U.S. traders flouting sanctions on buying Myanmar teak, report says

Vast quantities of timber from Myanmar continue to enter the United States despite sanctions on the country’s state-controlled timber monopoly, according to a new report from U.K.-based watchdog group the Environmental Investigation Agency (EIA).

Following the February 2021 military coup and violent crackdowns on citizens, countries including the U.S., Canada, the European Union, Switzerland, and the United Kingdom placed sanctions on Myanmar’s junta leaders and military-run enterprises from the forestry, mining, and oil and gas sectors in an effort to curb the regime’s access to natural resource revenues.

However, according to the new report, U.S. timber traders imported more than 3,000 metric tons of Myanmar teak into the U.S. over the past two years.

The sanctions have had “no major impact on the trade of Myanmar teak into the US,” according to the report. “Instead, trade has continued at the same levels as before the coup, with the fourth quarter of 2022 seeing some of the biggest monthly imports since the time leading up to and after February 2021.”

Teak (Tectona grandis) possesses natural water resistance and is much sought-after for high-end furniture, flooring and for fitting out luxury yachts owned by some of the richest people in the world.

Given that Myanmar or Burmese teak is considered among the highest quality in the world, international demand for the timber is a major driver of deforestation in the country. With a Belgium-size area of forest lost between 2001 and 2018, the EIA predicts that Myanmar’s forests will disappear by 2035 if the current trend continues.

This would be a serious blow for biodiversity. Myanmar’s remaining tracts of intact forest include some of mainland Southeast Asia’s most biologically rich landscapes. They’re home to charismatic species like the Asiatic black bear (Ursus thibetanus), the sun bear (Helarctos malayanus), several gibbon species and critically endangered Sunda pangolins (Manis javanica). Moreover, species that occur nowhere else on the planet cling to existence in remaining forest refuges. Fewer than 260 Popa langurs (Trachypithecus popa) are thought to remain in the world, for instance, all of them residing in four isolated patches of forest in Myanmar’s central plains.

The 2021 sanctions were levied on state-controlled company Myanma Timber Enterprise (MTE), which effectively holds a monopoly over the entire forestry sector. MTE regulates all harvesting and sales of timber in Myanmar and draws a percentage of all timber export revenue, thereby representing a key source of income for the military regime.

Secrecy stymies sanctions

The report identifies the top 12 U.S.-based companies that have imported Myanmar teak since the 2021 coup. Two companies, East Teak Fine Hardwoods and J. Gibson McIlvain, account for 88% of all teak imports during that period, trading a combined 1,600 metric tons of teakwood. Neither company responded immediately to Mongabay’s requests for comment.

The EIA says it provided all 12 company identities to U.S. authorities in December 2022 to give them an opportunity to investigate and act. At that time, the dozen firms had imported 2,760.46 metric tons of teakwood since sanctions were imposed. In the intervening period, up until May 2023, the EIA says a further 308.24 metric tons of Myanmar teak have entered the U.S.

U.S. traders continuing to import timber in defiance of the sanctions aren’t only acting beyond the law — they’re also essentially supporting a regime consistently committing human rights abuses, the EIA says. Since the coup, violent crackdowns on pro-democracy protesters and deadly airstrikes on civilian targets have been widely reported. According to the Assistance Association for Political Prisoners (AAPPB), the military regime has killed 3,558 civilians and arrested more than 22,531 people since the coup.

“By closing their eyes to the brutality of the military regime, both traders and those consuming teak for their yachts and floors are supplying much needed hard currency to a junta bankrupting the nation, supporting ever-increasing criminality within the country and enabling corruption,” the EIA report says.

Further to the sanctions imposed in response to the 2021 coup, Myanmar teak also cannot be traded in compliance with the U.S. Lacey Act, which requires that imports of wildlife, fish or plants must be legally harvested under the exporting country’s laws. This should in theory prevent imports of illegally sourced timber into the U.S.

The report says that some timber trading companies claim their teak was harvested and stockpiled prior to the coup. However, with the MTE under military control, Myanmar’s timber auctions have become more opaque, making it difficult to trace the provenance and legality of timber, the report warns. The military junta rarely disclose revenues generated from timber sales, or make clear where timber traded at auctions is sourced from.

The lack of transparency essentially renders it impossible to tell whether exported timber came from stockpiles purchased before the coup and whether it was legally harvested. The likelihood that any legal timber is mixed with illegal timber “is extremely high,” the report says. It adds that the military is also unlikely to be following national laws that ban exports of raw timber and that any third-party verification of lumber via DNA testing is dubious due to the challenges of accessing trees and timber in Myanmar during the current unrest.

The continued trade highlights the challenges of tracing timber and enforcing sanctions and regulations. The EIA report is the latest in a string of investigations documenting the failure of sanctions to stem the flow of Myanmar timber into North America and Europe.

In 2021, advocacy group Justice for Myanmar (JFM) found that U.S. firms were circumventing sanctions by buying timber from private brokers, instead of directly from MTE, many of whom were shipping timber via intermediate countries like China.

Also in 2021, Forest Trends reported that almost one-fifth of Myanmar’s total timber exports reported between February and November 2021 went to countries with active sanctions on MTE. According to the Forest Trends report, the overall number of companies importing sawn teakwood into the U.S. dropped by two-thirds during that period, but total trade in the timber increased slightly.

Immediate action required

The EIA report urges the U.S. government and enforcement agencies to investigate and prosecute those who continue to import Myanmar teak and to tighten controls on timber brought into the country. One way the EIA suggests to achieve this would be through the Timber Interdiction Membership Board and Enforcement Resource (TIMBER) Working Group, a task force newly formed in April 2023 by the U.S. Department of Justice.

Faith Doherty, the forest campaigns lead for the EIA, said inaction to clamp down on those continuing to violate timber laws is simply unacceptable. “Without action, it’s no wonder US-based traders blithely continue to import Myanmar’s blood teak when they know there will be no consequences,” she said.

“The US Government must act against all those involved in the trade of blood timber from Myanmar, using the full weight of the law to prevent profits from timber supporting the military regime and its cronies.”

This article by Carolyn Cowan was first published by Mongabay.com on 22 May 2023. Lead Image: White-handed gibbons (Hylobates lar) are one of many species of rare primates still found in Myanmar’s rapidly diminishing forests. Image by JJ Harrison via Wikimedia Commons (CC BY 3.0).

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