13
Rosewood: Illegal Logging In Madagascar Presented by: Liankanto RANAIVOSON Theory of Economy

Illegal logging of rosewood in Madagascar

  • Upload
    li-ann

  • View
    192

  • Download
    0

Embed Size (px)

Citation preview

Rosewood:Illegal Logging In Madagascar

Presented by: Liankanto RANAIVOSONTheory of Economy

MadagascarTotal GDP: 10.61 milliards USD (2013)

GDP per capita: 462.97 USD (2013)

Political instability since the 2009 revives the illegal logging trade

Even though the logging and export of rosewood from Madagascar is banned through a National Decree in 2010

Madagascar Rosewood species is under the protection of the Convention on International Trade in Endangered Species (CITES)

Rosewood : supply and demand

• SUPPLIERS: Malagasy mafia who hire the Local community: Þ Loggers wage $1 per kilo, $3 to $5 per day for the dangerous and

physical work. • DEMAND: China (98%) and west countries (Europe and America) (2%) ÞEach 150-kilogram has an approximate market value of U.S. $1,300

Rosewood as a goods• For local community: rosewood is kind of merit goods because

they underestimate the benefits of it, they are not aware of how valuable rosewood are in the international market.

• In reality, rosewood are luxury goods because after being constructed, in China and in west countries, an increase in income causes a bigger % increase in demand

Rosewood trade flow• Sourcing: Northeast part of the island : Marojejy National

Park and Masoala National Park as well as the Mananara Biosphere Reserve (UNESCO World Heritage)

• Trade route: Madagascar => shipped to intermediary countries (Mauritius, Mozambique and Kenya) where false papers were drawn up legalizing the cargo => Final destinations China (Guangzhou, Hong Kong), Europe, USA

Manufacturing• Factories that make traditional “red wood” Ming- and Qing-style furniture are located in three major areas: ÞJiangsu/Zhejiang/Shanghai areaÞGuangzhou/Shenzhen/Fujian areaÞHebei/Tianjin/Beijing area

The total number of factories is estimated at around 300–500. A typical factory usually hires about 150–300 workers, supervised by a handful of highly skilled carvers. Since carving skills are passed down only within families, most of the factories have labour shortages, and workers are paid well

The evolution of the price of one rosewood furniture

Source: Global Witness Et Environmental Investigation Agency, 2010

A huge market worth billions of dollar

• Value increases dramatically, of course, after being constructed, for example, into high-end Ming Dynasty-style furniture in China, a single bed can sell for around $20,000 or more.

A huge market worth billions of dollar

• In the United States, Gibson guitars and Taylor guitars may cost more than $5,000

Economic impacts• From 2007 to 2014, illegal trafficking of rosewood is estimated

to 39,000 tons: $376 million of loss in revenue for the government and the Malagasy population (most of the traffic are hidden so it is just a part of the reality)

• When trees are cut without the right permits and are smuggled abroad, governments lose out financially in several ways, including lost revenue from taxes and duties and the costs of efforts to manage illegal logging.

Suggestions to deal with illegal stockpiles

• Suggestion 1: (By Global Witness (GW) and Environmental Investigation Agency (EIA))

Destruction of all illegally felled wood

• Suggestion 2:The transformation of felled rosewood into manufactured products for sale > Investors > Creation of job opportunities

• Suggestion 3:The logs are not sold on the open market. Rather, philanthropists, conservation organizations, and international aid agencies pay to “adopt” a log. Each log can be “adopted” for its market value (about $1,300).

• Suggestion 4:Logs would be auctioned via a transparent market system in which the price and the log code would be recorded, publicly available, and digitally traceable.

Thank you!