I. CASE BACKGROUNDCASE NUMBER: 96
CASE MNEMONIC: TEAK
CASE NAME: Thai and Burmese Timber Trade
I. CASE BACKGROUNDA. IDENTIFICATION
1. The Issue
This case analysis examines the growing timber (specifically the hardwood teak) trade along the Thai-Burmese border from 1988 to present. Dramatic events in these two respective countries in late 1987 and 1988 led to a monumental shift in the scope and amount of trade among these two partners and their trade relations abroad. The trade has brought about untold suffering to the peoples of the region both through state sanctioned human rights abuses and the loss of a once vital and abundant ecosystem that provided for tribal agricultural practices. Many unilateral policies have been pursued by the Thai government but the recalcitrant authoritarian SLORC (Burma's ruling party) has profited from the trade and utilized the proceeds for its long standing dispute with Thailand over border territories. More recently, ASEAN has taken interest but so far to no avail.
2. Description
The changes in Teak trade have led to substantial deforestation with accompanying soil erosion and flooding that has not only, possibly irreparably, damaged the land but resulted in the death of hundreds of citizens. The trade has had additional repercussions ranging from government sponsored military interventions to the birth of a fledgling, though rapidly growing, green movement. Tertiary repercussions range from the routine human rights violations of tribal hill populations, to animal rights abuses in the use of elephants to haul timber.
The history of deforestation is long but in nearing the end of the twentieth century the problem has become a virtual epidemic. Burma is one of the most recent culprits of deforestation. In the brief eight years of increased teak export in the southern region of Burma (Myanmar), bordering Thailand, the sheer destructiveness of the trade has gone largely without bounds or restrictions. In 1992, Burma was listed the third in rainforest destruction.(1)
Due to the closed nature of the regimes in Burma and Thailand clear assessment of the extent of the damage has been difficult. The Association of South East Asian Nation (ASEAN) has made numerous attempts to evaluate the scale and depth of the problem. This culminated in the ASEAN Plan of Action for the Environment.
The established international community through Greenpeace and the World Wildlife Fund (WWF) have also sought to monitor the issue. The UN has attempted to address the problem, with varying degrees of success.
With the student led revolt against the authoritarian and autarkic regime of the Burmese People's Republic in August 1988, there was a tentative opening and a brief facade of the pursuit of democracy in Burma, despite the reigning despotic military junta. In 1990, elections in Burma favored the National League of Democracy by 80%, but were declared null and void by the militarily coordinated State Law and Order Restoration Council (SLORC).(2)
Within two years, Thailand also became briefly engulfed in a student inspired bloodless coup. Prior to the coup, the "puppet democracy" in Thailand for decades had been controlled by the military generals. After the coup, democratic institutions and principles became more entrenched and sovereign. This freed the popularly elected civilian administration from military intervention. Concurrently, a fledgling green movement began to take root when it became publicly apparent that nearly two-thirds of Thailand's teak forests had been cleared, and that the state could no longer rely on timber as a means toward their successful economic development (3). In the past, the unaccountable generals' have personally profited from kickbacks associated with the teak trade.
By the end of 1988 a pattern of trade was beginning to take root between these Thailand and Burma. This was compounded when, in January 1989, Thailand banned the harvesting timber in the country following the worst flooding there in nearly a century.
The environmental disruption caused by deforestation (evident by the flooding) and Thailand's move to democracy through industrializing its economy, resulted in the reduction of its domestically unpopular and environmentally destructive raw material exports. Burma, on the other hand, one of the poorest nations and desperate for economic capital, was ready to depart from nearly forty years of a closed economy. The easiest way to accomplish this: filling vacuum left by Thailand's decreased timber exports; the source: Burma's mature and relatively unspoiled teak forests.
Clearly, the stage was set for an expanded exploitation of the Southeast Rainforest, the world's second largest (4). A briefing document written by the Burmese Government's Timber Corp. in February 1989 said that 20 concession areas had been contracted along the Thai-Burma border with total exports of 160,000 tons of teak logs and 500,000 tons of hardwood total. Thus in 1989, the rather suspect official Burmese Junta sources estimated revenues of $112 million in exports per year (5).
As Thailand eased and nearly eliminated its harvest of timber, the Burmese market provided the perfect alternative. In 1994, border trade of timber between Thailand and Burma through Thailand's customs station in the North amounted to $184 million, about 50% of total Thailand-Burma trade (6). More alarming is that the unofficial trade in timber between the two states is estimated to be worth as much as 50% of the volume of trade through the customs (7).
The exploitation of Burmese timber becomes more apparent once the content of trade among these two nations is established. Thailand's exports to Burma include ready-made clothes, personal hygiene items, instant food, candies, bicycles, motorcycle parts, plastic wares, cosmetics, construction materials, and electrical appliances (8). These items are clearly manufactured goods that substantiate the elevated nature of the Thai economy in regards to its tremendously underdeveloped neighbor. On the contrary, exports from Burma to Thailand include teak, timber, wood products, and to a far lesser extent gems and livestock (9). Thus the two neighbors share a complimentary trade, yet it is highly destructive in terms of environmental degradation.
By 1995, teak had become Burma's second most important source of foreign exchange, earning almost $200 million annually for more than 300,000 cubic meters of timber, according to the Burmese government (10).
The economics of teak trade became of such vital importance that the Burmese military regime has violently defended its interests. Although poorly documented, on several occasions small scale armed conflict broke out between Thai border police and Burmese mercenaries, as well as State Law and Order Restoration Council (SLORC).
As demonstrated the breadth and magnitude of the trade has grown enormously over the rather short time period. Likewise, the actors involved have proliferated as well. Intrastate institutions such as the SLORC forces have served instrumentally in directing Burmese trade relations. Other intrastate institutions include the more recently established Myanmar Investment Commission (MIC) (11).
With increased economic and environmental costs, regional and multilateral bodies have recently become engaged in the debate. The ASEAN nations have sought agreements, but the divisive nature of this issue has incited great acrimony amongst member states, preventing effective multilateral action.
Nongovernmental organizations have long been involved in the issue of deforestation. In this case, the World Wildlife Fund (WWF) for Nature has been vociferous regarding criticisms of Burma's and Thailand's deforestation--labeling the trade with these nations as "unacceptable" (12). As a result of cases such as this, the environmental movement is now calling for a new superstructure to better manage forestry practices. The WWF has called for the creation of an independent certifying organization operating on multilateral standards so that eco-conscious consumers would have a means to align their timber-associated purchases with internationally recognized standards. By doing so, the world's forests would sufficiently supply demand far into the future (13).
Burma, which is currently one of the world's largest exporters of top-quality teak, still has 33 million hectares (81.5 million acres) of forest cover, according to official statistics. The annual harvest of timber, according to official sources, is approximately three million cubic meters (14). The problem of Burmese exports of this valued commodity is more clear when viewed in terms of the rejuvenation of teak. Teak takes at the minimum 120 years to reach maturity from a seedling (15). The mature teak reserves in Thailand are minimal, while Burma's are still substantial. The current rate of Burmese harvest will render Burma like Thailand in fewer years than it takes a seedling to reach maturity.
In May 1995, Burma's Ministry of Forestry called for regional cooperation to address the rapid deforestation and the smuggling of timber. The SLORC has marginalized the influence of the ministry and some argue that the SLORC is conspiring with the smuggling of timber along the border regions with Thailand (16). Therefore, as was mentioned earlier, the rates of forest depletion are alarming, but, as a result of SLORC influence and corruption, the official counts do not accurately reflect the true loss.
Thailand has not been the only neighbor expressing great interest in Burmese teak. India recently negotiated a trade agreement with the capital hungry SLORC, much to the chagrin of the weak aforementioned Ministry of Forestry. India, like Thailand, enjoys a natural advantage over other countries by virtue of the border it shares with Burma. Bilateral trade has gone unconstrained because there is no formal treaty between the two states establishing limits or any other form of regulation (17). In addition, many of the other developed Asian economies have increased their import of teak from Burma in recent years. Japan, China, Taiwan, and Korea all seek raw teak timber that can be utilized in the production of luxury furniture in their respective home economies.
The case of Burma, and to a far lesser extent Thailand, have had a massive impact upon the indigenous populations residing in the affected forested areas. The ruling SLORC of Burma has been one of the most notorious state-sanctioned human rights violators on Earth (18). Besides not recognizing the democratically elected officials in 1990, the SLORC has suppressed ethnic tribal minorities who object to the logging practices exercised by the state. Indigenous ethnic minority populations, such as the Karen and Mon, numbering in the hundreds, have been rounded up and sent to camps if they did not agree with the state's logging policies--those who were persistent troublemakers were imprisoned for political reasons (19). These are clear violations of international human rights standards.
ASEAN has attempted for many years in its annual meetings to address the very divisive issue of human rights--agreement never come due to sovereignty reservations often taken by the initial states. In 1991 the issue of human rights took the fore for the first time at the annual meeting of ASEAN foreign ministers. Virtually all ministers object to any attempt to link human rights with trade. Some Ministers contend that human rights conditions (a tact often attempted) as another means of conditionality equating to protectionism (20). With states such as Cambodia and Burma, the problem goes without a regional discourse due to their not being a member of ASEAN despite their strong desires to do so.
In 1994 Burma was invited as a guest for the first time to the annual ministerial meeting of ASEAN. Despite centuries old tension of domination and intervention, Thailand invited Burma to the meeting due to their intensive teak trade relationship. Other ASEAN members resisted the move due to the pervasive authoritarian nature of the SLORC regime and their disregard over human rights in recent uprisings. It was believed that Burma's possible inclusion or participation in ASEAN would be frowned upon by the international community (21).
The conflict in this case emerges from the violation of human rights resulting from the deforestation process. The increased foreign capital has allegedly led to a "cleansing" operation by the SLORC, including raping, pillaging, torture, forced labor and forced relocation. (23) Many of the local indigenous populations have reportedly formed "guerilla forces" to combat the efforts by the SLORC. The SLORC continues to hoard the profits from the teak trade, and grant tax breaks on forestry products.(24)
The international attention to this case remains. In fact, several movements to boycott Burma have arisen. The state of Massachusetts has a resolution banning the use of products of companies who still do business with Burma. (This move has been countered by the EU which claims it affects fair trade between the United States and the countries of the EU.) More recently, American University in Washington, D.C. proposed a similar ban on products that are not "Burma-free." The United States' weapons trade ban on Burma has been ineffective, as Burma turned to China for its weapons resources. In the United States, other universities, city and state governments are pursuing similar efforts.
3. Duration
a. Start: 1988-Burmese student led revolt
b. End: In Progress
4. Location
a. Continent : Asia
b. Region: South East Asian
c. State: Burma (Myanmar) and Thailand
II. ENVIRONMENT CLUSTERS5. Environmental Problem Type: Source, Deforestation
Due to Thai logging of the border forests, Myanmar lost over 1 million acres of forest from 1985-90. This rate is five times greater than the period from 1976-80. Fewer than 50,000 trees were replanted annually resulting in deforestation and loss of wildlife habitats.
6. Type of Habitat: TROPICAL
7. Act and Harm Sites
| Site of Act | Site of Harm | Example |
| Burma (Myanmar) | Burma (Myanmar) | Burma's ruling group allows the deforestation of Burma for profit |
8. Strategic Environmental Interest: Resources, scarcity
III. CONFLICT9. Type and Level of Conflict: Intrastate, low
10. Environment-Conflict Link and Dynamics:
11. Outcome of Dispute
12. Fatality Level of Dispute (military and civilian fatalities)
13. Level of Strategic Interest: Sub-state
14. Actors
a. Direct: SLORC, southern and eastern Burma's indigenous populations: Mon, Karen, and
Karenni, Thailand
b. Indirect: NGOs, environmental organizations, international community at large
IV. Related Information15. Related ICE Cases
See ICE Search Engine
16. Related Web-Sites
Burma's
Struggle for Democracy
Burma: Deforestation in
the Ethnic Mon Areas
Exploitation of Burmese
Tropical Forests
"Its Easy to Boycott"
Pepsi and Burma's Human Rights
Record
Rainforest Relief's International
Teak Week
International Teak Week of
Action
18. Relevant Literature
Annual Status of Human Rights Yearbook, Amnesty International, 1990. Birsel, Robert, "Fighting Flares Over Burma's Precious Teak Forests," Reuters, Limited, July 18, 1995, Nexis/Lexis retrieval. "Burma Calls for Cooperation on Forestry Problems," Rueters Limited: Reuter Asia-Pacific Business Report, May 30, 1995, (lexis/nexis retrieval). Macek, Paul and Chareonying, Kalaya, "Thailand's Logging Ban," TED case study #69, data set #2. McDonald, Hamish, "Partners in Plunder," Par Eastern Economic Review; 22 February 1990, vol. 147, No. 8, p. 16. Sharma, Dinesh C., "India: India Expands Trade Ties with Burma," Bangkok Post, February 28, 1995, p. P4, (lexis/nexis retrieval). Tansubhapol, Bhanravee and Chabang, Achara, "Burma: New Organization Handles All Investment in Burma," Reuter textline, Bangkok Post, February 22, 1995, (lexis/nexis retrieval). "Teak Cycle: 120 Years from Seedling to Settee," Agence France Presse, December 23, 1993, (lexis/nexix retrieval). "Teak Plantations in Burma," Modern Asian Studies, May 1994. Tickell, Oliver, "Kindest Wood Cuts of All," The Times, Limited, June 11, 1994, (lexis/nexis retrieval). "Thailand: Report Calls on Thais to Boost Trade Relations with Burmese," Reuter Textline: Bangkok Post, August 24, 1995, Nexis/Lexix retrieval. "Thailand: Students Government Over Policy on Burma," Bangkok Post, July 22, 1994, (lexis/nexis retrieval). "War on Teak," Sierra, May 1991. Wellner, Pamela, "Timber Accord Destroys Forests," New York Times, February 5, 1994, p. 20. Vines, Richard, "EC: Community Moves to ASEAN Allay Fears Over Trade," South China Morning Post, July 24, 1991.16. Endnotes 1. http://bioc09.uthscsa.edu/natnet/archive/nl/9203/0024.html 2. http://www.envirolink.org/orgs/rainrelief/teakweek.htm 3. McDonald, 16. 4. Bangkok Post, August 24, 1995. 5. McDonald, 17. 6. Bangkok Post. 7. ibid. 27. 8. ibid. 28. 9. ibid. 10. Bersel, Reuters Ltd. July 10, 1995. 11. Tansubhapol, Bangkok Post, 2/22/95. 12. Tickel, The Times, 6/11/94 13. ibid. 14. Agence France Presse, 12/23/93. 15. Reuter Asia-Pacific Business Report, May 30, 1995. 16. McDonald, 19. 17. Sharma. 4. 18. McDonald. 19. 19. Amnesty International, Yearbook 1990. 20. McDonald. 21. Vines. 1. 22. Bangkog Post, July 22, 1994. 23. Vines. 1. 24. http://garnet.berkeley.edu:3333/.cco/.orginfo/.inserts/.humrts/burma.html: Burma's Struggle for Democracy 25. http://www.envirolink.org/orgs/rainrelief/teakweek.htm: International Teak Week of Action July, 1997 26. http://garnet.berkeley.edu:3333/.cco/.orginfo/.inserts/.humrts/burma.html: Burma's Struggle for Democracy