US timber importers ‘circumventing Myanmar sanctions,’ says advocacy group

An organisation calling itself a ‘covert group of activists’ is demanding a total ban on US imports of timber from Myanmar/Burma, as trade in teak logs continues despite sanctions.

Justice for Myanmar said, ‘Since the illegal attempted military coup in February 2021, the United States has imported 1,565 metric tonnes of teak from Myanmar, even though sanctions began soon after.’

It notes that sanctions imposed in response to the coup included the designation of the state-owned company, Myanma Timber Enterprise (‘MTE’), which, it says, ‘has sole responsibility for the sale of timber in Myanmar, auctioning logs for export. The forestry industry in Myanmar is effectively controlled by MTE.’ Since the coup, ‘MTE has come under the control of the Myanmar military junta [and through] MTE, the junta takes a percentage of export revenue, and this helps finance their atrocities,’ it says.

On 21 April 2021, announcing sanctions against MTE, OFAC said, ‘Myanma Timber Enterprise is a state-owned enterprise under the Ministry of Natural Resources and Environmental Conservation (MONREC). It is responsible for the production and export of timber on behalf of the Burmese military regime. Through its regulatory role, MTE is a key generator of government revenue.’

Justice for Myanmar points out that US companies are purchasing timber from private companies that are acting as brokers in Myanmar and evade sanctions by not buying directly from MTE.  It said: ‘These private companies include major teak traders, some of which have reportedly placed winning bids at MTE auctions since the attempted coup. The private companies that act as brokers buy the timber from MTE in Myanmar, then export it, sometimes through foreign freight companies. While the data analysed for this feature only captured teak exports directly from Myanmar to the United States, it is likely that even more teak is being exported to the US via third countries such as China. So, the overall amount of teak exported since the attempted coup is expected to be significantly more.’

It added, ‘This indirect trade between companies in the US and MTE may not have attracted penalties from OFAC at this stage, but it still appears to contravene US sanctions.’