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Good morning! We’re covering the hike in Amazon deforestation numbers. More controversy surrounding Justice Minister Sergio Moro. And a case that could limit Brazil’s anti-corruption efforts. (This newsletter is for platinum subscribers only. Become one now!)


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Operation Car Wash, launched this morning, targets former Paraguayan President Horacio Cartes (2013-2018). An arrest warrant has been issued against Mr. Cartes, who is believed to have helped Dario Messer, a notorious money launderer, flee the police last year.</p> <p>Today&#8217;s operation focuses on money laundering schemes, but also concerns the smuggling of firearms and illegal cigarettes across the Brazil-Paraguay border. Mr. Cartes&#8217; dealings with Mr. Messer have reportedly been monitored by U.S. law enforcement agencies for nearly two decades.</p> <hr class="wp-block-separator"/> <h2>Amazon deforestation at highest in ten years</h2> <p>Between August 2018 and July 2019, Brazil lost 9,762 square kilometers of Amazon forest coverage, according to official data. That is roughly the size of Cyprus and represents a 29-percent bump from the previous 12 months. The government minimized the results, saying that deforestation rates have been rising since 2012.</p> <p><strong>Why it matters.</strong> President Jair Bolsonaro and his administration have backed looser environmental controls. And even if the government is right that Amazon deforestation gradually increased during previous governments, the rise between 2018 and 2019 was almost three times sharper than in previous years.</p> <div class="flourish-embed" data-src="visualisation/659590"></div><script src="https://public.flourish.studio/resources/embed.js"></script> <p><strong>An HR issue?</strong> NGOs blame the government for the numbers, saying that environmental agencies never issued such a small amount of fines to transgressors. That is partially explained by a loss of professionals in the Environment Ministry. Since December 2018, almost 20 percent of analyst positions were dismissed.</p> <p><strong>Fires.</strong> In August, Brazil faced massive international scrutiny after a government agency detected a spike in man-induced Amazon fires. The Bolsonaro administration dismissed the alerts, saying the situation was &#8220;normal&#8221; and &#8220;below the historical average.&#8221; It also said that international criticism came from forces seeking to seize control of the forest. But, as a group of scientists claims in an <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/gcb.14872">article</a>, the number of active fires was three times higher than in 2018. It is worth noting that the impact of the August fires will only show up in <em>next year&#8217;s</em> annual deforestation results.</p> <p><strong>Regional numbers.</strong> The state of Pará accounted for 40 percent of detected Amazon deforestation, followed by Mato Grosso (17 percent). These two, combined with the states of Amazonas and Rondonia, accounted for 84 percent of forest loss. The northernmost state of Roraima showed a 216-percent hike in deforestation.&nbsp;</p> <p><strong>Now what?</strong> Environment Minister Ricardo Salles said he will study actions with governors in the region. But the truth is that the government ignored all alerts, and has no plan to curb the advances against the rainforest.</p> <hr class="wp-block-separator"/> <h4 style="text-align:center">Environmental fines issued in Brazil</h4> <div class="tableauPlaceholder" id="viz1574162692007" style="position: relative"><noscript><a href="#"><img alt=" " src="https://public.tableau.com/static/images/mu/multas_15741338719800/Painel1/1_rss.png" style="border: none"></a></noscript><object class="tableauViz" style="display:none;"><param name="host_url" value="https%3A%2F%2Fpublic.tableau.com%2F"> <param name="embed_code_version" value="3"> <param name="site_root" value=""><param name="name" value="multas_15741338719800/Painel1"><param name="tabs" value="no"><param name="toolbar" value="yes"><param name="static_image" value="https://public.tableau.com/static/images/mu/multas_15741338719800/Painel1/1.png"> <param name="animate_transition" value="yes"><param name="display_static_image" value="yes"><param name="display_spinner" value="yes"><param name="display_overlay" value="yes"><param name="display_count" value="yes"></object></div> <script type="text/javascript"> var divElement = document.getElementById('viz1574162692007'); var vizElement = divElement.getElementsByTagName('object')[0]; if ( divElement.offsetWidth > 800 ) { vizElement.style.minWidth='420px';vizElement.style.maxWidth='650px';vizElement.style.width='100%';vizElement.style.minHeight='587px';vizElement.style.maxHeight='887px';vizElement.style.height=(divElement.offsetWidth*0.75)+'px';} else if ( divElement.offsetWidth > 500 ) { vizElement.style.minWidth='420px';vizElement.style.maxWidth='650px';vizElement.style.width='100%';vizElement.style.minHeight='587px';vizElement.style.maxHeight='887px';vizElement.style.height=(divElement.offsetWidth*0.75)+'px';} else { vizElement.style.width='100%';vizElement.style.height='827px';} var scriptElement = document.createElement('script'); scriptElement.src = 'https://public.tableau.com/javascripts/api/viz_v1.js'; vizElement.parentNode.insertBefore(scriptElement, vizElement); </script> <hr class="wp-block-separator"/> <script src="https://www.buzzsprout.com/299876/1548880-73-is-brazil-capable-of-protecting-the-amazon-on-its-own.js?player=small" type="text/javascript" charset="utf-8"></script> <hr class="wp-block-separator"/> <h2>Moro was invited to join Bolsonaro before election, says former aide</h2> <p>Gustavo Bebianno, a former advisor to President Jair Bolsonaro, <a href="https://www.youtube.com/watch?v=45mPkVfQ-EQ&amp;feature=emb_title">said in an interview</a> that Sergio Moro was sought out to become Jair Bolsonaro&#8217;s Justice minister weeks before the runoff election.</p> <p>At that point, Mr. Moro was a federal judge and the face of Operation Car Wash—and made information that was damning to the Workers&#8217; Party available to the public just days before election day.</p> <p><strong>Why it matters.</strong> Mr. Moro has always sustained that his decisions as a judge followed no political agenda, and that talks of him becoming a member of the cabinet only came <em>after</em> Jair Bolsonaro was elected. These revelations, combined with private messages he exchanged with prosecutors—and leaked by <em>The Intercept</em>—suggest otherwise.</p> <p><strong>Misconduct?</strong> Following <em>The Intercept</em>&#8216;s revelations that Mr. Moro often quarterbacked the prosecution against defendants, former President Lula filed a lawsuit asking for the judge to be disqualified because of suspicion, which would then annul the ex-president&#8217;s conviction. The case is expected to go to trial before the end of the year, as Supreme Court Justice Gilmar Mendes told editor Euan Marshall in an <a href="https://brazilian.report/power/2019/11/18/interview-gilmar-mendes-moro-car-wash/">exclusive interview</a>.</p> <p><strong>Grain of salt.</strong> Mr. Bebianno&#8217;s words shouldn&#8217;t necessarily be taken at face value. He sought the Justice Ministry position for himself, and earlier this year he acrimoniously left the government in a highly publicized feud with President Bolsonaro and one of his sons.</p> <hr class="wp-block-separator"/> <h2>Supreme Court to decide on sharing of financial data with law enforcement</h2> <p>Last week, Supreme Court Chief Justice Dias Toffoli issued a decision granting himself access to all financial reports made by Brazil&#8217;s money laundering enforcement agency, consisting of the personal data of some 600,000 people. He said he wanted to understand how these reports are shared with law enforcement. Yesterday, he went back on this call, saying that he didn&#8217;t access the sealed information and that the agency&#8217;s explanation of its procedures was satisfactory.</p> <p><strong>Context.</strong> In July, the chief justice suspended all investigations using reports by the anti-money laundering agency which were obtained without a court order. These reports, however, are usually the first step of an investigation, as they flag financial transactions considered suspicious.</p> <p><strong>Why it matters.</strong> These decisions concern an investigation into Senator Flávio Bolsonaro, the president&#8217;s eldest son—who is suspected of laundering money from corruption schemes.</p> <p><strong>What&#8217;s next?</strong> The Supreme Court is expected to decide tomorrow on how law enforcement is allowed to use said reports. The expected outcome is a middle-ground verdict—restricting their use, but not ruling it out entirely. Over 700 cases have been suspended until a decision is made.</p> <p><strong>Concerns.</strong> The Organization for Economic Co-operation and Development (OECD) is concerned about the possibility of Brazil rolling back its recent anti-corruption efforts, the organization&#8217;s anti-bribery committee chair Drago Kos told reporter Natália Scalzaretto in an <a href="https://brazilian.report/power/2019/11/18/oecd-brazil-anti-bribery-progress-problems-remain/">exclusive interview</a>.</p> <hr class="wp-block-separator"/> <h2>What else you need to know today</h2> <p><strong>Currency. </strong>The Brazilian Real closed at an all-time low on Monday. But <a href="https://brazilian.report/money/2019/11/15/brazilian-currency-all-time-low-not-exactly/">as we explained</a>, the exchange rate of BRL 4.2061 to USD 1.00 is much lower, in real terms, than the peak in 2002 caused by markets&#8217; anticipation of Lula&#8217;s first win in a presidential race. In today&#8217;s money, the exchange rate in September 2002 would have been USD 1: BRL 10.279. In part, a lower BRL reflects frustrations with the Jair Bolsonaro administration, but unlike in the past, it is no longer a great thermometer to measure Brazil&#8217;s country risk.</p> <p><strong>Business.</strong> Ambev, Latin America&#8217;s biggest brewer, announced that CEO Bernardo Paixa is stepping down to &#8220;pursue personal projects.&#8221; He will be replaced by Jean Jereissati, the current head of sales and marketing. Ambev has lost market share in recent years, as Heineken has increased its footprint in Brazil. Back in October, the company posted underwhelming Q3 earnings and faces an investigation into alleged abusive competition practices by antitrust regulators.</p> <p><strong>Elections.</strong> In a statement to Congress, messaging app company WhatsApp said over 400,000 accounts were banned during Brazil&#8217;s 2018 electoral campaign due to violations of the app&#8217;s terms of use—but the company said it didn&#8217;t look into the content being sent by said accounts. WhatsApp has become <a href="https://brazilian.report/power/2018/10/03/far-right-voters-social-media/">one of the main media for sharing news</a> (and thus, misinformation) in Brazil.</p> <p><strong>Oil spill.</strong> As we mentioned in <a href="https://brazilian.report/newsletters/weekly-report/2019/11/18/true-situation-brazil-public-service-charts-psl-bolsonaro/">yesterday&#8217;s Weekly Report</a>, Federal University of Alagoas researchers have identified a new possible culprit for the massive oil spill that has now affected 643 locations along the Brazilian coast. Through satellite imagery, they spotted an oil stain connected to tanker Voyager I, which is under the Marshall Islands flag and registered to a German company. The vessel is currently in Oman, heading to Singapore, according to <a href="https://www.marinetraffic.com/en/ais/home/shipid:686586/zoom:10">MarineTraffic.com</a>. Earlier this month, federal marshals opened investigations against a <a href="https://brazilian.report/society/2019/11/02/greek-ship-bouboulina-caused-brazil-oil-spill/">Greek oil tanker</a> believed to be responsible for the spill.</p> <p><strong>Indigenous rights.</strong> Portuguese hotel group Vila Gale canceled plans to build a 500-room luxury resort on the coast of Bahia following public pressure against the project. The hotel would be established in a location where the indigenous group Tupinambá de Olivença (made up of 4,631 people) is fighting for recognition. Their process to turn the land into a reserve started in 2003 and since 2016 now depends on a green light from the government—but President Bolsonaro promised not to give &#8220;one inch of land&#8221; to indigenous tribes.

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BY Gustavo Ribeiro

Gustavo is the founder of The Brazilian Report, and is an award-winning journalist with experience covering Brazilian politics and international affairs. His work has been featured across Brazilian and French media outlets.