Stimulus for land grabbing and deforestation in the Brazilian Amazon

We assessed the impact on the Brazilian Amazon of a 2017 land law that reinforces a mechanism for acquiring land rights historically linked to deforestation, since land grabbers clear the forest to signal land occupation and claim land rights. In particular, we assessed two significant potential impacts: (i) the loss of government revenue due to the sale of public land below market prices and (ii) the risk of future deforestation and associated CO2 emissions in 19.6 million hectares allocated to expand land privatization. The short-term revenue loss ranges from U$ 5 to 8 billion for 8.6 million hectares; the future revenue loss ranges from U$ 16.7 to 23.8 billion for 19.6 million hectares; and between 1.1 and 1.6 million hectares would risk being deforested until 2027, which could emit 4.5–6.5 megatonnes of CO2. The Brazilian government should review the decision about this area allocation; prioritize land allocation for conservation and, if selling part of this area, charge market prices.


Introduction
In 2017, the Brazilian government revised the country's rules on land tenure regularization and this new law threatens efforts to reduce forest loss in the Amazon. After a significant reduction of deforestation in the region between 2005 and 2012 [1], the annual forest loss rates in the region began to increase again, reaching the highest rate in the last decade in 2018 (7900 km 2 ) [2]. In addition, the relationship between deforestation, land grabbing and violent land conflicts, that has been documented by previous studies [3,4], continues in the region. In 2017, Brazil had the highest rate of murders of environmental and land rights defenders, and 80% of the victims were in the Amazon region [5].
The current political context in the country may worsen this scenario of degradation and violence. As of January 2019, Jair Bolsonaro, the newly elected president of Brazil, has indicated his support for the agribusiness section in the region, for weakening environmental enforcement, and freezing the demarcation of indigenous territories [6]. But all of these measures, if implemented, could also lead to more deforestation and conflict. Thus, the implementation of the new land law and the new national political scenario may represent a threat to the Amazon forest conservation. At the same time, this context may hinder Brazil's pledges to the Paris Accord to reduce greenhouse gases (GHG) emissions. The country is the seventh largest emitters of GHG and its commitments to global efforts to climate change mitigation rely mostly on curbing deforestation [1].
Passed in July 2017, the new land law (number 13 465) granted amnesty to those who illegally occupied public rural lands between 2005 and 2011, a crime according to a 1966 federal law. The new rule allows land grabbers to purchase public lands below market prices. Also, the new law extends these benefits for large areas up to 2500 hectares [1], which represents a 1000 hectares increase compared to the previous legislation [7]. All these factors have the potential to stimulate further land grabs and forest loss, since they reinforce a preemption mechanism for acquiring land rights [7] that has been historically linked to deforestation in the Amazon region [8][9][10].
In this preemption mechanism: (i) the private parties occupy public land and, in some cases, expel indigenous peoples or traditional communities previously occupying these areas; (ii) they deforest the area and plant grass to raise cattle, which is a relatively cheap way to signal land use [10]; (iii) they request a Original content from this work may be used under the terms of the Creative Commons Attribution 3.0 licence.
Any further distribution of this work must maintain attribution to the author(s) and the title of the work, journal citation and DOI.
land title from the government as a formal recognition of their land occupation. When land grabbers occupy public areas after the legal deadline for granting land rights, they reach representatives in Congress, usually from the so-called rural caucus (ruralistas), to demand a legal revision for extending such deadlines and to demand land price discounts. For instance, in the previous law, landholders that occupied federal public areas as of July 2004 could request a land title from the federal government upon compliance with some requirements, including not owning another rural property [7]. However, the government has extended the 2004 deadline to 2011 in the 2017 legal revision. As of January 2018, three lawsuits were questioning the constitutionality of this law before the Brazilian Supreme Court.
In addition to promoting the privatization of public lands, the federal government has reduced the pace of demarcation of indigenous lands and creation of conservation units [1], both considered important mechanisms to recognize land rights of indigenous peoples and traditional communities, while acting as barriers to the advance of deforestation [11,12]. There are 70 million hectares of non-allocated forest in the Brazilian Amazon and this area has potential for creation of new protected areas and allocation to social use [13,14]. However, the focus on land privatization may stimulate new illegal occupation of land associated with deforestation.
Given the new legal and political context, in this study we use a spatially explicit dataset of public land allocated for future land privatization in the Brazilian Amazon to assess two possible impacts of the new law: (i) the loss of government revenue due to the sale of land below market prices and (ii) the risk of future deforestation and associated carbon dioxide (CO 2 ) emissions.

Methods
Assessing revenue loss First, we estimated the potential governmental revenue loss in two sets of public land stocks as follows: (i) Short-term revenue loss due to sale of 32 490 parcels, accounting for 8.6 million hectares in the Brazilian Amazon. These parcels are in the process of receiving a land title through sale from the Brazilian government and their sizes range from 50 to 2500 hectares.
(ii) Future revenue loss in public land designated for potential future sale encompassing 19.6 million hectares. Even though there are 70 million hectares without formal recognition of land rights in the Amazon [13,14], we used a smaller dataset of areas where the government plans to expand its program to issue land titles. These areas are under direct risk of land grabbing, since the government is signaling it will issue land titles in the future for the landholders. According to this dataset, obtained through the Access to Public Information Law, the 19.6 million hectares includes one million hectares that overlap with potential indigenous land claims.
We estimated the revenue loss by calculating the difference between the market price and governmental price for these areas. We considered the average land market price in 2016 per municipality [15] and four scenarios for governmental land prices established by the new law, summarized in table 1. The two highest governmental prices apply when: (i) the land title beneficiaries want to avoid losing the parcel if they fail to comply with certain labor and environmental regulations after receiving the land title and (ii) the landholder has another property or occupied the public land between 2008 and 2011. For payments in installments and lump sum, the Federal Decree 9304/2018 establishes the percentage of land price to be charged in each case, depending on the parcel size. Since we did not have the parcel sizes in the area allocated for future regularization, we calculated the range of possible values determined by the land law, from 10% to 50% of the minimum governmental land price.

Assessing risk of future deforestation and CO 2 emissions
We assessed the risk of future deforestation in the 19.6 million hectares allocated to expand land privatization. Forty-four percent of this area was already deforested as of 2016. We applied the methods used by Barreto and colleagues [16] to estimate the risk of future deforestation in 2017-2027 as a consequence of the advance of the cattle ranching frontier if this area is allocated for private landholdings. We modified the methodology for this study by extending the period analyzed, from 3 to 10 years. Below is a description of the methodology steps:  We estimated the carbon dioxide (CO 2 ) emissions for the two future scenarios using the following approach. First, using the function Zonal Statists from ArcGIS 10.3, we calculated for each scenario the total aboveground carbon (AGC) within the cells at risk of deforestation [18]. Next, we converted the AGC to CO 2 , by multiplying by 44/12 (units of CO 2 per units of carbon). We assumed that all carbon was compromised by the future deforestation, which means that the CO 2 emissions would occur all at once. Due to the lack of data, we did not calculate the below-ground and soil carbon emissions nor the removals from forest regrowth.

Governmental revenue loss
The estimated short-term governmental revenue loss for the sale of the 8.6 million hectares of public lands varies from U$ 5 to 8 billion (figure 1), considering the conversion rate of R$3.72 to US$1.00. The potential future governmental revenue loss for the sale of the additional 19.6 million hectares that may be privatized ranges from U$ 16.7 to 23.8 billion ( figure 2). Therefore, in total, the new land policy could lead to revenue losses of U$ 32 billion. This amount corresponds to 7% of the Brazilian gross domestic product in 2018 and more than a hundred times the annual budget of the Ministry of Environment.
Governmental land prices established by the new law represented in average 1.8%-42% of the land's market value in the four scenarios of future revenue loss. This variation is based on the total discount applied in each scenario and whether the minimum, mean or maximum governmental land price applies in each scenario according to the legislation. Our results demonstrate that even the mean and the highest governmental price scenario are advantageous for the buyer. For instance, by paying 25% or 33% of market value (the mean governmental land prices in future and short-term scenarios, respectively), the title beneficiaries eliminate the risk of losing the property if they fail to comply with social and environmental requirements and can easily profit by selling the land for the market price.

Risk of future deforestation and carbon emissions
If all the 19.6 million hectares are allocated for future sale, between 1.1. and 1.6 million hectares are at risk of being deforested due to the cattle ranching frontier advance until 2027 (figures 3 and 4). This forest loss could emit 4.5-6.5 megatonnes of carbon dioxide respectively. Such estimates are between three to five times above the targeted annual deforestation rate for the Amazon region by 2020 (339 000 hectares), according to the national climate change policy law.

Increased risk to conservation and indigenous lands rights
The new land policy repeats an old pattern of validating illegal grabbing of public lands and rewards the illegal occupants by selling land below market prices. As in the past, this situation is likely to lead to at least two negative impacts: (i) loss of public revenues in the order of tens of billions of US$ and (ii) new illegal occupations of public lands associated with deforestation and land conflicts.
Beyond the financial and social conflict implications, this scenario is in stark contradiction to other federal and state conservation, human rights, and development policies. According to current Brazilian laws and policies, the allocation of public lands should prioritize granting land rights to indigenous peoples (a constitutional right) and traditional communities, as well as creating new conservation units, which is consistent with the national goals of reducing deforestation.
Thus, since one million hectares of the area allocated to privatization overlaps with potential indigenous land claims, the federal government should exclude such an area from its land privatization program. Even if the government still needs to conduct legally required studies to determine the extent of the claimed indigenous territories, such areas should become temporarily unavailable for other types of land allocation. This measure could prevent conflicts if the government issues private land titles in areas that could be later declared as indigenous territories.
In addition, to allow public scrutiny over decisions with socioenvironmental impacts in the Amazon, it is fundamental that the government continues to disclose spatially explicit datasets of its decisions on how to allocate lands in the region. The continuation of such a transparency practice is uncertain, since the new government attempted to make it easier for public officials to classify public data as secret [19]. The executive order with such provision was revoked after much criticism, but this example raises concerns that some governmental decisions will no longer become easily available to the public.
Freezing public land sale and improving legal mechanisms to decide land allocation In addition, a new wave of privatization of public lands in the Amazon could stimulate new illegal occupations over the 70 million hectares of non-allocated forest in the Amazon. The conservation of this area is paramount to meeting Brazil's commitments to the Paris Accord. Thus, to prevent land grabbing and deforestation of such an area, the government should freeze public land sales in the Amazon region, submit the decision about this area allocation for public and scientific review and, if selling part of this area, charge market prices. The two first measures could be done by expanding the use of an existing legal mechanism called Area of Provisional Administrative Limitations (ALAP for its Portuguese acronym), a legal instrument that freezes any type of land allocation over a certain area for seven months [19]. Currently, ALAP only   applies to areas being considered for conservation units [20], but the legislation could be changed to allow its use when deciding the most appropriate allocation to any undesignated public forest. Thus, instead of pushing for private landholding regularization in existing forest areas, the federal government should speed up the recognition of priority land claims for indigenous groups, traditional communities and conservation targets to comply with the Brazilian constitution and laws, as well as with Brazil's climate change mitigation goals.

Conclusion
This study demonstrated that the 2017 land law in Brazil will have financial and socioenvironmental costs to the country, as well as threaten the country's climate change mitigation commitments if the deforestation advances over the 19.6 million hectares to be allocated to privatization in the Amazon. The federal government can still prevent such perverse effects by freezing new privatizations, increasing public land prices and prioritizing creation of protected areas and land allocation to social and sustainable use. However, such measures to avoid the estimated damages are unlikely to be implemented if two political factors remain: (i) the agribusiness lobby continues to hold enormous power such as they demonstrated by changing laws to facilitate land grabbing and (ii) the newly elected president of Brazil implements policies to freeze demarcation of indigenous lands, as he promised during his campaign.