Brazil's president puts economy ahead of Amazon

By Stuart Grudgings

BRASILIA (Reuters) - Hailed as Brazil's first "green president" when he took office, Luiz Inacio Lula da Silva's environmental credentials appear thinner than ever after the resignation of Amazon defender Marina Silva.

The former rubber tapper and union activist was one of the fresh faces who marked a break from Brazil's conservative past when she was appointed environment minister in Lula's first cabinet.

Her departure on Tuesday underlines Lula's long journey from firebrand union leader to business-friendly president more than five years after he became Brazil's first working-class leader.

"He is increasingly conservative," said Christopher Garman, head of the Latin America practice at Eurasia Group. "He has caved in to the view that the Amazon has to be developed in some form or fashion."

Silva's resignation comes at a critical moment for the world's largest rain forest as pressure on its resources from high world food prices and growing energy demands push it closer to what environmentalists warn is a "tipping point" of destruction.

Silva had become increasingly isolated inside Lula's team, analysts say, over issues ranging from the government's support for biofuels, to genetically modified crops and nuclear power.

A major clash with business interests and other ministries came with her opposition to the expansion of hydroelectric power from dams in the Amazon region at a time when fast-growing Brazil is hungry for energy.

She unsuccessfully opposed several infrastructure projects in the rain forest, including two hydroelectric dams and a road that will link the western grain belt with the Amazon River.  Continued...