Category Archives: trade-environment

Naked Commercial Whaling and Toxic Whale Meat

Scientific “research” was also the reason Japan’s government gave for continuing to kill whales in the vast Southern Ocean after a global moratorium on commercial whaling came into force in 1985. But international criticism along with environmental groups’ attempts to sabotage the annual hunt proved too costly to Japan’s reputation and purse (the government bankrolled the hunt). In late 2018 Japan declared it was giving up killing in the Southern Ocean .

The Southern Ocean is now a sanctuary. But it comes at a cost. Japan walked out of the International Whaling Commission (IWC), accusing the anti-whaling members of failing to appreciate the cultural significance of whaling in Japan and of imposing their values on others. Freed from the IWC’s strictures, the government said commercial whaling would resume in Japan’s own extensive waters. But…whaling in home waters is troubling. Most whale populations in the Southern Ocean are healthy. In Japanese waters, stocks are less bountiful….

The whaling lobby is powerful in Japan. For now, the subsidies continue, supposedly to help ease the switch to nakedly commercial whaling but they coud be gone in two or three years. Other fleets complain that whaling gets far more than its fair share of subsidies for fisheries.

The challenges are immense. Whalemeat consumption has fallen from 230,000 tonnes a year in the early 1960s to 3,000 tonnes today, and whale is no longer cheap. Local whales have higher accumulations of toxins (such as a mercury) than those in the Southern Ocean. One packager of sashimi admits he sources his whale meat from Norway.

Excertps from Japan wants to catch whales. But who will eat them?, Economist, Apor. 25, 2020

Oceans Restored: the 2050 Deadline

A study published in Nature on April 2, 2020 claims that marine ecosystems could recover in just 30 years because of the growing success of conservation efforts and the ocean’s remarkable resilience. Some of these conservation efforts include the increase in Marine Protected Areas (MPAs) from less than 1 percent in 2000 to almost 8 percent today and the restoration of key habitats such as seagrass beds and mangroves

One great success is the restoration of humpback whales that migrate between Antarctica and eastern Australia. Their numbers have rebounded from a few hundred in 1968 to more than 40,000 today. Sea otters in Western Canada have also jumped from dozens in 1980 to thousands. Green turtles in Japan, grey seals and cormorants in the Baltic and elephant seals in the United States have all also made remarkable comebacks. However, “If we don’t tackle climate change and raise the ambition and immediacy of these efforts, we risk wasting our efforts,” Duarte, one of the authors of the study, told BBC News. The initial price tag on all this is hefty: $10 to $20 billion a year until the 2050 recovery date.

Excerpts from Oceans Can Recover by 2050, Study Shows, EcoWatch, Apr. 2, 2020

The Nightmare: Sabotaging 20 Million Nuclear Shipments

Nuclear and other radioactive material is hardest to protect when it is transported from point A to point B — more than half of the incidents of theft of radioactive material reported to the IAEA between 1993 and 2019 occurred while it was in transport.

Around 20 million shipments of nuclear and other radioactive material are regularly transported within countries and across borders each year. These materials are used in industry, agriculture and medicine, as well as in education. Some of them are also radioactive sources that are no longer useful, known as disused sources.

The aim of nuclear security during transport is to ensure that the material is secured throughout and that it is not used for criminal or malicious purposes. While the level of security differs depending on the sensitivity of the material, the fundamental elements of secure transport include physical protection, administrative measures, training and protection of information about the transport routes and schedule. In some cases, escort personnel may also need to be armed

“During conversion of our research reactor from high enriched to low enriched uranium fuel, we had to transport highly radioactive spent reactor fuel from the site to the airport to be sent back to the original manufacturer, and we had to transport the new low enriched uranium fuel from the airport to the facility,” said Yusuf A. Ahmed, Director of the Centre for Energy Research and Training in Nigeria, who was involved in the conversion project. “Although the transport time is only a few hours, there is a lot that can happen during that time, from simple traffic accidents to malicious interventions and sabotage of shipments.”

While only around 30 countries use nuclear power and therefore have significant amounts of nuclear materials to transport, almost all countries use radioactive sources.

Excerpts from Inna Pletukhin, A Moving Target: Nuclear Security During Transport, IAEA Bulletin, Jan. 24, 2020

Viva Over-Fishing! Addicted to Over-Consumption of Fish

In 2015 world leaders signed up to a long list of sustainable development goals, among them an agreement to limit government subsidies that contribute to overfishing. Negotiators at the World Trade Organisation (wto) were told to finish the job “by 2020”. They have missed their deadline. Overfishing is a tragedy of the commons, with individuals and countries motivated by short-term self-interest to over-consume a limited resource. By one measure, the share of fish stocks being fished unsustainably has risen from 10% in 1974 to 33% in 2015.

Governments make things worse with an estimated $22bn of annual subsidies that increase capacity, including for gear, ice, fuel and boat-building. One study estimated that half of fishing operations in the high seas (waters outside any national jurisdiction) would be unprofitable without government support.

 Trade ministers were supposed to sort it all out at WTO meeting in December in Kazakhstan. But the meeting was postponed till June 2020. Moreover, the murky nature of subsidies for unregulated and unreported fishing makes their work unusually difficult. Governments do not have lines in their budget that say “subsidies for illegal fishing”, points out Alice Tipping of the International Institute for Sustainable Development, a think-tank.

Negotiators are trying to devise a system that would alert governments to offending boats, which would become ineligible for future subsidies. That is tangling them up in arguments about what to do when a boat is found in disputed territory, how to deal with frivolous accusations and how to treat boats that are not associated with any country offering subsidies.

When it comes to legal fishing of overfished stocks, it is easier to spot the subsidies in government budget lines, but no easier to agree on what to do about them. America and the European Union, for example, have been arguing over whether to allow subsidies up to a cap, or whether to ban some subsidies and take a lenient approach to the rest. The EU favours the second option, arguing that where fisheries are well-managed, subsidies are not harmful. To others this looks like an attempt to ensure any eventual deal has loopholes.

Further complicating matters is a long-running row about how to treat developing countries. All WTO members agree that some need special consideration. But as an American representative pointed out at a recent WTO meeting, 17 of the world’s 26 most prolific fishing countries are developing ones. That means broad carve-outs for them would seriously weaken any deal.

China, both the world’s biggest fisher and biggest subsidiser of fishing, has proposed capping subsidies in proportion to the number of people in each country who work in the industry. But it is the world leader here, too, with 10m at the last count (in 2016). Other countries fear such a rule would constrain China too little.

Excerpts from The World Trade Organization: What’s the Catch, Economist, Jan 4, 2020

The Severe Extent of Marine Pollution Crime

A global operation led by INTERPOL involving 61 countries and regional law enforcement partners has identified thousands of illicit activities behind severe marine pollution. Code-named 30 Days at Sea 2.0, the month-long (1-31 October, 2019) operation gathered more than 200 enforcement authorities worldwide for concerted action across all continents. Illustrating the severe global extent of marine pollution crime, preliminary operational results have already revealed more than 3,000 offences detected during 17,000 inspections. The offences – such as illegal discharges at sea, in rivers, or in coastal areas – were found to have been committed primarily to avoid the cost of compliance with environmental legislation.

The operation gathered more than 200 enforcement authorities worldwide, such as here in Bosnia and Herzegovina where officers inspect a company suspected of illegal discharge into local rivers
In Nigeria, INTERPOL’s National Central Bureau in Abuja coordinated the action of 18 authorities through a task force created to conduct inspections into illegal oil refineries, found responsible for severe oil leakages polluting the country’s waterways.   Information exchanged between Malaysia and The Netherlands permitted authorities to identify the source country of seven containers of plastic waste being illegally shipped into Malaysia from Belgium via Hong Kong, and to initiate their repatriation.

Marine pollution: thousands of serious offences exposed in global operation, Interpol Press Release, Dec. 16, 2019.

The Carbon-Neutral Europe and its Climate Bank

The European Union (EU) Green Deal, a  24-page document reads like a list of vows to transform Europe into a living demonstration of how a vast economy can both prosper and prioritise the health of the planet. It covers everything from housing and food to biodiversity, batteries, decarbonised steel, air pollution and, crucially, how the EU will spread its vision beyond its borders to the wider world….The plan is large on ambition, but in many places frustratingly vague on detail.

Top billing goes to a pledge to make Europe carbon-neutral by 2050….Current policies on renewable energy and energy efficiency should already help to achieve 45-48% cuts by 2030. Green NGOs  would like to see the EU sweat a bit more and strive for 65% cuts by 2030, which is what models suggest is needed if the bloc is to do its share to limit global warming to 1.5-2ºC.

All this green ambition comes at a price. The commission estimates that an additional €175bn-€290bn ($192bn-$320bn) of investment will be needed each year to meet its net-zero goals. Much of this will come from private investors. One way they will be encouraged to pitch in is with new financial regulations. On December 5th, 2019 EU negotiators struck a provisional agreement on what financial products are deemed “green”. Next year large European companies will be forced to disclose more information about their impacts on the environment, including carbon emissions. These measures, the thinking goes, will give clearer signals to markets and help money flow into worthy investments.

Another lever is the European Investment Bank, a development bank with about €550bn on its balance-sheet, which is to be transformed into a climate bank. Already it has pledged to phase out financing fossil fuels by 2021. By 2025 Werner Hoyer, its boss, wants 50% of its lending to go to green projects, up from 28% today, and the rest to go to investments aligned with climate-change goals. Some of that money will flow into a “just transition” fund, worth €100bn over seven years. Job losses are an unavoidable consequence of decarbonising Europe’s economy; the coal industry alone employs around 250,000 people, mainly in eastern Europe. The fund will try to ease some of this pain, and the political opposition it provokes.

The Green Deal goes beyond the scope of previous climate policies. One area it enters with gusto is trade. Under the commission’s proposals, the eu will simply refuse to strike new trade deals with countries that fail to comply with the Paris agreement’s requirement that signatories must increase the scale of their decarbonisation pledges, known as “nationally determined contributions” or NDCs, every five years. That would mean no new deals with America while Donald Trump is president; it is set to drop out of the Paris agreement late in 2020. And, because the first round of enhanced ndcs is due next year, it would put pressure on countries that are dragging their feet on these, of which there are dozens—including China and India.

The deal also sketches out plans for a carbon border-adjustment levy. Under the eu’s emission-trading scheme, large industries pay a fee of about €25 for every tonne of carbon dioxide they emit. Other regions have similar schemes with different carbon prices. A border-adjustment mechanism would level the playing field.

Excerpts from, The EU’s Green Deal, Economist, Dec. 2019

Saving the Giraffe from Trophy Hunting and Meat Production

In August 2019, countries agreed to monitor trade in giraffes and their body parts to help conserve the species, now deemed vulnerable to extinction. From 1985 to 2015, the wild giraffe population shrank by about 40% to approximately 68,000 adults. The declines were especially sharp in eastern and Central Africa where giraffes’ savanna and forest habitat has been turned into farms and the animals are poached for meat; most trophy hunting of giraffes happens in southern Africa, where populations have been increasing… The only figures on trade in giraffe parts show that about 40,000—including hides, carved bones, and hunting trophies such as mounted heads—were brought into the United States from 2006 to 2015.

Excerpt from Giraffe Trade to Be Tracked, Science, Aug. 30, 2019

How to Manage Water Like Money and Fail: Australia

Australia’s Darling River…provided fresh water to farmers seeking to tame Australia’s rugged interior.  No longer. The Darling River hasn’t flowed for eight months, with long stretches completely dried up. A million fish died there in January 2019.  Kangaroos, lizards and birds became sick or died after drinking from toxic pools of stagnant water.  Australia’s water-trading market is drawing blame. The problems with the system, created more than a decade ago, have arisen as similar programs are being considered in the U.S.

Water crises are unfolding across the world as surging populations, industrial-scale farming and hotter temperatures deplete supplies.  Australia thought it had the answer: a cap-and-trade system that would create incentives to use water efficiently and effectively in the world’s driest inhabited continent. But the architects of water trading didn’t anticipate that treating water as a commodity would encourage theft and hoarding.   A report produced for a state resources regulator found the current situation on the Darling was caused by too much water being extracted from the river by a handful of big farmers. Just four license holders control 75% of the water extracted from the Barwon-Darling river system.

The national government, concerned that its water-trading experiment hasn’t turned out as intended, in August 2019 requested an inquiry by the country’s antitrust regulator into water trading.  Anticorruption authorities are investigating instances of possible fraud, water theft and deal making for water licenses. In one case, known as Watergate, a former agriculture minister allegedly oversaw the purchase of a water license at a record price from a Cayman Islands company co-founded by the current energy minister. The former agriculture minister said he was following departmental advice and had no role in determining the price or the vendor. The energy minister said he is no longer involved with the company and received no financial benefit from the deal.

Since 2007, Australia has allowed not only farmers but also investors who want to profit from trading to buy and sell water shares. The water market is now valued at some $20 billion.    But making water valuable had unintended consequences in some places. “Once you create something of real value, you should expect people to attempt to steal it and search for ways to cheat,” says Mike Young, a University of Adelaide professor. “It’s not rocket science. Manage water like money, and you are there.”  Big water users have stolen billions of liters of water from rivers and lakes, according to local media investigations and Australian officials, often by pumping it secretly and at night from remote locations that aren’t metered. A new water regulator set up in New South Wales investigated more than 300 tips of alleged water thefts in its first six months of operation.  In 2018, authorities charged a group of cotton farmers with stealing water, including one that pleaded guilty to pumping enough illegally to fill dozens of Olympic-size swimming pools.  Another problem is that water trading gives farmers an incentive to capture more rain and floodwater, and then hoard it, typically by building storage tanks or lining dirt ditches with concrete. That enables them to collect rain before it seeps into the earth or rivers.

The subsequent water shortages, combined with trading by dedicated water funds and corporate farmers, have driven up prices. Water in Australia’s main agricultural region, the Murray-Darling river basin, now trades at about $420 per megaliter, or one million liters, compared with as low as $7 in previous years.  David Littleproud, Australia’s water-resources minister, says 14% of water licenses are now owned by investors. “Is that really the intent of what we want this market to be?” he asks. “Water is a precious commodity.”

Excerpts from Rachel Pannett , The U.S. Wants to Adopt a Cap-and-Trade Plan for Water That Isn’t Working, WSJ, Sept. 4, 2019

Low Risk-High Rewards: Killing Endangered Species

The animals’ meat, hides and, above all, tusks are money-spinners. East Asia is the biggest market for ivory and for many illegally traded products, such as animal parts used in traditional Chinese medicine (TCM)—tiger bones, rhino horns, pangolin scales—or in its cuisine—pangolin meat, for example. In July,  2019 the authorities in Singapore seized 8.8 tonnes, about 300 elephants’-worth, of ivory, along with 11.9 tonnes of pangolin scales, from some 2,000 of the anteaters, the world’s most widely trafficked endangered mammal. The annual profits of the trade in illegal wildlife products are estimated at between $7bn at the low end and $23bn. This makes it the fourth-most profitable criminal trafficking business, with links to others—slavery, narcotics and the arms trade..

Athough China is trying to curb illegal trade, it is also promoting TCM as one of its civilisation’s great contributions to the world. It has indeed made breakthroughs, such as artemisinin, now a widely used defence against malaria. Artemisinin is isolated from the plant Artemisia annua, sweet wormwood, a herb employed in TCM….Conservationists are alarmed that in 2019 the World Health Organisation (WHO) gave TCM respectability by including diagnoses for 400 conditions in its influential International Classification of Disease. 

The WHO approved in June 2019 a new version of its International Classification of Diseases, a highly influential document that categorizes and assigns codes to medical conditions, and is used internationally to decide how doctors diagnose conditions and whether insurance companies will pay to treat them. The latest version, ICD-11, is the first to include a chapter, chapter 26, on TCM.

Excerpts from How to curb the trade in endangered species: On the Horns, Economist, Aug. 10, 2019; The World Health Organization’s decision about traditional Chinese medicine could backfire, Nature, June 5, 2019

Who to Save? Forests or Farmers

Agriculture continues to present the biggest threat to forests worldwide. Some experts predict that crop production needs to be doubled by 2050 to feed the world at the current pace of population growth and dietary changes toward higher meat and dairy consumption. Scientists generally agree that productivity increase alone is not going to do the trick. Cropland expansion will be needed, most likely at the expense of large swathes of tropical forests – as much as 200 million hectares by some estimates. 

Nowhere is this competition for land between forests and agriculture more acute than in Africa. Its deforestation rate has surpassed those of Latin America and Southeast Asia. Sadly, the pace shows no sign of slowing down. Africa’s agriculture sector needs to feed its burgeoning populations- the fastest growing in the world…. What’s more, for the millions of unemployed African youth, a vibrant agriculture sector will deliver jobs and spur structural transformation of the rural economy. Taken together, the pressures on forests are immense. Unless interventions are made urgently, a large portion of Africa’s forests will be lost in the coming decades – one farm plot at a time.

The difficult question is: what interventions can protect forests and support farmers at the same time? 

To tackle these complex challenges, the Center for International Forestry Research (CIFOR) has launched a new initiative: The “Governing Multifunctional Landscapes (GML) in Sub-Saharan Africa: Managing Trade-Offs Between Social and Ecological Impacts”  Read more

Excerpts from XIAOXUE WENG et al Can forests and smallholders live in harmony in Africa?, CIFOR, June 3, 2019

The Sad Mismanagement of Sand

With the global demand for sand and gravel standing at 40 to 50 billion tonnes per year, a new report by UN Environment reveals that aggregate extraction in rivers has led to pollution, flooding, lowering of water aquifers and worsening drought occurrence.

The report Sand and sustainability: Finding new solutions for environmental governance of global sand resources presents how the demand for sand has increased  three-fold over the last two decades. Further to this, damming and extraction have reduced sediment delivery from rivers to many coastal areas, leading to reduced deposits in river deltas and accelerated beach erosion

Sand extraction is fast becoming a transboundary issue due to sand extraction bans, international sourcing of sand for land reclamation projects and impacts of uncontrolled sand extraction beyond national borders. International trade in sand and gravel is growing due to high demand in regions without local sand and gravel resources and is forecast to rise 5.5 per cent a year with urbanization and infrastructure development trends.

Unsustainable sand extraction does not only impact the environment but can also have far-reaching social implications. Sand removal from beaches can jeopardize the development of the local tourism industry, while removing sand from rivers and mangrove forests leads to a decrease of crab populations—negatively affecting women whose livelihood depends on the collection of crabs.

Excerpts from Rising demand for sand calls for resource governance, UNEP, May 7, 2019

How to Make Broken Ships Disappear: pollution

How do you make a 10,000-tonne container ship disappear? At Alang, a small town in Gujarat, on the western coast of India  is the world’s biggest ship-breaking town. Almost a third of all retired vessels—at least 200 each year—are sent to be broken up here, at over 100 different yards stretching along 10km of sand. The industry employs some 20,000 people, almost all men who migrate from the poorer states of India’s northern Hindi-speaking belt. Taxes paid by breakers generate huge sums for the state government. Yet it is a dangerous industry for its workers and a filthy one in environmental terms.

Of 744 ships that were pulled apart worldwide last year, 518 were dismantled on beaches. Only 226 were processed “off the beach” at industrial sites designed for the purpose, according to the Shipbreaking Platform, an ngo which campaigns against beach-breaking. The majority of big shipping firms use beaches, except a tiny few such as Hapag Lloyd of Germany and Boskalis of the Netherlands.

A typical operation involves a ship being beached at low tide. Once her fittings and other resaleable parts are removed, hundreds of workers with gas blowtorches clamber over the vessel’s hull, cutting it into huge steel blocks. These are then dropped onto the beach, where they are cut up again before being sold, then rerolled for use in construction.

Apart from the danger of dropping tens of tonnes of steel from a great height, the method is immensely polluting. A review in 2015 by Litehauz, a Danish marine environmental consultancy, found that in the process of scrapping a 10,000-tonne ship at least 120 tonnes of steel becomes molten and is lost in the sea. Levels of mercury and lead, as well as oil, in Alang’s water are at least 100 times higher than at other beaches. Workers must handle asbestos and dangerous chemicals. Accidents are common. Last year 14 workers died at Alang.Alang is just one of many ship-breaking centres in South Asia. Among the others are beaches in Bangladesh (where workers reportedly include children) and Pakistan. Last year the subcontinent recycled around 90% of the world’s ships by tonnage.

Ship-breaking is concentrated in the region for three reasons. Prices for scrap steel are higher than elsewhere (90% of a ship is typically steel), thanks to demand for rerolled steel for construction. Labour costs are lower than at yards in Europe, America or Turkey (workers at Alang make up to 800 rupees, or $11, per day, and usually less) and safety and environmental regulations are much weaker. Most sellers scrap their ships in South Asia because they get better prices for them.

 Shipowners, in particular Maersk, a Danish company which is the world’s biggest shipper, are preparing to comply with them…At the Baijnath Melaram shipyard a huge crane barge sits in the water next to a stretch of “impermeable” concrete. “We used to have to winch the blocks up the beach,” says Siddharth Jain, the firm’s business manager. Now, the crane lifts blocks of steel down from the ships directly to the concrete, so that they need never touch the sand. In contrast to the yards nearby, where men in simple work clothes and no safety goggles operate blowtorches, the workers scuttling around Baijnath Melaram wear boiler suits, face masks and helmets.

Blocks of steel from recycled ships

The changes are largely down to Maersk… Around 70 more are upgrading in order to meet standards set by the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, an unratified treaty on ship recycling.  Maersk’s campaign is in response to new regulations in force since December 31st 2018 that require all European-flagged vessels to be recycled at shipyards approved by Brussels. Just over a third of the world’s ships fall in this category. Maersk, whose fleet is roughly 40% European-flagged, hopes that the best yards at Alang will be able to comply with the new rules. Two Indian yards have already been audited for the European certification; 11 more have applied. “If we sustain that momentum, in five, six or seven years all of Alang could be really responsible,” says John Kornerup Bang, Maersk’s sustainability chief.

But on January 30, 2019 the eu announced that the Indian yards audited will not make the list,… Ingvild Jenssen of the Shipbreaking Platform says that even Alang’s best yards are not clean enough. She argues that Maersk’s efforts merely “greenwash” a model that needs to change completely…. Not clean enough for Europe; but too expensive to compete with breakers in Bangladesh or Pakistan which have not changed at all. If that happens, the industry in Alang—and the jobs and revenue it generates—could disappear almost as quickly as the ships it dismantles.

Gadani, Pakistan

Excerpt from HIgh by the Beach: Ship Recycling, Economist, Mar. 9, 2019

From Savior to Villain: Biofuel from Palm Oil

Globally, average palm oil yields have been more or less stagnant for the last 20  years, so the required increase in palm oil production to meet the  growing demand for biofuels  has come from deforestation and peat destruction in Indonesia.  Without fundamental changes in governance, we can expect at least a third of new palm oil  area to require peat drainage, and a half to result in deforestation.

Currently, biofuel policy results in 10.7  million tonnes of palm oil demand.  If the current biofuel policy continues we expect by 2030:
• 67 million tonnes palm oil demand due to biofuel policy.
• 4.5 million hectares deforestation.
• 2.9 million hectares peat loss.
• 7 billion tonnes of CO2 emissions over 20 years, more than total annual U.S. GHG emissions.
It must always be remembered that the primary purpose of biofuel policy in the EU and many  other countries is climate change mitigation. Fuel consumers in the European Union, Norway  and elsewhere cannot be asked to continue indefinitely to pay to support vegetable oil based
alternative fuels
that exacerbate rather than mitigate climate change.

The use of palm oil-based biofuel should be  reduced and ideally phased out entirely.  In Europe, the use of biodiesel other than that produced from approved waste or  by-product feedstocks should be reduced or eliminated.
In the United States, palm oil biodiesel should continue to be restricted from generating  advanced RINs under the Renewable Fuel Standard. Indonesia should reassess the relationship between biofuel mandate, and its  international climate commitments, and refocus its biofuel programme on advanced biofuels from wastes and residues. The aviation industry should focus on the development of advanced aviation biofuels  from wastes and residues, rather than hydrotreated fats and oils.

Excerpts from Dr Chris Malins,  Driving deforestation: The impact of expanding palm oil demand through biofuel policy, January 2018

In Feb. 28, 2019, Norway’s $1 trillion sovereign wealth fund, the world’s largest, pulled out of more than 33 palm oil companies over deforestation risks.

100 Ways to Finance Criminal Cartels Logging Forests

The report – Green Carbon, Black Trade (2012) – by UNEP and INTERPOL focuses on illegal logging and its impacts on the lives and livelihoods of often some of the poorest people in the world set aside the environmental damage. It underlines how criminals are combining old fashioned methods such as bribes with high tech methods such as computer hacking of government web sites to obtain transportation and other permits. The report spotlights the increasingly sophisticated tactics being deployed to launder illegal logs through a web of palm oil plantations, road networks and saw mills. Indeed it clearly spells out that illegal logging is not on the decline, rather it is becoming more advanced as cartels become better organized including shifting their illegal activities in order to avoid national or local police efforts. By some estimates, 15 per cent to 30 per cent of the volume of wood traded globally has been obtained illegally…

The much heralded decline of illegal logging in the mid- 2000s in some tropical regions was widely attributed to a short-term law enforcement effort. However, long-term trends in illegal logging and trade have shown that this was temporary, and illegal logging continues. More importantly, an apparent decline in illegal logging is due to more advanced laundering operations masking criminal activities, and notnecessarily due to an overall decline in illegal logging. In many cases a tripling in the volumes of timber “originating” from plantations in the five years following the law enforcement crack-down on illegal logging has come partly from cover operations by criminals to legalize and launder illegal logging operations….

Much of the laundering of illegal timber is only possible due to large flows of funding from investors based in Asia, the EU and the US, including investments through pension funds. As funds are made available to establish plantations operations to launder illegal timber and obtain permits illegally or pass bribes, investments, collusive corruption and tax fraud combined with low risk and high demand, make it a highly profitable illegal business, with revenues up to 5–10 fold higher than legal practices for all parties involved. This also undermines subsidized alternative livelihood incentives available in several countries.

[It is important to discourage] the use of timber from these regions and introducing a rating og companies based on the likelihood of their involvement in illegal practices to discourage investors and stock markets from funding them.

Excerpts from Nellemann, C., INTERPOL Environmental Crime Programme (eds). 2012.Green Carbon, Black Trade Illegal Logging, Tax Fraud and Laundering in the Worlds Tropical Forests. A Rapid Response Assessment United Nations Environment Programme

The Game-Changers: oil, gas and geothermal

The Democratic Republic of the Congo (DRC) has decided to degazette parts of two UNESCO World Heritage Sites to allow for oil drilling. Environmentalists have reacted sharply to the decision to open up Virunga and Salonga national parks – a move that is likely to jeopardise a regional treaty on the protection of Africa’s most biodiverse wildlife habitat and the endangered mountain gorilla…The two national parks are home to mountain gorillas, bonobos and other rare species. Salonga covers 33 350 km2 (3,350,000 ha)of the Congo Basin, the world’s second largest rainforest, and contains bonobos, forest elephants, dwarf chimpanzees and Congo peacocks….

On 7 April, 2018, a council of ministers from the DRC, Rwanda and Uganda agreed to ratify the Treaty on the Greater Virunga Transboundary Collaboration (GVTC) on Wildlife Conservation and Tourism Development. The inaugural ministerial meeting set the deadline for September 2018 to finalise the national processes needed to ratify the treaty.

The Virunga National Park (790,000 ha, 7 900 km2)is part of the 13 800 km2 (1 3800 00 ha) Greater Virunga Landscape, which straddles the eastern DRC, north-western Rwanda and south-western Uganda.  The area boasts three UNESCO World Heritage Sites – Virunga, Rwenzori Mountains National Park and Bwindi Impenetrable National Park. It also boasts a Ramsar Site (Lake George and Lake Edward) and a Man and Biosphere Reserve (in Queen Elizabeth National Park). It is the most species-rich landscape in the Albertine Rift – home to more vertebrate species and more endemic and endangered species than any other region in Africa.

According to the Greater Virunga Landscape 2016 annual report, the number of elephant carcasses recorded in 2016 was half the yearly average for the preceding five years. The report also mentions a high rate of prosecution and seizures. It cites a case study on Uganda’s Queen Elizabeth National Park where 282 suspects involved in poaching were prosecuted, with over 230 sentenced….The GVTC has also helped to ease tensions between the countries by providing a platform where their military forces can collaborate in a transparent way. ..

Armed groups have reportedly killed more than 130 rangers in the park since 1996. Militias often kill animals such as elephants, hippos and buffaloes in the park for both meat and ivory. Wildlife products are then trafficked from the DRC through Uganda or Rwanda. The profits fund the armed groups’ operations.

Over 80% of the Greater Virunga Landscape is covered by oil concessions and this makes it a target for state resource exploitation purely for economic gain.


2015: Until recently, in GVL, extraction of highly valued minerals such as gold and coltan, were largely artisanal. The recent discovery of oil, gas and geothermal potential, however, is a game-changer. Countries are now moving ahead in the exploration and production of oil and gas, which if not properly managed, is likely to result in major negative environmental (and social) changes. Extractive industries are managed under each GVL partner state policy guidelines and legislation. Concessions for these industries cover the whole of the GVL, including the World Heritage Sites as well as national protected areas . Since 2006, Uganda discovered commercial quantities of oil in the Albertine Graben and production in Murchison will begin within the next few years. The effect of the extractive industries, similar to and contributing to that of the increase in urbanization is the increased demand for bush meat, timber and fuel wood from the GVL.

Excertps from Duncan E Omondi Gumba, DRC prioritises oil over conservation, ISS Africa,  July 11, 2018//GREATER VIRUNGA LANDSCAPE
ANNUAL CONSERVATION STATUS REPORT 2015

 

Well blowouts and Pipeline breakdowns: Who Profits?

The global oil spill management market size is projected to grow beyond USD 125.62 billion by 2024. Growing incidents of oil spilling in the past along with severe safety and environmental policies are likely to propel the market over the forecast phase (2016-2024). Also, escalating pipeline and seaborne shipping of crude oil and chemicals could positively impact the market further.  The market is fragmented by technologies, techniques, applications, and regions. Technologies are Pre-oil spill and Post-oil spill. Pre-oil spill segment is divided into double-hull, pipeline, leak detection, blow-out preventers, and others. Double-hulling was the dominant segment in 2015 with highest shares.

Marine trade registers for a majority of petroleum products and natural gas transportation. Mounting demand for crude and petroleum products oil in Europe and Asia Pacific will boost the maritime trade growth further. Post-oil spill segments are mechanical, chemical, biological, and physical. Chemical and mechanical containment and recovery are the techniques used in the industry….In 2015, onshore post-oil spill sector was valued close to 60% of the total market demand. Regions such as Norway, U.S, Mexico, Canada, U.S., China, and Nigeria have observed well blowouts and occurrences of pipeline breakdowns. This could be accredited to huge market diffusion in past

Main regions in the market encompass North America, Europe, Asia Pacific, the Middle East and Africa (MEA), and Central & South America. North America was the leading market for pre-oil spill management. It was estimated at 40.1% of total demand in 2015. This region will potentially face lucrative demand due to production activities and increasing oil & gas discovery. Pre-oil spill management shares in Asia Pacific will gain over USD 21,540 million by 2024…  Top companies in the global oil spill management market include OMI Environmental Solutions, Skim Oil Inc., American Green Ventures Inc., and Spill Response Services.

Excerpts from Global Oil Spill Management Market Size is Projected to Grow Beyond USD 125.62 Billion by 2024, Hexa Research Press Release, Mar. 17, 2018

The Most Trafficked Animal in the World: Pangolin

Pangolins are a smuggler’s dream. For defence, and when asleep, they roll themselves up into spheres, scales on the outside, to thwart any predator. That makes them easy to handle and pack. And handled and packed they have been, in enormous numbers. The International Union for Conservation of Nature, a worldwide wildlife-preservation organisation, reckons that more than 1m pangolins were traded illegally from their African and Asian homelands over the decade to 2014. That may be a conservative estimate. A paper published in 2017 in Conservation Letters calculates the number of pangolins hunted in central Africa alone as between 400,000 and 2.7m a year. Based on statistics such as these it seems likely that pangolins, of which there are eight species, four African and four Asian, are the most trafficked type of animal in the world.

Some are consumed locally. That is not necessarily illegal, for laws vary from place to place. International trade, though, is a different matter. Early in 2017 CITES, the Convention on International Trade in Endangered Species, listed all eight pangolins as part of what is known as Appendix 1. This means signatories to the convention (which most countries are) cannot permit them to be imported or exported.

Most of those that are, nevertheless, exported illegally from their homelands end up in China and Vietnam. In these countries pangolins’ meat is a treat and their scales are used in folk medicine, even though those scales are made of keratin, the same substance as hair and fingernails, and thus have no medicinal value. Pangolin scales fetch as much as $750 a kilogram in China. A 12-tonne stash of them, the world’s biggest seizure, was found last summer by the authorities in Shenzhen….

Cracking down on poachers and traders is difficult, particularly in poor places…Part of the blame lies with ignorance. Awareness of pangolins is patchy. They are nocturnal and shy, and thus rarely feature on tourists’ tick-lists. That makes them a low priority, even to game-management authorities who know they are there. …The Hywood Foundation’s initiative is part of a larger effort in Uganda, sponsored by the Uganda Wildlife Authority (UWA), the government’s conservation agency. Now that pangolins are on the UWA’s radar, it has stepped up intelligence and investigative work on poachers and traffickers…At the consumption end of the trafficking routes, too, things are starting to happen…. In theory, eating pangolin meat (along with that of many other wild species) is already illegal in China—not for conservation reasons, but as a reaction to the outbreak of SARS, a fatal respiratory disease…Persuading people to stop using the animals’ scales may be harder.

Excerpts from  Conserving Pagolins: A Problem of Scale, Economist, Feb 3, 2018

An Earth Bank of Codes: who owns what in the biological world

A project with the scale and sweep of the original Human Genome Project…should be to gather DNA sequences from specimens of all complex life on Earth. They decided to call it the Earth BioGenome Project (EBP).

At around the same time as this meeting, a Peruvian entrepreneur living in São Paulo, Brazil, was formulating an audacious plan of his own. Juan Carlos Castilla Rubio wanted to shift the economy of the Amazon basin away from industries such as mining, logging and ranching, and towards one based on exploiting the region’s living organisms and the biological information they embody. At least twice in the past—with the businesses of rubber-tree plantations, and of blood-pressure drugs called ACE inhibitors, which are derived from snake venom—Amazonian organisms have helped create industries worth billions of dollars. ….

For the shift he had in mind to happen, though, he reasoned that both those who live in the Amazon basin and those who govern it would have to share in the profits of this putative new economy. And one part of ensuring this happened would be to devise a way to stop a repetition of what occurred with rubber and ACE inhibitors—namely, their appropriation by foreign firms, without royalties or tax revenues accruing to the locals.

Such thinking is not unique to Mr Castilla. An international agreement called the Nagoya protocol already gives legal rights to the country of origin of exploited biological material. What is unique, or at least unusual, about Mr Castilla’s approach, though, is that he also understands how regulations intended to enforce such rights can get in the way of the research needed to turn knowledge into profit. To that end he has been putting his mind to the question of how to create an open library of the Amazon’s biological data (particularly DNA sequences) in a way that can also track who does what with those data, and automatically distribute part of any commercial value that results from such activities to the country of origin. He calls his idea the Amazon Bank of Codes.

Now, under the auspices of the World Economic Forum’s annual meeting at Davos, a Swiss ski resort, these two ideas have come together. On January 23, 2018 it was announced that the EBP will help collect the data to be stored in the code bank. The EBP’s stated goal is to sequence, within a decade, the genomes of all 1.5m known species of eukaryotes. ..That is an ambitious timetable. The first part would require deciphering more than eight genomes a day; the second almost 140; the third, about 1,000. For comparison, the number of eukaryotic genomes sequenced so far is about 2,500…

Big sequencing centres like BGI in China, the Rockefeller University’s Genomic Resource Centre in America, and the Sanger Institute in Britain, as well as a host of smaller operations, are all eager for their share of this pot. For the later, cruder, stages of the project Complete Genomics, a Californian startup bought by BGI, thinks it can bring the cost of a rough-and-ready sequence down to $100. A hand-held sequencer made by Oxford Nanopore, a British company, may be able to match that and also make the technology portable…..It is an effort in danger of running into the Nagoya protocol. Permission will have to be sought from every government whose territory is sampled. That will be a bureaucratic nightmare. Indeed, John Kress of the Smithsonian, another of the EBP’s founders, says many previous sequencing ventures have foundered on the rock of such permission. And that is why those running the EBP are so keen to recruit Mr Castilla and his code bank.

The idea of the code bank is to build a database of biological information using a blockchain. Though blockchains are best known as the technology that underpins bitcoin and other crypto-currencies, they have other uses. In particular, they can be employed to create “smart contracts” that monitor and execute themselves. To obtain access to Mr Castilla’s code bank would mean entering into such a contract, which would track how the knowledge thus tapped was subsequently used. If such use was commercial, a payment would be transferred automatically to the designated owners of the downloaded data. Mr Castilla hopes for a proof-of-principle demonstration of his platform to be ready within a few months.

In theory, smart contracts of this sort would give governments wary of biopiracy peace of mind, while also encouraging people to experiment with the data. And genomic data are, in Mr Castilla’s vision, just the start. He sees the Amazon Bank of Codes eventually encompassing all manner of biological compounds—snake venoms of the sort used to create ACE inhibitors, for example—or even behavioural characteristics like the congestion-free movement of army-ant colonies, which has inspired algorithms for co-ordinating fleets of self-driving cars. His eventual goal is to venture beyond the Amazon itself, and combine his planned repository with similar ones in other parts of the world, creating an Earth Bank of Codes.

[I]f the EBP succeeds, be able to use the evolutionary connections between genomes to devise a definitive version of the tree of eukaryotic life. That would offer biologists what the periodic table offers chemists, namely a clear framework within which to operate. Mr Castilla, for his part, would have rewritten the rules of international trade by bringing the raw material of biotechnology into an orderly pattern of ownership. If, as many suspect, biology proves to be to future industries what physics and chemistry have been to industries past, that would be a feat of lasting value.

Excerpts from Genomics, Sequencing the World, Economist, Jan. 27, 2018

Old Continents, New Trees

In the 1920s, when Ireland became independent, it was thought to have just 220,000 acres (90,000 hectares) of woods, covering about 1% of the land. Once-extensive forests had been shrinking for centuries…In 2017, though, almost 11% of Ireland is covered with forest, and an unknown additional amount by small woods and scattered trees. The government’s target is to cover 18% of the land area with forests by 2046. Ireland is behind schedule. Still, about 6,000 hectares of new forest ought to be planted this year, while almost none will be lost. It is part of a broad trend: the foresting of the West.

Trees are spreading in almost every European country. Because many of these forests are young, the quantity of wood in them is growing faster than their extent. Europe’s planted forests put on a little more than 1.1m cubic metres of wood per day. For comparison, the iron in the Eiffel Tower is about 930 cubic metres. Russia’s forests spread more slowly in percentage terms between 2005 and 2015, but, because Russia is so big, more than in the entire European Union in absolute terms. Forests now occupy a third of America’s land, having grown by 2% in the past decade. They are even expanding in Australia, following a long decline.

Deforestation in South America and Africa rightly gets most of conservationists’ attention. That loss is huge—equivalent to about 4.8m hectares a year, which far outweighs gains elsewhere. Yet the foresting of rich countries is still one of the world’s great land-use changes. It seems just as unstoppable as the deforestation of poorer places. It has plenty of critics, too.

The growth of forests is partly a result of changes to food markets. As the best farming areas have become more productive, and as rich countries have imported more of their food, marginal land has become unusable for ordinary agriculture…Forests are also growing because governments have favored them through laws and subsidies….Since the 1990s environmental considerations have weighed more heavily. Forests are increasingly valued as sponges for heavy rain, as wildlife habitats and as carbon sinks…

Planted forests are far from universally popular, though. Between June and October 2017, forest fires in Spain and Portugal killed more than 100 people and darkened Europe’s skies. The fires were partly blamed on the spread of non-native trees, especially eucalyptus. That Australian import, which was planted with support from the World Bank, among others, grows so quickly that trees can be harvested for pulp when less than ten years old. It also burns readily, scattering embers far afield. Portugal’s government has begun to restrict planting, in an effort to prevent the country from turning into what one green group calls “Eucalyptugal”.

The eucalyptus tree is a scapegoat for a bigger problem, argues Marc Castellnou, a fire analyst in Spain. The real trouble is that forests in Portugal and Spain have expanded quickly, with little thought for the consequences. Well-managed eucalyptus plantations are not the biggest danger—much worse are ill-managed ones with lots of underbrush and fallen wood, and the impromptu forests that grow on abandoned farms. The fires that get going in such forests jump to the treetops and burn so energetically that they cannot be stopped.

In Ireland, the criticisms are different. The country’s default tree is the sitka spruce, a fast-growing, damp-tolerant conifer from America’s Pacific Northwest. Spruce plantations are said to be devoid of life—vertical deserts of dark green. They are accused of wrecking rural communities and driving farmers off the land….

The first charge is false. Mark Wilson of the British Trust for Ornithology says that conifer plantations support more bird life per hectare than farmland, largely because they harbour more insects. Inevitably, some birds benefit more than others. The march of conifers across Britain and Ireland has increased the numbers of pine-loving birds such as siskins and crossbills. Conifers are also loved by crows—which is less obviously good, because crows raid the nests of rare birds such as curlews.

The second accusation, that trees push out other kinds of agriculture, is only partly true. Forestry subsidies and regulations have indeed distorted Ireland’s land market.

Excerpts from The Foresting of the West, Economist, Dec. 2, 2017,at 51

Cocoa Production and Forest Loss

At the UN Climate Change Conference (COP23) in Bonn in November 2017 top cocoa-producing countries Côte d’Ivoire and Ghana with leading chocolate and cocoa companies have announced far-reaching Frameworks for Action to end deforestation and restore forest areas.  Central to the Frameworks is a commitment to no further conversion of any forest land for cocoa production.  The companies and governments pledged to eliminate illegal cocoa production in national parks, in line with stronger enforcement of national forest policies and development of alternative livelihoods for affected farmers. Côte d’Ivoire and Ghana combined produce nearly two-thirds of the world’s annual supply of cocoa, the main ingredient in chocolate and a range of other consumer products…

Up-to-date maps on forest cover and land-use, as well as socio-economic data on cocoa farmers and their communities will be developed and publicly shared by the governments. Chocolate and cocoa industry agree to put in place verifiable monitoring systems for traceability from farm to the first purchase point for their own purchases of cocoa, and will work with the governments of Côte d’Ivoire and Ghana to ensure an effective national framework for traceability for all traders in the supply chain.

The two governments and companies agree through the Frameworks to accelerate investment in long-term sustainable production of cocoa, with an emphasis on “growing more cocoa on less land,”. Key actions include provision of improved planting materials, training in good agricultural practices, and development and capacity-building of farmers’ organizations.  Sustainable livelihoods and income diversification for cocoa farmers will be accelerated through food crop diversification, agricultural inter-cropping, development of mixed agro-forestry systems, and other income generating activities designed to boost and diversify household income while protecting forests.

The governments and companies, which represent and estimated 80+ percent of global cocoa usage, commit to full and effective consultation and participation of cocoa farmers in the process…The governments and companies have committed to a comprehensive monitoring process, including a satellite-based monitoring system to track progress on the overall deforestation target, and annual publicly disclosed reporting on progress and outcomes related to the specific actions in each Framework.

Excerpts from Cocoa and Forests Initiative

Companies that have joined the initiative include; Cargill, General Mills, Godiva, Hershey, Mars, Mondelēz, and Nestlé.

Taxing Carbon Emissions: EU

The European Union wants to slash greenhouse-gas emissions to 80% below 1990 levels by 2050. It is on course to cut just half that amount. To get back on track, on February 15th, 2017 the European Parliament voted for a plan to raise the cost for firms to produce carbon. It has prompted growing calls for the bloc to tax the carbon emissions embodied in the EU’s imports. At best, such a levy will barely curb emissions. At worst, it could cause a trade war.

The EU’s latest reforms try to put up the price of carbon by cutting the emissions allowances firms are granted. They include the EU’s first border tax on carbon, levied on cement imports.

Under the EU’s reforms, steelmakers in Europe would pay up to €30 ($32) to emit a tonne of carbon, but foreign producers selling in the EU would not have to pay a cent. Putting an equivalent tax on these imports is a neat solution to this problem. “It’s wonderful in theory,” says Jean Chateau, an economist at the OECD, a club of rich countries. But “in reality it’s very problematic.”

One big problem is how to calculate the carbon in imports. This is not easy even for simple steel sheets; for items made of several bits of metal from different sources, it is hellishly complex. Some countries might even refuse to provide the information. And any method brought in for foreign firms, if not applied to local ones, could fall foul of WTO rules,..

A global carbon price would produce far greater economic benefits than border taxes, but would require closer international co-operation. A trade war is not the way to get there.

Excerpts from Steely defences: Carbon tariffs and the EU’s steel industry, Economist,  Feb. 18, at 62

Deforestation and Supply Chains

366 companies, worth $2.9 trillion, have committed to eliminating deforestation from their supply chains, according to the organization Supply Change. Groups such as the Tropical Forest Alliance 2020, the Consumer Goods Forum and Banking Environment Initiative aim to help them achieve these goals.  Around 70 percent of the world’s deforestation still occurs as a result of production of palm oil, soy, beef, cocoa and other agricultural commodities. These are complex supply chains.  A global company like Cargill, for example, sources tropical palm, soy and cocoa from almost 2,000 mills and silos, relying on hundreds of thousands of farmers. Also, many products are traded on spot markets, so supply chains can change on a daily basis. Such scale and complexity make it difficult for global corporations to trace individual suppliers and root out bad actors from supply chains.

Global Forest Watch (GFW), a WRI-convened partnership that uses satellites and algorithms to track tree cover loss in near-real time, is one example. Any individual with a cell phone and internet connection can now check if an area of forest as small as a soccer penalty box was cleared anywhere in the world since 2001. GFW is already working with companies like Mars, Unilever, Cargill and Mondelēz in order to assess deforestation risks in an area of land the size of Mexico.

Other companies are also employing technological advances to track and reduce deforestation. Walmart, Carrefour and McDonalds have been working together with their main beef suppliers to map forests around farms in the Amazon in order to identify risks and implement and monitor changes. Banco do Brasil and Rabobank are mapping the locations of their clients with a mobile-based application in order to comply with local legal requirements and corporate commitments. And Trase, a web tool, publicizes companies’ soy-sourcing areas by analyzing enormous amounts of available datasets, exposing the deforestation risks in those supply chains…

[C]ompanies need to incorporate the issue into their core business strategies by monitoring deforestation consistently – the same way they would track stock markets.

With those challenges in mind, WRI and a partnership of major traders, retailers, food processors, financial institutions and NGOs are building the go-to global decision-support system for monitoring and managing land-related sustainability performance, with a focus on deforestation commitments. Early partners include Bunge, Cargill, Walmart, Carrefour, Mars, Mondelēz, the Inter-American Investment Corporation, the Nature Conservancy, Rainforest Alliance and more.  Using the platform, a company will be able to plot the location of thousands of mills, farms or municipalities; access alerts and dashboards to track issues such as tree cover loss and fires occurring in those areas; and then take action. Similarly, a bank will be able to map the evolution of deforestation risk across its whole portfolio. This is information that investors are increasingly demanding.

Excerpt from Save the Forests? There’s Now an App for That, World Resources Institute, Jan. 18, 2017

Ozone Layer at 2016

In 1974 scientists discovered that chlorofluorocarbons (CFCs), chemicals used in refrigeration and as propellants in products such as hairsprays, release chlorine into the stratosphere as they decompose. This depletes the ozone that protects Earth from ultraviolet radiation. CFCs are also powerful greenhouse gases, which absorb solar radiation reflected back from the planet’s surface and so trap heat in the atmosphere.

Initially, the consequences for the ozone layer caused most concern. In 1985 a gaping hole in it was found above Antarctica. Two years later, leaders from around the world acted decisively. They signed a deal, the Montreal protocol, to phase out CFCs. Now ratified by 197 countries, it has prevented the equivalent of more than 135 billion tonnes of carbon-dioxide emissions, and averted complete collapse of the ozone layer by the middle of the century. Instead, by that point the ozone hole may even have closed up….

In order to manage without CFCs, firms replaced them in applications such as refrigeration, air-conditioning and insulation with man-made hydrofluorocarbons (HFCs). These substances do not deplete ozone and last in the atmosphere for just a short time. However, they still contribute hugely to global warming.  The average atmospheric lifetime for most commercially used HFCs is 15 years or less; carbon dioxide can stay in the atmosphere for more than 500 years. But, like CFCs, HFCs cause a greenhouse effect between hundreds and thousands of times as powerful as carbon dioxide while they linger. Total emissions are still relatively low, but are rising by 7-15% a year. Controlling HFC emissions has been under discussion for the past decade; America and China, the world’s two biggest polluters, made a deal on the issue in 2013, which paved the way for co-operation on limiting carbon emissions ahead of UN-sponsored climate talks in Paris last year. There leaders agreed to keep warming “well below” levels expected to be catastrophic.

Average global temperatures are already 1°C higher than in pre-industrial times….America wants action on HFCs speedy enough that emissions will peak in 2021 and then start to fall; after recent talks in Hangzhou between Mr Obama and Mr Xi China may be ready to commit to reaching that point by 2023. Brazil, Indonesia and Malaysia lean towards 2025, and India has lobbied for a later date, closer to 2030.

Some sectors firms are already preparing to move away from HFCs: in 2015 the Consumer Goods Forum, an international industry group whose members include Walmart and Tesco, began enacting a plan to phase out the substances.

A big question is what to use instead….Some HFCs commonly used in refrigeration could be replaced by others that would have an impact more than 1,000 times smaller. Honeywell, an electronics giant, already makes these less-damaging alternatives. But patents covering such substances have been a sticking point in past discussions, says Achim Steiner, until recently the head of the UN Environment Programme….Other possible replacements include isobutane, propane and propylene, all of which occur naturally. These hydrocarbons are cheap and non-toxic, and can be used as coolants without the same harm to the ozone layer….

Excerpts from The Montreal protocol, Economist, Sept. 24, 2016,at 58

Exotic Pets-Illicit Markets

It’s easy to catch grey parrots, say researchers from Birdlife, a global grouping of conservation groups. A team of hunters will use decoys or go to the birds’ water and mineral licks in the forests where flocks gather. They then throw nets over them and take dozens at a time.

Once caught they will be smuggled over borders, stuffed in tiny cages and flown illegally to Europe, South Africa, the Middle East and China, where they may fetch up to £1,000 each. All this makes the African grey probably the most highly traded bird in the world, causing their numbers to plummet… Some conservationists estimate only 1% of their historical numbers remain…

“Africa’s overall elephant population has seen the worst declines in 25 years, mainly due to poaching over the past 10 years,” the IUCN’s director-general, Inger Andersen, will say. “Their plight is truly alarming. Poaching has been the main driver of the decline, while habitat loss poses an increasingly serious, long-term threat to the species.”..

Laos has pledged to phase out its controversial tiger farms, which supply neighbouring China with bones and other parts for traditional medicine. But international animal trade inspectors will report in Johannesburg that rhinoceros horn, elephant ivory and many other wildlife specimens are being regularly smuggled through the country both to China and other south-east Asian countries. “Laos is being targeted by organised crime groups as a transit point,” says wildlife trade monitoring network Traffic.

South Africa.. has lost nearly 6,000 rhinos to poachers since 2007, including more than 700 this year. Vietnam needs to crack down on its rampant illegal rhino horn trade and China has been identified as the world’s primary destination for precious woods…..The street value of ivory is now more than £1,500 a kilogram in Beijing, and rhino horn can sell for £50,000 per kilo – far more than the price of gold or platinum – on the Chinese black market. Meanwhile rosewood can sell for many thousands of pounds a cubic metre.

Excerpt from The grey parrot and the race against Africa’s wildlife extinction, Guardian, Sept. 24, 2016

Industrial-Scale Hunting

Starting September 25, 2016,  thousands of conservationists and top government officials will be thrashing out international trade regulations aimed at protecting different species.A booming illegal wildlife trade has put huge pressure on an existing treaty signed by more than 180 countries — the Convention on International Trade in Endangered Species (CITES)….

[T]he plight of Africa’s elephants, targeted for their tusks, generated fierce debate as the talks kicked off.Zimbabwe, Zambia, South Africa and Namibia castigated Western-based animal charities, saying they “dictated” on how African resources should be managed.”Please leave us alone, don’t just come and dictate what we should be doing,” Zambian Tourism Minister Stephen Mwansa said.Fortune Charumbira, head of Zimbabwe’s traditional chiefs, blasted “elitist NGOs who are coming from countries where there are no animals”, describing them as “domineering”.

A coalition of 29 African countries is pressing for a total halt to the ivory trade to curb poaching of elephants, but other delegates believe it would only fuel illegal trading…CITES forbids trade in elephant ivory, but Namibia and Zimbabwe have made a proposal asking for permission to sell off stockpiles to raise funds for local communities that co-exist with the animals….

CITES’ secretary general John Scanlon… warned illegal wildlife trafficking was “occurring on an industrial scale, driven by transnational organised criminal groups”.

African countries lash out at Western charities at international wildlife conservation meeting, ABC News, Sept. 24, 2016

Forest Fires and Haze

In 2015 a dry spell caused by the El Niño weather pattern made Indonesia’s forest fires especially severe. Smoke settled over Singapore for months and even reached Cambodia, Vietnam and the Philippines. At least 2m hectares of forest were burned. Dozens of people were killed and hundreds of thousands sickened. For much of October 2015 greenhouse gases released by those fires exceeded the emissions of the entire American economy. The losses over five months of fires amounted to around 2% of the country’s GDP…[The event has labeled  the 2015 Southeast Asian haze]

Between 2001 and 2014, Indonesia lost 18.5m hectares of tree cover—an area more than twice the size of Ireland. In 2014 Indonesia overtook Brazil to become the world’s biggest deforester.

One of the reasons for those forest fires is economic. The country produces well over half the world’s palm oil, a commodity used in cooking and cosmetics, as a food additive and as a biofuel. It accounts for around 4.5% of Indonesia’s GDP, and demand is still rising. To meet it, Indonesian farmers set fires to clear forest and make way for new plantations. Often these forests grow on peatlands, which store carbon from decayed organic matter; in tropical regions these hold up to ten times as much carbon as surface soil. Draining peatlands releases all of that carbon. The peat also becomes a fuel, so it is not just felled trees that are burning but the ground itself.

But politics also plays a part. … The president declared a moratorium on peatland-development licences and called for peat forests to be restored, even as his agriculture minister pointed out that burned peatland can be used for corn and soyabean planting….

Civil-society groups have had some success. At least 188 Indonesian palm-oil companies have made some sort of sustainability pledge, including five large multinational firms that in 2014 signed the Indonesian Palm Oil Pledge (IPOP), which commits them to avoiding deforestation and planting oil palms on peatland. Together those five firms account for 80% of Indonesia’s palm-oil exports.All the same, deforestation continues. Perversely, it may even have increased temporarily, as companies cleared as much land as they could before the agreement took effect. Besides, opaque supply chains allow companies to buy palm oil from suppliers not bound by IPOP.

Forests: A world on fire, Economist Special Report on Indonesia, Feb. 27, 2016

Illegal Waste Gangs: the case of ENI

Italian prosecutors on August 12, 2016, agreed to release energy giant ENI’s Centro Oli oil treatment plant from court-ordered seizure. The plant near the town of Viggiano in the Agri Valley in the southern Basilicata region was seized on March 31. 2016  in a probe that resulted in ex industry minister Federica Gudi resigning amid conflict-of-interest claims. It treated some 75,000 barrels of oil a day, before two tanks and a reinjection well were seized.

State-controlled ENI, nine other companies, and 60 individuals have been investigated for illegal waste trafficking in the southern Basilicata region,..The 70 subjects were notified that the investigation has ended, in Italy usually a prelude to indictment.

Prosecutors say ENI reaped millions in “unjust profits” from illegally dumping waste from its Viggiano plant. As well, the probe found irregularities in the construction of Total’s Tempa Rossa oil centre between Corleto Perticara near Potenza and Gorgoglione near Matera.

Former Total chiefs as well as various businessmen and officials were sentenced to terms ranging from two to seven years in prison on April 4, 2016.  The current suspects include former Corleto Perticara mayor Rosaria Vicino from Premier Matteo Renzi’s Democratic Party (PD), former Basilicata environmental department chief Donato Viggiano, former ENI southern region exec Ruggero Gheller, his current replacement Enrico Trovato, and five ENI staffers who have been under house arrest since March 31.
ENI earlier defended its Viggiano plant operations….

Excerpts from : Prosecutors OK freeing of ENI oil plant (2), Basilicata plant seized in waste trafficking probe,  ANSA, Aug. 5, 2016

The Eradication of Rosewood: deforestation

On May 13th, 2016 hoping to save his country’s dwindling forests, Thongloun Sisoulith, the new prime minister of Laos, banned all timber exports. A government representative says environmental protection is among its top priorities. But a report to be published on June 24th, 2016  by the Environmental Investigation Agency (EIA), an NGO, suggests the clampdown will not be implemented by local officials—and even if it is, may come too late to save Siamese rosewood from being eradicated in Laos and Cambodia.

Much like the trade in rhino horn and tiger skins, trade in rosewood is driven by demand from China’s burgeoning middle classes for goods once reserved for the rich: in this case, hongmu, or “redwood”, furniture made in the ornate Qing-dynasty style. Siamese rosewood is among the most highly prized of the 33 types of tree used to make hongmu.

Five years ago Thailand had roughly 90,000 Siamese rosewood trees—more than anywhere else in the world. But the EIA says “significant volumes, if not most” of those trees were illegally chopped down before trade in Siamese rosewood became regulated under the Convention on International Trade in Endangered Species (CITES), a treaty.

That grim history seems to be repeating itself in Laos and Cambodia. Between June 2013 and December 2014 Vietnam and China (including Hong Kong) imported more than 76,000 cubic metres of Siamese rosewood—more than the total amount growing in Thailand in 2011. Jago Wadley of the EIA says that Vietnam is a conduit through which the wood enters China. Of the total amount imported, 83% came from Laos and 16% from Cambodia.

Documentation accompanying the imported wood showed that 85% was harvested in the wild. Corrupt local officials have failed to enforce the restrictions imposed by the central Lao and Cambodian governments. Middlemen pay villagers to cut down the trees; they then sell the timber to Chinese or Vietnamese businessmen.

Excerpts Endangered species: No rosewood of such virtue, Economist, June 25, 2016

How to Catch Illegal Fishers: port state measures

The Agreement on Port State Measures to Prevent, Deter and Eliminate Illegal, Unreported and Unregulated Fishing (the Agreement)  entered into force on June 5, 2016.  The main purpose of the Agreement is to prevent, deter and eliminate illegal, unreported and unregulated (IUU) fishing through the implementation of robust port State measures. The Agreement envisages that parties, in their capacities as port States, will apply the Agreement in an effective manner to foreign vessels when seeking entry to ports or while they are in port. …

The Agreement provides an opportunity for port States to check and verify that vessels not flying their flags and that seek permission to enter their ports, or that are already in their ports, have not engaged in IUU fishing.  The Agreement also enhances flag States control over vessels as the Agreement requires the flag State to take certain actions, at the request of the port State, or when vessels flying their flag are determined to have been involved in IUU fishing….

Furthermore, the Agreement’s seeks to prevent the occurrence of so-called ports of non-compliance (formerly known as ports of convenience). Countries operating ports of non compliance do not regulate effectively the fishing and fishing-related activities that take place in the ports, including determining whether IUU-caught fish are landed, transshipped, processed and sold in the ports. Ratifying and acceding to the Agreement and implementing its measures robustly will reduce the number of ports of non compliance and opportunities for vessels to dispose of IUU-caught fish with relative ease. Port state measures are a cost-effective tool in ensuring compliance with national law and regional conservation and management measures adopted by RFMOs. This is because port States do not have to expend time, effort and resources in monitoring, pursuing and inspecting vessels at sea. Port inspections and controls are very much cheaper and safer than alternative, more conventional air and surface compliance tools. Port State measures, if used in conjunction with catch documentation schemes, have the potential to be one of the most cost-effective and efficient means of combating IUU fishing.

The Agreement’s most potent effect in terms of its potential to curb IUU fishing is that through the implementation of its provisions, including those relating to denial of access to ports, port inspections, prohibition of landing, and detention and sanction, can prevent fish caught from IUU fishing activities from reaching national and international markets. By making it more difficult to market fish through the application of port State measures, the economic incentive to engage in IUU fishing is reduced. In addition, many countries have also decided to prohibit trade with countries that do not have port state measures in place.

Excerpt from Food and Agriculture Organization  FAO Website.

Crocodile Farms for Hermes Bags

Over 20 countries export crocodilian skins, according to statistics from the UN Environment Programme. More than half the global tally is from caimans and alligators farmed in Colombia and the United States. The skins are largely sold to tanners in Italy and France, and also in Singapore.The industry has grown apace since the late 1970s, when conservationists began loosening an export ban designed to defend the animals from hunting (the trade is still controlled under CITES, an intergovernmental effort to protect endangered creatures). Grahame Webb, a biologist, says that many of the 5,000 or so farms are tiny set-ups in Asian villages. The largest outfits, however, now boast as many as 70,000 crocs. Some are getting snapped up by big leather-buyers at fashion houses such as Hermès and Louis Vuitton.

Excerpt from  Crocodile Farming: Snapping Dressers, Economist, May 14, 2016, at 55

Logging Wars: Tasmania

Bruny island, off south-eastern Tasmania, is a home to the swift parrot. Small and green, with patches of red and blue, it breeds only in Tasmania, feeding on nectar from the blue gum tree, a eucalypt, and migrating to south-eastern Australia for the winter. But the logging of Tasmanian forests has destroyed its habitat…Only 2,000 individuals may survive.  In November 2015  the state government stopped logging on Bruny Island after an outcry over the parrot’s plight. An earlier study by Dejan Stojanovic, of the Australian National University, and colleagues had revealed how logging and land-clearing for farms in Tasmania had left swifts, which breed in the trunks of old gum trees, vulnerable to predation by sugar gliders, an introduced possum…. UNESCO-listed world heritage wilderness area was expanded to embrace the Styx valley west of Hobart, thick with eucalyptus trees thought to be 600 years old. The listed region now covers almost a quarter of Tasmania.

But…On becoming premier two years ago, Will Hodgman of the conservative Liberal party said he was tearing up the deal, concerned that his state’s growth lagged the rest of Australia. He now proposes opening up some protected areas for logging.  UNESCO wants commercial logging in the listed forests banned.

Tasmania’s forests: Saving the swift parrot, Economist,  Feb. 13, 2016

Why Illegal Logging Persists

The European Union (EU) adopted in 2010 Regulation (EU) No 995/2010 laying down the obligations of operators who place timber and timber products on the market (the Timber Regulation,, as part of the implementation of the Action Plan on Forest Law Enforcement, Governance and Trade……[The EU adopted the Regulation because] llegal logging is a pervasive problem of major international concern. It has a devastating impact on some of the world’s most valuable remaining forests as well as on the people who live in them and who rely on the resources that forests provide. It contributes to tropical deforestation and forest degradation, which may be responsible for 7 to 14%3 of total CO2 emissions from human activities; it threatens biodiversity and undermines sustainable forest management and has a negative impact on poverty reduction…..

The following major challenges to the effective application of the Timber Regulation have been identified in the evaluation process: insufficient human and financial resources allocated to the [authorities dealing with implementation], varying types and level of sanctions across EU states and a lack of uniform understanding and application of the Regulation throughout the EU. Those challenges have translated into uneven enforcement, which creates a non-level playing field for economic operators….

In order to address the shortcomings identified, EU states should significantly step up their implementation and enforcement efforts. The current level of technical capacity and resources (both human and financial) allocated to the [authorities dealing with implementation] does not match with the needs and must be reinforced in most of the Member States with the aim to increase the number and quality of compliance checks.

Excerpts from REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Regulation EU/995/2010 of the European Parliament and of the Council of 20 October 2010 laying down the obligations of operators who place timber and timber products on the market (the EU Timber Regulation, Feb. 18, 2016,  COM(2016) 74 final

 

Rhino Poachers Hide in Villages

Lieutenant General Berning Ntlemeza, head of the Directorate for Priority Crime Investigation (better known as the Hawks), of South Africa wants community involvement with poachers stopped.He told the Police Parliamentary Portfolio Committee that impoverished communities on the borders of the Kruger National Park were  “Heavily armed, wealthy poachers avoid hotels and hide in villages, waiting for night to fall before they sneak into the park to kill rhino and harvest horn,…. If communities don’t own or benefit from the park we are not going to win the fight against poaching,” he said.

Excerpts Communities supporting poachers must be targeted – Hawks boss, defenceWeb.com, Feb. 1, 2016

The Scramble for Lithium

SQM, Chile’s biggest lithium producer [has]Its headquarters in the military district of Santiago bears no name. The man who for years ran the business, Julio Ponce, is the former son-in-law of the late dictator, Augusto Pinochet. He quit as chairman in 2015, during an investigation into SQM for alleged tax evasion. (The company is co-operating with the inquiry.) Last month it emerged that CITIC, a Chinese state-controlled firm, may bid for part of Mr Ponce’s controlling stake in SQM, as part of China’s bid to secure supplies of a vital raw material…

SQM is part of a global scramble to secure supplies of lithium by the world’s largest battery producers, and by end-users such as carmakers. That has made it the world’s hottest commodity. The price of 99%-pure lithium carbonate imported to China more than doubled in the two months to the end of December, to $13,000 a tonne…

The industry is fairly concentrated, which adds to the worry. Last year Albermarle, the world’s biggest lithium producer, bought Rockwood, owner of Chile’s second-biggest lithium deposit. It and three other companies—SQM, FMC of America and Tianqi—account for most of the world supply of lithium salts, according to Citigroup, a bank. What is more, a big lithium-brine project in Argentina, run by a joint venture of Orocobre, an Australian miner, and Toyota, Japan’s largest carmaker, is behind schedule. Though the Earth contains plenty of lithium, extracting it can be costly and time-consuming, so higher prices may not automatically stimulate a surge in supply.

Demand is also on the up. At the moment, the main lithium-ion battery-makers are Samsung and LG of South Korea, Panasonic and Sony of Japan, and ATL of Hong Kong. But China also has many battery-makers…Tesla Motors, an American maker of electric cars founded by Elon Musk, a tech tycoon, is also on the prowl. It is preparing this year to start production at its “Gigafactory” in Nevada, which it hopes will supply lithium-ion batteries for 500,000 cars a year within five years….[I]n August Bacanora, a Canadian firm, said it had signed a conditional agreement to supply Tesla with lithium hydroxide from a mine that it plans to develop in northern Mexico. Bacanora’s shares jumped on the news—though analysts noted that shipping fine white powder across the United States border would need careful handling.Bigger carmakers also have a growing appetite for lithium…

Another big source of demand may be for electricity storage. The holy grail of renewable electricity is batteries cheap and capacious enough to overcome the intermittency of solar and wind power—for example, to store enough power from solar panels to keep the lights on all night.

Excerpts from  An increasingly precious metal, Economist, January 16, 2016

Gene Banks: saving world’s crops

Syria’s civil war has forced scientists to request the first-ever withdrawal of seeds from a Doomsday vault built in the Arctic to safeguard the world’s food supplies…The International Center for Agricultural Research in the Dry Areas (ICARDA) said it has made a request to take back some of its samples from the Svalbard Global Seed Vault. The vault was created by the Norwegian government in 2008 to protect vital crops such as wheat against global disasters, war or disease.

It will be the first time seeds have been withdrawn from the facility, which lies more than 800 miles inside Arctic Circle — midway between Norway and the North Pole — and is the largest vault of its kind in the world. Built into the mountainside on the Svalbard archipelago, it relies on permafrost and thick rock to ensure that the seed samples will remain frozen even without power..,ICARDA has requested approximately 16,500 of its seed samples — one seventh of the total it has stored in Svalbard — and hopes to reproduce them at its other facilities in Morocco and the American University in Beirut, Lebanon. Eventually it will send new samples back to Norway…

He said some scientists were still present at the Aleppo facility but that its one-time headquarters had been occupied by armed groups.  “Fortunately it is not ISIS, they are some fundamentalist groups,” he said. “They seem to co-exist. They are using the land for their own benefit, for example to grow legumes, but we have no control of it…..The Svalbard seed bank has exactly 865,871 samples from every country in the world, Asdal said.  “In fact, we have seeds from more countries than now exist,” he explained, since some of the older seeds are from now-defunct nations such as Czechoslovakia. Syria’s civil war has killed a quarter of a million people since 2011, according to United Nations estimates, and driven 11 million more from their homes.

Excerpts from ALASTAIR JAMIESON, Syria War Forces First Withdrawal from Svalbard Global Seed Vault,NBC News, Sept. 25, 2015

When the Buying Stops the Killing Can too: Endangered Species

[O]n October 15th, 2015 China announced a one-year ban on the import of ivory hunting trophies from Africa, closing a big loophole. Wildlife activists are delighted….The world’s elephant population has dived from 1.2m in 1980 to under 500,000 today. In 1989 the sale of ivory was banned worldwide. But in 1999 and again in 2008, the Convention on International Trade in Endangered Species (CITES), a conservation pact, allowed the sale of stockpiles of ivory from southern Africa to China. The countries vowed to use the proceeds for conservation; China claimed it had a robust registration system that would keep illegal ivory out. But conservationists rightly predicted the concession would fuel more smuggling and so more killing.  Permitted sales became a cover for illegal ones. In 2010-12 about 100,000 elephants were slain for their tusks. In the past five years, Mozambique and Tanzania have lost half their elephants to poaching…

Despite strong demand for ivory among China’s rising middle class, attitudes may gradually be changing. As of 2012, nearly half of Chinese people saw elephant poaching as a problem, according to a survey by WildAid. The figure has been boosted by the support of celebrities. Yao Ming, a basketball player, and Jackie Chan, an actor, appear on posters everywhere with the message: “When the buying stops, the killing can too.” The government has donated $200m worth of media space every year since 2008.

Opinion on ivory has shifted fast, says Mr Knights, partly because of the success of another campaign, to protect sharks. In the markets of Guangzhou, the global centre for the trade, dried shark fins have fallen from 3,000 yuan ($470) per kilo five years ago to 1,000 yuan today, as Chinese people abjure shark-fin soup, a delicacy.  WildAid raised its voice over that issue, too, but more important was the Communist Party’s ban in 2013 of shark-fin soup at official banquets, part of a drive against corruption and excess. The Hong Kong government followed, as did airlines and hotels. A survey in 2013 found 85% of people said they had stopped eating shark-fin soup in the past three years.

One scourge is untouched by all this: the illegal trade in rhinoceros horn. More than 1,200 rhinos were killed for their horns in 2014 in South Africa alone, up from just 13 killed in 2007. This partly reflects a huge rise in demand in Vietnam, but China is also a consumer. Ground rhino horn is believed to cure fever and improve sexual performance. One kilo can cost up to $70,000.

Ominously, some African nations now want a one-off sale of rhino-horn stocks, as happened twice with ivory. To secure this, South Africa must win two-thirds of the member states at the next CITES conference…

Excerpts from Animal conservation: The elephants fight back, Economist, Nov. 21, 2015, at 44

Regulation of Deep-Sea Fishing

A study published in 2009 suggested that in all but the deepest of their waters—those with a seabed closer than 1,500 metres to the surface—yields had dropped by 70% over 25 years. Even in the abyss below that depth, the fall was 20%. To try to stem this decline the European Union, which regulates fishing in much of the area, is proposing to limit the depth at which trawling can take place. This would, in effect, create a marine reservoir below that level, a form of protection additional to the system of species-specific quotas that already exists. The question is where the line below which trawl-gear is forbidden should be drawn. And, until now, there have been few scientific data to inform that decision.
This has just changed, however, with the timely publication, in Current Biology, of a study by Jo Clarke of Glasgow University and Francis Neat of Marine Scotland Science, a government agency. Their work suggests that the appropriate cut-off would be at a depth of 600 metres—below which the ecological damage caused by trawling increases substantially.

Ms Clarke and Dr Neat derive their conclusion from data collected between 1978 and 2013 by Marine Scotland Science and the Universities of Aberdeen and St Andrews. These data record species caught, and also the depths of the trawls that caught them, which ranged from 250 to 1,500 metres.

The researchers note that biodiversity increases with depth. On average, an extra 18 fish species show up with each 100-metre increase. Many of these, though, are of little commercial value. Such so-called by-catch gets thrown back, but by then most of it is dead. And that, particularly because deep-sea species tend to grow more slowly than those which live near the surface, and have lower fecundity rates, can have profound effects on ocean ecology.  Trawls at 300 metres, Ms Clarke and Dr Neat found, have a ratio of catch to by-catch (in terms of weight) of five to one. At 600 metres the ratio is around three to one. At 800 metres, though, it is ten to nine; at 1,000 metres one to one; and at 1,200 metres, one to two.

Based on these findings, Ms Clarke and Dr Neat suggest that a trawl limit of 600 metres would be a suitable compromise between commercial reality and ecological necessity.

Excerpts from Fisheries: Drawing the line, Economist, Sept.  5, 2015, at 80

Spilling Toxic Liquids – Train Accidents

The US federal government predicts that trains hauling crude oil or ethanol will derail an average of 10 times a year over the next two decades, causing more than $4 billion in damage and possibly killing hundreds of people if an accident happens in a densely populated part of the U.S.  The projection comes from a previously unreported analysis by the Department of Transportation that reviewed the risks of moving vast quantities of both fuels across the nation and through major cities. The study completed last July took on new relevance this week after a train loaded with crude derailed in West Virginia, sparked a spectacular fire and forced the evacuation of hundreds of families .  This  accident was the latest in a spate of fiery derailments, and senior federal officials said it drives home the need for stronger tank cars, more effective braking systems and other safety improvements.

The volume of flammable liquids transported by rail has risen dramatically over the last decade, driven mostly by the oil shale boom in North Dakota and Montana. This year, rails are expected to move nearly 900,000 car loads of oil and ethanol in tankers. Each can hold 30,000 gallons of fuel.  Based on past accident trends, anticipated shipping volumes and known ethanol and crude rail routes, the analysis predicted about 15 derailments in 2015, declining to about five a year by 2034.

The 207 total derailments over the two-decade period would cause $4.5 billion in damage, according to the analysis, which predicts 10 “higher consequence events” causing more extensive damage and potential fatalities.  If just one of those more severe accidents occurred in a high-population area, it could kill more than 200 people and cause roughly $6 billion in damage.

The Association of American Railroads  and the Railway Supply Institute, which represents tank car owners and manufacturers, said federal officials had inflated damage estimates and exaggerated risk….Safety officials are pushing to make the tanker-car fleet even stronger and confronting opposition from energy companies and other tank car owners….Derailments can happen in many ways. A rail can break underneath a train. An axle can fail. A vehicle can block a crossing. Having a better tank car will not change that, but it should reduce the odds of a tank car leaking or rupturing,…

Railroads last year voluntarily agreed to reduce oil train speeds to 40 mph in urban areas. Regulators said they are considering lowering the speed limit to 30 mph for trains not equipped with advanced braking systems. Oil and rail industries say it could cost $21 billion to develop and install the brakes, with minimal benefits.

Derailments of trains hauling fuel could kill hundreds, cost billions, Associated Press, Feb. 22, 2015

Exploiting Himalaya Rivers

Himalayan rivers, fed by glacial meltwater and monsoon rain, offer an immense resource. They could spin turbines to light up swathes of energy-starved South Asia. Exports of electricity and power for Nepal’s own homes and factories could invigorate the dirt-poor economy. National income per person in Nepal was just $692 last year, below half the level for South Asia as a whole.

Walk uphill for a few hours with staff from GMR, an Indian firm that builds and runs hydropower stations, and the river’s potential becomes clear. An engineer points to grey gneiss and impossibly steep cliffs, describing plans for an 11.2km (7-mile) tunnel, 6 metres wide, to be blasted through the mountain. The river will flow through it, before tumbling 627 metres down a steel-lined pipe. The resulting jet—210 cubic metres of water each second—will run turbines that at their peak will generate 600MW of electricity.  The project would take five years and cost $1.2 billion. It could run for over a century—and produce nearly as much as all Nepal’s installed hydropower.

Trek on and more hydro plants, micro to mighty, appear on the Marsyangdi. Downstream, China’s Sinohydro is building a 50MW plant; blasting its own 5km-long tunnel to channel water to drive it. Nearby is a new German-built one. Upstream, rival Indian firms plan more. They expect to share a transmission line to ill-lit cities in India.

GMR officials in Delhi are most excited by another river, the Upper Karnali in west Nepal, which is due to get a 900MW plant. In September the firm and Nepal’s government agreed to build it for $1.4 billion, the biggest private investment Nepal has seen.

Relations between India and Nepal are improving. Narendra Modi helped in August as the first Indian prime minister in 17 years to bother with a bilateral visit. Urged by him, the countries also agreed in September to regulate power-trade over the border, which is crucial if commercial and other lenders are to fund a hydropower boom…. Another big Indian hydro firm agreed with Nepal’s government, on November 25th, to build a 900MW hydro scheme, in east Nepal, known as Arun 3. Research done for Britain’s Department for International Development suggests four big hydro projects could earn Nepal a total of $17 billion in the next 30 years—not bad considering its GDP last year was a mere $19 billion.

All Nepal’s rivers, if tapped, could feasibly produce about 40GW of clean energy—a sixth of India’s total installed capacity today. Add the rivers of Pakistan, Bhutan and north India and the total trebles.  Bhutan has made progress: 3GW of hydro plants are to be built to produce electricity exports. The three already generating produce 1GW out of a total of 1.5GW from hydro. These rely on Indian loans, expertise and labour….

A second reason, says Raghuveer Sharma of the International Finance Corporation (part of the World Bank), was radical change that opened India’s domestic power market a decade ago. Big private firms now generate and trade electricity there and look abroad for projects. India’s government also presses for energy connections over borders, partly for the sake of diplomacy. There has even been talk of exporting 1GW to Lahore, in Pakistan—but fraught relations between the two countries make that a distant dream.

An official in India’s power ministry says South Asia will have to triple its energy production over the next 20 years. Integrating power grids and letting firms trade electricity internationally would be a big help. It would expand market opportunities and allow more varied use of energy sources to help meet differing peak demand. Nepal could export to India in summer, for example, to run fans and air conditioners. India would export energy back uphill in winter when Nepali rivers dry and turbines stop spinning.

Governments that learn to handle energy investments by the billion might manage to attract other industries, too. Nepal’s abundant limestone, for example, would tempt cement producers once power supplies are sufficient. In the mountains, it is not only treks that are rewarding.

South Asia’s Hydro-Politics: Water in them hills, Economist, Nov. 29, 2014, at 38

Who Slaughters the Elephants?

Across Africa the illegal slaughter of elephants is accelerating at such a pace—recent estimates put the number killed at 100,000 in just three years—that it threatens to exterminate whole populations. The worst of this butchery takes place in Tanzania, the biggest source of illegal ivory.

Every third poached elephant in Africa dies on the watch of Tanzania’s president, Jakaya Kikwete…One contributing factor may be the government’s failure to investigate and if necessary prosecute high-level offenders. Some of these are said to be closely connected to the ruling Party of the Revolution (CCM), which has dominated the politics of Tanzania since the country’s mainland became independent.  State corruption runs through Tanzania’s illegal ivory trade from savannah to sea. At the bottom of the poaching networks are hired helpers who are often recruited from the armed forces. If caught, officers are transferred to new posts rather than fired. Some allege that soldiers rent out guns to poachers….

Police have even been known to escort convoys of illicit ivory….Other armed forces and governments are also said to be involved. A report by the Environmental Investigation Agency, a non-profit group in London, documents involvement in the illegal ivory trade by Chinese government and military officials. Yet it is allegations of corruption closer to the top of the Tanzanian ruling party that are of the greatest concern

Tanzania’s dwindling elephants: Big game poachers, Economist, Nov. 8, 2014, at 53

Keystone XL: 2014 Update

Keystone XL makes environmentalists livid… Oil extracted from Canada’s tar sands produces about 17% more carbon dioxide than conventionally-pumped supplies do—largely thanks to the energy needed to get it out of the ground. The process uproots forests and leaves toxic lakes behind. A pipeline carrying Canadian oil to Gulf coast refineries would lower the cost of getting such oil to market, so it might encourage energy firms to extract more…

Canadian oil is already getting to market, points out Charles Ebinger of the Brookings Institution, a think-tank—just mostly by barge and train. A new pipeline would ease the strain on Canada’s railways and increase the profitability of extracting the oil. But compared with swings in global oil prices, the effect will be small. Nor will many jobs be created. Most of those 42,000 are temporary posts; just 35 full-time permanent employees will be needed to run the pipeline.  Oddly, the project may not matter much in Louisiana. If completed, Keystone XL will deliver oil to Texas…

Excerpt from: Keystone XL: Back in the Pipeline, Economist, Nov. 22, 2014, at 26

Deforestation: mixed picture

In a new study of the Centre for Global Development (CGD), a Washington think-tank, Jonah Busch and Kalifi Ferretti-Gallon look at 117 cases of deforestation round the world. They find that two of the influences most closely correlated with the loss of forests are population and proximity to cities (the third is proximity to roads). Dramatic falls in fertility in Brazil, China and other well-forested nations therefore help explain why (after a lag) deforestation is slowing, too. Demography even helps account for what is happening in Congo, where fertility is high. Its people are flocking to cities, notably Kinshasa, with the result that the population in more distant, forested areas is thinning out.

Two of the countries that have done most to slow forest decline also have impressive agricultural records: Brazil, which became the biggest food exporter of all tropical countries over the past 20 years; and India, home of the green revolution. Brazil’s agricultural boom took place in the cerrado, the savannah-like region south and east of the Amazon (there is farming in the Amazon, too, but little by comparison). The green revolution took place mostly in India’s north-west and south, whereas its biggest forests are in the east and north.

But if population and agricultural prowess were the whole story, Indonesia, where fertility has fallen and farm output risen, would not be one of the worst failures. Figures published inNature Climate Change in June show that in the past decade it destroyed around 60,000 sq km of primary forests; its deforestation rate overtook Brazil’s in 2011. Policies matter, too—and the political will to implement them.

The central problem facing policymakers is that trees are usually worth more dead than alive; that is, land is worth more as pasture or cropland than as virgin forest. The benefits from forests, such as capturing carbon emissions, cleaning up water supplies and embodying biodiversity, are hard to price….The most successful policies therefore tend to be top-down bans, rather than incentives (though these have been tried, too). India’s national forest policy of 1988 explicitly rejects the idea of trying to make money from stewardship. “The derivation of direct economic benefit”, it says, “must be subordinated to this principal aim” (maintaining the health of the forest). In Brazil 44% of the Amazon is now national park, wildlife reserve or indigenous reserve, where farming is banned; much of that area was added recently. In Costa Rica half the forests are similarly protected. In India a third are managed jointly by local groups and state governments.

Top-down bans require more than just writing a law. Brazil’s regime developed over 15 years and involved tightening up its code on economic activity in forested areas, moratoriums on sales of food grown on cleared land, a new land registry, withholding government-subsidised credit from areas with the worst deforestation and strengthening law enforcement through the public prosecutor’s office. (The most draconian restriction, requiring 80% of any farm in the Amazon to be set aside as a wildlife reserve, is rarely enforced.)

Two developments make bans easier to impose. Cheaper, more detailed satellite imagery shows in real time where the violations are and who may be responsible. Brazil put the data from its system online, enabling green activists to help police the frontier between forest and farmland. Its moratoriums on soyabeans and beef from the Amazon, which require tracing where food is coming from, would not have worked without satellites…

The Forestry Ministry of Indonesia, [on the other hand] is rated the most corrupt among 20 government institutions by Indonesia’s Corruption Eradication Commission in 2012. Some within government are hostile to anti-deforestation schemes, which they see as “foreign”, says Ade Wahyudi of Katadata, an Indonesian firm of analysts. Perhaps the biggest problem is the lack of a single, unified map including all information on land tenure and forest licensing: efforts to create one have been slowed by unco-operative government ministries and difficulties created by overlapping land claims.

Excerpts from Tropical Forests: A Clearing in the Trees, Economist,  Aug. 23, 2014, at 56

Deaths of Rhinos in National Parks

In cold statistics the number of rhinos poached a day in South Africa has now reached three with 769 of these Big Five animals killed to… (Sept 2014).  That equates to 3.027 animals a day and the country’s (South Africa’s) internationally renowned Kruger National Park remains the preferred hunting ground for rhino poachers. Bordering on both Mozambique and Zimbabwe, the park, increased security and patrol activities notwithstanding, offers poachers fairly easy access and egress with their bounty. So far this year Kruger’s rhino population has been decimated by 489 – well over half the national loss.

Statistics released by the Department of Environmental Affairs this week show all nine of South Africa’s provinces, including mostly urban Gauteng, have now been hit by rhino poachers.  The latest kill figures come ahead of next week’s United States-South Africa: Border Surveillance Technology Co-operation Symposium at the CSIR International Convention Centre.  All eyes will be on retired SA Army general Johan Jooste, now Commanding Officer: Special Projects for SANParks based in Kruger. The title of his keynote address is “Turning the tide – borders, poaching, technology”…

US Ambassador to South Africa, Patrick Gaspard, is also carded as a speaker alongside senior representatives (unnamed at the time of publication) from Armscor; the CSIR’s Defence, Peace, Safety and Security section; SA Aerospace, Maritime and Defence Industries Association (AMD); the US Army Research Office and the US Corps of Engineers.

Excerpts from Kim Helfrich, Three rhinos shot every day in South Africa, Defence Web, Sept. 12, 2014

$10 Billion Illegal Market for Wildlife

At $10 billion a year, illegal wildlife makes up the world’s fifth-largest illicit market behind drugs, counterfeit products, trafficked people and smuggled oil. An intergovernmental conference in Geneva from July 7th-11th, 2014 revealed the special worries about ivory smuggling in Thailand, rhino-horn trafficking through Mozambique and trade in tiger parts across South and South-East Asia.

According to TRAFFIC, a lobby group, the street value of rhino horn is $60,000 per kilo—more than the price of gold. Gram for gram, bear-bile flakes or powder sell in Japan [slightly less] than cocaine in Asia. Booming demand from Asia’s growing middle classes is pushing some species close to extinction. As supply dwindles, prices rocket, which tempts criminal gangs to sink their claws in even further.

Elephant ivory is valued for aesthetic reasons. Demand for rhinoceros horns, the paws and bile of Asiatic black bears and sun bears, tiger bones and penises, and deer musk, is stimulated by the healing powers ascribed to them in traditional Chinese medicine. Rhino-horn shavings boiled in water are said to cool and to cure headaches; the brew is akin to fingernail clippings in water (both are mainly keratin, an indigestible protein). Bear bile does help with gallbladder and liver problems—but no more than the synthetic version of ursodeoxycholic acid, its main component.

In February 42 countries, including China and Japan, and the European Union signed a declaration against trade in illegal wildlife products. Chinese law punishes the purchase or consumption of endangered species with up to ten years in jail. But in May, when Philippine forces seized a Chinese vessel carrying sea turtles, giant clamshells and live sharks off the disputed Half Moon Shoal, China expressed outrage at the “provocative action”—not the illegal cargo.

The illegal trade in wild-animal products: Bitter pills, Economist, July 19, 2014, at 54

Tar Sands from Canada to Europe

Canada and the US have threatened to pull out of TTIP [Transatlantic Trade and Investment Partnership] trade talks unless the EU ignores the massive emissions of oil from tar sands – and the EU is collapsing under the pressure…For five long years the federal government and the oil industry have lobbied against the European Union labeling oilsands (also called tar sands) bitumen as ‘dirty oil’ in its Fuel Quality Directive (FQD).  A new report [authored by environmental groups] reveals the how recent involvement of the US in the lobby offensive to keep the EU market open for bitumen exports has tipped the scales in favour of oilsands proponents….

The report shows the EU Fuel Quality Directive, a piece of legislation designed to reduce global warming greenhouse gas (GHG) emissions in the EU’s transportation sector, is unlikely to acknowledge fuels from different sources of oil – conventional oil, oilsands, oil shale – have different carbon footprints.  All oil is the same – no matter how great the disparity in emissions  Instead all oils will more than likely be treated as having the same GHG emissions intensity ‘value’ in the Directive. This is exactly what Canada, the oil industry and now the US have been pushing for…

The EU has not fallen for the federal government’s argument that bitumen produces only marginally more GHG emissions than conventional oil in extraction, processing, and use.  A European Commission study found bitumen’s carbon footprint is between 12% – 40% higher than conventional oil as so much of the bitumen produced from the tar sands is burnt to fuel the energy-intensive extraction process.  The report reveals trade, not science, is the cause of the EU backing off from implementing the Fuel Quality Directive as it was originally meant to be implemented.

The US in some ways has been more open [than Canada] about its lobbying against the Fuel Quality Directive.  US Trade Representative Michael Froman confirmed he “raised these issues [of the FQD implementation] with senior Commission officials on several occasions, including in the context of the Transatlantic Trade and Investment Partnerships (TTIP).” The TTIP is the highly controversial trade agreement between the US and the EU currently under negotiation.  European Commission documents obtained by Friends of the Earth Europe reveal the US trade missions has “substantive concerns” with the Fuel Quality Directive singling out fuels produced from bitumen as having a higher carbon footprint than conventional oil.    Like Canada and the oil industry, the US wants all oil – regardless of GHG emissions – to be treated the same as conventional oil in the Directive…Recently eleven members of US Congress sent a letter to the US trade mission expressing their concerns “that official US trade negotiations could undercut the EU’s commendable efforts to reduce carbon pollution.”

Excerpts, Derek LeahyIgnore tar sands emissions! EU buckles under US, Canada pressure in TTIP talks, Ecologist, July 23, 2014

Palau Fights Big Fishing Countries

The traditional prescription for an ailing reef is a fishing ban called a bul. Local chiefs may declare a bul to rest a busy fishing spot or protect endangered sea turtles. Now Palau’s president has a more drastic plan. He proposes a complete ban on commercial fishing—a bul to turn the 600,000 square kilometres (232,000 square miles) of Palau’s Exclusive Economic Zone (EEZ) into a marine reserve the size of Ukraine. Locals could still fish close to shore, but not for export. The ban would last until world leaders implement programmes “to reverse the devastation to our oceans and seas”, Palau’s president, Tommy Remengesau, recently told the United Nations. Environmentalists have rallied to his cause. Such reserves are usually declared by countries with fishing grounds and cash to spare. Palau has a population of 20,000 and a GDP of $246m. I

A total ban might hurt Palau, which is part of Micronesia, 800km (500 miles) east of the Philippines. Though small, its waters are full of bigeye and yellowfin tuna. Japanese and Taiwanese boats pay to fish there, helping Palau earn $5m in revenue from fishing taxes and licensing fees in 2013. That is a lot for a microstate with an annual government budget of only $70m. And fishing revenues have been growing thanks to a regional negotiating block. Together, eight remote Pacific states control 14m square km of tuna-rich waters. They have forced Asian and American ships into a cap-and-trade scheme that boosts access fees by limiting total fishing days. In an age of collapsing fish stocks, the relative health of fisheries in the western Pacific has given island states a rare measure of economic influence. Palau’s bet, however, is that its fish are worth more in the water than out. Mr Remengesau doubts that small islands will ever capture more than “a drop” of a tuna fishery worth billions but dominated by foreign fleets. Ecotourism, meanwhile, accounts for about half of Palau’s GDP. Palau’s leaders hope that a national marine reserve will lure enough tourists to offset lost fishing revenue….

Palau has only one boat capable of patrolling its EEZ. Many tuna bandits escape detection. Technology could help: last year the country tested surveillance drones. The problem is money. Japan and America have helped fund enforcement. Both have an interest because of their fishing deals with Palau. But they may not want to fund a system that locks them out of its waters altogether,

Marine protection in the Pacific: No bul, Economist, June 7,  2014, at 46

Seals Better than Pigs: Seal Hunting

A (World Trade Organization) WTO appeal panel has upheld a decision that the European Union’s ban on the import of seal pelts, oil and meat is justified on moral grounds…The ruling, released Thursday in Geneva by the WTO’s Appellate Body, is one more blow to an industry that has been dying for years as a result of a successful campaign by animal-rights activists to convince international buyers that the Canadian seal hunt is inhumane.

The appeal body reversed some minor portions of a WTO panel decision, but agreed that the EU’s ban on seal products “is necessary to protect public morals” as spelled out in the General Agreement on Tariffs and Trade.  The appeal body agreed with the earlier panel decision that the ban on seal pelts imposed by the EU in 2010 undermines the principles of fair trade, but is justified because it “fulfills the objective of addressing EU public moral concerns on seal welfare.”

Canada and Norway had argued that the ruling sets a dangerous precedent because trade decisions were being made on the basis of morality rather than conservation and science. The federal Conservative government, and the two opposition parties, agree that the seal hunt, which is largely based in Newfoundland, is humane, sustainable and well-regulated…. The sealers say Canada has the highest standards for animal-welfare practices of any hunt in the world. The animal-rights groups, on the other hand, point to reports by veterinary and zoology experts who say the clubbing and shooting of seals in Canada is inhumane and should be prohibited.

The Canadian government set the quota for the seal slaughter this year at 400,000. But it is estimated that fewer than 55,000 of the animals have been killed by hunters as the season nears an end. Rebecca Aldworth, the executive director of Humane Society International/Canada, said… “I think it’s clear that the sealing industry is already over. The only question is whether the Canadian government will continue to keep it on artificial life support in the form of government subsidies, or whether it will invest in a one-time buyout of the commercial sealing industry.

Excerpts from GLORIA GALLOWAY, Canada loses bid to block European ban on seal products,  Globe and Mail, May 22, 2014

Marine Protected Areas: PIPA, Kiribati

After years of claiming untruthfully that the world’s most fished marine protected area was “off limits to fishing and other extractive uses,” President Anote Tong of the Pacific island state of Kiribati and his cabinet have voted to close it to all commercial fishing by the end of the year.  The action, if implemented, would allow populations of tuna and other fish depleted by excessive fishing to return to natural levels in the Phoenix Islands Protected Area (PIPA), a patch of ocean the size of California studded with pristine, uninhabited atolls.

The move comes at a time global fish populations are steadily declining as increasingly efficient vessels are able to extract them wholesale from ever-more-remote and deep waters around the globe.  While no-take zones of comparative size exist in Hawaii, the Chagos Islands and the Coral Sea, none are as rich in marine life, making this potentially the most effective marine reserve in the world.,,,

In a speech still he gave at the Delhi Sustainable Development Summit two years ago still visible on Youtube, Tong mentions “the initiative of my country in closing off 400,000 square kilometres of our [waters] from commercial fishing activities,” calling it “our contribution to global ocean conservation efforts.”

In fact, when PIPA was created, only in the three percent of the reserve that’s around the islands, where virtually no fishing was going on, fishing was banned. In the rest of the reserve, the catch increased, reaching 50,000 tonnes in 2012 – an unheard-of amount in any protected area.

Christopher Pala, Kiribati Bans Fishing in Crucial Marine Sanctuary, IPS, May 15, 2014

Poaching Endangered Species – Namibia

he rising tide of elephant and rhino poaching in Africa is spreading to the sparsely-populated vastness of Namibia in the southeast of the continent, latest official figures show. Between 2005 and 2011 just two elephant were killed, while 121 have been killed in the past two and a half years, according to figures presented by the environment ministry.  And while no rhino were poached between 2005 and 2010, a total of 11 have been killed since then — rising from one in 2011 to four already this year.

Deputy Environment Minister Pohamba Shifeta told AFP that the government is worried by the trend and is working with law enforcement agencies to tackle the problem. “We don’t want the numbers to escalate further,” Shifeta said.  “There is a high probability that attention will shift to Namibia as we have recently experienced.”

Across the border in South Africa, rhino poaching has reached crisis levels, with more than 290 killed already this year.  Most of the poaching in Namibia has taken place in protected areas, such as the Bwabwata National Park in the northeast, where 13 elephant were killed in 2012, the environment ministry report said.

“The immediate requirement is to control the emerging commercial ivory poaching in the northeast part of the country and to prevent the westwards spread of rhino and elephant poaching into the Etosha National Park and beyond,” Shifeta told a meeting of police officers and rangers.  Namibia has 79 conservation areas covering more than 100,000 square kilometres and inhabited by some 300,000 people.

Several poachers have been arrested in recent years, with the latest suspects being two Asian men who were held in March this year allegedly in possession of rhino horn worth around $230,000 (167,000 euros). Asia is a major market for rhino horn, where it is believed to have medicinal value, and for elephant ivory.

Namibia caught in net of elephant, rhino poaching, Agence France Presse, May 13, 2014.

Loans-for-Oil: China and Latin America

China’s demand for commodities has entrenched Latin America’s position as a supplier of raw materials. The country guzzles oil from Venezuela and Ecuador, copper from Chile, soyabeans from Argentina, and iron ore from Brazil—with which it signed a corn-import deal on April 8th.   Chinese lending to the region also has a strong flavour of natural resources. Data are patchy, but according to new figures from the China-Latin America Finance Database, a joint effort between the Inter-American Dialogue, a think-tank, and Boston University, China committed almost $100 billion to Latin America between 2005 and 2013 (see chart). The biggest dollops by far have come from the China Development Bank (CDB). These sums are meaningful. Chinese lenders committed some $15 billion last year; the World Bank $5.2 billion in fiscal year 2013; foreign commercial banks lent an estimated $17 billion.

More than half of China’s lending to Latin America has been swallowed by Venezuela, which pays much of the loan back from the proceeds of long-term oil sales to China. Ecuador has struck similar deals, as has Petrobras, Brazil’s state-controlled oil firm, which negotiated a $10 billion credit line from CDB in 2009.

Such loan-for-oil arrangements suit the Chinese, and not simply because they help secure long-term energy supplies. They also reduce the risk of lending to less creditworthy countries like Venezuela and Argentina. Money from oil sales is deposited in the oil firm’s Chinese account, from where payments can be directly siphoned.  It is no surprise that Chinese money is welcome in places where financial markets are wary. Ecuador, which defaulted on its debts in 2008, has used Chinese loans both to fill in holes in its budget and to re-establish a record of repayment in advance of trying to tap bond markets again.

But Chinese credit has its attractions in other economies, too. It often makes sense for countries to diversify sources of lending. Loans can open the door to direct investment. And as Kevin Gallagher of Boston University points out, the Chinese banks operate in largely different sectors to the multilaterals. Of the money China has lent in the region since 2005, 85% has gone to infrastructure, energy and mining. Borrowers may have to spend a proportion of their loan on Chinese goods in return; some observers worry about the laxer environmental standards of Chinese banks. But the main thing is that money is available. Expect the loan figures to rise.

Chinese lending to Latin America: Flexible friends, Economist,  Apr. 12, 2014, at 27

Dumping Coal in the Sea

Until recently Colombia was lax in enforcing its environmental laws. So it came as a shock to the country’s mining industry when, in January, the government halted coal exports from a port operated by Drummond, an American miner, in a row over pollution. The suspension has been costly not only for Drummond: its operations generate $66m a month in royalties and taxes for the Colombian treasury.

The mining minister, Amylkar Acosta, confirmed this week that the government would let the company resume its exports later this month, when it completes improvements to the port facility to prevent contamination of nearby beaches. The government has been under pressure to take action since environmentalists photographed an incident last year in which more than 500 tonnes of coal were dumped into the Bay of Santa Marta to stop a barge from sinking. Last month six employees at the port were charged, and face possible jail sentences. Drummond has been fined $3.6m and told to clean up the mess.

The case is an illustration of how the government, having welcomed foreign miners, is now having to contend with public disquiet over both pollution and the way the country’s mineral wealth is shared. In an election in May, President Juan Manuel Santos will seek a second term. So he cannot ignore the “hostile” climate of public opinion on the issue, says Alvaro Ponce, a Colombian mining expert.

Protests by nearby residents have delayed several big projects, including AngloGold Ashanti’s proposed gold mine in Tolima province and Eco Oro’s planned gold and silver mine in Santander province. A study by Colombia’s national audit office, published in January, found that economic and social development in towns next to large mining operations is worse than in places where illegal coca crops are grown for making cocaine.

The environment ministry is seeking new powers to require licences for exploration as well as extraction. Mining firms grumble that the process of getting projects approved is already tortuous enough. This and the recent fall in world prices of some minerals mean that up to $7.3 billion of investments are stalled, they say. Mr Acosta says the miners must accept that besides getting their official permits, they have to convince local communities to accept their presence, earning a “social licence” to operate. “Without that, the projects become unviable,” he says.

The backlash against mining has been building for some years. In the mid-2000s, when commodity prices were booming and Colombia’s internal conflicts were subsiding, the government offered incentives for foreign firms to come in and create mining jobs. It awarded exploration permits for swathes of territory, including in areas hitherto off limits, such as the fragile páramo tundra in the Andes. “The floodgates were opened,” says James Lockhart-Smith of Maplecroft, a risk-analysis firm.

But Colombia’s regulators were ill-prepared. In 2011 the government stopped accepting new applications for licences while it dealt with a backlog of 19,000. It rejected 90% of these, then turned its attention to 10,000 projects that had already been given licences, finding that 92% were failing in some way to comply with their conditions.

Despite all the stumbles and setbacks, Colombia is getting somewhere in its drive to exploit its mineral reserves. In 2013 mining investment was $3.6 billion, 21% more than in 2012. Mining already accounts for 2.3% of GDP and 7% of exports, and foreign companies are still lining up to explore new prospects. By the standards of resource-rich emerging economies, it is a fairly well-run place, so the chances are that it will succeed in coming up with a licensing regime that eases public worries without deterring investment. As in richer countries, mining projects will still be welcomed, but not at any price.

Mining in Colombia: Digging itself out of a hole, Economist, Mar. 15, 2014, at 61

Organized Crime: rhino horn to waste dumping

[A]ccording to America’s Congressional Research Services,  illegal trade
in endangered wildlife products is worth as much as $133 billion annually. Commodities such as rhino horn and caviar offer criminals two benefits rarely found together: high prices and low risk. Rhino horn can fetch up to $50,000 per kilogram, more than gold or the American street value of cocaine. Get caught bringing a kilogram of cocaine into America and you could face 40 years in prison and a $5m fine. On January 10th, by contrast, a New York court sentenced a rhino-horn trafficker to just 14 months…Organised crime is globalising and diversifying. Mono-ethnic, hierarchical mafias are being replaced by multi-ethnic networks that operate across borders and commit many types of offence. In an ongoing investigation into rhino-horn trafficking, the Fish and Wildlife Service (FWS) arrested Irish travellers using indigent Texans to procure material for Chinese and Vietnamese buyers. Europol, the European Union’s law-enforcement agency, estimates that just a quarter of Europe’s roughly 3,600 organised-crime groups have a main nationality, and that some operate in dozens of countries. A third are involved in more than one criminal enterprise, with half of those linked to drug-trafficking.

And though traditional trafficking in drugs, guns and people is still lucrative, gangs are increasingly moving into lower-risk, higher-reward areas—not just wildlife, but fraud and illegal waste-disposal….Gangs in Britain make around £9 billion ($14.8 billion) a year from tax, benefit, excise-duty and other fraud—not much less than the £11 billion they earn from drugs. In America cigarette-trafficking deprives state, local and federal governments of $5 billion in tax revenues annually. The European Union estimates that losses within its borders from cigarette smuggling, tax fraud and false claims on its funds by organised groups total €34 billion ($46.5 billion) a year. But member states bring fewer than ten cases each a year for defrauding the EU, and sentences tend to be light.

According to the FLARE Network, an international group of campaigners against organised crime, criminal groups in Italy make around €14 billion a year from being mixed up in agriculture. In some parts of the country mafias control food production and distribution; Franco La Torre, FLARE’s president, says they also enrich themselves through fraudulent claims on EU agricultural funds. Increasingly strict regulation of waste disposal has created another profitable opportunity for organised crime in Europe—particularly, according to Europol, for the Italian Camorra, ’Ndrangheta and Cosa Nostra…

Old-style loan sharks and drug-dealers are finding a new role as distributors for the modern mobsters who manage the supply chains, marketing, finance and human resources needed to move goods, money and people across borders. “The new generation are very talented businessmen and technologically advanced experts,” says Mr La Torre. They prefer invisibility to showy violence. Many also have legitimate business interests.  Clever criminals acting across borders are extremely difficult to prosecute. They profit from gaps in enforcement and regulation, and conceal their illegal acts in complex supply chains. If a network of Nigerian scammers based in Amsterdam defrauds French, Australian and American credit-card holders, where does the crime occur? And who has the motivation, not to mention the jurisdiction, to prosecute?

A commodity such as oil, ivory or fish will be transported on a ship flying a flag of convenience, explains Mr Leggett. The ship will be owned by a holding company registered in a tax haven with a phoney board. Thus the criminals can disguise the provenance of their ill-gotten goods and middlemen can plead ignorance….

Until then, illicit goods will keep coming in quantities too great for governments to stop. One FWS inspector estimates that for all the peering, prodding and chirping, for all the rewards promised and rhino-horn traffickers caught, the agency picks up perhaps 5% of wildlife brought illicitly into America. For criminals, that is merely a light tax on the profits from the rest.

Excerpts, Organised crime: Earning with the fish,Economist, Jan. 18, 2014, at 59

Mining in Africa: who gets the money?

Most west African governments have signed—or pledged to sign—the Extractive Industries Transparency Initiative (EITI). The EITI tries to ensure that contracts and accounts of taxes and revenue generated by concessions are open to public scrutiny. But that is easier said than done. Last year Liberia’s government asked a British accounting firm, Moore Stephens, to carry out an audit of Liberian mining contracts signed between the middle of 2009 and the end of 2011. The audit, published in May 2013, found that 62 of the 68 concessions ratified by Liberia’s parliament had not complied with laws and regulations. The government has yet to take action after a string of recommendations emerged from an EITI retreat in July 2013.

Regional governments also fret over a practice known as “concession flipping”, whereby foreign mining companies that do not have the capacity to exploit sites sell their concessions to larger companies for windfall profits. “Every flip is essentially a heist on the government exchequer, with anonymous offshore firms as the getaway car,” says Leigh Baldwin of Global Witness, a London-based lobby that fights for fairer deals for local people and their governments from mining and other resources. Concession flipping, he adds, is widespread in Africa. The Africa Progress Panel, headed by Kofi Annan, a Ghanaian who once led the UN, has put out a report called “Equity in Extractives”. This, too, stresses a need for more openness in mining contracts. As people in the region demand more democracy, better deals from mining are a new priority.

Mining in west Africa: Where’s our cut?, Economist, Dec. 7, 2013, at 51

Genetically Modified Food – China v. US

Public unease about genetic modification is common around the world. In China, alongside rising concerns about food safety, it has taken on a strongly political hue. Chinese anti-GM activists often describe their cause as patriotic, aimed not just at avoiding what they regard as the potential harm of tinkering with nature, but at resisting control of China’s food supply by America through American-owned biotech companies and their superior technology. Conspiracy theories about supposed American plots to use dodgy GM food to weaken China

They are even believed by some in the government. In October an official video made for army officers was leaked on the internet and widely watched until censors scrubbed it. “America is mobilising its strategic resources to promote GM food vigorously,” its narrator grimly intoned. “This is a means of controlling the world by controlling the world’s food production.”  Peng Guangqian, a retired major-general and prominent think-tanker, echoed these sentiments in an article published by official media in August. He said America might be setting a “trap”. The result, he said, could be “far worse than the Opium War” between Britain and China in the 1840s that Chinese historians regard as the beginning of a “century of humiliation” at the hands of foreign powers.

China already uses plenty of GM products. More than 70% of its cotton is genetically modified. Most of the soyabeans consumed in China are imported, and most of those imports are GM (often from America). The technology is widely used for growing papayas. The government wants to develop home-grown GM varieties and has spent heavily on research, eager to maintain self-sufficiency in food. Officials see GM crops as a way of boosting yields on scarce farmland.

In 2009 China granted safety certificates for two GM varieties of rice and one of maize. This raised expectations that it might become the first country in the world to use GM technology in the production of a main staple. But further approvals needed for commercial growing have yet to be granted. To the consternation of GM supporters, the safety certificates for the rice are due to expire next August.

Public opinion is a big reason for the delay. Environmental groups in China have rarely succeeded in changing government policy. Officials have long treated such NGOs with suspicion and made it hard for them to register or set up offices in more than one place. The only NGO in China that devotes much time to the GM issue is an international one: Greenpeace. But the anti-GM lobby has thrived, thanks not least to the adoption of the cause by conservatives in the establishment as well as by informal groups of diehard Maoists who see America as a threat.

To the Maoists, opposing GM food is an urgent priority. Hardly a speech is made by one of them without mentioning it. “I support Mao Zedong thought,” shouted one of the protesters outside the agriculture ministry. The police usually treat them with kid gloves; unlike others who protest in public, they are ardent supporters of Communist Party rule. And on this issue, at least, the Maoists enjoy much sympathy; public anxiety about food safety has soared in recent years thanks to a series of scares. Of 100,000 respondents to an online poll in November, nearly 80% said they opposed GM technology.

Since a change of China’s leadership a year ago, however, supporters of GM food inside the government and among the public have begun fighting back. In October Chinese media reported that 61 senior academics, in a rare concerted effort, had petitioned the government to speed up the commercialisation of GM crops. The Ministry of Agriculture was also said to be preparing a new public-education campaign on the merits of GM food…One of the recent petitioners, Li Ning of China Agricultural University, laments that the issue remains ensnared by nationalist sentiment.

Excerpts, Genetically Modified Crops, Food Fight, Ecomomist,  Dec. 14, 2013, at 53

The Global Regulation of Mercury

The Minamata Convention on Mercury – a global, legally binding treaty which opened for signature today – was agreed to by governments in January (2013) and formally adopted as international law…Countries began the recognition for this new treaty at a special ceremonial opening of the Diplomatic Conference in Minamata, the city where many local people were poisoned in the mid-20th Century after eating mercury-contaminated seafood from Minamata Bay. As a consequence, the neurological syndrome caused by severe mercury poisoning has come to be known as Minamata Disease.

The Minamata Convention provides for controls and reductions across a range of products, processes and industries where mercury is used, released or emitted. The treaty also addresses the direct mining of mercury, export and import of the metal, and safe storage of waste mercury.

“Mercury has some severe effects, both on human health and on the environment. UNEP has been proud to facilitate and support the treaty negotiation over the past four years because almost everyone in the world – be they small-scale gold miners, expectant mothers or waste-handlers in developing countries – will benefit from its provisions,” said Achim Steiner, Executive Director of the United Nations Environment Programme (UNEP) and Under-Secretary General of the United Nations….Other potential impacts include impaired thyroid and liver function, irritability, tremors, disturbances to vision, memory loss and cardiovascular problems.

“With the signing of the Minamata Convention on Mercury we will be going a long way in protecting the world forever from the devastating health consequences from mercury,” says WHO Director-General Dr Margaret Chan. “Mercury is one of the top ten chemicals of major public health concern and is a substance which disperses into and remains in ecosystems for generations, causing severe ill health and intellectual impairment to exposed populations.”

Under the provisions of the Minamata Convention, Governments have agreed on a range of mercury-containing products whose production, import and export will be banned by 2020. These items have non-mercury alternatives that will be further phased in as these are phased out. They include:

•Batteries, except for ‘button cell’ batteries used in implantable medical devices

•Switches and relays

•Some compact fluorescent lamps

•Mercury in cold cathode fluorescent lamps and external electrode fluorescent lamps

•Soaps and cosmetics (mercury is used in skin-whitening products)

•Some mercury-containing medical items such as thermometers and blood pressure devices.

Mercury from small-scale gold-mining and from coal-fired power stations represent the biggest source of mercury pollution worldwide. Miners inhale mercury during smelting, and mercury run-off into rivers and streams contaminates fish, the food chain and people downstream.  Under the Minamata Convention, Governments have agreed that countries will draw up strategies to reduce the amount of mercury used by small-scale miners and that national plans will be drawn up within three years of the treaty entering into force to reduce – and if possible eliminate – mercury.

The Convention will also control mercury emission and releases from large-scale industrial plants such as coal-fired power stations, industrial boilers, waste incinerators and cement clinkers facilities.

New global treaty cuts mercury emissions and releases, sets up controls on products, mines and industrial plant, UNEP Press Release, Oct 10, 2013

Tracking Illegal Ivory: the Forensics

The atmospheric carbon left over from nuclear bomb testing could help scientists track poached ivory, new research has found.  These bomb tests changed the level of carbon in the atmosphere, which can be traced to date elephant tusks…Scientists say the findings, published in PNAS, could make it easier to enforce the ivory ban.The number of elephants being poached is now at the highest it has been for two decades, according to a UN backed report.  This was highlighted in January when a family of 11 elephants was slaughtered in Kenya, their tusks hacked off with machetes.

Traditional radiocarbon dating determines the age of ancient objects by measuring the amount of carbon-14 (C14).  The approximate time since an organism died can be measured from the amount of C14 left in its remains. But remains from after the Cold War contain higher levels of C14 due to the nuclear bombs.  In a new study Dr Uno and colleagues used this increase in carbon to date herbivore samples, which they matched to corresponding points on the bomb-curve

In the 1980s, more than half of Africa’s elephants are thought to have been wiped out by poachers. This led to an international ban on trading ivory in 1989….Scientists have found that radioactive carbon in the atmosphere emitted during the Cold War bomb tests will make it easier to distinguish between illegal ivory–that acquired after the 1989 ban– and legal ivory– that acquired before the 1989 trade ban.  The amount of radiocarbon in the atmosphere nearly doubled during nuclear weapons tests from 1952 to 1962, which steadily dropped after tests were restricted to underground. This has been dubbed “the bomb-curve”.

The levels have declined since but as they are still absorbed by plant, they enter the food chain and are measurable in plant and animal tissues.  The concentration of radiocarbon found in tiny samples of animal tissue can accurately determine the year of an animals death, from 1955 until today, Kevin Uno from Colombia University, US, explained to BBC News.  “This is different to the traditional dating technique which takes advantage of the loss of radiocarbon through time.”  Traditional radiocarbon dating would only be able to pick up an “imperceptible amount of decay” added Dr Uno, but because the bomb spike doubled the concentration or carbon, they were able to find huge variations over the last 60 years, which enabled accurate dating.Dr Uno said this technique “would dovetail very nicely with DNA testing which tells you the region of origin, but not the date”.  As anti-poaching funding is extremely limited, understanding where the poaching hotspots are, as well as how old the tusks are, could help the international community to direct funding to the places most at risk, he added…

These wildlife forensics are ready to roll, now we need to speak to the organisations who can set up a programme to make it happen.”

Excerpts, Melissa Hogenboom, Carbon from nuclear tests could help fight poacher, BBC News, July 1, 2013

Deforestation: Rubber Barons and their Bankers

Along Route 7 in Cambodia’s remote north, dozens of small tractors known as “iron buffaloes” are plying a dilapidated piece of highway. Under cover of darkness, they transport freshly cut timber into nearby sawmills. The drivers wear masks, their tractors fitted with just one dim lamp at the front. Each carries between three and six logs which locals say were felled illegally on or near the Dong Nai rubber plantation, owned by Vietnam Rubber Group (VRG).

Illegal logging and land-grabbing have long been problems in Cambodia. A new report entitled “Rubber Barons” by Global Witness, a London-based environmental watchdog, has highlighted the issue once again. Dong Nai features prominently in the report, which claims that luxury timbers like rosewood, much in demand for furniture in China and guitars in the West, were culled as a 3,000-hectare (7,400-acre) section of forest was illegally cleared.

Global Witness says that local and foreign companies have amassed more than 3.7m hectares of land in Cambodia and Laos since 2000, as governments have handed out huge land concessions, many in opaque circumstances. Two-fifths of this was for rubber plantations, dominated by state companies from Vietnam, the world’s third-largest rubber producer.

The report claims that VRG and another Vietnamese company, HAGL, are among the biggest land-grabbers, and have been logging illegally in both Cambodia and Laos. It says that, through Vietnam-based funds, the two companies have received money from Deutsche Bank, while HAGL also has investment from the IFC, the private-sector arm of the World Bank. The two Vietnamese companies have denied any wrongdoing. Deutsche Bank and the IFC say they are studying the findings.

The report says that the two companies have failed to consult local communities or pay them compensation for land they formerly used. The companies routinely use armed security forces to guard plantations. Large areas of supposedly protected intact forest have been cleared, in violation of forest-protection laws and “apparently in collusion with Cambodia’s corrupt elite”.

Global Witness is urging authorities in Cambodia and Laos to revoke the two companies’ land concessions, which cover 200,000 hectares and are held through a network of subsidiaries. It thinks both companies should be prosecuted.

Logging in South-East Asia: Rubber barons, Economist, May 18, 2013

See also Bankers with Chainsaws

 

Mining Companies Love Least Developed Countries

An expert panel led by Kofi Annan, a former UN secretary-general, looked at five deals struck between 2010 and 2012, and compared the sums for which government-owned mines were sold with independent assessments of their value. It found a gap of $1.36 billion, double the state’s annual budget for health and education. And these deals are just a small subset of all the bargains struck, says the report, which Mr Annan presented in Cape Town, South Africa, on May 10th.

The report highlights some puzzling details. For instance ENRC, a London-listed Kazakh mining firm, waived its rights to buy out a stake in a mining enterprise owned by Gécamines, Congo’s state miner, only to acquire it for $75m from a company owned by Dan Gertler, an Israeli businessman, which had paid $15m for it just months earlier. Mr Gertler is close to Joseph Kabila, Congo’s president. ENRC, which is being investigated by the Serious Fraud Office in Britain, was Congo’s third-largest copper producer last year. Both ENRC and Mr Gertler deny wrongdoing.

African countries often fail to collect reasonable taxes on mining, says Mr Annan’s panel. For example, Zambia’s copper exports were worth $10 billion in 2011, but its tax receipts from mining were a meagre $240m. The widespread use by mining firms of offshore investment vehicles as conduits for profits creates scope for tax avoidance. Their use is not restricted to rich-world companies. Much of the oil that Angola ships to China is via a company called the China International Fund. Its trading prices are not made public…

Congo’s prime minister, Matata Ponyo Mapon, promises change. In January 2013… Mr Ponyo said he would rein in the state-owned mining companies and increase transparency in the industry. “We must avoid situations where we’re not publishing our mining contracts, where our state assets are undervalued, and where the government doesn’t know what its state mining companies are doing,” he told miners and officials at a conference in January….

Last year miners in Congo, which include Freeport-McMoRan and Glencore Xstrata, shipped $6.7 billion-worth of copper and cobalt from the country.

Business in the Democratic Republic of Congo: Murky minerals, Economist, May 18, 2013, at 74

 

Bay of Bengal: fishermen v. port builders

Bangladesh’s Chittagong, has… become a bottleneck. The Bangladeshis are modernising it… China is putting $200m towards upgrading the airport at Cox’s Bazar, the country’s southernmost tip, to attract investment and tourists.  Myanmar’s …new government, keen for foreign inflows to help rebuild the economy, has been approving projects that sat idle for years. Sittwe is one, but it looks small compared with the Dawei project on Myanmar’s Tenasserim coast… a deepwater port, industrial zone and highways to connect it with distant Bangkok, estimated to cost $8.5 billion.Thailand’s rulers dabbled for centuries with the idea of building a canal across the Kra isthmus, which would link their own gulf directly to the Andaman Sea and save days of costly shipping through the Strait of Malacca. Dawei should do the trick…. The Japanese are taking advantage of Myanmar’s opening to build a riverine port called Thilawa, south of Yangon.

The Chinese are exploring ways round their own Malacca-strait dilemma. They have been building new oil and gas pipelines across the whole of Myanmar starting from a new port-terminal at Kyaukphyu, near Sittwe….China’s activity in the Bay of Bengal is purely “defensive” [some say] but Indians versed in the “string of pearls” theory, which sees Chinese-built ports encircling India, will not be much comforted.

Amid the sometimes airy speculation, it is relatively easy to predict the effects on the repurposed waters of the bay. Yugraj Yadava, the director of an environmental watchdog in Chennai, says increased shipping is already eroding traditional livelihoods and polluting the sea. About 31% of the world’s coastal fishermen live and work on the Bay of Bengal, and they stand to lose huge tracts to the port-builders (and to rising sea levels, too). Mr Yadava says the bay still has some of the world’s healthiest natural fisheries, but they are under threat, not least from non-native species that stow away in long-haulers’ ballast.

Collisions between fishing vessels and commercial ships are becoming more frequent, as are snagged nets. All this will probably accelerate in the next few years. Before the Bay of Bengal falls victim to its new-found popularity, it might be good if some of its beneficiaries were to build a transnational maritime authority, to limit the damage.

Excerpts, The Bay of Bengal: New bay dawning, Economist,Apr. 27, 2013, at 40

The Risk of Unburnable Carbon

Several  reports suggest that markets are overlooking the risk of “unburnable carbon”. The share prices of oil, gas and coal companies depend in part on their reserves. The more fossil fuels a firm has underground, the more valuable its shares. But what if some of those reserves can never be dug up and burned?

If governments were determined to implement their climate policies, a lot of that carbon would have to be left in the ground, says Carbon Tracker, a non-profit organisation, and the Grantham Research Institute on Climate Change, part of the London School of Economics. Their analysis starts by estimating the amount of carbon dioxide that could be put into the atmosphere if global temperatures are not to rise by more than 2°C, the most that climate scientists deem prudent. The maximum, says the report, is about 1,000 gigatons (GTCO2) between now and 2050. The report calls this the world’s “carbon budget”.

Existing fossil-fuel reserves already contain far more carbon than that. According to the International Energy Agency (IEA), in its “World Energy Outlook”, total proven international reserves contain 2,860GTCO2—almost three times the carbon budget. The report refers to the excess as “unburnable carbon”.

Most of the reserves are owned by governments or state energy firms; they could be left in the ground by public-policy choice (ie, if governments took the 2°C target seriously). But the reserves of listed oil companies are different. These are assets developed using money raised from investors who expect a return. Proven reserves of listed firms contain 762GTCO2—most of what can prudently be burned before 2050. Listed potential reserves have 1,541GTCO2 embedded in them.

So companies and governments already have far more oil, gas and coal than they need (again, assuming temperatures are not to rise by more than 2°C). Logically, the response to this would be for governments to leave their reserves untouched and for companies to run theirs slowly down, returning more of what they earn to shareholders. Neither of these things is happening. State-owned companies are taking an increasing share of total energy output. And in 2012, says Carbon Tracker, the 200 largest listed oil, gas and coal companies spent five times as much—$674 billion—on developing new reserves as they did returning money to shareholders ($126 billion). ExxonMobil alone plans to spend $37 billion a year on exploration in each of the next three years.

Such behaviour, on the face of it, makes no sense. One possible explanation is that companies are betting that government climate policies will fail; they will be able to burn all their reserves, including new ones, after all. This implies that global temperatures would either soar past the 2°C mark, or be restrained by a technological fix, such as carbon capture and storage, or geo-engineering.Recent events make such a bet seem rational. On April 16th the European Parliament voted against attempts to shore up Europe’s emissions trading system against collapse. The system is the EU’s flagship environmental policy and the world’s largest carbon market.  Putting it at risk suggests that Europeans have lost their will to endure short-term pain for long-term environmental gain. Nor is this the only such sign. Several cash-strapped EU countries are cutting subsidies for renewable energy. And governments around the world have failed to make progress towards a new global climate-change treaty. Betting against tough climate policies seems almost prudent.

The markets are [also] mispricing risk by valuing companies as if all their reserves will be burned. Investors treat reserves as an indicator of future revenues. They therefore require companies to replace reserves depleted by production, even though this runs foul of emission-reduction policies. Fossil-fuel firms live and die by a measure called the reserve replacement ratio, which must remain above 100%. Companies see their shares marked down if the ratio falls, even when they pull the plug on dodgy, expensive projects. This happened to Shell, for example, when it suspended drilling in the Arctic in February….

At the moment neither public policies nor markets reflect the risks of a warmer world.

Energy Firms and Climate Change: Unburnable Fuel, Economist, May 4, 2013, at 68

US Government Lobbying for Biotechnology Industry

American diplomats lobbied aggressively overseas to promote genetically modified (GM) food crops such as soy beans, an analysis of official cable traffic revealed on Tuesday.  The review of more than 900 diplomatic cables by the campaign group Food and Water Watch showed a carefully crafted campaign to break down resistance to GM products in Europe and other countries, and so help promote the bottom line of big American agricultural businesses.

The cables, which first surfaced with the Wikileaks disclosures two years ago, described a series of separate public relations strategies, unrolled at dozens of press junkets and biotech conferences, aimed at convincing scientists, media, industry, farmers, elected officials and others of the safety and benefits of GM producs…The public relations effort unrolled by the State Department also ventured into legal terrain, accotrding to the report. US officials stationed overseas opposed GM food labelling laws as well as rules blocking the import of GM foods. The report notes that some of the lobbying effort had direct benefits. About 7% of the cables mentioned specific companies, and 6% mentioned Monsanto. “This corporate diplomacy was nearly twice as common as diplomatic efforts on food aid,” the report said….

In some instances, there was little pretence at hiding that resort to pressure – at least within US government circles. In a 2007 cable, released during the earlier Wikileaks disclosures, Craig Stapleton, a friend and former business partner of George Bush, advised Washington to draw up a target list in Europe in response to a move by France to ban a variety of GM Monsanto corn.  “Country team Paris recommends that we calibrate a target retaliation list that causes some pain across the EU since this is a collective responsibility, but that also focuses in part on the worst culprits,” Stapleton wrote at the time.”The list should be measured rather than vicious and must be sustainable over the long term, since we should not expect an early victory. Moving to retaliation will make clear that the current path has real costs to EU interests and could help strengthen European pro-biotech voices,” he wrote.

Excerpts, Suzanne Goldenberg,Diplomatic cables reveal aggressive GM lobbying by US officials, Guardian, May 15, 2013

Fighting Biopiracy: European Union

The European Union is debating a biopiracy law requiring industry to compensate indigenous people if it makes commercial use of local knowledge such as plant-based medicines.  Under the law – based on the international convention on access to biodiversity, the Nagoya protocol – the pharmaceuticals industry would need the written consent of local or indigenous people before exploring their region’s genetic resources or making use of their traditional know-how. Relevant authorities would have the power to sanction companies which failed to comply, protecting local interests from the predatory attitude of big European companies.

A German pharmaceutical company’s dealings in South Africa [is an example of biopiracy].  Pelargonium sidoides, a variety of geranium known for its antimicrobial and expectorant qualities, has been used traditionally by indigenous communities in South Africa for centuries to treat bronchitis and other respiratory diseases. It also stimulates the nervous system, so has been used in the treatment of AIDS and tuberculosis.  In 2000, the German company Schwabe made significant profits on Umckaloabo, a product derived from the geranium, without compensating local communities. It then filed patents claiming exclusive rights to the medical use of the plant.

But in 2010 the patents were cancelled following appeals from the African Centre for Biosafety in South Africa and the Bern Declaration in Switzerland, calling the patents “an illegitimate and illegal monopolization of genetic resources derived from traditional knowledge and a stark opposition to the Convention on Biodiversity.”…[The] law would help protect biodiversity and ensure that the people from the region are adequately compensated for their resource and their traditional know-how. …The need to ensure the property rights of indigenous populations becomes more pressing as industry looks more and more to plant and animal-based cures to common diseases.Only 16 countries have ratified the Nagoya protocol. The European Union and its 24 of its 27 member states have signed the convention, but are yet to ratify it. When they do, Nagoya should soon reach the 50 states needed for it to come into force…  “The 16 states are countries in the South…

Excerpts, EU ponders biopiracy law to protect indigeneous people, EurActiv, April 26,  2013

See also EU portal on Biodiversity and Benefits Sharing

See also article on Alice v. Schwabe

Tibet – Mineral Resources, Fragile Ecology

The ecology of the Tibetan plateau, noted the Ministry of Land and Resources two years ago, is “extremely fragile”. Any damage, it warned, would be difficult or impossible to reverse. But, it went on, the China National Gold Group, a state-owned company, had achieved “astonishing results” in working to protect the environment around its mine near the region’s capital, Lhasa. On March 29th at least 83 of the mine’s workers lay buried under a colossal landslide. Its cause is not yet certain, but critics of Tibet’s mining frenzy feel vindicated.

The disaster at the Jiama copper and gold mine, about 70km (45 miles) north-west of Lhasa, has clearly embarrassed the government in Beijing. According to China Digital Times, a California-based media-monitoring website, the Communist Party ordered newspapers to stick to reports issued by the government and the state-owned news agency, Xinhua.

Foreign reporters are rarely allowed into Tibet, least of all to cover sensitive incidents. The official media have avoided speculation about any possible link between the landslide and mining activities in the area. They say the landslide covered a large area with 2m cubic metres of rubble. By the time The Economist went to press, 66 bodies had been pulled out by teams of rescuers with sniffer dogs. The high altitude and lack of oxygen made rescue work hard. A deputy minister of land and resources, Xu Deming, said preliminary investigations had shown that the landslide was caused by a “natural geological disaster”. Fragments of rock left behind by receding glaciers are being blamed, though officials do not explain why the workers’ camp was set up so close to such an apparent hazard.

The Tibetan government-in-exile based in India says it fears the disaster was caused by work related to the mine, which appears to have grown rapidly since construction began in 2008. It was formally opened two years later, at a ceremony attended by Tibet’s most senior officials. The $520m investment was described at the time as the biggest in Tibet’s mining industry by a firm belonging to the central government. The mine is owned by China Gold International Resources, a company listed in Hong Kong and Toronto. China National Gold Group is the controlling shareholder.

Tibet has been trying hard in recent years to encourage such companies to dig up the plateau’s metals and minerals. It has a lot of them to offer: China’s biggest reserves of copper and chromite (used in steel production), among the world’s biggest of lithium (used to make batteries), as well as abundant reserves of uranium, gold, borax (a component of ceramics and glass) and oil. Extracting these, however, often involves boring into a landscape considered sacred by Tibetans.

The Jiama mine, in a valley known to Tibetans as Gyama and revered as the birthplace of a seventh-century Tibetan king, has been the focus of protests by locals angered by environmental and other issues. Water from the valley flows into the Lhasa river. Woeser, a Tibetan activist based in Beijing, has blogged about locals’ fear that their water supplies will be polluted.

Tibetan resentment has been fuelled by the mining industry’s failure to provide much direct employment.

Excerpts, Mining in Tibet: The price of gold, Economist, April 6, 2013, at 54

Greening the Shipping Industry

The shipping industry faces the cost of complying with a deluge of new rules(issued by the International Maritime Organisation (IMO)). To make matters worse, it is in the middle of a slump caused by too many ships chasing too little trade.  As the deadlines for all these rules approach, shipping bosses are firing off distress flares. Masamichi Morooka, chairman of the International Chamber of Shipping (ICS), a lobby group, lamented on March 19th that the cost could run into “hundreds of billions” of dollars. He begged regulators to take into account the dire state of shipping

One of the first big expenses will be for cleaner fuel. Ships used to burn the cheap, unrefined crud, laden with sulphur and other nasties, that is left over when oil is refined. The fine soot that such fuel gives off can cause premature deaths from asthma and heart attacks. So in 2005 the IMO started to limit the sulphur content of maritime fuel, especially in “emission-control areas” along heavily populated coasts in North America and Europe. These limits are set to be tightened drastically,  Such fuels currently cost about 50% more than unrefined “residual” grades…

Shipping firms are also under pressure to cut their emissions of carbon dioxide and other greenhouse gases. The IMO reckons that ships cause about 2.7% of total man-made emissions, a bit more than planes but a lot less than cars and trucks. Under a convention it has brought into force this year, ships will have to introduce fuel-economy measures with the aim of reducing their emissions by 20% by 2020 and 50% by 2050….

The IMO is also pressing on with planned new rules on cleaning up ships’ ballast water. These may come into effect this year, once enough national governments have signed up for them. A study last year in the Journal of Marine Engineering and Technology* reckoned that around 60,000 ships worldwide would need refitting with one or more cleansing units, costing up to $1.7m each. In that case, shipping firms could be whacked with a bill of the order of $50 billion…

New proposals to make shipping greener, and push it further into the red, keep popping up. This week the European Parliament’s environment committee backed proposals for recycling levies on vessels calling at EU ports. This would pay for safer scrapping of old ships, which can contain asbestos and other toxic materials….

At a conference in Athens recently John Platsidakis, a Greek shipping boss who chairs an association of bulk-cargo operators, grumbled: “We carry 90% of world trade and we emit only 2.7% of the CO2 but still we are treated as if we are acting with indifference to the environment.”…[A]irlines, for example, have lobbied more shrewdly than shipping firms. But then again, the shipping industry is bigger and more fragmented than aviation, making it harder for it to present a united front. Many small, family-owned shipping firms have publicity-shy bosses and lack the sophisticated public-relations machines that giant firms deploy….[T]he ICS seeks to represent the entire global merchant-shipping fleet with just 20 people. The industry’s sluggish lobbying has meant that rules get passed before it has a chance to object to them. And once they are passed, it is much harder to get them changed.

The shipping industry: Sinking under a big green wave, Economist, Mar. 30, 2013, at 69

It Can Cost Your Life: Shipping Minerals

A dark underbelly exists in Indonesia’s thriving trade with China. Since late 2010 five ships loaded with Indonesian minerals have sunk when bound for China, with huge loss of life. Little has been done to break the deadly trend. Indeed, plenty of interests have an incentive to hush it up. The latest ship to founder is the Harita Bauxite, a bulk carrier which sank on February 17th near the Philippines. Of its 24 crew, who were all or mainly from Myanmar, ten were rescued, one of whom later died. Fourteen were still missing when the search was called off two weeks later.

The vessel is thought to have been carrying nickel ore, a potentially deadly cargo, loaded on Obi island in the remote Indonesian province of Muluku and destined for China’s steel mills. In terms of the global bulk trade, shipments of nickel ore from Indonesia to China are tiny: just 2m-3m tonnes out of more than 4 billion tonnes of bulk goods carried each year on over 9,000 vessels. Yet this backwater trade accounted for four of the 20 bulk freighters lost worldwide during 2010-11, and for 66 of 82 deaths, according to Intercargo, an association of ship owners.

ll four ships were found to have sunk because the cargo had liquefied. Nickel ore is dangerous because if it gets too wet, the fine, claylike particles that are often present in the ore turn the cargo to a liquid gloop that sloshes about the holds with such momentum that even a giant ship can capsize. The four ships had loaded during Indonesia’s rainy season. The ore is typically stockpiled in the open. Quite how the Harita Bauxite foundered is not yet clear, but if liquefaction was a factor, as many in the shipping industry suspect, it will have been another entirely avoidable tragedy.

Preventing liquefaction should be fairly simple. It involves checking the moisture content of susceptible commodities. If they are too wet, a surveyor will deem the cargo unsafe and not to be loaded. Time and again in Indonesia, checks have been inadequate. With the bulk-shipping business in the doldrums, the profitable nickel trade is a siren call for ship owners and charterers. Indonesia’s ministers and mandarins in Jakarta, the capital, refuse to comment on the tragedies and have done little to tighten policing at faraway ports in Sulawesi, Muluku and Papua.

Ship captains report intimidation by miners and agents if they refuse to accept cargo. A leading marine insurer says the ports’ remoteness makes it hard to sample cargoes reliably. Local officials turn a blind eye to unsafe practices. Peter Lundahl Rasmussen at Bimco, a maritime association, says surveyors trying to do their job have been assaulted or arrested.

With insurance claims mounting, shipping bodies and insurers have issued plenty of instructions about how to load nickel ore safely, especially in Indonesia. The International Maritime Organisation (IMO), the UN agency responsible for shipping safety, is also taking steps to tighten the regulations for commodities that can suffer liquefaction.

But the IMO’s process is a glacial one, and the new rules will not clear its various committees and be promulgated until at least 2015. Even then, the organisation relies on its members to enforce regulations. In Indonesia, in other words, the impact of tighter rules may be minimal. Moreover, existing and planned legislation covers ore depots and the ports, but not the transit between the two, where rain may do its dangerous work. Steve Cameron at RTI, a risk consultancy, argues that it would be more effective if mining companies faced charges of corporate manslaughter for not ensuring that their ore reaches ships in good condition.

Shipping: Deadly Trade, Economist, Mar. 23, 2013, at 46.

 

Gated Rainforests: the militarization of conservation

The  Epulu  village  in the Democratic Republic of Congo is situated inside a nature reserve in the Ituri rainforest, an area covering 5,000 square miles that is supposed to be off limits to hunters and gold prospectors. A militia, led by a former elephant poacher called Paul Sadala, has terrorised communities inside the reserve since 2012, employing methods brutal even by the grisly standards of this part of the world.

“The attacks were absolutely terrifying,” said Justin Oganda, a representative of the residents of Epulu who remain displaced in Mambasa, about 50 miles away. By the end of that day in June, the militiamen had murdered, raped, burned people alive and even eaten the flesh and heart of one of their victims. “To have killed so many people, to burn them alive, the cannibalism … Mentally they cannot be normal,” Oganda added.

As ever with Congo, it is not just a simple tale of victims and villains. Sadala, who goes by the nom de guerre Morgan, and his “Mai Mai Morgan” gunmen are thought to have powerful supporters in the security forces who enable their lucrative illegal trade in ivory and smuggled gold. Some local people with an eye on the gold in the ground beneath their feet tacitly support Morgan, who improbably also likes to be called Chuck Norris. “There is complicity between [Morgan] and certain elements within the army,” said Jefferson Abdallah Pene Mbaka, the MP for Mambasa. “With the support of certain army authorities [Mai Mai Morgan] have increased their poaching activities. The sale of ivory is organised by these figures in the army.” Many people in the region believe soldiers have orders not to arrest Morgan.

Morgan’s principal targets are those who operate and police the Unesco-recognised world heritage site known as the Okapi wildlife reserve, or by its French acronym, RFO. The laws of the reserve forbid the hunting of endangered species, especially elephants and okapi, and the exploitation of its gold reserves….The suspicion is that at least some of Morgan’s booty winds up 280 miles south-west of Epulu, in the hands of the Congolese army. At the end of 2012 the United Nations group of experts on Congo issued a report that accused Congolese general Jean Claude Kifwa in the provincial capital, Kisangani, of giving “arms, ammunition, uniforms and communication equipment to Mai Mai Morgan in exchange for ivory”….

Despite the brutality of the attacks, many reserve dwellers express sympathy for Morgan, with some even confessing to outright support for him. “I am behind Morgan,” said an 18-year-old in a small village not far from Epulu who refused to give his name. “Because Morgan is here the rangers cannot patrol and we are free to dig for gold. But I wouldn’t support him if he came here and burned our homes.”  Most people, however, have a more nuanced position, saying that although revolted by his methods, they support his stated desire to see the size of the reserve reduced and more rights given to locals to hunt and dig.  “The forest is where we find what we need to survive,” said Matope Mapilanga, the leader of a Pygmy community on the edge of the reserve. “[The park authorities] have cut our land, there is now a part we cannot access. It has worsened in the last few years, since the RFO got bigger. We would prefer that the people of the RFO weren’t in our forest. We feel like the big non-governmental organisations and the rangers have privileged the animals over the people.”

The conservationists remain unconvinced, though. “The people who say they support Morgan are just those people who want to dig gold and exploit timber,” said Robert Mwinyihali, the project leader for Wildlife Conservation Society’s (WCS) work in the Ituri rainforest. WCS has given financial backing to the park rangers and the Congolese Wildlife Authority’s work in the reserve. “There are laws in Congo about the exploitation of resources,” said Mwinyihali. “These people can either respect those laws, or they can ignore them and commit criminal acts.”  WCS and GIC’s support for the park rangers has led to accusations that they are partly responsible for the militarisation of the conflict. However, Mwinyihali said the biggest problem was the absence of effective intervention by the Congolese state, which meant NGOs and the park rangers had had to fulfil roles that should be the government’s responsibility: for example, bringing in armed guards to track Morgan. Bernard Iyomi Iyatshi, the director of park rangers, complained about a lack of government funds for his anti-poaching operations.

Mwinyihali also accused the Congolese government of doing little to reconcile the park authorities and local communities. As mutual resentment and misunderstanding grows, Morgan and other armed groups are able to exploit the toxic atmosphere and continue their poaching, digging and savage attacks.  “There are no job opportunities created by government investment here,” said Mwinyihali. “This has led to this crisis, where people have no option but to want to dig for gold. This leads to the conflict with the park authorities, and then it is only a small step to people taking up arms and joining militias.”  Despite being a member of the ruling party, Mbaka is an outspoken critic of the government’s policy, or lack of it, in the region. “Swaths of the park are inaccessible, there’s just no infrastructure,” he said. “It’s an absolute scandal, there’s potentially so much wealth here. It also means it is difficult to track and stop men like Morgan.”  Even if Morgan is caught, people fear that his powerful backers in the army will find another militia to continue poaching and stealing gold…

About 70% per cent of the ivory from slaughtered African elephants goes to China, another of the countries warned by Cites. The price of ivory has rocketed. Cites reported that the price more than doubled between 2004 and 2010, from about $300 to $700 (£198 to £462) a kilogramme. An Associated Press investigation in 2010 claimed ivory was being sold in China for $1,800 a kilogramme.

Excerpt, Pete Jones, Gold and poaching bring murder and misery to Congolese wildlife reserve, Guardian, Mar. 31, 2013

The Polar Bear: An Animal or Icon

The Inuit see the animal as a fierce predator, a cultural symbol and a valuable source of food, warmth and money in a part of the world where all three are in short supply.Yet to animal-welfare and green groups in warmer places the polar bears are both an icon in the fight against climate change and an animal under threat of extinction. The melting of the Arctic’s ice cap, which the bears use as a hunting platform, means the estimated population of between 20,000 and 25,000 will decline sharply, they say. They see hunting the bears as an anachronism and want international trade in bear pelts and parts, already severely restricted, completely banned.

These opposing views are set to clash at a meeting of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), an intergovernmental agreement, between March 3rd and 14th in Bangkok. Having failed at the previous meeting of CITES in 2010, the United States is again leading a move to switch the polar bear from Appendix II of the convention to Appendix I, which would ban trade in all but “exceptional” circumstances. The American proposal is backed by Russia but opposed by Canada, Norway, Denmark (which represents Greenland) and the CITES secretariat.

The debate promises to be emotional. What it lacks are facts. The Americans acknowledge that only eight of the 19 known groups of polar bears have been surveyed since 2000. Of the remaining 11, four have never been surveyed. The submission relies on a controversial forecast undertaken for the US Fish and Wildlife Service in 2007 that suggests the decline in sea ice will lead to the disappearance of two-thirds of the world’s polar bears by 2050.  Should the United States obtain the two-thirds majority needed to change the bear’s status, it will be a blow to the Inuit. Their trade in walrus tusks and narwhal horns has dried up because of curbs on sales of ivory designed largely to protect elephants. The trade in seal pelts and meat was curtailed by a 2009 import ban by the European Union, though this granted a limited exemption to indigenous peoples.

In Canada polar bears are hunted under annual quotas set by territorial governments. The Inuit trade bear pelts, claws and teeth, and sell some of the quota to trophy hunters, who employ local guides and buy local supplies…..

Countries which want to become observers at the Arctic Council, an intergovernmental body, will be reluctant to vote against Canada, Norway and Denmark on the issue. Canada takes over as chairman of the council in May. Still, it will take resolve to stand up to the United States, also a council member, and the array of animal-welfare and environmental groups backing its position.

The Inuit also argue that if the problem is climate change, to ban trade in polar bears is to attack the symptom rather than the cause. That was the argument of the European Union’s environment commissioner, Janez Potocnik, when the European Parliament debated the issue earlier this month. But the MEPs still voted in support of the American position.

Canada’s Inuit: Polar-bear politics, Economist, Feb. 23, at 36

Nuclear Waste from Britain to Japan on the Pacific Grebe

Japan Nuclear Fuel Ltd. said Thursday that 28 canisters of high-level radioactive waste produced through the reprocessing of spent Japanese nuclear fuel in Britain will arrive in Aomori Prefecture in the latter half of February.  The 28 canisters of vitrified radioactive waste include 14 for Kansai Electric Power Co. and seven each for Chubu Electric Power Co. and Chugoku Electric Power Co.

The freighter Pacific Grebe carrying the waste left the port of Barrow on Wednesday Jan, 9, 2013) and will travel to Rokkasho, Aomori Prefecture, via the Panama Canal, Japan Nuclear Fuel said.  It will be the third time that vitrified radioactive waste will be brought to Japan from Britain.

Japan has received 104 canisters of such waste from Britain and plans to receive around 800 more. The 104 canisters have been stored at a facility in the village of Rokkasho.

Reprocessed nuclear waste to arrive in Aomori from Britain in late February, The Japan Times, Jan. 11, 2012

Nuclear Energy and the Supplies of Uranium: 2013

Uranium is poised to rebound from a second annual decline as Japan considers restarting its atomic plants almost two years after the Fukushima disaster and China pushes ahead with the world’s biggest nuclear building program…A revival in demand from Japan is raising the prospect that supplies of the radioactive metal will shrink at the same time as China continues with a project to increase its nuclear power capacity at least fivefold by 2020. That’s a boost for uranium producers such as Perth, Australia-based Paladin (PDN) Energy Ltd. It’s also a blow for liquefied natural gas exporters including Qatar and Australia, which have helped plug Japan’s power shortage since the earthquake that led to the meltdown at the Fukushima Dai-Ichi plant in March 2011.,,,

The uranium forecasts for 2013 ranged from $45 to $62.60 a ton in the Bloomberg survey conducted Dec. 10 to Dec. 19. That compares with a three-year high of $73 in February 2011, according to data from Roswell, Georgia-based Ux Consulting, which advises the nuclear industry. The fuel averaged $56.80 in 2011 and was $43 a pound on Jan. 3.  The price plunged as low as $49.75 a ton in March 2011 after Japan’s biggest earthquake on record and a subsequent tsunami damaged reactors at the Fukushima site run by Tokyo Electric Power Co. (9501), releasing radiation and causing the evacuation of 160,000 people. The government responded to the disaster by keeping all 54 of the nation’s then-functioning atomic plants shut after safety checks, while countries from China to France reviewed their nuclear policies and Germany said it would close its facilities….

Speculation that uranium demand will rebound has grown since Dec. 16, when Japan’s Liberal Democrat Party won a landslide election victory. The previous administration of the Democratic Party of Japan, which ordered the shutdowns, planned to phase out nuclear power by the end of the 2030s…

Stockmarket investors have been betting that the resumptions will occur and boost uranium demand just as China pushes on with plans to build at least 26 new reactors. At the same time, analysts are predicting a drop in the price of LNG as Japan’s utilities seek to reduce their electricity-generation costs by switching back to nuclear.

Paladin, which operates two uranium mines in Africa and has exploration assets in Australia, rose 22 percent in Sydney in the two days through Dec. 18. Energy Resources of Australia Ltd. (ERA), whose Ranger mine in the Northern Territory produces about 10 percent of the world’s mined uranium, advanced 13 percent over the same period. Australia has the world’s largest known deposits of the fuel, according to the World Nuclear Association.

The cost of Japan’s LNG imports almost doubled in the past three years, reaching a record $18.07 per million Btu in July, according to Finance Ministry data. Purchases for the first 11 months of last year increased 11.5 percent from the same period in 2011 to a record 79.5 million tons, according to data from the ministry….The country must restart reactors quickly because of the price of fossil fuels, LDP General Council Chairman Hiroyuki Hosoda said Nov. 27.

Ben Sharples. Uranium Rebound Seen as Japan Considers Nuclear: Energy Markets, Bloomberg, Jan. 4, 2012

Another War to Save the Rhino

Retired SA Army Major General Johan Jooste was this week unveiled as the man who will be in overall command of the Kruger national park’s (located in South Africa) efforts to for once and all stop rhino poaching.  So far this year 381 rhino have been killed by poachers in Kruger, well over half the national loss of 618.  Jooste… was his usual straightforward self when commenting on the new task.  “I am no messiah. What I am is a proven leader as well as a team player…The battle lines have been drawn and now the team and I are going to work hard to push back poachers.  It is a fact that South Africa as a sovereign country is under attack by armed foreign nationals. This can be seen as a declaration of war. We are going to take the war to these bandits and we aim to win it,” the highly decorated and respected retired two-star general said in Skukuza.  SANParks chief executive Dr David Mabunda who is on record as saying the country was engaged in “a low intensity war” against poachers, said the arrival of Jooste in Kruger was another indication of the high priority the national conservation agency was giving to the scourge of rhino poaching.  “We are fully aware we will never be able to put a ranger behind every rhino. That’s why we are developing modern and innovative ways of protecting rhino against a well-organised onslaught.”

Jooste’s appointment is in line with SANParks multi-pronged approach to rhino poaching including a single operations command. He brings with him experience in military intelligence, border and area protection as well as contemporary knowledge of modern military technology, its use and integration at operational level as well as conservation knowledge.

Kim Helfric, War on rhino poaching intensifies as general joins the fray, The NewAge, Dec. 13, 2012

Turning Turkey into an Illegal Nuclear Dump: the evidence

Amid growing public concern about the discovery of radioactive waste buried at an abandoned factory in Izmir (Turkey), experts have pointed out to the possibility that there could be other sites with nuclear waste imported illegally into Turkey from foreign companies that operate nuclear plants.Public concerns about radioactive and other toxic waste began after a news report appeared in the Radikal daily last week about the discovery of highly radioactive waste buried at a defunct factory on Akçay Street, the main thoroughfare running through Izmir’s Gaziemir district. The Turkish Atomic Energy Agency (TAEK), which was assigned to test the plant on Tuesday, stated that the radioactive level at the site did not constitute a dangerous situation, but they didn’t address concerns about a radioactive material that might have been brought into Turkey illegally.   The factory, situated on more than 70 acres, used old batteries and scrap lead to produce cast lead until just a few years ago.

In relation to the inspection, a former senior manager of the Izmir factory, speaking on condition of anonymity to Radikal on Thursday, confirmed the fact that the toxic waste of the factory was buried on the site in an effort to save money by not sending the waste for proper disposal. However, he didn’t comment on the possibility of nuclear materials being brought in illegally.  It was also reported that locals, particularly children playing in the vicinity, had access to the plant as the wire fencing around the factory had corroded over time.

Radikal reported that TAEK had examined the site of the factory in 2007. A radioactive substance called europium, an illegally imported element used in nuclear reactor control rods, found on the site is thought to be the source of the radioactivity, a report from TAEK showed.  A nuclear engineer at Okan University, Tolga Yarman said the radioactive element could have entered the country along with other nuclear waste, as it was illegal to keep this substance in Turkey. In fact, other sites where nuclear waste was buried have been discovered. A similar case was reported in 1987 by Professor Ahmet Yüksel Özemre, a former general director of TAEK and Turkey’s first nuclear engineer….”The ministry should have ideal staffing levels to work more closely on the detection of nuclear waste cases by complying with European Union standards, and a control mechanism should be part of this improvement,” said Ministry of Environment and Urban Planning Deputy Undersecretary Mustafa Öztürk.  Professor Öztürk warned about tons of toxic waste which is illegally buried at many other plants in different provinces around Turkey.  “Toxic waste can only be kept on site at a plant for six months provided that plant authorities take the necessary environmental precautions, and the waste should be moved to disposal centers at the end of the period stated by law. However, plants keep running while their waste is buried in the soil without taking any precautions. This is the case for many provinces, including Istanbul, Samsun, Hatay, Kayseri and Mersin,” answered Öztürk to a question about the legal regulations regarding the conservation and disposal of toxic waste.

A similar case was reported in 1987 by Professor Özemre, who received an anonymous tip that 1,150 tons of radioactive waste, which were imported from Germany, had been buried on the site of the Göltas cement factory in Isparta, a province in southwest Turkey. Özemre had also asserted, in a written document and on several television news programs, that a flour factory in Konya had burned 800 tons of toxic waste on its site in order to generate energy.  He further noted that he would not have given credit to this anonymous tip about the nuclear waste cases in Isparta and Konya if he himself had not received a similar proposal from a German firm who offered him 40 million Deutsche Mark in return for burying 4,000 tons of radioactive waste while he served as the director of TAEK. Özemre asserted that when he did not accept the German firm’s proposal, stating that he “would not let Turkey turn into a nuclear landfill,” the firm told him that the toxic waste would be buried in Turkey one way or another.

A research commission was assigned by the Turkish Parliament to check into the claim that illegal nuclear waste was buried around Isparta and had been burned in Konya. The conclusion of the commission, published in the form of general meeting minutes in 1997, showed that the factory sites did not include radioactive elements.

Excerpt, Izmir Factory Scandal Causes Concern Over Nuclear Waste Elsewhere, http://www.haberler.com, Dec. 9, 2012

The Arctic Challenger: ready for Arctic oil spills

Shell Oil has been building and testing equipment designed for the Arctic Ocean in Puget Sound, Seattle, United States.  In September, a key test of underwater oil-spill equipment was a spectacular failure.  It forced the energy giant to postpone drilling into oil-bearing rocks beneath the Arctic Ocean until next summer. Shell and its federal regulators have been tight-lipped about the failed test.  But a freedom-of-information request reveals what happened beneath the surface of Puget Sound.

Before Shell can drill for oil in the Arctic Ocean, it needs to prove to federal officials that it can clean up a massive oil spill there. That proof hinges on a barge being built in Bellingham called the Arctic Challenger.  The barge is only one component of Shell’s plans for handling oil spills off the remote north coast of Alaska. But the Obama Administration won’t let oil drilling get under way until the 36-year-old barge and its brand new oil-spill equipment are in place,  On board the Arctic Challenger is a massive steel “containment dome.” It’s a sort of giant underwater vacuum cleaner. If efforts to cap a blown-out well don’t work, the dome can capture spewing oil and funnel it to a tanker on the surface.

The Arctic Challenger passed several US Coast Guard tests for seaworthiness in September. But it was a different story when its oil-spill containment system was put to the test in 150-foot-deep water near Anacortes, Washington.  The federal Bureau of Safety and Environmental Enforcement required the test of the oil-spill system.

According to BSEE internal emails obtained by KUOW, the containment dome test was supposed to take about a day. That estimate proved to be wildly optimistic.

•Day 1: The Arctic Challenger’s massive steel dome comes unhooked from some of the winches used to maneuver it underwater. The crew has to recover it and repair it.

•Day 2: A remote-controlled submarine gets tangled in some anchor lines. It takes divers about 24 hours to rescue the submarine.

•Day 5: The test has its worst accident. On that dead-calm Friday night, Mark Fesmire, the head of BSEE’s Alaska office, is on board the Challenger. He’s watching the underwater video feed from the remote-control submarine when, a little after midnight, the video screen suddenly fills with bubbles. The 20-foot-tall containment dome then shoots to the surface. The massive white dome “breached like a whale,” Fesmire e-mails a colleague at BSEE headquarters.

Then the dome sinks more than 120 feet. A safety buoy, basically a giant balloon, catches it before it hits bottom. About 12 hours later, the crew of the Challenger manages to get the dome back to the surface. “As bad as I thought,” Fesmire writes his BSEE colleague. “Basically the top half is crushed like a beer can.”

Representatives of Shell Oil and of BSEE declined to answer questions or allow interviews about the mishaps. In an email, Shell spokeswoman Kelly op de Weegh writes:  Our internal investigation determined the Arctic Challenger’s dome was damaged when it descended too quickly due to a faulty electrical connection, which improperly opened a valve. While safety systems ensured it did not hit the bottom, buoyancy chambers were damaged from the sudden pressure change.

Environmental groups say the Arctic Challenger’s multiple problems show that Shell isn’t prepared for an Arctic oil spill.

Excerpt, By John Ryan, Sea Trial Leaves Shell’s Arctic Oil-Spill Gear “Crushed Like A Beer Can”, Kuow.org. Nov. 30, 2012

Oil Sands of Canada

Canada’s oil sands contain some 170 billion barrels of oil that can be recovered economically with today’s technology (and perhaps ten times that in total). Canada thus has the world’s third-largest proven oil reserves, after Saudi Arabia and Venezuela. And since most oil-rich nations’ reserves are under state control, Canada has the largest reserves that private companies are free to invest in—more than half of the global total, reckons Ken Hughes, Alberta’s energy minister.

Other countries welcome the idea of plentiful energy from a stable democracy. It could reduce the rich world’s dependence on the Middle East. There are “no bribes or body bags”, grins an oil-industry booster. And the potential is immense. A new study by the Alberta Geological Survey estimates that the province has huge resources in its shale beds as well as its oil sands: 3,400 trillion cubic feet of natural gas and 420 billion barrels of oil—numbers comparable to America’s.  However, Canada’s output of 3.5m barrels of oil a day is less than half that of America. (America’s output is set to exceed Saudi Arabia’s; see article.) Several problems hobble Canadian energy: geology, capital, people and pipes.

First, geology. Canadian oil is hard to extract. It mostly comes in the form of bitumen, which is “hard as a hockey puck” at 10°C, as the Canadian Association of Petroleum Producers (CAPP), an industry body, puts it. If it is far below ground, it must be blasted with steam to make it flow, and then pumped out. This process (known as “steam-assisted gravity drainage”) was developed in Alberta. In the past decade, with high oil prices, it has made the oil sands economical to exploit. But precariously so: the best projects break even when oil is $30 a barrel, but many new ones need it to be $80 or more. (West Texas Intermediate is currently $85.)

Canada gets less than it should for its oil because it lacks enough pipelines. Environmentalists oppose them, arguing that pipes leak (which is always possible) and that Canada’s heavy oil causes more greenhouse-gas emissions than other oil (which is true, but not by much). President Barack Obama has delayed the approval of a pipeline called Keystone XL, which would move Canadian oil to America’s Gulf coast. A decision is expected soon.

Alex Pourbaix of TransCanada, the firm behind the Keystone pipeline, insists that the project will be good for both countries. Canada forgoes a fortune—perhaps $20 a barrel—because it cannot get its oil to the sea. Canadian gas sells at a discount, too: North American prices are far lower than those in Asia.  Another proposed pipeline, Northern Gateway, would carry oil to Canada’s west coast, whence it could be shipped to Asia. Canada would benefit from having a choice of customers. But the government of British Columbia, and various aboriginal groups, have yet to say yes.

To exploit its hydrocarbons, Canada needs capital: some $50 billion-60 billion a year, on recent trends. Such sums are “far more than Canadian capital markets can raise,” says Dave Collyer of the CAPP. Canada gets plenty of foreign investment: Syncrude, one of the biggest oil-sands developers, is a joint venture that includes American, Chinese and Japanese partners. But lately the country has grown frostier towards foreign capital.

In October Canada’s federal government temporarily blocked a $5.2 billion bid by Petronas, Malaysia’s state energy giant, for Progress Energy Resources, a Canadian natural-gas company. It has yet to approve a $15 billion offer by CNOOC, a Chinese state-owned firm, for Nexen, a Canadian oil-and-gas firm. A deadline passed last week; a decision may come next month. Mr Hughes says he is keen on foreign investment so long as foreign firms abide by the same rules as Canadians; but it is not up to the provincial government.

The other big bottleneck is human capital. Hardly anyone lives near the oil sands, so labour must be imported, from other parts of Canada and from abroad. People from 127 countries live in Fort McMurray, says Ken Chapman of the Oil Sands Developers’ Group. They speak 69 languages. The Walmart in town looks like the United Nations, except that all the shivering Africans are buying woolly hats. Mr Hughes expects to see a skills shortfall of 100,000 people in Alberta by 2017. Canada’s immigration rules are more liberal than America’s, but firms still gripe about delays. An Irish worker in Fort McMurray complains of having to fly to Calgary to sit a test of English proficiency. It’s her native language, and the test is online.

Companies poach staff from each other, bidding up labour costs. It would be easier to attract workers to Fort McMurray if the town were more liveable; a one-bedroom flat can cost $2,000 a month. To build more homes, however, the town must wrestle with provincial red tape—and also attract legions of builders, plumbers and electricians, all at inflated wages.

Working conditions in the oil sands are tough. Touch a metal pipe with your bare hand at minus 40 and it sticks. “It’s not for everybody,” shrugs an oil-firm boss. At remote work camps, companies provide hot food, warm cabins, broadband and squash courts. All this is costly. Many firms make equipment elsewhere and truck it in, so that fewer people have to toil in the cold. Some are hoping dramatically to raise the proportion of man-hours worked off-site.

With so many bottlenecks and a volatile oil price, firms are growing cautious. Suncor Energy and Canadian Natural Resources, among others, are putting new investments on hold. “It’s the uncertainty,” says Marcel Coutu, the boss of Canadian Oil Sands, a firm that owns 37% of Syncrude. “No one knows when or whether those pipelines will be built.”

Canadian energy: The sands of grime, Economist, Nov. 17, 2012, at 62

Bankers with Chainsaws – logging companies and their banks

Some big banks do little more than pay lip service to environmental issues. HSBC likes to think of itself as different. It has signed up to many initiatives, including the Equator Principles, a set of social and environmental standards launched in 2003 for project financiers….

Sarawak (Malaysia) has lost more than 90% of its “primary” forests to logging and has the fastest rate of deforestation in Asia. Sarawak has only 0.5% of the world’s tropical forest but accounted for 25% of tropical-log exports in 2010. As timber stocks have become depleted, the loggers have moved into the palm-oil business, clearing peat-swamp forests to make way for plantations. The deforestation has been accompanied by abuses against indigenous groups, including harassment and illegal evictions. Allegations of corruption and abuse of public office dog Abdul Taib Mahmud, Sarawak’s chief minister, finance minister and planning-and-resources minister, who is believed to have firm control over the granting of logging licences. Mr Taib has long denied being corrupt.

Global Witness, a campaigning group, has analysed the publicly available financial records of seven of Sarawak’s largest logging and plantation companies.  It identified loans and other financial services from HSBC that it estimates have generated at least $116m in interest payments and $13.6m in fees for the bank since 1977. Although lending has declined over the past decade, HSBC continues to list Sarawak loggers among its clients, in apparent violation of its own Forest Land and Forest Products Sector Policy.

On paper HSBC’s forest policy gets high marks, including from BankTrack, a network of NGOs that monitors lenders. When it was drawn up in 2004, the policy required clients to have 70% of their activities certified by the Forest Stewardship Council (FSC), or equivalent, by 2009, with evidence that the remainder was legal. (The FSC is a global non-profit body that sets standards and does independent certification for logging and forest products.)

Not only did the seven firms analysed fail to meet that deadline, but none has any FSC-certified operations today. Ta Ann Holdings, for example, listed HSBC as a “principal banker” in its 2011 annual report. Ta Ann does not have FSC certification, and has failed to obtain full verification of the legality of its Sarawak concession under the independent “Verified Legal Origin” scheme. The firm has been accused of clear-felling rainforest that is home to endangered orangutan and of cutting down conservation forest for plantations. Ta Ann told Global Witness it is “collaborating closely with HSBC towards achieving full compliance” with its forest policy.

Another forestry conglomerate that is still banking with HSBC, according to its annual report, is WTK Holdings, whose intensive logging is widely believed by pressure groups to have caused landslides that ended up blocking a 50km (31-mile) stretch of river in 2010. None of WTK’s operations is FSC-certified.

In all, Global Witness identified six loans, totalling $25m, made by HSBC to non-compliant Sarawak loggers since the bank introduced its forest policy. HSBC said in 2004 that it would stop doing business with clients that failed to make a reasonable effort to comply by 2009.  The Economist asked HSBC to comment. The bank declined to discuss its clients because of confidentiality, but said it is “not accurate” to state that its clients are in violation of its forestland and forest-products policy. It said current data show that 99% of its forest-sector clients worldwide (by size of lending) are “compliant” or “near-compliant” with its policy. What precisely it means by “near-compliant” is unclear…..HSBC’s  continued involvement, however modest, allows logging firms to claim credentials they don’t deserve. Ta Ann, for instance, has run adverts saying it holds forest-policy certification from HSBC. That looks like a figleaf.

Deforestation in Sarawak: Log tale, Economist, Nov. 3, 2012, at 75

Nuclear Waste and Environmental Justice

After California regulators refused to allow the U.S. Air Force to label residue from radioactive aircraft instruments as “naturally occurring” – declaring it unsuitable for a Bakersfield-area dump – the military turned to Idaho with the same story.  There, military officials met with success. The Air Force is now sending radioactive waste from Sacramento County’s McClellan Air Force Base to a Grand View, Idaho, hazardous waste landfill.

This solution involved a bit of legal semantics rejected in California despite 10 months of Air Force lobbying: The military claimed radium dust left over from glow-in-the-dark aircraft instruments actually was naturally occurring, putting it the same relatively lax regulatory category as mine tailings, according to government memos obtained by California Watch through a public records request.  Larry Morgan, a health physicist with the California Department of Public Health, disagreed with that characterization. Radioactive paint does not “meet the definition” of naturally occurring waste, he wrote in a September 2011 memo.

The Idaho facility’s permit allows it to accept materials defined as natural without notifying state regulators, leaving the state’s hazardous waste manager in the dark.  “I’m not familiar with this particular waste stream. I intend to find out now that you’ve contacted me,” Robert Bullock, hazardous waste permits manager for the Idaho Department of Environmental Quality, said during an October interview.  The redefinition of the waste as natural might not even have been necessary, given Idaho’s different standards for waste containing trace amounts of radium.

Days after the Idaho Department of Environmental Quality told California Watch that the agency was unaware of the Air Force waste, an official went out to inspect the landfill. Interviewed after that visit, engineer Dennis Meier said the dumping was legal because of the low concentration of radium in the soil, despite the source.  “It’s not waste that has to go to a radioactive waste facility,” he said. “The concentration is way below what we would accept.”

Nonetheless,California health officials and environmental activists accused the Air Force of bending the truth to get its way.  “Illuminated instrument dials do not naturally occur,” said Daniel Hirsch, a lecturer on nuclear policy at UC Santa Cruz who leads the environmental group Committee to Bridge the Gap. “I can’t dig into the soil and discover naturally occurring radium instrument dials.”

The radioactive dirt in question hails from the former McClellan Air Force Base northeast of Sacramento,now a commercial development site.“At least 24 sites” on the base “all have low levels of radium mixed in with the soil, and there are many thousands of cubic yards” of contaminated soil, according to Philip Mook, Western region senior representative for the Air Force Civil Engineer Center, which is in charge of cleanups at Air Force installations. “A little bit of radium goes a long way.”  The Air Force has sent 22,000 tons of radioactive dirt from McClellan out of state so far, according to Charlotte Fadipe, a spokeswoman for the California Department of Toxic Substances Control.

According to the federal Environmental Protection Agency, if significant radium is inhaled or ingested, it can increase the risk of diseases such as lymphoma, bone cancer and leukemia. While the concentrations in the McClellan soil are low, they are above limits the federal government has set to protect human health.  Before these medical effects became evident, aircraft dials and gauges were painted with glowing radium so pilots could see them better at night. Air Force officials speculate that the radium became dispersed in the soil at McClellan “probably in cleanup water, like mop water or solvents that were used to clean the equipment or to clean up spills of radium,” Mook said. Although radium paint wasn’t used on the base after the 1950s, items contaminated with it remained…

Stephen Woods, chief of the California Department of Public Health’s Division of Food, Drug and Radiation Safety, argued in a Nov. 4, 2011, letter that the dirt should be sent to “a licensed low-level radioactive waste disposal facility.” The Idaho facility where the soil is now going does not meet that criteria. Neither do any California waste disposal facilities.  That’s partly because of vocal opposition from local Kern County residents and environmental groups.  “Hazardous waste landfills in low-income communities of color in California aren’t the right places for” nuclear waste, said Caroline Farrell, executive director of the Center on Race, Poverty & the Environment, which for almost two decades has fought to limit the Buttonwillow landfill’s expansion and impact on local residents.

But in the past, the landfill has accepted nuclear waste. In 1998 and 1999, the Army Corps of Engineers sent residue from the Manhattan Project, the World War II-era research and development program that produced atomic bombs dropped in Japan, to the landfill.  The move outraged civilian officials.  Democratic U.S. Sen. Barbara Boxer testified before a Senate committee on July 25, 2000: “When I learned that the Corps had disposed of 2,200 tons of radioactive waste at an unlicensed hazardous waste facility in Buttonwillow, California, I was shocked. The facility sits atop aquifers that supply water to the Central Valley of California.”  Since the Manhattan Project controversy, the facility’s permit has been tightened. Yet the landfill’s current permit states that it may accept naturally occurring radioactive materials at low concentrations….

US Ecology, which operates the hazardous waste landfill in Grand View, Idaho, seemed to accept the terminology.  Steve Welling, senior vice president of sales and marketing for US Ecology, said in an interview that “state law and our permits” allowed the facility to accept the waste that the Air Force had characterized as naturally occurring.

Katharine Mieszkowski and Matt Smith, Air Force Ships Calif. Radioactive Waste To Idaho Landfill, NBC, Nov. 9, 2012

Palm Oil Industry: environmental and human impacts

Indonesia’s largest palm oil company, Sinar Mas, ran into trouble recently when communities in Liberia complained about a 33,000 ha. operation being developed on their lands by its indirectly-owned subsidiary, Golden Veroleum in Butaw District, Sinoe County. Alfred Brownell, the lawyer from Green Advocates representing the Kru tribes impacted by the project who is attending the 10th Roundtable on Sustainable Palm Oil (RSPO) being held in Singapore this week noted:

Golden Veroleum is in clear violation of the RSPO’s New Planting Procedure as it has not advertised its plans to clear and plant oil palms and carry out and publicise a High Conservation Value Assessment in advance of expanding its operations. Under the RSPO procedure, the company should now cease clearance until due process is followed. The villagers are concerned that their lands are being taken without their fully informed or free consent.

This is the second palm oil development involving a prominent RSPO member to run into controversy in Liberia. Last year, a subsidiary of Malaysia’s largest palm oil consortium, Sime Darby, was criticised for expanding its operations without respecting local peoples’ rights. The company was in the early stages of developing a 220,000 ha. operation but was halted in its tracks by complaints, which, to its credit, the company has responded to by entering into dialogue with the communities.

The spotlight is now on two large palm oil operations in Cameroon. One is planned by a company called BioPalm, a subsidiary of India-based corporation Siva Group which is marking out its planned operations without consultation on the lands of the Bagyeli “Pygmies” in Océan Département in western Cameroon. The company claims to be an RSPO member but does not show up on the RSPO’s membership lists. Messe Venant, Project Coordinator of the community-based indigenous NGO Okani says:  As the affected Bagyeli communities have told us, the forest is their memory. If they lose it, they lose their past, their present and their future. They will no longer be Bagyeli. To destroy the forest is to reduce them to nothingness.

Another palm oil developer is SG Sustainable Oils Cameroon PLC (SGSOC), owned by Herakles Farms from the USA and an affiliate of Herakles Capital, which is also involved in the telecommunications, energy, infrastructure, mining and agro-industrial sectors in Africa. SGSOC is developing an oil palm plantation further north in Cameroon, but has also run into sustained opposition from local communities and concerned NGOs and has announced it will pull out of the RSPO.

Other cases are highlighted in a searching review of 15 companies’ operations carried out by the Forest Peoples Programme and SawitWatch with a consortium of other NGOs and community organisations in Liberia, Cameroon, the Democratic Republic of Congo, the Philippines, Malaysia and Indonesia.

One case examined is the operation being developed by Genting Plantations, a client of HSBC, and a subsidiary of the vast Genting group which runs a casino, hotel and property empire in Malaysia. Both companies are prominent RSPO members. Genting is now in a protracted land dispute with the Dusun and Sungai peoples in Tongod District in Sabah over the imposition of the oil palm plantation. Leonard Alaza representing the Indigenous Peoples Network of Malaysia or Jaringan Orang Asal SeMalaysia (JOAS) at the 10th Roundtable of the RSPO underway in Singapore, says:  The communities have been objecting to this plantation since 2000 and filed a court case 10 years ago asking the court to recognise their rights and freeze the company’s expansion. But instead of recognising our rights, as the RSPO standard requires, the company has been contesting even the admissibility of our case and meanwhile has taken over and planted all the disputed lands.

Excerpt from Press Release of Forest Peoples Programme, New oil palm land grabs exposed: Asian palm oil companies run into trouble in Africa, Nov. 1, 2012

WTO and the Level Playing Field: Europe v. Russia

Europe’s trade chief threatened to take Russia to the World Trade Organization over a string of restrictive practices saying Moscow needed to play by the rules now it was a member of the global body.  Trade Commissioner Karel De Gucht singled out Russia’s ban on European live animal imports, plans to levy fees on imported vehicles, two anti-dumping cases and another trade defense case launched by Moscow against Europe in recent months.  In the same week that the European Commission opened an investigation into Russia’s Gazprom and China’s solar panel exports, De Gucht said the measures sent “the wrong signal”, Reuters reports.

“Membership of the WTO means a country is subject to the dispute settlement mechanism of that organization,” he told an EU-Russia seminar in Helsinki. “Russia should understand that Europe takes that mechanism very seriously and that we will not hesitate to enforce our rights where they are violated,” he added.

Russia joined the WTO last month after an 18-year wait. President Vladimir Putin said on Wednesday the country would use its membership to try to develop freer trade across the world, but he’ll also be hoping it will further boost the energy-driven $1.9 trillion economy.  De Gucht said Russia was violating WTO rules by keeping its markets closed to competitors.  “What these and other measures … have in common is that they affect products where significant market opening is due to take place under Russia’s WTO commitments,” De Gucht said.  “This is the wrong signal to send at a time when liberalization is supposed to be moving forward.”

Russia and the EU are deeply intertwined, with Europe relying heavily on Russian energy exports and Russians hungry for EU products and access to its 500 million consumers.  But the two sides argue over issues ranging from energy supplies, trade and market access to human rights. While relations are at times frosty, both refer to each other as “strategic partners” and meet for twice-yearly summits.  Negotiations between Russia and the EU towards closer economic and political ties have also stalled, and Brussels is concerned by Putin’s plan to develop a “Eurasian union” of ex-Soviet states, including Kazakhstan and Belarus.

EU warns Russia to play by WTO rules or face action, Reuters, Sept. 7, 2012

Russian President Vladimir Putin signed a decree giving the government the right to protect its natural gas-export monopoly, OAO Gazprom (GAZP), from an anti-trust inquiry by the European Union.  Putin’s measure bans strategic companies from disclosing information, disposing of assets or amending contracts without government approval in case claims are made by foreign states or entities, the president’s office said in an e-mailed statement from Moscow today. The Russian leader on Sept. 9 warned the EU, which relies on Russia for a quarter of its gas needs, that there would be “losses on both sides” if the issue isn’t resolved. He accused the 27-nation bloc of trying to shift responsibility for subsidizing former communist EU members onto Russia by forcing Gazprom to cut prices for customers in eastern and central Europe.

Excerpt, By Henry Meyer, Putin Moves to Protect Gazprom From EU Pricing Dispute, Bloomberg, Sept. 11, 2012

The iPhone, radioactive waste and rare earths: the Lynas case

Lynas Corporation, an Australian based mining company are constructing a rare earth processing plant, known as the Lynas Advanced Materials Plant (LAMP) in Gebeng industrial estate in Kuantan, Malaysia. The LAMP will process lanthanide concentrate which will be trucked from the mine site in Mt Weld Western Australia to the Port of Fremantle where it will be shipped to Malaysia. This report provides an assessment of the emissions from the LAMP plant rather than Lynas Corporation‟s activities in Western Australia. The LAMP plant will have significant atmospheric, terrestrial and waterborne emissions of toxic chemicals and radionuclides including uranium, thorium and radon gas.

________________________________________________________

A Malaysian high court put on hold until October 4 a temporary operating license granted to Lynas Corp Ltd’s controversial rare earth plant near the eastern city of Kuantan, prompting an 8 percent fall in the Australian firm’s shares on Tuesday (Sept. 24, 2012).  The rare earth plant – the world’s biggest outside China – has been ready to fire up since early May, but the company has been embroiled in lengthy environmental and safety disputes with local residents since construction began two years ago [regarding the handling of radioactive waste at the plant].

The plant is considered important to breaking China’s grip on the processing of rare earths, which are used in products ranging from smartphones to hybrid cars.

Lynas confirmed the Kuantan High Court’s decision on Tuesday, but said it would not affect production at the plant and that it plans to strongly assert its rights at the next court hearing…Lynas shares plunged more than 8 percent after the court order to A$0.795, their lowest close in almost three weeks as investors closely track each move in the sensitive case. Earlier this month they rose up to 50 percent when Malaysia approved the license.

Activists linked to the environmental group, Save Malaysia Stop Lynas, want the court to suspend the temporary license until two judicial review cases challenging the government’s decision allowing the plant to operate are heard.  “It’s a small victory, but there is still a long way to go,” Tan Bun Teet, a spokesman for the group, told Reuters after the court decision. “We will fight tooth and nail. We have a lot at stake,” he added.  The group’s previous attempts to legally stop the plant had failed.

Lynas received a temporary operating license for its long-delayed $800 million rare earth plant earlier this month, enabling it to start production as early as October.  The Malaysian Atomic Energy Licensing Board (AELB) issued the permit following an earlier recommendation from a government committee.  Protests over possible radioactive residue have drawn thousands of people and the project has become a hot topic ahead of an election that must be held by early next year.

Sources

Lee Bell, Rare Earth and Radioactive Waste: A Preliminary Waste Stream Assessment of the Lynas Advanced Materials Plant, Gebeng, Malaysia, National Toxics Network. April 2012

Siva Sithraputhran, Malaysian court puts license on hold for Lynas rare earth plant, Reuters, Sept. 25, 2012

How to Avoid the Carbon Tax

According to the Union of Concerned Scientists (UCS),  a Climate of Corporate Control, statements and actions on climate science and policy by 28 U.S. companies, shows how these contributions can be problematic, and suggests steps that Congress, the public, the media, and companies themselves can take to address the problem.  Corporations have the right, of course, to weigh in on public policy issues that affect their interests. But too often they do so irresponsibly, misrepresenting and misusing science at the public’s expense, and in recent years their influence has grown.

Corporations skew the national dialogue on climate policy in a variety of ways—making inconsistent statements across different venues, attacking science through industry-supported organizations, and taking advantage of the secrecy allowed them by current legal and regulatory structures.

Inconsistency: Having It Both Ways–Some corporations are contradictory in their actions, expressing concern about the threat of climate change in some venues—such as company websites, Security and Exchange Commission (SEC) filings, annual reports, or statements to Congress—while working to weaken policy responses to climate change in others.  For example, ConocoPhillips has acknowledged on its website that “human activity…is contributing to increased concentrations of greenhouse gases in the atmosphere that can lead to adverse changes in global climate.” Yet in its comments on the 2009 EPA Endangerment Finding, the company claimed that “the support for the effects of climate change on public health and welfare is limited and is typified by a high degree of uncertainty.”

Using Outside Organizations: Contrarians By Proxy–One way a company can work against effective climate policy while avoiding accountability for that work is to provide funding to outside groups that lobby against climate legislation and regulation or engage in advocacy campaigns against climate science. Such groups range from business associations such as the National Association of Manufacturers to front groups like the Heartland Institute.

Echoing the inconsistency in their other statements and actions on the issue, many companies belong to groups lobbying on both sides of the climate policy debate. For example, Caterpillar is affiliated both with the World Resources Institute and Nature Conservancy, which advocate global warming solutions, and with the Cato Institute and Heritage Foundation, which oppose them.  Of course, corporations may point out that the organizations they support work on many issues besides climate—but the fact remains that many of these groups take starkly anti-science positions on climate change and work aggressively to challenge science-based climate policies.

A Lack of Transparency–When business interests can hide their influence on policy-making processes from public view, it becomes easier for them to manipulate perceptions of science and skew policy discussions. There are several areas in which greater transparency is needed:  Charitable contributions. Current law only requires corporate foundations to disclose their donations to the IRS; companies can get around this requirement by making their donations directly, bypassing their foundations. This information is also hidden from shareholders: several corporations have received proposals from their shareholders demanding access to the company’s charitable contributions, and legislation to require such disclosure has been proposed in Congress.  Lobbying and political expenditures. While companies are legally required to report their total expenditures on political contributions and lobbying, they are not required to disclose the particular issues for which these contributions are targeted. So it is not possible to determine how much lobbying corporations are doing on climate issues. Business risks from climate change. Publicly traded companies are required to discuss risks that might materially affect their business in their annual SEC filings. The report shows that compliance with this requirement with regard to climate change is not consistent; some companies address climate-related risks fully, some discuss only the possible impacts of climate regulation, neglecting the physical impacts of climate change, and others ignore the issue entirely.

Good and Bad Behavior–It’s not all bad news out there: The report shows that some companies, such as NIKE, appear to be consistently constructive in their climate-related statements and actions.  At the other extreme, some companies appear to be almost uniformly obstructionist on climate issues. This list is dominated by fossil-fuel companies such as Peabody Energy and Marathon Oil.  But because of the lack of disclosure, it is impossible to say for sure whether companies are completely constructive or obstructionist.  Inappropriate corporate influence on the national dialogue on climate science and policy is a large-scale, complex problem requiring large-scale, complex solutions.

Excerpt from A Climate of Corporate Control

Resuscitating Collapsed Fisheries: catch shares

For American fish, this is a good time to be alive. On May 14th, 2012 the National Oceanic and Atmospheric Administration (NOAA) reported that a record six federal fisheries returned to health last year. After a decade of similar progress, 86% of America’s roughly 250 federally monitored commercial fish stocks were not subject to overfishing; 79% were considered healthy…

In the late 1980s cod fisheries in the Gulf of Maine and Georges Bank collapsed. This led to efforts to improve the fishery act, in 1996 and 2006, which forced the eight regional bodies that manage federal fisheries to introduce science-based quotas and ten-year recovery programmes for depleted fisheries. The recent recovery of species, including New England scallops, mid-Atlantic bluefish and summer flounder and Pacific lingcod, is the result. This signals another truth: given a break, the marine environment can often replenish itself spectacularly.

America’s fisheries are probably now managed almost as well as the world’s best, in Norway, Iceland, New Zealand and Australia. Yet there is plenty of room for improvement. State-run fisheries, which tend to be close to shore and dominated by small-scale and inefficient fishermen, are less well funded and well managed and much poorer for it. New England groundfish stocks, including cod, have also not recovered: they account for 13 of the remaining depleted populations. This appears to be partly the result of environmental change, climatic or cyclical.

And the politicians are still interfering. On May 9th the House passed legislation forbidding NOAA from developing an innovative means of apportioning fishing quotas, known as catch shares. These are long-term, aiming to give fishermen a stake in the future of their fisheries; market-based, since they can be traded; and, in practice, good for fish. Sadly, the two Republican congressmen behind the ban consider they have been designed “to destroy every aspect of American freedom under the guise of conservation”.

Fish stocks: Plenty more fish in the sea, Economist, May 26, 2012, at 32

China and its Collaborators in Africa

Congolese critics accuse Sassou-Nguesso [President of Congo] of using the Chinese-backed building boom to move from his ‘authoritarian-authoritarian’ model to something nearer the ‘developmental authoritarian’ style of Rwanda’s President Paul Kagame. However, Sassou-Nguesso was in triumphant mode as he inaugurated a spate of Chinese construction projects in the country’s hinterland on 14-18 May. These projects are intended to bring the benefits of oil-backed growth to regions previously isolated from the bustling cities of Brazzaville and Pointe-Noire.  Now known locally as ‘The Cutter of Ribbons’, Sassou-Nguesso is using oil money and plans to develop Congo-Brazzaville’s mineral resources to shape a new relationship with China. Once a key commercial and diplomatic ally of France, Sassou-Nguesso’s headlong rush to Beijing coincides with the election of President François Hollande. Hollande’s African policy team promises to break with the old Françafrique networks. Among their advisors is the activist lawyer William Bourdon, who has been pursuing a case against Sassou-Nguesso in France for stealing Congolese state assets…..

From fibre-optic installation and new dams to more than 1,000 kilometres of paved roads, companies like China Road and Bridge Corporation and China State Construction Engineering Corporation have quietly landed most of the major contracts issued by the Brazzaville government.  That means large profits and more deals to come.

Congo-Brazzaville, for so long the preserve of European companies, is drawing serious attention from China. The two countries have signed deals to develop special economic zones, build a new oil port and revamp an ageing refinery. For the Chinese investors, the lure is Congo-Brazzaville’s rich but under-exploited resource base. Having relied for decades on offshore oil riches and forestry, the country has until recently made little effort to exploit its mineral deposits, develop its more remote regions or diversify the economy into commerce and services. That could change if the new Asian relationships live up to their billing. For Sassou-Nguesso, the big attraction is an engagement based purely on economic and financial criteria, with a partner who does not impose awkward governance or human rights conditions.

This is not Congo’s first encounter with Asian investment. South Korean and Malaysian companies, via the Consortium Congo Malaisie Corée, had proposed a huge resources-for-infrastructure deal that would build new rail lines in exchange for access to forestry and mining permits in 2008. That deal didn’t work out but the Chemin de Fer Congo Océan received part of its order of engines and cars from Korail in August 2011. Malaysian investors have looked at opportunities in the hydrocarbons sector and – building on their experience of rural Congo in the timber business – palm oil production. In 2010 Atama Plantation agreed to invest $300 million in new oil palm plantations and processing capacity.

The most recent interest from Chinese entities takes the engagement a step further. Alain Akouala Atipault, a Minister in the Presidency, was China’s guest at an international infrastructure and investment forum in Macau where, on 24 April, he signed an agreement with the China Friendship Development International Engineering Design and Consult Corporation (FDDC) – an offshoot of the Trade Ministry in Beijing.  FDDC will seek out Chinese investors interested in setting up operations in four special economic zones, which Congo plans to establish in Brazzaville, Pointe- Noire, Ouesso and the Oyo-Ollombo area. FDDC will also help to mobilise financing for the zones, build their infrastructure and carry out feasibility studies……

China’s engagement in Congo is typical of its strategy elsewhere in Africa. Beijing often takes a long-term view of whether projects will generate an economic return. Viability is seen in broad terms, encompassing not just the specific project’s concerns but also the wider trade and political benefits of partnership and the political goodwill that could open up access to valuable natural resources. Congo has both major reserves of high-value timber – a sector where Congo Dejia Wood Industry, Jua Ikié, Million Well Congo Bois, Sino-Congo Forêt and Société d’Exploitation Forestière Yuan Dong are already active – and reserves of minerals such as iron ore and potash, which are largely untouched.

China National Complete Plant Import & Export Corporation is developing the potash reserves at Mengo with Canada’s MagIndustries; Australia’s Sundance Resources relies on finance and expertise from Hanlong Mining and other Chinese infrastructure companies to make its designs on iron-ore projects in Cameroon (Mbarga) and Congo-Brazzaville (Nabeba) viable. Sundance is waiting for final approvals from Yaoundé and Brazzaville and expects all the paperwork to be signed before the end of 2012.

Beijing’s policy of ignoring questions of democracy and human rights is certainly helpful to Sassou-Nguesso’s regime – which has a poor human rights record, is marred by widespread corruption and remains fundamentally authoritarian despite the trappings of a multiparty system.

Excerpt, Congo-Brazzaville: Sassou Draws in Beijing,AllAfrica.com, June 2, 2012