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Francisco de Assis Costa: The multiple faces of the Amazon

Economist points out the diversity of productive structures and the role of peasants dating back to the eighteenth century

In his articles and books, which combine history, economics, mathematical modeling, sociology, and anthropology, economist Francisco de Assis Costa explores the diversity of productive structures and agents in the Amazon. Professor and researcher at the Center for High Amazonian Studies (NAEA) at the Federal University of Pará (UFPA), he calls particular attention to the extractive and agricultural production of a peasant group that dates back to the eighteenth century and which to this day is one of the key components of the regional economy. A key aspect of Costa’s work is that of peasantry, defined as a group of rural workers that organize themselves into productive family units. According to Costa, the diversity of the methods of rural production and, in general, of economic agents has practical implications for the development of sustainability policies for the Amazon.

Born in Pedro Avelino, a countryside city in Rio Grande do Norte, which has a current population of close to 5,000, Costa is married to a lawyer and his two daughters are also lawyers. He published his most recent book in February 2019, A Brief Economic History of the Amazon: 1720-1970, and this year another will also be released by the same publisher, Cambridge Scholars Publishing, about Ford’s failed attempt to produce rubber in the Amazon at the beginning of the twentieth century. In this interview carried out at the end of February in his home office in Belém, he analyzes the history, perspectives, and errors that governed the Amazonian economy since colonial times.

Age 70
Agrarian economy and planning
Federal University of Pará (UFPA)
Undergraduate degree from the Federal University of Rio Grande do Norte (1971), Master’s from the Federal Rural University of Rio de Janeiro (1981) and Doctorate from the Free University of Berlin (1988)
Scientific production
84 scientific articles and 26 books, including A Brief Economic History of the Amazon: 1720-1970 (2019)

You lived in Belém, but went to study the Amazon in Germany in 1982. Why?
In 1978, after my master’s program at the Postgraduate Center for Agricultural Development at the Getulio Vargas Foundation in Rio de Janeiro [CPDA–FGV], I returned to my role as technical coordinator of the State Agricultural Commission in Belém. I wrote a dissertation on Ford’s experience trying to produce rubber in the Amazon and I thought of doing my doctorate in the United States, which was the country of choice of economists at that time. But there were few options for a broader approach to political economics, which is what I was seeking.  Horácio Martins de Carvalho, who was a professor at CPDA, was enthusiastic about the work of Elmar Altvater (1938–2018) at the Free University of Berlin, an important political economist in Europe. He suggested that I go to Germany. I did not know one word of German, but I took daily classes, then wrote a proposal and sent it to Elmar and Manfred Nitsch, also of the Free University of Berlin, and both accepted me. I arrived there in May 1982 with the intention of continuing to study the large companies in the Amazon and cross-check against the peasant dynamic. I understood that peasant education had already been explained by the sociologists studying the Amazon at that time, such as José de Souza Martins at USP [University of São Paulo], Octavio Ianni [1926–2004] at PUC [Pontifical Catholic University of São Paulo] and Otávio Guilherme Velho at the Brazilian National Museum, but I later realized that they had only studied the more recent peasants. The historical and economic analyses had not been done. I left big business aside and focused on peasantry, which became a 450-page book.

What did you discover?
I perceived that, in the eighteenth century, the peasants formed themselves into preexisting structures that were the religious villages. The religious orders were responsible for the deculturalization of the indigenous peoples, fostering the formation of nucleated families. Many western European habits became part of their organization, such as wearing clothing, hunting with rifles, using gunpowder, and seasoning food with salt. Families began to use knowledge about nature to satisfy their new needs and a colonial trade project was designed for a peasant structure. The project yielded cocoa, oils, sarsaparilla, peppers, cloves, and other substitutes for Oriental spices. In exchange, the peasants who were essentially acculturated indians, received gunpowder, clothing, and salt.

What is the connection between your thesis and your most recent book, A Brief History, which also addresses the peasants?
Over time, I acquired data to explore the phenomena that I was able to cover in my thesis. In the book, I describe how the economic system organized by the religious orders actually functions. The villages addressed everyone’s needs. Those that were closest to the lushest forests specialized in the search for the so-called drugs of the sertão (badlands), while others, such as those of the Salgado region in Pará, were dedicated to the production of flour, fish, or salt; in Marajó, cattle; in Moju, liquor. The Jesuits ended up with a usurious economy because they developed a substantial savings and loaned out with interest. I also verified that the proliferation of the caboclo-peasantry in the Amazon began to accelerate in 1755, during the second five-year term of governance of the Marquis of Pombal [Sebastião José de Carvalho e Melo, 1699–1782], who cast out the Jesuits. When the villages were broken up, the members of the nucleated families did not return to living as indians. They became peasants and began to negotiate with the huckster, a kind of salesman who was also new and who sold and traded his products almost anywhere on the rivers, channeling local production to the world market.

If we suppress differences, we will describe a world that is scientifically incorrect and socially unjust

How would you define a peasant structure?
A peasant structure is a group of peasants of a defined territory. [Alexander] Chayanov [economist, 1888–1937] proposed a very interesting theory about the peasant economy. He spoke about the peasant business to refer to a nucleated peasant family, with father, mother, and children. According to Chayanov, what makes the peasant business unique is the fact that, while being a family or a unit of consumption, it is also a business, or a unit of production. As a business, a peasant family only employs its own members and divides the profit they earn among themselves. These unique characteristics create a very special economy that is focused on consumption. At the beginning of the colonization of the Amazon, there were no peasants, but rather only tribes with very large families and the farms of the settlers, owners of the sesmarias, which were based on slavery. The religious orders created villages for the indigenous and motivated the nucleated families to get an education because this was the Christian family ideal. Later, during the Pombaline era, intermarriage was encouraged among Portuguese and indian nucleated families. When they became autonomous, these families began to function as peasant families according to Chayanov. As they combined indigenous and European knowledge and needs, they became very special peasants that I called Amazonian caboclo peasants.

Are the peasants still important for the Amazonian economy?
Yes, and it is a pillar that is almost always neglected in economic analyses. Over the past 15 years, family agriculture has even continued to increase. In the 2006 Agricultural Census, considering the productive units of less than 200 hectares and primarily used for family work, the peasants represented 429,840 out of the total of 444,622 properties in the northern region, with a total workforce of 1,088,441 people. In the initial results of the 2017 Census, the peasants had 500,618 productive units and 1,398,366 family workers. Another comparison: in 2006, the aggregated peasant methods represented 75% of rural gross domestic product [GDP] of the northern region. The initial results of 2017 have not yet reached GDP.

In Brief history, you criticize the perspective of the economic cycles, such as that of rubber. Why?
This perspective hides a structural diversity that needs to be seen, or we risk committing historical improprieties and social injustices. Traditional historiography focuses on the cocoa of the Amazon and sugarcane of the Northeast, linking colonial Brazil to the world and being the key to everything, while the rest, which supplies products for the domestic market, is overshadowed. In the book, I show how export activity was combined with production for the domestic market and guaranteed the productive process of the colony. This is a win that comes from the way in which I search for economic history and insist on viewing diversity in the actors and the productive fundamentals in the colonial system as a whole. With rubber, we have the same problem. Classic literature on rubber, including that of Arthur César Ferreira Reis [historian, 1906–1993] and Euclides da Cunha [1866–1909], talks about “a great plantation,” but this is not true. The peasants that organized themselves in the eighteenth century were the ones that began to produce rubber and solely represented its production between 1850 and 1880. For 30 years, the caboclo peasants were the only ones producing rubber and almost no one spoke about them. Beginning in 1880, the great plantation began to be developed. The 1910 pricing crisis destroyed this second productive arrangement, that of the great producers, but the peasant structure remained.

How did you reach these conclusions?
I was only able to demonstrate this with the SIG-Fundiário [Integration System of Agrarian and Environmental Data, coordinated by UFPA and the Public Prosecutors of Pará]. I examined 4,125 land ownership records between 1892 and 1986 from the archives of ITERPA [Institute of Lands of Pará] incorporated into the SIG-Fundiário. I was able to map out the agrarian structure because the ownership declarations included information about the number of rubber trees on each property. The peasants represented 52% of rubber production capacity in Pará in the beginning of the twentieth century. Production began to increase again in the 1930s with the sale of latex to companies in São Paulo. The peasantry also maintained its export base with cocoa and Brazil nuts; rubber was simply one of the items of their product portfolio. In the 1970s, there were various forms of peasantry: the extractivist, the northeastern farmer, the Japanese, among others. Each one followed its own technological journey.

Personal archive Costa, upon receiving the official sword of the War Navy in 1972Personal archive

What are technological journeys?
This is a concept that I adapted from Italian economist Giovanni Dosi to understand the economics of the Amazon. There are different converging systems of production, both peasantry and employer-based, that lead to standards in cattle-raising, agriculture, and agroforestry systems, as well as to either more amicable or more hostile forms of land use. The production standards have a relevant institutional dimension in that they identify methods of land appropriation, access to knowledge, and access to credit. The way in which these concepts are developed allows them to be seen in combination. The tendency of traditional economics is to see things as if the economic agents were individual and that all of the people and structures were guided by the same principles. The peasant families make their decisions based on the needs of the members, while the rural businessman and the landowner are directed exclusively by the market. These are fundamental differences that impact the economy and thus need to be considered. If I make one contribution to my field, it would be to show that it is possible to analyze an economy with this diversity in mind, which I call profound structural diversity.

What is this exactly?
This type of diversity explains the motives of multiple actors, as there are various types of peasants—those that know how to manage the forest and those who only know agriculture. There are also very distinct forms of doing business. If we ignore the differences, we would describe a world built on the image of only one type of agent or structure, which is scientifically incorrect and socially unjust. This path leads to policies adapted to the needs of some social groups, while others are disregarded. And the qualities that are attributed to privileged groups are not necessarily superior to those of the groups that are overlooked. In one view of sustainable development, a social group whose abilities are geared toward preservation of natural resources cannot be treated as atavistically behind and consequently susceptible to elimination in the name of progress, but this is how the peasants with extractivist or agroforest technological journeys were perceived. What is perceived as ‘lagging’ could in reality be sophisticated forms of combining social survival with preservation of ecosystems. Policies should strengthen these journeys, taking care that the survival of those involved is both dignified and citizen-focused. For the same reasons, it is not enough to consider social groups, whose behavior only produces economies where natural resources are exterminated, as intrinsically modern, but we must look at how to proceed with respect to producers following the course of traditional commodities, such as soy and livestock. Policies should make them effectively modern, ecologically prudent, and socially just.

How does industry come into your research?
I examine the role of local industry, which is equally obscured. After the rubber pricing crisis, when the capacity to buy abroad was lost, a diversified industrial park was developed to meet the restrained demand for textiles, foods, etc. In the book, I show that industry moved from 1.7% of the regional economy at the turn of the twentieth century to 18% in the 1940s. I have worked with my research group to follow the process of industrial development around acai and the production of oils, drugs, and cosmetics. These production arrangements have an industrial component that is linked to rural productive diversity and multiple forms of agroforest systems. We—myself and my research group colleagues at NAEA and in the postgraduate economics program at UFPA—understand that these arrangements are strategies for thinking about the development of the region with a view to environmental sustainability and social inclusion.

Another contribution you have made was alpha social accounting. What is this?
This is a production methodology of input-output models based on the mathematics of Leontief [Wassily Leontief, economist, 1906–1999]. These models describe the sectoral interactions of agriculture, industry, and services, and they are used to calculate aggregated values of a country’s production, for example. Alpha accounting describes these relationships, inverting the direction of the calculation, beginning with the most basic information at the level of the producer to the level of a local or regional economy. This allows me to describe local economies that are safeguarding their structural diversity. I applied this methodology to describe local economies, such as that of the southeastern region of Pará, incorporating mining alongside different rural structures that interact with urban sectors, observing environmental impacts resulting from different activities and from the diversity of rural production methods. More recently, I used alpha accounting to analyze the economy of acai.

Personal archive Costa (right) doing fieldwork with acai producers in 2017Personal archive

How is the acai economy doing?
It’s growing a lot, despite little support from the government. In 2017, my group identified a new technological-industrial path competing with what had been developing locally for some time. The traditional method is to hit the acai without touching the tannin layer around the seed, which leaves an unpleasant taste. This precaution was fundamental in the development of local technology because, if the hitting is so strong that the seed is reached, the taste of the acai is ruined for the local culture. However, a generic form of technology for fruit pulp does not take this into consideration and hits the acai with greater force, resulting in a different taste. The machines are faster and thus more profitable, and have been adopted by production companies when their demand does not require the preferred flavor of the local culture, which is of the true acai. Acai consumption has increased recently in many places, resulting from its status as a superfood: the anthocyanin molecules are key; the flavor, derived from its fat content, does not count. The principles of competition are based on this conflict, which can establish important aspects of this economy. Is acai a generic commodity or should it be safeguarded for its value that comes from its terroir? This last possibility requires that we teach the world what makes good acai, as the French and Italians did with their wines.

How do you assess the work of big business in the Amazon?
The 1970s represent a new era in the history of the Amazon. The military dictatorship [1964–1985] began to implement an occupation project in the Amazon, with the goal of attracting capital from large companies in the Southeast for agricultural projects in the region. Ford’s experiment to develop a rubber tree plantation in the 1920s showed that the homogenous plantations in this region are very vulnerable. In the second year, the rubber trees were infested with fungi. It took eight years to find a technique that would contain the fungus, requiring three grafts. Homogeneity continues to be a problem. Observing the past and what is currently in process, it seems correct to say that the technologies based on mechanics and chemistry, and that assume homogeneity and a broad range of crops, have a much shorter lifespan in the Amazon than in other regions of Brazil and the world. And, considering the fragility of the soils in the region, these technologies impose significant challenges for ecological regeneration. The great agricultural opportunity of the Amazon brings with it a long-term social risk that, despite the warnings, we are concerned about not assessing correctly.

Why do you not like the idea of an empty demographic in the Amazon?
The dictatorship communicated the idea that the Amazon was an empty demographic in order to justify their actions. If it were, what should be done? Occupy, fill the void. But emptiness did not exist anywhere. What existed were different forms of occupation—the indians have large families, the extractivist peasants occupy vast areas. It could only be said that there was emptiness in the Amazon because academia and society in general did not show the occupation. The river dwellers, who cannot be seen on the map because they don’t cause deforestation, have been there for three centuries.

We need to teach the world about what is good acai, as the French have done with their wines

How was your experience with government?
I joined the ADA [Amazon Development Agency] in 2003 as part of a team tasked with returning the agency to being a new SUDAM [Superintendency for the Development of Amazonia]. After assuming this role, I discussed with management the possibility of observing the regional economy through local production arrangements, which came to the economy through the conglomeration of actors. We covered all of the states of the region, found close to 40 local production arrangements, and selected four to receive immediate support; the first was that of acai. We were doing well when various problems occurred among the politicians and they began to attack me for my ideas. I quit. Years later, in 2011, I was invited to hold a management position at IPEA [Institute for Applied Economic Research]. I launched a series of debates to show the economists of the institute, the majority of whom were very well qualified, that they did not see the regions as a result of their adopted theories and methodologies. I showed that we could observe the diversity of economic structures and, little by little, I acquired allies and we began to plan how to do customized presentations by region. We were on this promising path when, again, we faced political problems and fights. Once again, I left to take care of my life.

What do you remember about Pedro Avelino, your birth city?
I remember a lot. I was there in January 2018 for the 150th anniversary of the city in the hinterland of Rio Grande do Norte, and city hall invited me to speak to City Council. I took the opportunity to speak about my generation, which benefited greatly from the guidance of Fr. Antonio Antas [1918–1975]. Fr. Antas wagered that knowledge would put young people in another kind of environment. He built his own school which offered a more complete education than the public schools. When a child finished primary school, he would tell the parents that they had to send their children to study in another school. For those who needed gym class, he would look for spaces in the religious schools in Natal. In this way, he helped many people. I was an altar server and I really liked this opportunity to imitate Fr. Antas. At 10 years of age, I went to São Pedro Seminary in Natal. But four years later, I could see it was not working for me and I moved to a lay school. My father, who was a salesman, paid for my studies. When I entered the faculty of economics in Natal, there was a great flood in Pedro Avelino and my father lost a significant portion of his inventory. He was never able to fully recover from this financial loss. As luck would have it, I was also able to complete a diploma in mathematics and then passed a public competition for elementary school teachers. As I was an economics student, I was chosen to teach in the most important public school in Natal, Atheneu Norte-Riograndense. Thus, I was able to support myself and help my siblings, who left Pedro Avelino, and my family was saved from the entire disaster.

And your experience with the Navy?
I graduated from economics in 1971 and began to work for an apparel company in Natal, but I wasn’t satisfied with my salary so I entered a public competition for the Navy ancillary officers corps, trained in civil universities. I spent one year in Rio and came to the Navy shipyard here in Belém. That was when I discovered the Amazon. I arrived at 2 o’clock in the morning, and as soon as I opened the door of the airplane, I got that whiff of air that I’d never smelled before. It was October, the hottest month of the year in Belém. The taxi took me along a route that was almost all slums, with daunting houses on stilts. I didn’t sleep that night. At 5 a.m., I was at the hotel window looking at the city. A beautiful city but also one that had a lot of suffering and that had inherited a long period of recession. My life as a Navy marine lasted for two years, when I realized it was not worth it. The extremely rigid environment and the logic of the organization of the shipyard bothered me a lot. I quit and began a six-month specialization course in agrarian planning offered by the National System for Agrarian Planning [SNPA]. And later, SNPA offered me a position as technical coordinator at the State Commission for Agrarian Planning, which was being established in Belém. I then returned to Rio to study at CPDA-FGV. It was an extraordinary period of my education. From that point, I had the capacity to bring together multiple theoretical perspectives and find methodologies to articulate different ways of explaining reality.