Regulation of the trade in ivory

If the consumer demand for raw ivory and ivory products were to be met largely through the supply of legal ivory (i.e., tusks from elephants dying naturally or from the occasional trophy hunting), there would have been no need for elaborate controls on trade. At the peak of the recent wave of poaching during the 1980s, it was estimated that 80% of tusks shipped from Africa were illegal. Similarly, at least two of three Indian elephant tusks used by carvers (who also used imported African elephant tusks) in southern India at this time came from poached elephants. The regulation of trade in ivory, with all its complex dimensions, has thus become central to conservation strategies for elephants. Each country has its own laws and regulations on the local sale and possession of tusks or ivory articles. Most African countries permit local trade in ivory, as do several Asian countries. India is one of the few elephant range states to impose a total ban on all internal trade in ivory, including carvings, although possession is allowed through a permit.

The international trade in ivory and other elephant products is officially regulated by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), which came into force in 1975. The convention has established lists of species under various "appendices," categorized according to differing perceived threats as voted on by its member states. Thus, species listed under Appendix I, considered the most endangered species, may not be traded internationally for commercial purposes, while limited trade is permitted for those under Appendix II as long as the trade is not detrimental to the survival of the species. The Asian elephant was straightaway placed in Appendix I, thus banning all international trade in its products. It was only in 1977 that the African elephant was placed in Appendix II, which regulated trade in its ivory under a system of quotas and licenses.

It soon became clear that these limited CITES controls on the international trade in African ivory had failed to stem the rising tide of elephant poaching in Africa. In fact, implementation of CITES controls by states such as Hong Kong, a major player in the trade, may actually have triggered a temporary sharp rise in the price of ivory, providing even greater incentive for poaching. The slaughter of elephants across the continent continued, as seen from the large volume of tusks being exported and reports from the field on carcasses and encounters with poachers.

Many countries exporting or importing ivory managed to use loopholes in CITES regulations and enforcement to trade in tusks that were clearly illegal. For instance, Burundi, a country without elephants, was issued ivory export documents that fulfilled CITES requirements. Large volumes of what could only have been illegal ivory went out of this country before the leak was plugged. Traders also took advantage of other loopholes in moving ivory between Japan and Hong Kong.

A global campaign to completely choke the trade in ivory now began to gather momentum. A defining movement in this campaign was perhaps the burning of 12 tonnes of confiscated tusks worth U.S.$3 million by the Kenyan president in July 1989 at a well-publicized event. The campaign culminated in the African elephant being transferred to Appendix I of CITES at the October 1989 Conference of the Parties (COP).

Following this complete ban on the international ivory trade, the price of raw ivory crashed by up to 90% in parts of Africa and about 50% overall in outside markets. The incidence of poaching also decreased sharply, giving African elephant populations a much-needed respite. The price of African ivory did recover partly after the initial shock of the ban, but with a very wide variation across the continent, and in outside markets, it is difficult to draw any general conclusions. There have been sporadic reports during the 1990s of a rise in poaching on localized scales, but the situation can in no way be compared to the previous two decades.

Several southern African countries—Zimbabwe, Botswana, Namibia, and South Africa—that have managed their elephant populations well, with very little impact from poaching, had been campaigning for at least partial lifting of the ban to allow them to trade in ivory and other elephant products. In June 1997, the CITES Conference of Parties (COP) voted at Harare to transfer the elephant populations of these southern African countries back to Appendix II with a onetime sale of 60 tonnes of ivory from Zimbabwe, Botswana, and Namibia to Japan the following year. Sales were not permitted at the COP in 2000, but during the COP at Santiago in 2002, three countries—Botswana, Namibia and South Africa—received the necessary votes to sell 60 tonnes of ivory during 2004 after they and the purchasing countries satisfy the CITES conditions.

There are opposing views on the international ban in trade of African elephant ivory and other products. While an outright ban is strongly favored by many conservationists and governments, others have argued for controlled trade. These views are examined next, as are the possible implications of the African ivory trade for Asian elephant populations. Pro-trade arguments

Those who favor limited trade in ivory point to the wide variation across Africa in the status of elephant populations and incidence of poaching. Elephant populations in southern African countries, particularly Botswana, South Africa, and

Zimbabwe, are healthy ones that are expanding at a high rate and are subjected to very little pressure, if any, from ivory poaching. For example, Zimbabwe's elephant population more than doubled by 1995, from an estimated 33,000 in 1960, in spite of culling. Even if there were to be little or no culling, considerable quantities of tusks would continue to be retrieved from elephants dying of natural causes. These countries badly needed the revenues from ivory sales for boosting the local economy, for supporting community-based conservation projects, and eventually for financing the protection of elephants. An outright ban on international trade in ivory would penalize such African countries that have efficiently managed their elephant populations, a counterproductive strategy.

The underlying philosophy was simple—wildlife in parts of Africa will have to pay for itself if it is to survive. A mere ban in trade is no guarantee that a species would survive. The two species of African rhinos had been placed in Appendix I of CITES since 1976, but had declined extensively due to poaching for horn, with the black rhino nearly hunted to extinction.

Economics is obviously central to the trade in ivory. A key question is how this could be harnessed in a fashion to allow legitimate aspirations of producers and consumers to be met without endangering the elephant itself. The only published work on the economics of the ivory trade is that of Edward Barbier, Joanne Burgess, Timothy Swanson, and David Pearce. This team was part of the preban assessment produced by the Ivory Trade Working Group that recommended a complete ban, although the Barbier et al. team had a differing view. Fully recognizing the earlier limitations of CITES in curbing illegal trade in ivory, Barbier and colleagues are in favor of "a very limited trade in ivory, designed to maintain the incentive to sustained management in the southern African countries and to encourage other countries to follow suit." They otherwise fear that the trade would merely be driven underground. According to them, "The ivory trade is a 'game' in which there are many players, all with individual motives and concerns. Failure to capture those motives and concerns in an international agreement inevitably risks no agreement or its eventual breakdown" (1990, pp. xi-xii)

After discussing the reasons for failure of several preban CITES regulations, such as the Management Quota System, Barbier and colleagues present their own proposals based on economic theory for effective regulation of the ivory trade. A workable system of international regulation would involve the correction of "investment deficiencies" or reasons for the failure of producer nations to invest in the maintenance of elephant numbers, as well as setting up an "enforcement system" that deters possible attempts by individuals or nations to circumvent the system.

The economic reasons for the steep decline in elephant stocks were not difficult to understand. In Africa itself, the future is much less valued than the present ("a high discount rate") given the social and demographic conditions. Thus, any additional wealth is much more valuable today than in the future.

The decision whether to maintain current stocks of elephants or convert them into other forms of assets would be influenced by the dissipation and capture of rents (profits) from elephants. The rents from sale of ivory are widely dispersed across individuals and governments, including local poachers, chieftains, local dealers, international traders, officials, government agencies, and so on. Compared to the value of raw ivory in a consumer nation such as Japan, the sums that accrue locally to individuals or states are usually very low. Thus, a harvester of tusks in central Africa may only capture 10% (under U.S.$10/ kg in 1985) of the value of raw ivory (under U.S.$100/kg) in Japan. A major part of the rent is captured by external traders. Even the putative owners of the assets, the elephant range states, may capture only a small fraction of the rent. This created the conditions for uncontrolled exploitation of elephants. Only a country such as Zimbabwe, with a government that organized the collection and sale of ivory, captured about 70% of the rent; this is perhaps a benchmark for other range states to emulate.

The solution to these problems may lie in the channeling of all rents from the sale of ivory through a single controller. A joint marketing arrangement for ivory, along the lines of, say, the oil-producing nations, would be in the economic interest of the range states. This would eliminate the traders or middlemen, who otherwise would capture most of the benefits. The demand for ivory ("demand elasticity") is relatively nonresponsive to price in Japan, the major consumer nation (as with the price of oil here). Such a marketing agreement can only succeed if the consumer nations are willing to monitor and enforce the agreement for the producers. In the case of ivory, it would clearly be in the interest of a consumer nation such as Japan to provide the enforcement mechanism.

One of several kinds of financial and marketing systems could be used to implement such an arrangement. An annual ivory quota for each state based on elephant population and sustainable offtake could be the basis for an "ivory currency" system distributed among them. Consumer nations would be charged with ensuring that counterfeit currency (ivory) is not imported. A substantial difference in price between certified ivory (higher) and uncertified ivory (lower), arising out of consumer nations investing in monitoring, would also provide the incentive for sustainable management of elephant stocks by the producers.

An alternative system could be the establishment of an "ivory exchange" that would take in ivory from producers only in sustainable quantities, and consumers could enter into purchasing arrangements. An "ivory tax" could also be imposed by consumer nations for redistribution to the range states in accordance with their elephant stocks and degree of sustainable management. This would be an incentive for the range states to conserve their elephant populations.

Any ivory trade regulatory mechanism would need methods to detect illegal ivory. While some of these could be built into the documentation associated with the trade, enforcement authorities have also been looking toward means of identifying the source of ivory. For instance, how does one distinguish between Asian and African elephant ivory or identify the geographical origin of a particular shipment of African ivory?

In 1990, the results of two studies, one led by Nikolaas van der Merwe and the other by J. C. Vogel, that used isotope discrimination in elephant ivory and bone appeared in the same issue of the prestigious journal, Nature (fig. 9.7). The principle behind the isotopic method is quite simple (see chapter 5). The ratios of stable isotopes of elements such as carbon, nitrogen, strontium, and lead in animal tissue reflect the diet of the animal and provide an imprint of its habitat. Thus, stable carbon isotope ( C/ C) ratios reflect the proportion of C3 (browse) and C4 (grasses) plants in the diet, nitrogen isotope (15N/14N) ratios are related to rainfall and environmental water stress, and strontium isotope (87Sr/86Sr) and several lead (Pb) ratios reflect local geology. The first group analyzed collagen for carbon, nitrogen, and strontium isotopes from ivory and bone samples across 10 African countries representing all regions with the exception of central Africa, while the second group also added lead isotopes, but confined their survey to southern Africa. Obviously, no single elemental isotope ratio is able to differentiate between elephant populations, but the discriminatory power increases as more elements are added. From the stable isotopes of carbon and nitrogen, they were able to differentiate several populations across the continent, although considerable overlap also occurs when all the 20 populations sampled are considered simultaneously. The addition of strontium isotopes provided additional ability to distinguish some populations whose carbon and nitrogen isotope values overlapped. The study in southern Africa used multivariate statistical analysis incorporating carbon, nitrogen, strontium, and lead isotopes to achieve more robust discriminatory power, but it remains to be seen if this holds across the continent.

Research is also under way on the possible use of molecular genetic differences among populations for ivory forensics. This would have to involve building up a reference library of DNA profiles from both nuclear and mitochondrial genes of elephant populations (chapter 1). When the source of any consignment of tusks is in question, it may be possible to obtain minute quantities of tissue from scrapings at the basal portion for molecular amplification and matching with the DNA library. Sometimes, it may be impossible, of course, to obtain DNA from tusks or from worked ivory.

Both the isotopic and the genetic methods have their limitations. They depend on sophisticated science and technology that are expensive. The discriminatory power of the methods has not yet been proven; thus, some ambiguity would always remain. The antitrade arguments

The opposition to any international trade in ivory comes from conservationists and administrators who are skeptical that any regulatory mechanism would work in practice. The preban trade in African ivory was characterized by a complete breakdown of law and order in some countries; lack of field enforce-

Figure 9.7

Plots of isotope ratios in collagen from elephant bone or ivory in different regions of Africa. Values are expressed in standard notion (per mil). All isotope values are mean values for the population computed from the sources. (a) Stable carbon versus stable nitrogen isotope values in collagen for elephants at AD (Addo, South Africa); BF (Burkina Faso); GL (Gola, Sierra Leone); KA (Kasane, Botswana); KB (Kasungu, Malawi); KE (Kruger East, South Africa); KW (Kruger West, South Africa); KY (Knysna, South Africa); LG (Luangwa, Zambia); NM (Namibia); PW (Park W, Niger); SH (Shimba Hills, Kenya); SP (Sapo, Liberia); TM (Tembe, South Africa); and TS (Tsavo, Kenya). (Based on van der Merwe et al. 1990.) (b) Strontium versus stable nitrogen isotopes in collagen of elephants at AD (Addo, South Africa); CP (Caprivi, Namibia); EK (East Kaokoveld, Namibia); ET (Etosha, Namibia); KMS (Kruger Mid-South, South Africa); KNE (Kruger NE, South Africa); KSE (Kruger SE, South Africa); KSW (Kruger SW, South Africa); KY (Knysna, South Africa); and ND (North Namib Desert, Namibia). (Based on Vogel et al. 1990.)

Figure 9.7

Plots of isotope ratios in collagen from elephant bone or ivory in different regions of Africa. Values are expressed in standard notion (per mil). All isotope values are mean values for the population computed from the sources. (a) Stable carbon versus stable nitrogen isotope values in collagen for elephants at AD (Addo, South Africa); BF (Burkina Faso); GL (Gola, Sierra Leone); KA (Kasane, Botswana); KB (Kasungu, Malawi); KE (Kruger East, South Africa); KW (Kruger West, South Africa); KY (Knysna, South Africa); LG (Luangwa, Zambia); NM (Namibia); PW (Park W, Niger); SH (Shimba Hills, Kenya); SP (Sapo, Liberia); TM (Tembe, South Africa); and TS (Tsavo, Kenya). (Based on van der Merwe et al. 1990.) (b) Strontium versus stable nitrogen isotopes in collagen of elephants at AD (Addo, South Africa); CP (Caprivi, Namibia); EK (East Kaokoveld, Namibia); ET (Etosha, Namibia); KMS (Kruger Mid-South, South Africa); KNE (Kruger NE, South Africa); KSE (Kruger SE, South Africa); KSW (Kruger SW, South Africa); KY (Knysna, South Africa); and ND (North Namib Desert, Namibia). (Based on Vogel et al. 1990.)

ment capabilities; corruption at various levels, including the highest ones of government; inability of CITES to regulate or even to monitor all but a small fraction of the trade volumes; and ineffective controls by the consumer nations to detect illegal ivory.

Iain Douglas-Hamilton's continentwide survey of African elephant populations, poaching, and the illegal ivory trade clearly brought out the chaotic and corruption-ridden situation that prevailed in many countries prior to 1989. There was no reason to believe that the situation would be any better if trade in ivory were to resume, even partially. From an administrator's perspective, Richard Leakey (former head of the Kenya Wildlife Service) argues that any spurt in poaching resulting from opening of the trade would take much-needed resources and attention from infrastructural development. The opponents of trade also point out that the complete ban had caused ivory prices to crash, significantly reduced demand, and rendered the African range states a far safer place for elephants.

Andrew Dobson and Joyce Poole thus questioned the basis of the economic analysis of the ivory trade by Burgess and colleagues, who advocated controlled trade as the best option for elephants. There was no reason to "believe that an illegal, unmonitored trade might cause prices to rise faster than a legal, monitored trade" (1992, p. 151) The high cost of sophisticated isotopic or genetic analysis, even if technically feasible, to back up a controlled trade would actually result in high costs for the legal trade. This would make it possible for dealers offering cheaper illegal ivory to invade the trade.

The laundering of illegal ivory is a danger that many campaigners against the trade emphasize. Even Japanese conservationists like Hideo Obara and Masayuki Sakamoto contend that the country does not as yet have adequate management and enforcement capabilities for a controlled ivory trade. It is impossible to trace certified ivory from its source to the finished form given the several thousand ivory retailers in Japan. Vivek Menon and Ashok Kumar, two leading observers of the illegal wildlife trade in Asia, also fear that even partial opening of legal trade in African ivory would provide the opportunity for Asian ivory, the trade of which has always been banned under CITES, to be laundered. Even if safeguards for legal trade were in place at higher levels of transaction, the message percolating down to lower levels of the trade would be quite diluted, resulting in an upsurge in poaching.

The economics of "sustainable offtake" of elephants through culling has also been questioned. Richard Leakey estimates that, given a maximum sustainable offtake of 3% of the elephant population, the southern African countries at best could expect revenues of only about U.S.$3 million per year. These profits are insignificant in relation to the costs of antipoaching efforts that may be needed if the trade is opened.

Many international conservation organizations have also argued at forums such as CITES that the ivory could easily be purchased by donors and destroyed. They also point to potential revenue loss from tourists, who on ethical grounds may stay away from wildlife parks and countries that practice culling as part of their management. The value of tourism in Kenya, which does not practice culling, has been estimated at U.S.$375 million per year during the 1980s, with the tourism value of its elephant population alone being U.S.$25 million. The culling of elephants for generating revenue through trade in ivory is thus seen as a very shortsighted option.

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