The Mekong connection in illegal log trade

PUBLISHED : Sunday, 23 March, 2008, 12:00am
UPDATED : Sunday, 23 March, 2008, 12:00am

An exercise in parallel realities will begin next week in Vientiane.

Senior ministers from countries in the Greater Mekong Subregion will gather in the Lao capital's five-star hotels to discuss progress on a range of transport and technology 'corridors'.

These infrastructure links, backed by various agreements on border and customs details and supported by the Asian Development Bank, are meant to lead to greater 'connectivity' between Laos, Cambodia, Vietnam, Myanmar, Thailand and China - the countries the Mekong River links.

However, a report just released by the Environmental Investigation Agency (EIA), an international NGO, and its Indonesian partner Telapak, suggests that connectivity is the least of the region's problems.

Porous borders between Laos and Vietnam, coupled with corrupt local officials and military, are supporting a thriving illegal trade in logs from Laos to feed Vietnam's burgeoning export furniture industry.

Vietnam has called on Indonesia's and Cambodia's dwindling forests too, just as mainland firms import logs from Myanmar, Laos and Cambodia, with Thailand providing the financing and middlemen.

Most of these countries have logging bans and forward-looking legislation to protect their forests. Quotas exist on how much may be felled, as do rules intended to bring the processing industries within their own borders to raise local employment and incomes.

But the logging trucks roll across the borders, day and night.

Vietnamese and Thai officials did not reply to requests for comment, though both governments had acknowledged the trafficking of timber from Laos.

'In terms of timber trade, the Mekong countries are characterised by complex patronage relationships and corruption, a willingness to exploit neighbouring countries' forest resources while protecting domestic forests, and a system of confusing and poorly enforced laws,' the EIA says.

That most of it is illegal seems a minor point. The trade is also not listed on any public schedule of discussions by state planners due to gather at the summit.

'The cost of such unfettered greed is borne by poor rural communities in Laos who are dependent on the forests for their traditional livelihoods,' says EIA's head of Forests Campaign, Julian Newman.

Mr Newman says locals gain virtually nothing from this trade, with corrupt Laos officials and businesses in Vietnam and Thailand the profiteers. The EIA/Telapak approach to such 'ecological crime' is to go undercover and track shipments of logs, be they from forests deep in Indonesia's Kalimantan area or in eastern Laos, through the middlemen into factories, and out of ports.

'Posing as furniture buyers and timber traders, EIA/Telapak met manufacturers in Qui Nhon, Hanoi and Ho Chi Minh City,' the EIA says in its latest report.

'During the course of these meetings, it emerged that the Vietnamese outdoor furniture industry continues to rely heavily on supplies of illegal timber.'

The report details the extent of Vietnam's furniture industry, how it has grown and what woods are most in demand. 'Due to improved enforcement in Indonesia, supplies have become more erratic, leading Vietnamese factories to switch to neighbouring Laos to obtain yellow balau and keruing.'

Their investigations reveal how 'a few companies with the necessary connections, especially with the military, are able to secure large quantities of logs from Laos'.

It names the companies, who runs them, how and where they operate, and who benefits.

'At the Naphao border crossing, EIA/Telapak observed a total of 45 trucks carrying logs across from Laos to Vietnam in one afternoon,' the report notes. 'Based on this, and taking into account logging seasons and the number of border crossings which log trucks pass through, it is estimated that Vietnam receives at least 500,000 cubic metres of logs from Laos every year.'

Observers in border areas report - and photograph - the trucks crossing. Investigators posing as buyers visit factories. Others check the ports.

'Overall, the series of meetings with Vietnamese outdoor furniture companies and the monitoring of key ports and border crossings carried out by EIA/Telapak reveal the continuing and widespread use of illegal timber by the industry,' the report concludes.

For example, investigators visited Khai Vy Corporation, one of Vietnam's largest outdoor furniture companies. The EIA says it ships 200 containers a month, of which 70 per cent is outdoor furniture. It has also received financing from the World Bank's International Finance Corporation that stipulates the timber 'must come from well-managed forests'.

EIA investigations, however, show that most of the timber is illegal, relying on falsified documentation.

It goes on to quote Khai Vy's executive Le Van Tan: 'We buy it from middlemen from Vietnam because the middlemen, they know how to make paperwork. They make the paperwork and then we can buy [from] them.'

The end products are exported to the US, France, Britain, the Netherlands and Spain.

The report also shows how projects such as the World Bank-financed dams on the Mekong in Laos encourage illegal logging to clear the land and provide timber for construction.

Meanwhile, Thailand plays a key role in financing the illegal trade. In July last year, EIA/Telapak came across a Thai company called LVT (Laos Vietnam Thailand) International advertising large amounts of logs for export from Laos.

The EIA report also lists the companies in the west importing Vietnamese furniture and questions their claims to be environmentally sound.

'The ultimate responsibility for this dire state of affairs rests with the consumer markets with import wood products made from stolen timber,' Mr Newman says. 'Until these states clean up their act and shut their markets to illegal wood products, the loss of precious tropical forests will continue unabated.'