construct the dam, but about all of the destruction the dam will bring in the future: more corporations, more ranches, more land invasions, more conflicts, and even more dams. If the white man continues to carry on like this, everything will be destroyed very quickly.”
“The world must know what is happening here, they must perceive how destroying forests and indigenous people destroys the entire world. Because of this we do not want Belo Monte.”
If the Norwegian government is sincere about wanting to preserve the Amazon and avoid emissions from deforestation it cannot engage in the large-scale industry of aluminium production which is developed at the expense of the Amazon and its forest dependent peoples. Otherwise, it must say clearly that it is prioritising profits and business over the Amazon. As is currently the case.

Article based on the videos by Rebecca Sommer from the joint side event that took place in April 2010, at the World’s Peoples Conference on Climate Change and Mother Earth Rights, in Cochabamba, Bolivia:
Video part 1:
Click to watch the video on YouTube
Video part 2:
Click to watch the video on YouTube
Video part 3:
Click to watch the video on YouTube
Belo Monte. Massive Dam Project Strikes at the Heart of the Amazon”, International Rivers Network.
Indigenous Declaration After the Belo Monte Dam Auction”.

Data sources:
(1) Investor Village, “Norsk Hydro Buys Vale Aluminum Units for $4.9 Billion“.
(2) “Belo Monte’s Public Finance: Red Hot & Risky”, International Rivers.


UPDATE – 13 December 2013: My sentence (and the WRM article) described Norsk Hydro as “state-owned”. In fact, the Norwegian state owns 34.26% of shares in Norsk Hydro.

Leave a Reply

  1. Excellent article! You are questioning whether Norway really can be said to have a *net* positive effect on REDD. Exactly the same argument can be brought against them on their claim to be one of Europe’s first wholly green countries – in terms of no net CO2 emissions domestically. This is expensive route is bought on the back of the sale of enormous quantities of oil to other countries who will not tick be “greening” and may miss their #climatechange commitments as a result. So, is the natural resource Norway’s? Yes – it brings them huge profits. So, should it be accounted in their carbon invoice? NO mechanisms for doing it – and besides, the assets are owned by individual companies not the State. Complex. So, Norway as a State is doing fantastically in CO2 emissions and, importantly here, in REDD – but individual companies – state-sponsered or not – are not. Criticise them at your peril, however! Theya re funding huge tranches of the UN-REDD programme, presumably.

  2. There’s more information about the aluminium industry and its impact on the Amazon in this Bloomberg article from last year: “Plundering the Amazon“. The article looks at Alcoa and Cargill and how their operations have increased deforestation in the Amazon. It’s interesting to note that one company hired Conservation International to help clean up its image, the other hired The Nature Conservancy:

    “Alcoa is paying Conservation International, an Arlington- based nonprofit group, $100,000 a year to create a trust fund to finance the preservation of 10 million hectares of parks and preserves around Juruti.”

    “Cargill hired The Nature Conservancy, an Arlington, Virginia-based nonprofit group, to confirm that soybean farmers aren’t clearing the Amazon around Santarem. The group says it has certified this year that 155 of 383 farms weren’t deforesting.”

  3. interesting detail is that the BNDES State Bank which administers the 1 billion Norwegian tax payers dollars of the Amazon Fund, is the same bank that will loan out 13 billion dollars for the construction of the Belo Monte hydroelectric.

    Of course the Brazilian government needs international funding to protect the Amazon, because it is investing all its money in destructive projects like the Belo Monte dam (and the Jirau and madeira hydroelectrics on the Madeira river, equally in the Amazon region).

    Have to congratulate the spinn docters that managed to create this green image of the Brazilian government abroad.

  4. Again, Chris, for all of your endless blather, you seem to misunderstand the basics of REDD. Not every tree must end up standing, trade-offs must be made. The trees lost to support an hydro project will become losses under a REDD mechanism. A government must figure out which benefits the country and its people more. Meaning, REDD payments need to be high enough to offset these opportunity costs.

    Stop pretending to be a REDD expert and admit you are simply an anti-market and socialist propogandist using REDD to spread you failed philosophies.

  5. @Chris

    I and no doubt many others do not come on to this site to be confronted with the obscenities, insults, slurs and innuendo peddled by ‘Redd Observer’. Why don’t you just ban them from this site – they anyway have nothing whatsoever to offer but sheer ignorance.


  6. @Redd Observer – I’m fully aware that REDD involves trade-offs. Here’s what I wrote in the post above:

    The Amazon is, of course, a big place. It may be possible to build a dam, no matter how destructive, and still achieve reduced deforestation targets simply by reducing deforestation elsewhere in the country.

    It’s interesting that you describe me as an “anti-market and socialist propogandist”. According to Robert M. Persaud, Guyana’s Minister of Agriculture, what I do is “peddle right-wing prejudices,” in alliance “with economic neo-conservatives around the world.” Could you two please make up your minds?