Did the CITES one-off sale cause the ivory poaching crisis?

Most of what we hear about the ivory trade comes from Western NGOs often with an advocacy position to ban trade. So it is interesting to read this interview in National Geographic Magazine with 26 year old Chinese researcher Gao Yufang who recently graduated with a Masters from the Yale School of Forestry and Environmental Studies. His studies at Yale focused on the ivory trade

What is striking about the interview with Yufang is his detailed knowledge of the complex characteristics of ivory demand in China. Understanding this consumer demand is a necessary first step before advocating policy responses.

Yufang’s research “varied, sometimes conflicting understanding about the Chinese role in it. This, he believes, creates obstacles to stopping the slaughter of African elephants.” In particular, he has doubts about the assertions of Western NGOs that the CITES one-off sale of ivory “stimulated” demand and thus led to the current poaching crisis.

“Many conservation groups, animal welfare groups, and the media believe the 2009 CITES one-off sale stimulated ivory demand. This is the perception of many reports. But I’m not satisfied with this. To understand what caused ivory demand in China, we need to understand why Chinese buy ivory. We need to understand the different values of ivory in Chinese perception.

Chinese society has attached many values to ivory. The economic value of carved ivory as a good investment is the first. The second is the social value of ivory. The third is the cultural value of ivory as a traditional art. Ivory carving in 2006 was officially designated as a national intangible cultural heritage. The fourth value is the esthetic value—those who believe ivory is very beautiful, the necklaces and bangles they think are very pretty. The fifth is the religious value, such as ivory statues and guru beads, Buddhist ivory pendants, and statues of Quan Yin. The last is the medical value. Some people believe that if you wear ivory bangles, for example, it’s good for your health.

It’s also important that we understand the social change that promoted some of these values. I identified two trends.

The first was the preservation of traditional culture. In 2002 the Chinese authorities started to recognize the importance of protecting traditional culture, and there were lots of initiatives launched to protect this, and ivory carving is just one. The carvers seized on this opportunity, and ivory carving became an official national intangible cultural heritage in 2006. This increased the cultural value of ivory, and it’s one reason the authorities would like to have the ivory trade.

The second, and most important, trend is the boom of arts investment in China, especially after 2008 and 2009, because around this time the stock market and real estate market didn’t perform as well as expected. So people started to invest in many forms of arts and antiques and collectibles, and this included furniture, paintings, antique books, and ivory.”

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Linking trade, climate change and food security

 

The FAO in Rome

The FAO in Rome

This week I attended an expert meeting on climate change and agriculture organized by the Trade and Markets Division at FAO. I gave a presentation on ITC’s experience in working on addressing climate change in traded agricultural commodities, specifically tea in Kenya. One of the emerging themes was how trade is linked to the issues. Firstly, the big picture:

Climate change will have an impact on all four dimensions of food security, namely, food availability, access to food, utilization of food, and stability of the food system

(IPCC AR5 WG2 C7) (see Wheeler, T & von Braun, J. Science 134, 508 (2013)CC Impacts on global food security Doi 10.1126/science.1239402)

Trade smoothes out regional differences in food availability

Climate change is reducing crop productivity in regions close to the equator. This is putting food security at risk. According to the IPCC, the combined effect of climate and CO2 change appears about as likely or not to increase prices with a range of 30 to 45% by 2050 (IPCC AR5 WG4 ch7)

Food instability will grow so trade will grow in importance as way to smooth out regional differences

Thus it is important to keep trade open so that obstacles like tariffs and export quotas do not restrict the flow of food from surplus areas to food insecure areas. In 2007, the food crisis due to crop failures was exacerbated by restrictions placed on exports from Russia and Ukraine. By contrast a food crisis was averted following the drought in the US in 2012 as trade was not subject to these restrictions.

However, trade can only go so far to ensure food security

  1. Under IPCC scenarios,, the imbalance of food availability between temperate and tropical regions will increase. Trade will not be enough given the reduced supply and variability of supply in the latter. The vast majority of food is eaten domestically and is not traded. Trade can “knock tops and bottoms off variability” but climate change scenarios are worrying as variation between supply and demand is already great in food insecure countries.
  1. Furthermore, trade requires that the recipient country pays for the transfer. This is a challenge for already food insecure, resource constrained countries.

Trade is efficient way to access water in water scare areas

Trade is an efficient way to redistribute water from water rich areas e.g. northern France to water scarce areas, e.g. central Spain. Water is often redistributed in the form of cereals imports. It spreads the risk of agricultural production in a region that is food insecure. In the Horn of Africa, imports of crops into water-scarce regions are vital for smoothing out seasonal scarcities.

 

Tapestry in the "Mexico Room" at the FAO

Tapestry in the “Mexico Room” at the FAO

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The economics of waiting to see a doctor

One of my memories of childhood is waiting on many occasions for a very long time in the doctor’s surgery waiting room in west London. He was official doctor to Queens Park Rangers football club at the height of their 1976 glory, but that didn’t make it any less boring to wait.

Forty years later, the practice of keeping patients waiting even in the developed world seems not to have changed. My last two appointments for my excellent doctor here in France, I have waited 48 and 56 minutes respectively. By contrast, an appointment today with the bank, I waited 2 minutes longer than the appointed time. An appointment with a mortgage broker recently I had to wait 30 seconds longer. Why the difference between doctors and bankers. Is it an economic problem or something cultural? Given that I assume this practice is observed across different cultures and level of development (ie both rich and poor countries), I can only assume it is an economic issue. Here are the four economic reasons why i think doctors can afford to keep us waiting.

1.  There are only so many doctors in the village, i.e. there is a limited supply. Supply does not respond easily to demand because it is restricted by the fixed number of doctors trained each year. You can not easily import doctors (like nurses) as they usually have to pass national examinations.

2. Because the market entry requirements are so high (i.e. being clever and studying for many years), incumbents in the market (our existing doctors) face little competition from new entrants to the market. Disgruntled clients are not a problem are they have nowhere else really to go, unless they want to wait in another queue.

3. Disgruntled clients also have little choice but to wait in the queue. Seeing your bank manager is important but usually of less immediate importance that addressing a life threatening conditions. There is therefore inelastic demand for waiting time. i.e. the waiting time has a relatively small effect on the demand for the service. However long you are required to wait, you are prepared to do so because your condition must be examined at any cost.

4. The price inelasticity of demand is also determined by the fact that doctor’s services can not be substituted by anything else. If there is a long queue at the surgery you can not go next door to the estate agent, chip shop or even a doctor of philosophy to help you.

So what can be done to reduce waiting times. Ranting and raving won’t help as you may find you have to wait even longer next time. I am no expert on the economics of health, but I imagine addressing each of the above, particularly supply constraints would help. I wonder though if my son in 40 years time will also be waiting in line like his Dad in 1976,

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Listing environmental goods and services

Tariffs are not relevant when it comes to increasing trade in environmental goods and services. The main obstacles to getting trade moving in green goods is the host of non-tariff measures in place. That is the conclusion of Aaron Cosby of IISD in a two page briefing note in February.

“Primary among these (obstacles) are countervailing and anti-dumping policies (a fast-growing category in the renewable energy sector), weak intellectual property regimes and a host of non-trade policy variables to which investors are sensitive. Among these variables are national laws and regulations for employment of the technologies, tight financing and a lack of national environmental policies that create the demand for such goods”.

Cosby writes that any green goods agreement would face challenges to assess the items on the list of goods, performing three functions, listing, de-listing and revising.

An independent evaluation would be needed, but more fundamentally, the process would need a statement of objectives and a definition of green goods following from that objective.

“All multilateral environmental agreements that give special treatment (usually negative treatment) to certain traded goods start with a clear idea of what they are trying to achieve. This helps them define the class of goods to be covered (e.g., those species of plants and animals threatened with extinction). Although the WTO has been negotiating on environmental goods for over a decade now, it has no such objective or definition.”

“Are green goods those that are created in a green way (e.g., organic foods)? Are they goods that, in their use or disposal, perform better than most of their substitutes (e.g., efficient refrigerators, wind turbines)? Or are they goods whose purpose is environmental protection (e.g., equipment for monitoring pollution)?”

“In the worst-case scenario, no advisory body is created, no objective enunciated, and we are stuck ten years from now giving preference to last decade’s green goods, perversely tilting trade preferences away from the new goods that deserve them. Pity the future trade negotiators in that scenario, struggling to decide what constitutes a cutting-edge green washing machine”

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To ban or not to ban – scope for legalizing the wildlife trade

This is a link to an article I had published today by ICTSD’s BioRes – it discusses what scope there is for legalizing the trade in wildlife given the failure of trade bans to stop poaching of iconic species like rhino and elephant.

This article discusses why certain trade bans could undermine conservation goals, the opportunities and limitations for legal trade models to conserve species, and how aid for trade can support sustainable use of wildlife.

It finishes by framing the decision to ban or not in terms of risk.

“Legalisation is perceived by its opponents – and some supporters – as a risk. Risk is a function of uncertainty and thus there is a pressing need for more research and dialogue. If the research is well executed and South Africa consults widely, the voting parties at the CITES COP in 2016 will be in a better position to make an informed decision on the following important question; is the risk of rhino extinction higher under a continued trade ban or under a legalised trade?”

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