Human Trafficking and Prostitution Scandal Threatens Belo Monte Dam

Dam-building consortium questioned around project and sex slavery link in Brazil

Amazon Watch, International Rivers

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Altamira, Brazil – Brazil's Parliamentary Commission on Human Trafficking (CPI) announced yesterday that it will summon the president of the Belo Monte dam-building consortium Norte Energia to explain its relationship to a nightclub, located within the dam's work camp, where 18 young women and an adolescent girl were held hostage and forced to prostitute themselves before being freed last month. Should CPI's inquiry demonstrate that Norte Energia shares responsibility for the crimes of human trafficking and sexual slavery, the construction of the world's third largest dam on the Amazon's Xingu River could be immediately suspended pending the implementation of rigorous socio-environmental mitigation measures.

The human trafficking scandal broke in mid-February when a 16 year-old girl escaped from a nightclub and denounced that she and several others from southern Brazil had been held as sex slaves in abysmal living conditions after being lured with offers for jobs in Altamira from their native town of Santa Catarina. After the girl's escape, police arrested the nightclub's owners and guards, and a congressional inquiry was opened.

According to Congressman Arnaldo Jordy, president of the CPI on Human Trafficking, the location of the nightclub within Belo Monte's public land concession indicates that the Norte Energia consortium could have played a role in this crime and will have to make immediate amends. In addition, the CPI inquiry will summons representatives from Brazil's National Development Bank (BNDES), and the public banks Caixa Económica and Banco do Brasil to evaluate the "social damages" caused by the projects they are financing, such as Belo Monte.

"It's impossible that the company has no type of culpability. This brothel is on the side of the only road inside the work camp. We cannot accept this kind of complicity," said Mr. Jordy. "Whatever explanation is offered, whatever the defense presented by the consortium, we will evaluate the possibilities, among them to suspend the project until conditionalities are observed."

Since the construction of the Belo Monte dam began, tens of thousands of migrants have arrived in the city of Altamira in search of work, more than doubling the city's population from 90 thousand in 2010 to nearly 200 thousand today. In order to mitigate the detrimental impacts of this population boom, Norte Energia was mandated by the Brazilian federal government to comply with a rigorous set of socio-environmental actions prior to initiating the project's construction.

The chaotic migration has placed enormous strain on the city's social services and infrastructure, while leading to an explosion in violent crime, especially against women and girls. Since the project broke ground in 2011, the number of child victims of violence and sexual exploitation in Altamira has nearly tripled.

"Unfortunately human trafficking and sex abuses are considered a regular consequence of projects like this," said Maira Irigaray of nonprofit Amazon Watch. "Cases at sites Tucurui and Madeira were never even exposed. Brazilian authorities, construction companies and financers must be held accountable because they are responsible for these horrific abuses against women and girls."

"The latest scandals are part of a larger pattern within the Amazon dam industry, in which profit maximization and corruption constantly override concerns for human dignity and environmental protection," said Brent Millikan, Amazon Program Director of International Rivers. "According to Brazilian legislation, however, public financial institutions such as BNDES can be held legally responsible for the social and environmental damage that is already being caused by Belo Monte."

By summoning representatives of Belo Monte's principal project financiers BNDES, Caixa Económica and Banco do Brasil for questioning, the CPI inquiry could also aim to make these institutions accountable for the serious social damages being caused by the mega-dam's construction. BNDES is financing 80% of Belo Monte's US$15 billion price tag (31 billion reais).  In November of 2012, BNDES approved a 22.5 billion reais project loan, 7 billion of which is to be passed through by Caixa Económica, and 2 billion of which is to be passed through by BTG Pactual.

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