World Bank Drops Loan to Brazilian Cattle Giant

  Source: Greenpeace

Last week the International Finance Corporation (IFC), the private lending arm of the World Bank, withdrew the $90 million dollar loan to Brazil’s cattle giant Bertin. The loan was used for the company to further expand into the Amazon region, which was causing destruction of the rainforest and fuelling global climate change. While on one hand Lula’s government was making commitments to reduce deforestation rates in the Amazon, on the other hand the IFC was helping to expand the Brazilian cattle sector which is now the largest single source of deforestation in the world.

Forest destruction accounts for almost 20 percent of global warming causing emissions, which is more climate pollution than all the world’s cars, trucks, trains, planes, and ships combined. Brazil ranks as the world’s fourth biggest climate polluter, largely because of Amazon destruction. Although the IFC published a benign statement on its website about the terms of the cancellation, this announcement comes just two weeks after the release of the Greenpeace report "Slaughtering the Amazon."

The Greenpeace report revealed how the financial backing of the Brazilian cattle industry by the IFC and President Lula’s government via its national development bank (BNDES) has led the industry to become the largest single source of deforestation in the world and a major source of global greenhouse gas emissions. The report also shows how cattle products from ranches involved in illegal deforestation in the Amazon rainforest –as well as in the invasion of indigenous lands and slavery–contaminates the supply chains of top brands such as Adidas, Reebok, Timberland, Geox, Clarks, Nike, Carrefour, Gucci, IKEA, Kraft, and Wal-Mart.

By helping Bertin to expand into the Amazon, the IFC had been driving further destruction of the rainforest for products that often make their way into global meat or leather products while undermining Brazil’s commitments to reducing deforestation. For a bank that portrays itself as the “knowledge bank”, this was a very ill conceived and thoroughly destructive use of international resources. The last $30 million dollar hand-out from the IFC will no longer be given to Bertin and it is anticipated that the IFC will ask Bertin to return early the $60 million dollars it has already invested in the company. The World Bank Group is set to lend another $1.3 billion dollars to Brazil for “environmental protection.”

At Greenpeace we are calling for a commitment to Zero Deforestation and global solutions that will protect forests and reduce forest related emissions that are making global warming worse. In the fight to save the Amazon, every step will count so we are asking US consumers to join us in taking on companies like Nike, Timberland, and Adidas which cannot demonstrate that the leather in our shoes is not driving deforestation in the Amazon.