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Lula Seen Putting Brazil Economy Ahead Of Amazon

Date: 15-May-08
Country: BRAZIL
Author: Stuart Grudgings

The former rubber tapper and union activist was one of the fresh faces who marked a break from Brazil's conservative past when she was appointed environment minister in Lula's first cabinet.

Her departure on Tuesday underlines Lula's long journey from firebrand union leader to business-friendly president more than 5 years after he became Brazil's first working-class leader.

"He is increasingly conservative," said Christopher Garman, head of the Latin America practice at Eurasia Group. "He has caved in to the view that the Amazon has to be developed in some form or fashion."

The government named Silva's replacement on Wednesday as Carlos Minc, a co-founder of the Green Party in Brazil. Environmentalists said he was well respected but could run into the same problems as Silva without stronger support from Lula.

"After Marina Silva, I think anyone who takes this position will face a lot of pressure from different sectors in Brazilian society, especially from agri-business," said Paulo Moutinho, research coordinator at the Amazon Research Institute.

Silva's resignation comes at a critical moment for the world's largest rain forest. Pressure on its resources from high world food prices and growing energy demands are pushing it closer to what environmentalists warn is a "tipping point" of destruction where its rain-making capacity could start to fail and affect the regional climate.

Silva had become increasingly isolated inside Lula's team, analysts say, over issues ranging from the government's support for biofuels, to genetically modified crops and nuclear power.

A major clash with business interests and other ministries came with her opposition to the expansion of hydroelectric power from dams in the Amazon region at a time when fast-growing Brazil is hungry for energy.

She unsuccessfully opposed several infrastructure projects in the rain forest, including two hydroelectric dams and a road that will link the western grain belt with the Amazon River.

The last straw for Silva appeared to come last week when Lula publicly rebuffed her and named another minister to oversee a government development plan for the Amazon.

Silva said in her resignation letter that she stepped down because of the "difficulty she had been having for some time in carrying out the national environment agenda," a presidential spokesman said.

STRONG LEGACY

Lula said on Wednesday there was no change in his government's environment policy. But analysts say it could now be easier to push forward with hydro-electric and other infrastructure projects in the Amazon that have been stalled over environmental concerns, such as the huge Belo Monte Dam in Para state.

"The Amazon will increasingly be a politicised region for the government because it is the most important source of energy," said Garman, noting there were heavy investment plans for mining as well as hydro-electric power.

Lula is presiding over an unprecedented period of economic growth and stability in Brazil, with new power and infrastructure projects seen as crucial to maintain growth at more than 5 percent a year.

Silva would have a lasting legacy, environmentalists said, including having presided over a 77,200-square-mile (20-million-hectare) expansion of protected area in the Amazon between 2003-2007, a almost the size of Britain.

Deforestation in the Amazon fell for three straight years after 2003, but last year saw a sharp increase, coinciding with a rise in global food prices.

(Editing by Kieran Murray and Cynthia Osterman)

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