Brazil and Uruguay: Stora Enso’s promises and the harsh reality

For some months now, declarations have been circulating in Southern Brazil and in Uruguay, both by members of the Swedish-Finnish company Stora Enso and by Government authorities of these countries regarding the advantages for the local population of the installation of the company’s pulp mills in the region.

The president for Latin America of Stora Enso, Nils Grafström, as well as other high-ranking executives of the Swedish-Finnish company visit towns in both countries with the sole aim of announcing wealth, development and environmental preservation. Something very similar is taking place at this same time in other Latin American, African and Asian countries, such as China, where Swedish and Finnish corporate representatives increasingly affirm the social, economic and environmental benefits of projects to install thousands of hectares of plantations and new pulp mills.

However, the facts show that once installed in the countries of the South, the situation is really very different from what the companies had promised.

The experience of the Veracel pulp mill – joint property of Stora Enso and Aracruz and operated by the former – in the Brazilian State of Bahia is a clear example of unsustainablility. This is confirmed in a letter we received, signed by an important group of “men, women and young people, rural and urban workers, indigenous people, environmentalists, scientists, professors, students, in which they denounce the situation of degradation and poverty of the Southern Region of the State of Bahia, promoted by the pulp company Veracel, a joint venture of Stora Enso”.

This situation is the result of the negative social and environmental impacts caused both by the vast monoculture tree plantations that the company has been establishing in the region for many years now to make available the necessary raw material, and by the pulp mill itself that started operating in 2005, with an annual production of 900,000 tons of pulp for export.

This letter states that “Over the past years, Veracel has generated a track record of environmental degradation, concentration of land, eviction of thousands of workers from the rural areas to the outskirts of cities, causing significant social and environmental disruptions”.

Regarding the generation of jobs, the letter affirms that “Not satisfied with the large number of lands purchased in the Southern Region of Bahia for the plantation of eucalyptus, Veracel Celulose now moves forward to the south of the State ignoring the social impacts this entails. Only in the municipality of Mascote, the company purchased several estates. Approximately, 400 workers lost their employment. Many of these workers moved to the outskirts of nearby cities”.

As is also happening in the case in Uruguay and many other countries, the signatories of the letter complain that: “In one of the properties of the Santa Rita group (made up by 4 ranches) purchased by Veracel … the houses, corrals and plantations have already been destroyed to eliminate the signs that human beings once lived there, who depended on that land”.

Additionally and as is already happening in other regions, the plantations have negative impacts on water and in this respect, the letter states that: “Throughout the region, the extensive plantation of eucalyptus has resulted in the disappearance of several rivers and streams”.

When Stora Enso was installed in Bahía, it did so on the basis of the same promises of employment, development and wealth that it is now making in other countries. For instance, according to the Uruguayan press, “the information handled so far by Stora Enso” is that during its operational phase it will generate “some 3,000 direct and indirect jobs.” In Bahia not only did those promises prove to be false, but the company also generated rural migration, unemployment and poverty.

We ask ourselves how long these companies will be able to continue repeating their lies with impunity.

The letter referred to in this article is available at:

Source: WRM’s bulletin Nº 110, September 2006

About Grupo Guayubira

El grupo "Guayubira", fue creado en mayo de 1997, para nuclear a personas y organizaciones preocupadas por la conservación del monte indígena y por los impactos socioeconómicos y ambientales del actual modelo de desarrollo forestal impulsado desde el gobierno. El grupo aspira a tener incidencia a nivel nacional y local para implementar medidas que ayuden a la conservación del monte indígena y a modificar el actual modelo insustentable de desarrollo forestal basado en los monocultivos de árboles a gran escala.
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