Brazilian paradise or industrial center?
The Suape port in the East of Brazil is a modern sea port at a relatively short distance from both America and Europe. It is not only an important hub for the exports and imports of goods, but also for the emerging Brazilian off-shore oil industry and for the economy of the Pernambuco state.
An enormous oil refinery which is under construction and which costs close to 20 billion US dollars, will require large oil tankers to have access to the inner port. This might be good for the economy, employment, and future developments, but many people living in the immediate vicinity of the port, suffer from these harbor developments. Traditional fishermen and small-scale farmers have lost their livelihoods without sufficient compensation.
Luis Abilio da Silva (aged 82 on this photo) and his wife, Maria Luiza, on the land in Suape from where they were forcefully evicted. (Picture: Folha de Sao Paulo). Abilio da Silva passed away on the 20th of October 2016, at the age of 85.
In the indigenous Tupi language, the language of the original indigenous communities living along Brazil’s coast, Suape means “meandering ways”. A simple look at the area reveals why: it is full of streams and rivers meandering their way through the landscape towards the sea. The coastal area in and around the port consists of mangrove forests interspersed with white sand beach. The coral reef just off the coast is a popular spot for divers and snorkelers and the waves of the Atlantic coast are very attractive for surfers.
The first plans to develop a new port are from the 70s of the last century. After 1995 planning accelerated. Since then, most new harbor grounds were constructed and more than 100 companies already settled in the area. Dutch dredging company ‘Van Oord’ is involved in the dredging of harbors and land reclamation since then. In 2011 and 2012 this company acquired two additional large orders. Not only for dredging a new access for a future shipyard, but also to further deepen the access of the port from the sea to allow the largest oil tankers to enter.
“Image of the Cabo St. Augustin Met haer forten” [St. Augustine, Brazil],
I. Commelyn / J. Jansson, Amsterdam / 1656
Support from Dutch government
Van Oord holds an export credit insurance for these projects by the export credit insurance company of the Dutch government (Atradius Dutch State Business or Atradius DSB). Should payment problems regarding these projects occur and should Van Oord’s profit be at risk, Van Oord will be compensated up to 110 million euros. The Dutch government guarantees these payments.
Both Atradius DSB and Van Oord must comply to the social and environmental regulations applied by the OECD (Organization for Economic Cooperation and Development). Atradius DSB itself has criteria for corporate social responsibility (CSR) that a project or company must meet in order to qualify for export credit insurance. In the case of the port of Suape it seems that these criteria have not been met. The local environmental authorities of the State of Pernambuco even fined the port in September 2013 after finding that the environmental permits, provided for the dredging of the access channel to the port, were violated.
Destroyed mangrove forest at the 'Estaleiro Atlântico Sul' on the island ‘Tatuoca’, Suape harbor (photo Both ENDS)
The bottom of the sea consists largely of rocks covered with coral. To make dredging possible, these rocks first have to be blown up with explosives. Not only does this destroy the coral reef, but it also severely affects the fish population. Traditional fishing communities in the area have seen their main source of income disappear within the blink of an eye. Now that the coral reef is no longer an obstacle, sharks that normally live in open sea can come very close to the beach, posing a danger to swimmers and surfers. Mangrove forests have been destroyed, which disrupts the local water system in such a way that people increasingly suffer from floods. Rivers are polluted or become brackish up and are therefore unusable. Van Oord states that there is a reforestation program to compensate the loss of mangroves. However, nobody seems to know where, by and especially for whom this reforestation is being realised.
Access dam blocking the free flow of water in and out of the Tatuoca estuary, Suape harbor (Picture Both ENDS)
Local residents are intimidated by local private militias employed by the port's management. They are forced to leave their houses and land to create sufficient space for the port expansion (see this short video). Without any significant compensation they are often transferred to remote, barren and infertile areas where they can hardly get by. There has not been an increase in employment for the local population as promised; for the specialist contractor work, thousands of workers from other parts of the country are employed. This great wave of migrant workers – for whom the availability of basic services and housing is very insufficient- also brings along more violence, crime and sexual exploitation. The accumulation of all these factors has turned the life of the local inhabitants upside down.
Local residents and organisations have united in the 'Forum Suape’, which was officially launched in March 2013. Since its launch Both ENDS has supported this Forum, which coaches and trains the traditional communities of Suape. In doing so the community can bring forward social and environmentally friendly alternative developments in the region. In 2012 the Forum with the support of Both ENDS, created a video which contained strong testimonies of local residents.
In 2014 a follow-up video was produced, showing more local testimonies giving an update on the developments.
The Forum Suape website gives daily updates on what is going on locally, which protests are taking place and what should be done according to the members of the Forum.
Picture: Forum Suape
Monitoring by Both ENDS
Wiert Wiertsema of Both ENDS has been watching Atradius DSB, the export credit agency of the Dutch government, for years. In 2012 he decided to contact local organizations in Brazil to launch a fact-finding mission to Suape. So he was able to monitor in person the effects of an export credit insurance for large-scale dredging projects such as Suape. After extensive research and interviews with numerous stakeholders, Wiertsema concluded that both Atradius DSB and Van Oord did not take into account the local social and environmental situation. These conclusions are summarised in the "Report Suape".
Artificial representation of the future harbor expansion in Suape.
Pointing the finger at each other
This report was sent to both Atradius DSB and to Van Oord to allow them to respond. Both companies were willing to talk, but they continuously placed the responsibility for local problems at the hands of the Suape port authority and the Brazilian government. Both ENDS finds that both companies are therefore not dealing in compliance to their own CSR rules and regulations. Atradius DSB and Van Oord cannot back out of their responsibilities, Both ENDS states.
Since 2014, conflict has been raging between Van Oord and the Suape port authority: the port authority refuses to pay an outstanding bill of 150 million Brazilian real (nearly 50 million euro). Now, Van Oord has removed its equipment from the port, while the access channel to the port is not ready yet. Atradius DSB has compensated Van Oord according to their export credit insurance. The Dutch government is trying to recover this claim in Brazil through a judicial procedure. But to achieve a sustainable settlement of everything that went wrong in Suape, not only the Dutch losses should be considered, but also the harm that was to done to the local population.
Picture: Forum Suape
In 2014, Forum Suape has gained support from the official Bar Association (BA) in Pernambuco. The human rights commission of the BA has stated that, in principle, there is enough reason to file a complaint against the Port Authority of Suape. On November 10th 2014, the BA held a meeting with Suape's locals and as a result announced that it will further investigate the situation and take the required legal steps when necessary. However, as so often, also in Brazil the judicial processes are slow.
The issues in Suape gained more media attention after Both ENDS highlighted them:
- The Guardian, 4 March 2014: 'Brazil's shellfishing communities blighted by industrial pollution'
- A radio report of Radio 1 Reporter on October 26th 2014, in which Both ENDS' Wiert Wiertsema spoke, was entirely dedicated to this story.
Meanwhile, the local situation remains distressing. The consequences of the dredging of the port are becoming more obvious. The last inhabitant of Tatuoca Island was evicted from his home by the private militia of Suape in April 2016 and had to give up his simple restaurant directly next to the new shipyard. Also in other villages, the Port Authorities continue to intimidate the local population. The militia has destroyed the equipment of many fisherman, residents of Tatuoca may not return to their island to pick fruit and they are about to be evicted from their new home for a second time. More information can be found on the website of Forum Suape.
Complaint against Van Oord and Atradius DSB by the NCP
Both ENDS and the Forum Suape made repeated attempts to ensure Van Oord and Atradius DSB took up their own responsibilities. After these attempts failed, both organisations supported by local fishing representatives, filed a formal complaint on the 1st of June 2015 at the National Contact Point (NCP) for OESO guidelines in Brazil. The OECD Guidelines for Multinational Enterprises require companies doing business internationally to consider and take into account human rights and impact to the local environment. If a company does not adhere to these guidelines a formal complaint may be invoked. The complaint against Van Oord was directed towards the NCP in Brazil and the complaint against Atradius DSB at the NCP in the Netherlands. The complaint against the port authority was essentially dismissed, because the port is not a multinational company.
On November 30th 2016, the Dutch NCP published its final statement in the case against Atradius DSB. The NCP states that Atradius DSB remains responsible for observing social, environmental and human rights, also after providing export credit insurance, and should ensure a fair and correct processing of any complaints occurring. Both ENDS will certainly persist in reminding Atradius DSB of that recommendation.