South America

Criticism of President Luiz Inácio Lula da Silva’s handling of deforestation in the Amazon rainforest by many foreign observers does not consider the severity of Brazil’s need to develop the region’s economy. There is, however, considerable substance to critics’ arguments that his administration repeatedly favors an infrastructural and economic development strategy over a conservationist policy. Nonetheless, the Brazilian president is confronted with a difficult set of circumstances made evident by the bitter debates within Lula’s administration, which came to a head with the May 13 resignation of the dejected Minister of the Environment, Marina Silva.

Although it is difficult to anticipate how Brasília’s current measures will affect deforestation in the Amazon, the most important ecological initiative of Lula’s six-year tenure thus far has been the Plan for a Sustainable Amazon (PAS). The document was originally signed in 2004 and later enhanced in 2007, but its implementation only began this year. It is characteristically more pro-economic development than pro-environmental preservation. However, the PAS and related initiatives such as the 2004 Plan of Action for the Prevention and Control of Deforestation in the Amazon (PPCDAM) could potentially slow deforestation by designating new areas as nature reserves, combating illegal logging and farming, and eradicating falsified land deeds throughout the region. Overall, Brasília deserves some applause for developing a policy that responds to the international outcry against deforestation. Unfortunately, the needs of a growing economy and agricultural sector, in concert with high commodity prices, conflicts markedly with environmental groups’ unwavering commitment to preserving the region crucial to the survival of mankind.

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This analysis was prepared by Research Associate Jared Ritvo.

Peru’s Economic Model and Poverty Reduction: Is It Working?

The relationship between Bolivia and Peru has deteriorated rapidly over the last year, in part because of disagreements on foreign trade issuess. Recently, Peruvian President Alan Garcia and his Bolivian counterpart, Evo Morales, engaged in personal attacks which served to increase tensions between the two Andean nations. On July 2nd, Garcia attacked Morales by saying the latter was jealous of Peruvian economic growth. Maybe Garcia has a point in observing that Peru’s economic growth is more robust than Bolivia’s, but economic growth is not necessarily the ultimate objective for a country; more important may be the satisfaction of its citizens, which in Peru is trending downward because of growing inequality.

In its chronic struggle against poverty, Latin America has experimented with various economic models. These have included the neoliberal policies of the 1980s and 1990s, which have led to increased inequality. Some see neoliberal failures as responsible for the leftist wave that has spread across the region. Peru, however, is one of the two countries in Latin America that have not been tempted recently by solutions calling for the abandonment of the neoliberal development model.

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This analysis was prepared by Research Associate Guillermo Cornejo.