UPDATE ON ILLEGAL LOGGING IN MADAGASCAR

UNCLAS SECTION 01 OF 02 ANTANANARIVO 000763 SENSITIVE SIPDIS STATE FOR AF/E - MBEYZEROV - AND OES USDOC FOR RTELCHIN TREASURY FOR FBOYE ADDIS FOR KBAUMAN AND IHERSH USAID FOR AFR/EA - CTHOMPSON E.O. 12958: N/A TAGS: SENV ETTC ECON ETRD MA SUBJECT: UPDATE ON ILLEGAL LOGGING IN MADAGASCAR ¶1. (SBU) Summary: The forestry sector in Madagascar continues to be decimated by rampant unsustainable and illegal practices. Insufficient monitoring of the situation makes it difficult to ascertain the true dimensions of the problem, but a recent report issued by scientists associated with Missiouri Botanical Garden indicate that at least 871 containers of rosewood have left the country since April, and at least another 271 containers are awaiting export in one port in northern Madagascar. Between 30,000 and 65,000 precious hardwood trees have been cut in two national parks alone, deteriorating nearly 6,500 hectares of what should be protected forest and jeopardizing the livelihoods of local communities depending on the forest. An inter-ministerial order to export unprocessed precious hardwoods, combined with extremely limited capacity and seemingly inconsistent political will at multiple levels of the Government of Madagascar, have created an enabling environment for illicit behavior that has long-term economic, environmental and social consequences. While the Government of Madagascar issued a new inter-ministerial order requiring documentation of precious woods destined for export and has also seized illegal stocks of wood in recent weeks, these efforts are inconsistent and ineffective to date to address the magnitude of the problem. The absence of respect for rule of law, as reflected in the forestry sector, and ongoing illicit behavior is of significant concern. End Summary. ¶2. (U) On September 21, 2009 an inter-ministerial decree was issued for the exceptional export of non-processed precious woods from Madagascar. The decree authorized up to 25 containers each of precious woods, including rosewood, ebony and palissandre, for 13 operators. Wood was to come from existing stocks and each operator must pay 72 million Ariary (approximately USD 36,000) per container to be able to export the wood. While estimates vary, according to Missouri Botanical Gardens and other conservation groups, operators make approximately USD 200,000 profit per container. Two-thirds of the fees paid by operators (ca. USD 24,000) benefit the central treasury of the GOM, with the remaining third destined for a new fund managed by an inter-ministerial task force. Details on the fund and its administration are not easily obtained. Knowledgeable local and international conservation organizations operating in Madagascar indicate that the amount of wood to be exported exceeds the amount that should be available for legitimately stocked wood (e.g. hard woods that fell during cyclones),as all cutting of these species has been completely suspended since 2002. Insufficient surveillance, procedures and controls make corruption, fraud and illegal behavior highly likely. Furthermore, the inter-ministerial order appears to directly contradict numerous long-standing laws and regulations passed to promote a sustainable forestry sector in Madagascar. Numerous press reports in local national papers have decried the illegal behavior and loss of valuable natural assets that will no longer be available to support the struggling economy or the development needs of the Malagasy people. ¶3. (U) On October 5, 2009 a second inter-ministerial decree was issued to establish procedures that must be followed to grant export permits. This includes required documentation on source, volume, quantity, destination and other factors. The decree states that designated task force and forestry service investigators will attempt to verify paperwork and stocks. While making these steps explicit is valid, the GOM does not appear to have the capacity or the consistent will to effectively enforce the procedures. The decree also gave the government authority to seize improperly documented wood. In mid-October the GOM reported that it seized 91 containers of illegal precious wood that were destined for Mauritius. Under standing laws of Madagascar, the GOM has the authority to auction off this wood. The status of this wood, or what the GOM plans to do with it is currently not clear. Also in October, the Director of Environment and Forests in the northern district of Sava, where much of the nation's precious woods can be found, was sacked due to evidence of his complicity in illegal forestry activities. Intimidation of other forestry and national parks staff who are trying to crack down on the problem has also been reported for months. ¶4. (SBU) While it is difficult to truly get a sense of the magnitude of the problem, Missouri Botanical Gardens reports evidence that at least 271 containers are currently at one port in the north of Madagascar awaiting export. Given the known hundreds of containers that have already left Madagascar, it is clear that there is illegal wood leaving the country. ¶5. (U) Last week, civil society organizations, private banks and staff from the national park authority met in Antananarivo to discuss the growing problem of money laundering associated with illegal forestry activities. The group indicated a limited capacity to address the problem, although the Malagasy financial intelligence unit (SAMIFIN) has reportedly frozen fourteen bank accounts. Associated illegal trafficking in other endangered species of flora ANTANANARI 00000763 002 OF 002 and fauna has also been on the rise. For example, Durrell Wildlife Trust is concerned by increased smuggling of endangered tortoises destined for Asian markets. A ready-made infrastructure of poorly controlled export channels involving criminal elements and corrupt officials poses other risks for Madagascar. Associated degradation and loss of biodiversity and detrimental impacts on vulnerable and poor rural communities is also of great concern. ¶6. (SBU) Most of the illegal woods appear to be destined for China, according to preliminary observations from an investigation undertaken by Global Witness and the Environmental Investigation Agency. Companies and operators have been identified, including one German company. One American company has been named, and the US Fish and Wildlife Service is cooperating with other agencies to investigate the nature of the company's rosewood imports. Recent updates to the Lacey Act require American companies to provide documentation of legal sources of imported plant materials. The investigation will ascertain if any criminal acts have been committed. In Madagascar, local civil society organizations are currently exploring options to bring a legal suit against the Government of Madagascar regarding the inter-ministerial order to export precious woods. ¶7. (U) On November 4, 2009 the United States Congress passed a binding resolution introduced by Earl Blumenauer (D-Oregon) condemning the illegal plundering of natural resources in Madagascar. The resolution calls for importing countries to intensify monitoring and inspection processes to ensure they do not contribute to demand for illegally sourced wood; action to be taken within Madagascar to stop illegal activities and bring those responsible to justice; and for democratic rule to be returned to the island. MARQUARDT