|The Fragile Tropics of Latin America: Sustainable Management of Changing Environments (UNU, 1995)|
|Part 2 : The Brazilian Amazon|
|A fragile capitalism in a fragile environment: entrepreneurs and state bureaucracies in the free zone of Manaus|
The pariah capitalism
In a general way, the research findings have confirmed the hypothesis of the "pariah capitalism," in which entrepreneurs are recruited from among certain ethnic or religious groups that are typically peripheral in the context of international commerce. Indeed, here we face a characteristic trait of the economic history of Luso-Brazilian Amazon. As stressed by many of my respondents, there always were in the region, even previous to the rubber boom, entrepreneurs of Sephardic, Lebanese, recent Portuguese, or other origins, who filled the gap caused by the absence, or the weakness, of a native bourgeoisie of traders and manufacturers. However, these migrant entrepreneurs have often been rapidly assimilated into their new society, thereby losing, or tending to lose, touch with their countries and groups of origin. Thus, some of my informants made a point of drawing my attention to the fact (at least according to them) that the westernmost state of Acre is completely ruled, both economically and politically, by descendants of Syrian and Lebanese immigrants. The state of Amazonas, on the other hand, has fallen, according to the same sources, under the power of caboclos (among them the governor of the State himself), that is, Brazilians of mixed Portuguese and Amerindian ancestry. My informants added that both entrepreneurs and bureaucrats (often Brazilians from other regions) had to adjust to "those people" more than they would really like. But it is true that ethnic terms in the Amazon, like caboclo, Português, Paulista (a native of São Paulo State), and others, are frequently used with the vaguest of meanings.
Concerning immigrant entrepreneurs in the Amazon (especially commercial ones) I had reached my conclusions independently from, but in agreement with, Barbara Weinstein, who writes, referring to Pará that:
The Paraense elite had a long tradition of assimilating diverse individuals from Europe or other parts of Brazil ... As older, more established firms dissolved or collapsed, enterprising Syrian, Lebanese, and Jewish immigrants rushed in to fill the vacuum, eventually coming to exercise a near complete control over the Brazilian nut trade. By 1920, two Sephardic Jews could be counted among the leading officials of Pará's commercial association and another Paraense of Jewish extraction operated one of Belém's biggest export houses ... Bringing with them entrepreneurial skills and a bit of cash, Pará's Levantine and European immigrants succeeded in capitalizing on the few financial opportunities that a depressed economy offered. (Weinstein, 1986: 259-260)
Nearly all of my informants declared that at least 90 per cent of the industrial entrepreneurs of Manaus13 came from outside the Amazon, being mainly Paulista.14 The percentage of non-Amazonians is smaller in the commercial sector of the Free Trade Zone, and yet it is there that the presence of the "pariah capitalism," often connected to the "international of the free ports," is more keenly felt. There were, in early 1987, ten EastIndian-owned businesses in Manaus15 _ a phenomenon unknown elsewhere in Brazil.
In spite of much talk one hears in Manaus about the Free Trade Zone being nothing but "a consortium of Paulistas and Japanese," one sees no Japanese merchants in Manaus. One of my interviewees explained this in the following way: "The Japanese, sir? Here in the Amazon they are only gardeners and even so, you know, the climate, the soil do not help them at all." Yet in no way did this prevent the same informant, as well as several others during formal and informal contacts, from adding that the "real currency" of the Zona Franca was not even the United States dollar, but the Japanese yen.
It appears safe to conclude that there exists in Manaus a kind of "pariah capitalism" such as understood by Weber (1952) and even by Marx. This is made evident above all in the commercial sector by the high proportion of entrepreneurs belonging to ethnic minorities, who benefit from the often family-based links with the "international of the free ports" and from the experience and know-how they have acquired in other areas. Yet one should not belittle the presence, the activities, or the profits of the "native"16 entrepreneurs, especially in the commercial sector. Everything leads me to believe that a whole series of "backward and forward linkages" (Hirschman, 1958) benefited the commerce of Manaus even when not directly turned to the importation of foreign goods.
According to the respondents there would have been, in the whole history of the Free Trade Zone, only one clearcut instance of a "native" turned into a successful industrial entrepreneur. Yet, my informants continued, even this person, either for personal reasons or because he could no longer bear the way in which Suframa constantly persecutes all manifestations of local entrepreneurial talent, eventually moved to southern Brazil, taking his capital along with him. Recent immigrants, however (either from abroad or from elsewhere in Brazil), tend to describe the "native"17 as lacking in capital, initiative, know-how, and other requirements for a successful entrepreneurial career.
Whatever the boasts or complaints of both outsiders and "natives" (whose basic economic interests are not necessarily antagonistic), considering the low level of capital accumulation in Amazon, the Zona Franca model could not succeed without the resources of foreign and Paulista entrepreneurship, attracted to the area by generous tax incentives. The ideological justifications, revindications, or explanations of the several kinds of entrepreneurs (or of their surrogates) are not always to be taken at face value.
A much larger investigation would be required to analyse the composition, attributions, recruitment system, and performance of the bureaucracies associated with Suframa, its subsidiaries, like Fucapi, and other agencies, both on the national and on the Amazonas State level, including the several institutes that each claim to be the sole, or at least the main, agency legally entitled to do research in the Amazon valley. This is certainly a task which should be accorded top priority; however, here I will concentrate on the powers attributed by my respondents to the Superintendent of Suframa (surrounded, as already remarked, by a quasi-imperial aura) and his immediate assistants.
Keeping in mind the maze of laws, decree-laws, decrees, resolu tions, and the like (Brazilian administrative procedure is full of complexities and subtleties), we need not be amazed that the Superintendent and his assistants indeed have a great latitude in granting, denying, speeding, and delaying. However, as previously remarked, no other attribute of the Superintendent seemed to be more important for my interviewees, as, indeed, for every cognizant Mananara (the Amazonian Portugurse term for inhabitants of Manaus), than his authority over distributing importation quotas. There certainly are objective criteria for the exercise of that prerogative18 For the year 1987, these were stated in Resolution no. 050/87, signed by none other than the Superintendent himself. But everyone, even among the functionaries of Suframa, admitted to me that in spite of those criteria, or even because of them (since they are not always susceptible to a uniform interpretation), the Superintendent enjoys, to put it mildly, a considerable margin of discretion in dealing with quotas.
Thus, one of my respondents - whose opinions reflected the commercial, rather than the industrial, interest in the Free Zone - told me that, before the introduction of the quota system in 1976, the Superintendent of Suframa mattered so little that "he was not even invited to parties." But then, let us keep in mind that the main problem with quotas concerns their proportional allocation to commerce and industry. Industry has been given priority. Hence the anti-Suframa feelings of most tradesmen and the opposite reaction of most manufacturers.
When formally interviewed by me, the Superintendent himself reaffirmed that it was indeed the intention of Suframa to favour the industrial, rather than the commercial, sector of the Free Zone.19 However, he added, I should not take too seriously the complaints of traders and should waste no tears upon them. In 1986, for instance, out of a total value of nearly one billion dollars represented by commerce in the Free Trade Zone of Manaus, no more than 10 per cent according to the Superintendent, derived from the importation and sale of foreign goods other than component parts of products assembled in Manaus itself.
In spite, or perhaps because, of its imperial aura, the post of Superintendent of Suframa (like other important posts in the bureaucracy of Suframa and its subsidiaries) is subject to a high rate of turnover, which is certainly associated with the complexities of the quota-distributing functions incumbent upon it. Although it has an appointive, rather than an elective, character, it ranks among the few topmost positions in the Brazilian administrative system and it carries with it far more effective power than that of Governor of the State of Amazonas.
Who, then, are the beneficiaries of the creation of the Free Trade Zone of Manaus? This question can be answered in a number of ways. I will turn first to the big importers.
From a document I was able to examine in the archives of Suframa (1987), I derived the data presented in table 7.1, describing the aggregate of import quotas attributed to the commercial sector in 1987, the total number of firms benefiting from them, the value of individual quotas, and the number of firms. Even in the absence of an elaborate statistical treatment of these data, table 7.1 permits a glimpse at the high concentration of profits.20 Thus the fifteen topmost firms, representing no more than 4.2 per cent of all commercial firms in the Zone, get 35 per cent of the values of all quotas attributed to the commercial sector.21 In the industrial sector, the total of importation quotas, affecting 154 firms, is five times as large as that of the commercial sector (US$456,220,000 and US$85,77O,00O, respectively). Table 7.2 shows the distribution of that total by the main industrial subsectors of the Free Trade Zone. Finally, Table 7.3 presents the twelve industrial enterprises whose importation quotas in 1987 reached or surpassed the amount of US$10m.22
Another way of answering the question about the winners in the Free Trade Zone is to see it as a consortium of interests, a kind of joint-stock company - Zona Franca, Inc. - whose great shareholders are: (1) transnational and transregional (Paulista) enterprises, which stand out among the major beneficiaries from the tax incentive system of the Zone; (2) the "pariah" entrepreneurs, often linked with what I have called in this paper the "international of the free ports"; (3) local firms,23 overwhelmingly commercial, which profit either from the tax incentives that still apply to the importation of finished goods or from the general economic impetus of the Zona Franca; and (4) the great state bureaucracies of Suframa and subsidiaries, as well as of other agencies at the federal level and - to a lesser extent - the local state level, who are the representatives of what I have called (borrowing from Karl Wittfogel) "Oriental" or "hydraulic" despotism.
Table 7.1 Free Trade Zone of Manaus: Number of commercial firms by value of importation quotas , 1987
|Value of quotas |
|Number of firms||%||Total of quotas |
|1,000 or more||15||4.2||30,630||35.8|
|99 or less||158||44.6||9,730||11.3|
Source: Resolução 023/87, Gab. Sup. Suframa.
Table 7.2 Free Trade Zone of Manaus: Importation quotas for industrial sector in 1987. distributed by subsectors
|Subsector||Importation quotas (US$'000)|
Source: Resolução 023/87, Gab. Sup. Sufrarna.
Table 7.3 Free Trade Zone of Manaus: Industrial firms with importation quotas equal to or larger than US$10m in 1987
|Firms||Value of quotas (US$m)|
|Sharp do Brasil S.A.||32.0|
|Moto Honda S.A.||30.0|
|CCE da Amazonia S.A.||19.5|
|Semp Toshiba S.A.||17.2|
|Sanyo da Amazonia||14.2|
|Philco da Amazonia S.A.||12.0|
|Philco Componentes S.A.||11.5|
|Philips da Amazonia S.A.||10.0|
Source: Resolução 023/87, Gab. Sup. Suframa.
A final query concerns the people of Manaus and of Amazonia.
Did they gain or lose with the creation of the enclave? A full answer to this all-important question requires far more data than I was able to gather. It certainly can be said that, as a consequence of the tax incentive system of Suframa, employment possibilities have greatly increased in the area of Manaus. But many observers - including several of my interviewees stressed the artificial character of the Free Trade Zone, which is entirely dependent on the continuing good will of the Brazilian federal government. There are also those who mourn the demise of the traditional society and the damage done to the environment. But a long time has already elapsed since the balance of egalitarian societies, in harmony with their milieu, was destroyed in the region. Considering the history of Amazonia since the intrusion of the Europeans, the Free Trade Zone of Manaus is perhaps not the worst of its many evils.