Mon 11 Aug 2014
Filed under: Business / Trade,International,News
The United States Treasury Department granted a special one year licence beginning in late July for certain US companies to trade with Myanma Timber Enterprise and other members of the timber industry currently under sanction by the United States.
The announcement has drawn both praise and concern from forestry experts, with some applauding the hands-on approach to reform and others warning that the scheme could end up reinforcing the corruption that has defined the timber industry for decades.
The Myanma Timber Enterprise is a state-related outfit dedicated to extracting timber. As an industry leader, it has been targeted by environmental groups claiming a broad range of corruption, unsustainable production and human rights abuses.
The company was first sanctioned by former President George W Bush in 2008. The US embassy in Yangon and the US treasury department in Washington did not respond to requests for comment for this article.
The licence specifically allows members of United States-based timber group International Wood Products Association (IWPA) to import Myanma Timber Enterprise’s products.
Speaking to The Myanmar Times last week, IWPA executive director Cindy Squires said the initiative was aimed at using market pressure to push government and industry leaders create a system to track where and how timber is extracted.
“Under the licence, our members must urge the domestic mills to work toward independent legality verification. We also encourage the timber trade to work with the Myanmar Timber Merchants Association and the Myanmar Forest Certification Committee to improve the timber traceability system in Myanmar,” she said.
Rachel Butler, head of sustainability for the Timber Trade Federation in the UK, said the TTF “welcomed” the new initiative, pointing out that most other Western nations have already suspended or relaxed their sanctions of Myanmar timber.
“The timber industries in the EU, US and Australia all share the goals of supporting Myanmar in moving these systems toward longer-term sustainability, ensuring they meet domestic and international requirements, we cannot do that sat on the sidelines,” she said.
Both Ms Butler and Ms Squires affirmed that they believe trade and direct engagement is a better tool for encouraging reform than the sanctions and boycotts that have so far had little effect. Both also emphasised that the project initiative would seek input from all stakeholders in the government, industry and civil society.
“It is our view that it is better to be engaged with [the Myanma Timber Enterprise] and the Myanmar timber industry and demonstrate our support for the reform efforts and movement toward independent legality verification and sustainable management of Burma’s forest,” said Ms Squires.
While representatives from the Myanma Timber Enterprise could not be reached for comment, other experts said opening Myanmar’s timber market could entrench many of the existing problems, as removing sanctions removes any incentive for industry leaders to reform the sector.
“Recent developments in Myanmar’s forest governance and timber trade as pushed by some foreign governments and agencies are beginning to undermine efforts by civil society to reform the forest sector,” said Kevin Woods, a Yangon-based researcher with the INGO Forest Trends.
“Instead of promoting good governance and inclusive participation, the status quo of corruption and environmental crime that has long plagued the forest sector in the country is unfortunately being further buttressed by international lobbying interests.”
U Win Myo Thu, executive director of the Yangon-based environmental group EcoDev, stressed that he will need to study the program further before he passes judgement.
The opening of the timber sector in general is a source of great concern for his organisation, he said.
“I think [these programs] can lead to distortion of the forest policy … After this kind of US or EU procurement, [I wonder] whether there will still be motivation to address illegal timber as a whole.”
U Win Myo Thu went on to say that given the large gaps in record-keeping, endemic corruption and the isolated locations of many forests, he couldn’t see how a practical system to monitor logging could be created in less than one year.
“I can’t imagine how to do it and I’ve been working in this area for almost three decades … If you are not able to differentiate what is legal and what is illegal then it’s a risk.”
Daniel Aguirre, a legal advisor for the International Commission of Jurists based in Yangon, echoed U Win Myo Thu’s concerns.
“Laws protecting human rights and the environment are absent or in nascent stages of development in Myanmar. Despite this slow reform, the government is pressing ahead with a policy of promoting rapid growth in foreign investment. This creates a legal void into which foreign investment is flowing that can result in human rights abuse and environmental degradation.”
Reports from numerous environmental groups indicate that deforestation had increased at an alarming rate in the last decade, driving some species of trees to near extinction. Given this dire situation, U Win Myo Thu said a temporary ban on exports may give the industry time to develop best practices. “I think we should stop exporting timber until we’re sure about the sustainability of those forests,” he said. “I really worry about the ecological future of our forests.”