Brazil’s Finance Ministry has done something rare in the country’s fiscal debate: it put names, numbers and addresses on a public policy that for decades has been shielded by abstractions. By opening up data on tax exemptions, the ministry exposed the cost of the Manaus Free Trade Zone and showed who sits at the top of the beneficiary list.
The picture is uncomfortable. When the dashboard is filtered for Amazonas and Pará, it shows R$53.37 billion in tax breaks, spread across 83 programs and 1,538 companies. Moto Honda da Amazônia ranks first, with an estimated R$8.70 billion in benefits, followed by Samsung Eletrônica da Amazônia, with R$8.59 billion. Yamaha Motor da Amazônia comes next, with R$3.44 billion; TCL Semp, with R$1.66 billion; Recofarma, linked to the Coca-Cola system, with R$1.54 billion; and Videolar, Elgin, Gree, Foxconn and other companies operating in the industrial hub.
The Manaus Free Trade Zone has long been defended as a policy for the Amazon. The Finance Ministry’s dashboard shows it is also a policy for some of the world’s largest industrial multinationals. That does not make the regime automatically illegitimate. But it changes the debate. It makes it necessary to ask why this support should remain structured as a multibillion-real tax waiver, with a near-century-long horizon and large private groups among its main beneficiaries.
Supporters of the Free Trade Zone have strong arguments. Manaus built a relevant industrial base, created formal jobs and offered an economic alternative in a region where the absence of the state often leaves room for predatory activities. Pressure on the forest might have been worse without an urban-industrial hub capable of generating income and anchoring population.
But that argument cannot work as a permanent safe conduct. The Amazon rainforest has also been affected in recent decades, even with the Free Trade Zone in place. Deforestation advanced on several fronts, driven by illegal mining, disorderly occupation, land grabbing, cattle ranching and weak state capacity. We do not know what the environmental impact would have been without the Manaus model. Nor do we know, with enough precision, how much preservation can be attributed to it. The environmental argument is plausible. It needs to be measured, not merely repeated.
The same applies to geopolitics. For decades, the Free Trade Zone was treated as an instrument of strategic occupation of the Amazon. In a continental country, that matters. But territorial occupation in the 21st century can take other forms: defense, infrastructure, connectivity, environmental intelligence, science, bioeconomy, public services and effective state presence. The idea that Amazonian sovereignty depends essentially on tax subsidies for makers of motorcycles, televisions, electronics and air conditioners is, at best, incomplete.
Brazil’s tax reform makes this contradiction even clearer. The country approved a reform designed to simplify taxes, reduce distortions and make the system more transparent. At the same time, it preserved one of its largest exceptions. A transition fund was also created to support the competitiveness of the Free Trade Zone and diversify the regional economy.
That fund could become a bridge to new economic vocations — bioeconomy, technology, research and environmental services. Or it could become just another layer of protection for a model that has already shown an extraordinary capacity for political survival.
The problem is not supporting the Manaus Free Trade Zone. The problem is supporting Manaus in the same way for another 50 years. The Free Trade Zone was reshaped in 1967 and is protected until 2073. By the time that deadline arrives, the regime will have lasted 106 years. Few industrial policies anywhere in the world enjoy a comparable horizon.