Brazilian President Michel Temer is trying to reassure foreign trade partners that the corruption scandal engulfing the country’s meat industry does not mean its products are unsafe.
Meeting ambassadors from Europe, the United States and China to share a barbecue, Temer said his government remained confident about the quality of Brazilian meat.
Brazil’s pop meat-packers have been accused of selling rotten produce for years. Brazil is the world’s biggest red meat exporter.
“The Brazilian government reiterates its confidence in the quality of a national product that has won over consumers and obtained the approval of the most rigorous markets,” said Temer.
On Friday, federal police raided meat-producing plants and arrested more than 30 people. The government suspended more than 30 senior civil servants who should have spotted the unhygienic and illegal practices. They are being investigated for corruption.
Three meat-packing plants have been closed and another 21 are being investigated.
Temer said the plants under scrutiny represented a tiny proportion of Brazil’s meat industry.
“Only 21 units out of 4,837 in Brazil subject to government inspection are facing allegations of irregularities. And only six of them have exported in the past 60 days,” said Temer.
The Brazilian government is worried that the US, China and the EU may ban meat imports from Brazil, worth US$ 12 billion a year.
EU ambassador João Cravinho tweeted on Sunday that he would demand “complete, urgent clarifications from the agriculture ministry”.
Operation Weak Flesh was launched in the early hours of Friday in six Brazilian states after a two-year investigation. Federal police carried out raids in 194 locations, deploying more than 1,000 officers.
The investigators allege that some managers bribed health inspectors and politicians to get government certificates for their products. They accuse more than 30 companies of a number of unhygienic practices. Among them are JBS, the world’s largest beef exporter, and BRF, the world’s top poultry producer.
“They used acid and other chemicals to mask the aspect of the product. In some cases, the products used were carcinogenic,” the police said.
Both JBS and BRF said they followed high quality standards and sanitary regulations.
Prosecutors say a percentage of the bribe money was paid to two parties from the governing coalition: the PP and President Michel Temer’s PMDB.
Containing the Damage
Amid the scandal over the sale of rotten meat, Brazil’s government has been bending over backward to assure foreign consumers there has been no health threat.
In a desperate move to prove that Brazilian meat was safe, President Michel Temer on Sunday night invited ambassadors to a steak dinner against a backdrop of allegations that corrupt exporters had sold deliberately mislabeled rotten meat.
Three facilities were shut down right away and at least 30 people were arrested after it became known that bad meat had been sold and fraudulent certificates issued. In some cases, carcinogenic chemicals had been used to mask the smell of the meat, authorities confirmed.
Brazil has suffered from two years of recession. The meat industry has been one of the few bright spots in Latin America’s biggest economy.
Meeting ambassadors, Temer had the daunting mission of calming the scandal, which was threatening the reputation of the world’s biggest exporter of beef and poultry.
Brazilian meat is shipped to 150 nations; sales last year reached US$ 5.9 billion in poultry and US$ 4.3 billion in beef, according to government data.
In Temer’s address to the ambassadors (only 19 out of 33 took him up on the invitation), the president acknowledged that the scandal had caused “major concern.”
But he insisted that the tainted meat occurred in “only a very few businesses” and did not represent a wider problem.
There are worries that the recent revelations could hurt attempts to negotiate a trade deal between South America’s Mercosur group and the European Union.
That’s because the countries which are party to trade deals must not only have good reason to be confident that each others’ regulations are properly designed to protect consumers – the regulations must also be properly implemented.
So far Germany has not been affected. Gero Jentzsch from the German Butchers’ Association says that he only knows what is being published in the press and that we must wait to see what the investigations reveal.
Nonetheless, he calls for better structures in the agriculture and meat industries, which would make transparency and traceability easier for consumers.
“A close relationship between farmers and butchers, as well as a personal relationship between butchers and their customers would be an ideal situation.”
But for Brazil the knock-on effects of the scandal keep coming. China and Chile have both now temporarily suspended imports of Brazilian meat. Though a source told Reuters that China’s temporary ban is only a “precautionary measure.”
Shares of Brazilian meatpackers BRF SA and JBS SA slumped on Monday. Even shares of Minerva SA and Marfrig Global Foods SA, which are not involved in the investigations, likewise fell sharply as traders fretted over the possibility of further import bans.
The threat to Brazil’s reputation as the world’s biggest beef and poultry-exporting nation keeps growing.