PERU LOWERS MAHOGANY EXPORT QUOTA

UNCLAS LIMA 000707

SIPDIS

DEPT FOR WHA/AND, EPSC AND OES/ETC,ENV
BRASILIA FOR ESTH HUB - J STORY
USAID FOR LAC, EGAT, J.Kunen
USDA FOR /AS/FAA/BAILEY,/FAS/ITP/FSTSD/BREHM,/FS/MAYHE W
INTERIOR FOR USFWS/GABRIEL,ST.JOHN

SIPDIS

E.O. 12958: N/A
TAGS: EAGR SENV ETRD EAID ECON PE
SUBJECT: PERU LOWERS MAHOGANY EXPORT QUOTA

REF: (A) Lima 658 (B) Lima 4528 (C) Lima 4289


1. SUMMARY: The GOP has lowered its mahogany export quota to
13,476 cubic meters. While significantly lower than last year's
quota of 23,000m3, NGOs and Peru's scientific authority for CITES
believe that the quota is still too high. The quota also does not
permit (much less give a preference for) much of the certified
mahogany that USAID and NGOs have been striving to establish as the
alternative to unregulated mahogany exports. The recent visit of
Deputy Assistant USTR for Natural Resources gave post an opportunity
to press NGO and GOP contacts to suggest reconsideration of the
quota, as NGO's have threatened to push for a complete trade
suspension at the next CITES meeting in July. END SUMMARY.

NEW MAHGONY EXPORT QUOTA: 13,000 CUBIC METERS
--------------

2. GOP natural resources agency INRENA, which grants forest
concessions and is the Management Authority for broad leaf mahogany
under the Appendix II listing in the Convention Against Trafficking
in Endangered Species (CITES),announced at the end of February that
the mahogany export quota would be 13,476 cubic meters (m3). This
amount is a significant drop from previous years; the 2006 quota was
26,321m3 and the 2005 quota was 23,239m3. The downwards trend
reflects a response to the listing of mahogany as an Appendix II
threatened species in 2002, and the high amount of illegal logging.
INRENA states that it sets the quotas using the following criteria:
available volumes that could, in a representative fashion, be
verified as originating from legal sources; data on existing
mahogany per private sector concessions and statistical inference
from past year volumes. The 2007 quota has two components: Approved
and verified (by INRENA) 2007 harvest amounts; and approved and yet
to be verified 2007 harvest amounts.


3. Despite this significant reduction in permitted mahogany trade,
NGOs remain critical, complaining that the quota should be even
lower. More importantly, the quota does not give any preference to
cut mahogany certified by the independent NGO Forest Stewardship
Council and administered jointly by USAID, NGOs such as World
Wildlife Fund and participating private and indigenous community
concessionaires. Some mahogany under this program will not complete
the rigorous certification program until later in 2007, and thus
cannot be eligible for export. INRENA, under CITES and GOP law, must
certify that the origin of cut mahogany for export is legal and
non-detrimental to survival of the species. NGOs point to INRENA's
lack of capacity to fully verify both the source as well as when the
timber was harvested. NGOs contend that timber from illegal sources
has been stockpiled for the past few years in order to be exported
as part of the 2007 and future quotas.

SCIENTIFIC AUTHORITY SPEAKS
--------------

4. During a February visit by Deputy Assistant United States Trade
Representative Mara Burr, ESTHoff and USAID Forestry Programs
Director met with Dr. Ignacio Lombardi. Lombardi, a forestry
professor at the National Agrarian University (UNALM),has been
designated by the GOP under CITES as the Scientific Authority for
broad leaf mahogany. (CITES requires also a management authority,
which the GOP designated as INRENA.) Lombardi indicated that while
he believes the quota should most appropriately be around 1200
trees, equivalent to approximately 10,000m3, he realized that it is
difficult with competing economic and political interests to more
drastically cut the quota and he was prepared accept 13,000m3 as a
reasonable compromise, if certified wood was taken into account.


5. Lombardi was firm that the quota should ideally give preference
to certified wood, meaning that the quota should first be filled
with certified wood and then filled with non-certified. Failing
that, the cutoff date for wood eligible for the 2007 quota should be
extended to allow for wood that will be certified in the course of
the year. (Note: the major exporters have tended to oppose
certification due to the added expense. It is no secret, however,
that illegal logging of mahogany and corruption by government
overseers has been a problem. See Reftels. End Note.)

INVENTORY NEEDED
E
--------------

6. Lombardi and UNALM staff have been conducting an inventory of
mahogany population. Lombardi told us that the mahogany inventory
of Ucayali (central Peru, bordering Brazil) was completed, and
inventories for several other departments were in process. (Note:
Forest Services firm Winrock will conduct a seminar on March 9 on
aerial imaging inventory methodology and a completed pilot study for
a comprehensive inventory which, although expensive, would speed and
possibly better quantify and qualify the UNALM inventory. End
Note.) While in a perfect science-driven world it would be logical
to suspend all mahogany exports until a systematic and credible
inventory for the whole country was completed, Dr. Lombardi realized
that mahogany provides jobs in the jungle and extrapolating the
Ucayali inventory to the rest of Peruvian mahogany range, coupled
with a drastically reduced quota, should be enough to maintain the
species until a full inventory is complete.


7. Lombardi agreed that a logical management system would allow for
a rolling census, much like Peru's innovative human census, with
yearly or quarterly updates and revisions of the quota according to
rolling survey findings. Finally, Lombardi believes a quota should
include a ban on mahogany taken from Departments such as San Martin
which are seriously deforested and notorious sources for illegal
mahogany logging. (Note: an accurate mahogany inventory is hampered
by the lack of roads in the mahogany range, as well as lack of
resources allocated for inventory staff and aerial surveys. End
Note.)

NGOs READY TO TAKE TO THE HILL
--------------

8. USAID also met recently with a coalition of NGO's, led by WWF,
who follow the mahogany issue and many of whom are involved in
certification projects. NGOs and forestry experts also met to
analyze the new quota, concluding that INRENA needs to develop a
joint plan with UNALM on setting a quota that will conserve mahogany
but allow sustainable export. This group also noted in a written
statement the need to inventory all concessions before allowing
export, and failing that permit only certified wood for export.
NGOs have already written a letter to INRENA urging it to reconsider
the quota figure as well as the certification policy. These NGOs
tell us that they are ready to press CITES and the USG (including
Congress) for a full trade suspension at the Congress of the Parties
this summer in The Hague.


9. COMMENT: Post will continue to meet with all parties to work on
certification aspects of the quota. The 13,461m3 figure is on
balance marginally defensible if it could be combined with
conservation, research, inventory and reforestation efforts. This
would also track with President Garcia's recent announcement that he
will effect reforestation of 500,000 forest hectares (of which some
will be mahogany, which is naturally dispersed throughout the
Peruvian jungle). Post will meet with INRENA to discuss quota
alternatives.
STRUBLE