Lula’s ambitious green agenda runs up against Congress’s agribusiness might

Deforestation in the Brazilian Amazon fell by half in 2023 from the year before, showing that President Luiz Inácio Lula da Silva’s efforts to restore environmental protections dismantled by his far-right predecessor, Jair Bolsonaro, have achieved positive results. However, the first full year of Lula’s return to the presidency hasn’t been smooth sailing. Weakened in the face of a conservative Congress, his administration has been unable to prevent the passage of legislation that continues to dismantle environmental safeguards in favor of agribusiness interests. Just as under the Bolsonaro administration, Brazil’s Congress is still pushing what critics describe as an anti-environmental agenda, undermining Lula’s efforts to position Brazil as a global leader against climate change.

Despite Lula’s victory in the 2022 elections, Congress has become even more conservative. In addition, the agribusiness caucus, known as the FPA, has become more organized. In 2023, it used its powers, particularly in the lower house, the Chamber of Deputies, to block or undermine government environmental proposals that could affect the interests of the businesses it champions.

“It’s a more conservative Congress, more organized and more aware of its strength,” Dolores Silva, a professor in the political science graduate program at the Federal University of Pará (UFPA), told Mongabay by phone. “The president of the Chamber of Deputies, Arthur Lira, acts with unprecedented protagonism, setting agendas and guiding discussions. This protagonism helped Congress to retain some of the madness of the Bolsonaro government. Now, it’s a force that can stop Lula’s environmental agenda.”

Nilto Tatto, coordinator of the environmentalist caucus in the Chamber, said that during the Bolsonaro years, there was no need for such strong opposition to the environmental agenda in Congress because the dismantling was being done through executive decisions, without the need for legislation.

“It’s because of Lula’s inflexible stance toward the interests of ruralists that the path chosen is to weaken the environmental agenda through legislation,” Tatto, a Lula ally, told Mongabay by phone.

He said the situation got worse because the government needed to negotiate support from the ruralist caucus to approve priority bills in other areas.

“The truth is that the government is weak and has no power to stop environmental setbacks. The challenges of the climate crisis, the defense of Indigenous peoples, and many other policies are not moving forward because they directly affect agribusiness interests,” Tatto said.

Serial setbacks

Difficulties arose at the very beginning of the administration when Lula had sought to pass measures reorganizing the government’s ministries and strengthening environmental protection strategies. In the first blow to Lula’s campaign promises, Congress passed a bill reducing the powers of the Ministry of Environment and Climate Change and the newly created Ministry of Indigenous Peoples.

Congress’s most impressive show of strength to date was the approval by a large majority of the marco temporal or time frame provision, which sets a cutoff date beyond which Indigenous communities cannot lay claim to their ancestral territories. The provision stipulates they may only lay claim lands they were occupying at the time Brazil’s current Constitution was enacted, on Oct. 5, 1988. The same bill also includes several anti-Indigenous measures that strip back land rights and open up traditional territories to mining and agribusiness — activities that are prohibited under the Constitution.

A week before the bill first passed in Congress, Brazil’s Supreme Court ruled overwhelmingly against the highly controversial time frame provision, saying the Constitution cannot be used to define the traditional occupation of land by these communities. Congress ignored the court’s decision, using its power to push back not only against Lula’s agenda, but also the judiciary.

In October, Lula partially vetoed the controversial time frame bill. But on Dec. 14, Congress overwhelmingly rejected Lula’s veto, passing into law the anti-Indigenous proposals, with the Chamber voting 321-137 and the Senate voting 53-19. These numbers highlight Lula’s fragility in the face of Congress, experts say. The law is now being challenged in the Supreme Court, which will once again have to review it.

On Nov. 28, Congress approved a bill to slash regulations on pesticides, a priority project of the ruralist caucus that was in the works for several years and finally found fertile ground during Lula’s first year. The so-called “Poison Bill” eases restrictions on the sales and use of a wide range of agrochemicals, many of which can cause diseases, mutations, and hormonal changes. Approval of new pesticides would be relegated to a risk analysis, but the text of the bill doesn’t define what constitutes an acceptable risk. The bill also reduces analysis deadlines, weakens regulatory agencies, and waives pesticide registrations for export, among other rollbacks.

The final text was negotiated with the government’s allies, which pushed for specific articles to rein in the extent of the proposed deregulation. On Dec. 28, Lula sanctioned the pesticide bill with 14 vetoes to “guarantee adequate integration between production needs, health protection, and environmental balance.” Observers, however, say they expect the agribusiness caucus will overturn the vetoes, as it did with the anti-Indigenous law.

Suely Araújo, public policy coordinator at the Climate Observatory, a network of civil society organizations, blamed the government’s weak political position for failing to keep the environmental agenda off the negotiating table in Congress. “The ruralist caucus approves whatever it wants,” Araújo told Mongabay by phone. “Projects that weren’t voted on during the Bolsonaro government, when there was some resistance, are now moving forward.”

Silva, the political science professor, said disentangling ongoing bills from environmental policy is very difficult now. “This agenda affects the economic interests of very well-organized ruralists,” she told Mongabay. “And the [agribusiness] sector’s demand is for expansion, which clashes with many environmental proposals. I don’t see any chance of a weakened government changing this scenario over the next three years. This power game will continue because Congress will not give up its established power.”

New challenges in 2024

Other threats to the environmental agenda are making their way through the Brazilian Congress. The next battle will focus on the new environmental licensing bill, another priority long pushed by the agribusiness sector, which is finally making its way into law. It’s already been approved by the lower house and is set to go before the Senate soon.

The bill establishes fewer requirements for environmental impact studies for projects such as new roads, cattle ranching, and plantations, all on the grounds of reducing bureaucracy.

Over the coming months, the Senate will also decide on a bill to declare the BR-319 highway from Manaus to Porto Velho as critical infrastructure, indispensable to national security. The proposal loosens environmental licensing procedures for a project that could boost land grabbing, deforestation and illegal logging in the Amazon Rainforest.

Congress will also consider a proposal that provides for the compulsory contracting of coal-fired thermoelectric power and the bill that encourages invasions of public lands — a green light to land grabbers, according to experts. Another key bill aims to set up the framework for a cap-and-trade carbon market to regulate industry emissions, but which has been criticized by environmentalists for excluding agriculture and livestock farming — Brazil’s leading drivers of deforestation and greenhouse gas emissions.

“We need civil society mobilization and international pressure to prevent further setbacks,” Tatto said. “The government doesn’t have the strength to confront the immediate interests of Brazilian ruralists, who are highly organized and have a lot of political influence in Congress.”

Oil contradiction

Beyond fending off Congress’s attempts to undermine its agenda, critics say the Lula administration must also resolve its own contradictory policies, in particular its push for greater investment in fossil fuels.

On Dec. 1, during the COP28 climate summit in Dubai, Minister of Mines and Energy Alexandre Silveira announced Brazil’s intention to join OPEC+, a group of allies of the largest oil producers and exporters. The news contradicted Lula’s speech that same day demanding action to reduce greenhouse gas emissions.

After the summit, Brazil’s National Petroleum Agency (ANP) conducted what’s been dubbed the “end-of-the-world auction,” selling off drilling rights to 602 new exploration areas, including 21 in the Amazon River Basin and other blocks in regions that directly affect Indigenous lands and protected areas for biodiversity.
A letter signed by 160 organizations asked Lula to stop the plan.

“It is a contradictory position to the discourse that Brazil will be an environmental leader, an environmental powerhouse,” Araújo said. “It’s a terrible decision from a climate point of view because we’re going against the tide by intensifying the exploitation of fossil fuels.”

She said the oil reserves being auctioned off now will enter the production phase between 2030 and 2040, when demand for fossil fuels needs to be much lower to avoid the worst impacts of climate change. “Brazil is betting on a market that has to end and wants to become an exporting country at the height of the climate crisis. There is no sustainable oil. Everything will burn somewhere and put greenhouse gases in the planet,” Araújo said.

She added the justification often given that Brazil will use the revenue from oil exploration for its clean energy transition is problematic because Brazil needs to make those investments now. “It’s a badly resolved equation, a huge contradiction that attacks the government’s environmental narrative,” Araújo said.

Work in progress

The environmental challenges facing the government in the coming years are enormous, but there are some bright spots for the Lula administration. The halving of deforestation in the Amazon shows that actions on the ground, remote-monitoring strategies, the imposition of fines, and the seizure of illegal forest-clearing equipment have helped curb the destruction of the rainforest.

According to data from Brazil’s space agency, INPE, the rate of deforestation in 2023 was the lowest since 2018, ending a run of near-record-high rates under Bolsonaro from 2019 to 2022. “We still have a high level of deforestation, but the reduction shows that the work in the first year has been effective. There has been an impressive reduction,” Araújo said.

The results are even more positive in Indigenous lands and conservation units. In 2023, according to the Brazilian conservation nonprofit Imazon, protected areas across the Amazon had the lowest deforestation rate in nine years — a 73% reduction, almost four times lower than in the previous year.

In the Cerrado savanna biome that abuts onto the Amazon, however, there was a 43% increase in deforestation alerts in 2023, the highest rate ever recorded. Deforestation here is directly linked to the expansion of agribusiness, and the persistently high rate shows the government will need to develop new environmental protection mechanisms in partnership with state agencies responsible for issuing licenses for private properties, observers say.

Law enforcement operations in the Amazon have also helped to contain, though not entirely, the humanitarian crisis in the Yanomami Indigenous Territory, driven by the massive influx of illegal gold miners during the Bolsonaro years. In January 2024, Federal Police seized equipment from miners who had returned to work on Yanomami land. Minister of Indigenous Peoples Sonia Guajajara acknowledged difficulties in resolving the emergency.

The reconstruction of Brazil’s environmental policies saw other significant advances in 2023, such as the resumption of the Amazon Fund and the relaunch of the Climate Fund, which will finance studies, projects and undertakings aimed at reducing deforestation and greenhouse gas emissions.

From now on, experts say, the government needs to ramp up its efforts to generate more ambitious results. For Araújo, policies to regularize land ownership and promote sustainable production activities — included in the Action Plan for the Prevention and Control of Deforestation in the Legal Amazon (PPCDAm) — must be implemented.

“We know this takes time, but the government must prioritize it. For deforestation to remain low, we need to go beyond simple inspections,” she said.

Diplomatic bet

The significant drop in deforestation in the Amazon Rainforest is an asset for Lula’s environmental diplomacy abroad. Still, experts say it’s necessary to improve coordination with Congress and resolve the contradictions of oil exploration for Brazil to achieve a prominent place in international environmental advocacy.

Daniel Buarque, a postdoctoral researcher at the University of São Paulo’s Institute of International Relations, said Lula has realized that leadership on the environmental and climate crises can project Brazil’s international soft power.

“There is still no global leadership in this field,” he told Mongabay by phone. “There is a power vacuum. And Brazil has the potential to be a central player, as it is already recognized for the Amazon Rainforest, its hydroelectric energy matrix, its use of biofuels, and its involvement in major environmental and climate events.”

Buarque said there’s international optimism about Brazil, renewed by the recent declines in the deforestation rate. However, he said expectations for new results will be very high. As such, Lula will have to show at all times that he’s moving forward.

“As a leader, Lula needs to be able to find a way forward, resolve internal issues and move the agenda. Those looking in from the outside expect him to make the necessary negotiations. Lula represents Brazil. In the eyes of the world, he is even responsible for the decisions of Congress,” Buarque said.

Araújo agreed: “There will be demands for coherence between Lula’s environmental narrative and what is happening in the country. The first step is to ensure coherence about oil. Then, we need to work on this challenging relationship with Congress, improving political coordination with greater involvement by Lula himself, an effort to protect the environmental agenda in the negotiations.”

Banner image: Indigenous people attend the Supreme Federal Court hearing that invalidated the marco temporal provision, which established a cutoff date for claiming new Indigenous territories. Image courtesy of Antônio Cruz/Agência Brasil.

Outcry as Brazil Congress overrides president to revive anti-Indigenous law

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