Does POTUS ever travel in disguise

The disappearing home of the jaguar

Although the Amazon region enjoys full attention, the threat to other valuable forest areas in Latin America is likely to be even greater. A thousand kilometers further south, the dry forests of the Gran Chaco are disappearing faster than any other forest in the world. David Attenborough described this unique ecoregion, home to the jaguar, the great anteater and dozens of endemic species, as "one of the last great wilderness areas in the world".

The fastest to disappear is the Chaco in Paraguay. By 2016, this relatively small South American country had already lost a forest area larger than Switzerland. Most of it had been cut down in the previous 10 years. In 2019, the transformation was intensified again and a football field is now leveled every two minutes.

The driving force behind the destruction is industrial livestock farming, which seeks to meet foreign demand with it. Studies have shown that Paraguayan beef and leather are responsible for deforestation like no other raw material in the world. Over a fifth of the clearing is also illegal.

This destruction has catastrophic consequences - both for the biodiversity on site and for global climate protection. But it is also a catastrophe for the indigenous peoples of Paraguay, for whom forests are often the livelihood.

Most of their ancestral lands have already been stolen from them. Decades of corrupt rule have made Paraguay a country with one of the world's highest inequality rates, where 90 percent of the country belongs to a few thousand wealthy agribusinesses who also provide political leadership from within their ranks of the state. But the indigenous groups in the country have not given up yet. The Ayoreo Totobiegosode, who are among the last isolated peoples of Latin America outside of the Amazon region, play a key role in this struggle.

The invasion of indigenous areas for livestock

Since the early 1990s, Totobiegosode activists have been campaigning for the protection of their remaining tribal areas. Thanks to their efforts, a 5,500 square kilometer forest reserve was designated, in which Totobiegosode groups still live in voluntary isolation to this day. The area, known by the Spanish abbreviation PNCAT, was officially recognized by the Paraguayan state in 2001.

Only a few years later the aggressive expansion of the country's thriving beef industry began in the Chaco area. Despite the protection measures initiated by the Paraguayan Institute for the Indigenous Peoples, some ranchers with political ties managed to lease larger areas of the PNCAT. The effects were catastrophic. Since 2005, 53,000 hectares of Totobiegosode Forest have been cleared and turned into grazing land for cattle.

The worst deforestation is at the expense of a Brazilian company called Yaguarete Pora. Yaguarete first cut deep road aisles into the heart of the PNCAT and thus also dismembered historically important sites of the Totobiegosode. The company then used its political influence to obtain a permit to clear the surrounding forest areas. The permit was later found to have been illegally granted, and Yaguarete was sentenced to pay fines for failing to mention the existence of isolated groups in the areas in question. In 2013, however, Paraguay's Ministry of the Environment, in blatant disregard of this decision, issued the same permit again - and Yaguarete destroyed thousands of hectares of additional forest areas.

But other companies were also involved in the land grab. After losing all confidence in the Paraguayan authorities, the Totobiegosode turned to the international community for help. This was followed by damning reports from the United Nations and the IACHR, the regional human rights organization. In February 2018, the Paraguayan government finally reacted, and the State Forestry Institute (INFONA) put all land management plans for properties within the PNCAT on hold - any deforestation was now unequivocally illegal.

While the new regulations provided a brief respite, the bulldozers, Earthsight found, did not stand still for long.

The bullzdozers are back

Just two months after INFONA's decision, Earthsight discovered new deforestation within the PNCAT. Satellite imagery showed that bulldozers had begun systematically clearing forests on both sides of an important watercourse. Within a few months, 2,100 hectares of valuable forest were lost. The following year, another 520 hectares were cleared elsewhere on the opposite side of the PNCAT.

To determine who was responsible for this illegal clearing, Earthsight traveled to the Totobiegosode area in late 2019. We met with indigenous communities who are fighting against the clearing and, as an exception, allowed us to document the illegal logging in their area. We found that most of the most recent deforestation was caused by another Brazilian company, Caucasian SA, which had previously tried Totobiegosode activists in court. Further research revealed that the second site belongs to an agricultural cooperative called Chortitzer, one of Paraguay's largest beef exporters.

To understand how it can be that landowners in Paraguay apparently enjoy such impunity, Earthsight met with government whistleblowers. An officer who reported dozen cases of illegal logging in another part of the Chaco to her superiors gave a detailed account of how she was silenced. When she defied her superiors' demands to stop, she was sent to meet with representatives of the affected landowners who tried to bribe her. Eventually she was forced to resign. As part of further research, we covertly investigated Paraguayan real estate agents who offered us two different plots of land for sale within the PNCAT and assured us that, thanks to their personal relationships with the Ministry of the Environment, we would not have to wait for approval to start the deforestation of the forest in the country to begin.

The trail of money

However, the real people responsible for the destruction we documented can be found in a completely different place. The disappearance of the world's tropical forests is fueled by the increasing global demand for cheap raw materials. Cattle breeding is by far the main culprit. Paraguay exports over a billion dollars worth of beef and leather every year. While most of the beef is exported to Chile and Russia, sixty percent of the leather goes to the same country: Italy.

Following the trucks that bring the cattle for slaughter, Earthsight has been able to track the cows on their way from the Caucasian and Chortitzer farms to three of Paraguay's largest meat processing companies. Further research revealed that these companies supply tanneries, which account for 98 percent of Italian leather imports from Paraguay.

In the next step, through covert investigations in these tanneries and the analysis of thousands of delivery notes, we were able to determine that most of these exports are intended for the automotive industry. Manhattan could be covered three times with the leather that is used in automobiles around the world every year. Over a third of this comes from South America. We found that the largest automotive leather company in Europe, the Italian tannery Pasubio, is also one of the world's largest buyers of leather from Paraguay, buying up an estimated two-fifths of all Paraguayan leather exports.

Pasubio supplies the leather used in the luxury cars of the most famous names in the automotive industry. Our research shows that this also applies to hides from tanneries and slaughterhouses that source material from illegal cattle breeding in the heart of the PNCAT.

The connection to luxury cars

The managing directors of one of Paraguay's tanneries boasted that they were supplying BMW, including the X5 SUV. The German manufacturer has confirmed to Earthsight that it uses animal skins that can be traced back to the slaughterhouses of two of Paraguay's largest beef producers. Both companies source cattle from farms within the PNCAT. One, Frigorifico Concepcion, a meat processing company from Paraguay, buys cattle from Yaguarete Pora, while the other, a subsidiary of the Brazilian multinational Minerva, sources cattle from Caucasian.

Elsewhere in the PNCAT, cattle are transported from the Chortitzer ranch to the company's own slaughterhouse, Frigochorti, which supplies the Paraguayan leather company Cencoprod. The director of Cencoprod claims to have supplied leather that is used in several major brands, including: for the seats of the UK-made Range Rover Evoque or for Ferrari steering wheels. When Jaguar Land Rover, formerly one of Pasubio's largest customers, was later approached by Earthsight about it, the company did not deny using leather from Cencoprod. Ferrari claimed that Cencoprod was not currently one of the company's suppliers; however, it is unclear how reliable this is, as Ferrari failed to provide evidence of adequate traceability.

Many other auto giants also source leather from the Italian tanneries involved in the scandal, and while some deny that this includes animal hides from Paraguay, it appears that this is more accidental than deliberate. None of the automakers surveyed by Earthsight in June 2020 have a policy on the impact of their own leather procurement on forests and indigenous peoples. In addition, none of the manufacturers could trace their entire leather inventory back to the ranch where the cattle were raised.

And that does matter, because the leather that comes from deforested areas on the land of Totobiegosode is just the dirty tip of a much larger iceberg. Most of Paraguay's beef and leather comes from areas where the forest has been cleared over the past two decades. The world's luxury cars are now gobbling up five times as much leather from Brazil, where cattle ranching is the main cause of the ongoing deforestation in the Amazon.

The battle of the auto giants against government efforts to clean supply chains

Although cattle are responsible for the deforestation of tropical forests more than any other “forest risk raw material”, the beef and leather industries lag far behind other areas, such as palm oil and cocoa, when it comes to critically questioning their own role. But the other industries are also falling short of expectations. Ten years ago, a number of industry giants from the production, trade and sale of the affected products - including Nestlé & Unilever - pledged to end the use of all products that come from deforested areas by 2020. None of the companies has even come close to achieving this goal.

This failure shows that multinationals cannot be relied on to voluntarily clean up their supply chains. It shows how urgently the legislature must act here in order to oblige companies to take due diligence measures and thus ensure that their procurement of raw materials does not contribute to deforestation and other destruction. Europe has a key role to play in this. The EU and the UK are jointly responsible for 10 percent of global deforestation in the form of raw materials. They import an estimated EUR 6 billion worth of soy, beef, leather and palm oil raised or grown on land that has been illegally deforested. Italy and Germany are the two top buyers.

Bills, according to which companies would be obliged to clean up their supply chains, are being examined by the governments in Germany, Great Britain and the EU. However, we have found that industry associations that claim to represent the interests of European industry (including its influential automakers) are lobbying to topple or dilute these laws. You even use the corona pandemic as a justification. In view of the German EU Council Presidency, the country has a decisive role to play in promoting such legislative projects. The federal government has already announced that it intends to take on this task. However, four fifths of all cars in the premium segment are German brands, and the country's automotive industry is hugely influential. In view of the complaints from large parts of the industry, there is a real danger for the German supply chain law of being little more than an ineffective fig leaf. If the auto giants do not want to be branded as hypocrites, they must take a public stand in favor of effective regulations. If this does not happen, it is essential that the legislature also remains steadfast against lobbying activities from the opposite direction.