Debate: Would a legal ivory trade save elephants or speed up the massacre?
October 1, 2016
Andrew Seguya, Rowan Martin, Nitin Sekar, Solomon Hsiang, Enrico Di Minin and Douglas MacMillan The Guardian

The ivory ban has made prices high and poaching lucrative’

Enrico Di Minin, research fellow in conservation science at the University of Helsinki, and Douglas MacMillan, professor of biodiversity economics at the Durrell Institute of Conservation and Ecology, University of Kent.

The 1989 UN ban on international ivory trading was supposed to protect elephants. The result has been counterproductive because restricting supply in a time of increasing wealth in Asia has driven up prices, dramatically increasing incentives and rewards for poachers. Since 2008, large-scale elephant poaching has restarted, driven by high prices in Asia.

The trade ban is part of a prohibitionist approach that focuses on enhancing law enforcement, while constricting supply by confiscating and destroying ivory. But some of Africa’s biggest range states – Namibia, South Africa and Zimbabwe – support a legal trade.

The 2009 one-off commercial sale of 102 tonnes of stockpiled ivory generated more than $15m that benefitted elephant conservation and local communities. Further such sales were then banned until 2017.

Advocates of the prohibitionist approach argue that this one-off sale has led to increased demand for ivory in Asia and, consequently, stimulated poaching levels in Africa. There is no evidence to support this claim (pdf) despite numerous assertions by animal welfare groups.

Rather, the restrictions under which this one-off sale was permitted might have triggered large-scale poaching of elephants. Market speculators, who probably started investing in raw ivory during the global financial crisis, started stockpiling in anticipation the black-market price would increase because of scarcity during the sale moratorium. Indeed, the black market price of ivory skyrocketed between 2008 and 2014.

In pure economic terms, limiting the supply of ivory can have negative consequences for elephant conservation. Supply reduction, by burning ivory stockpiles and implementing sale moratoria when demand for ivory remains unchanged, can drive prices up and escalate elephant poaching. As the market is controlled by criminals and investors who have no interest in conservation and are influenced primarily by price, elephant poaching can be predicted to increase.

Despite recent investment in demand reduction in Asia, it is unlikely demand will be driven to zero within the short time frame required to save the species from extinction in the wild. A more practical approach would be to combine demand reduction campaigns with a legal and regulated supply of ivory, which would keep the price of ivory from rising higher and reduce the incentives for gangs to kill elephants.

If this doesn’t happen then African countries might choose to withdraw their participation from Cites and decide for themselves what to do with their elephants and other species.

‘Legal trade backfired badly in 2008. So why try again?’

Dr Nitin Sekar, science policy fellow with the American Association for the Advancement of Science, and Professor Solomon Hsiang, associate professor of public policy at Berkeley University

Whether or not legal sales of otherwise illegal products will undercut harmful black markets is a classic question in economics. It seems to have worked when the US repealed the prohibition of alcohol and legal booze flooded markets previously dominated by bootleggers. It’s less clear whether it is working in places that have experimented with legalising marijuana or prostitution. Will it work for ivory? This question pits two sets of economic theories against each other.

In the standard economic model, the best way to prevent poaching is to establish a market for the ivory collected from elephants that have died naturally. Alternatively, in a dynamic economic model where demand and supply can change in response to legalisation, poaching may be worsened by legal ivory trade.

This can happen in two ways. First, the conspicuous trade of legal ivory could draw new consumers. Individuals seeing ivory promotions on TV or their peers making purchases may become more interested in buying some themselves. But this growing demand might not be satisfied by the legal supply, incentivising more poaching. Second, with more legal ivory in circulation, it becomes tougher for authorities to distinguish legal from illegal ivory, reducing the risk of detection for illegal traders. This makes it possible for illegal traders to supply more illegal ivory.

Which of these economic theories is correct? In most black markets, this is a challenging question as they are almost impossible to observe. But thanks to Cites, we have data stretching back to 2003 that provides a window into the shadowy illegal ivory trade. At 79 large sites in 40 countries across Africa and Asia, Cites collects data on how many elephants are poached and how many died naturally. In a recent analysis, we used these data to see which economic model is right.

Using the Cites global poaching data, we examined whether the “one-time legal sale” of ivory to China and Japan caused changes in global markets for poached ivory.

What we found surprised us: the sale announcement corresponded with an abrupt, global and lasting 65% increase in poaching. These findings are further supported by reports on the ground. With the new influx of legal ivory, the Chinese government promoted the product, the Chinese media trumpeted the investment value of ivory, and a Chinese periodical noted that the one-time sale “stimulated new consumption instead of slowing down illegal ivory trades”. A secondary market for legal ivory permits has emerged to help launder illegal ivory.

We tested many alternatives to the “dynamic” theories, but none of them could explain the dramatic 2008 increase in poaching. As far as we can tell, the legal sale and the persisting legal markets caused elephant poaching rates to rise and stay high.

We can’t know all the intricacies of the ivory black market, but the evidence suggests that the legal sale of ivory in 2008 led to more poaching, not less. Bans are imperfect, but they’ve worked in western markets. With presidents Barack Obama and Xi Jinping’s recent promises to enact “nearly complete bans” on trade in ivory, combined with data-driven demand reduction campaigns and law enforcement efforts, there is an unprecedented opportunity to try andto make them work in the east as well.

‘Lifting Africans from poverty is the only way to save elephants’

Rowan Martin, Zimbabwe delegate to the Cites meeting in Johannesburg

Ivory has been part of Africa’s wealth for centuries, and the colonial powers of the 18th, 19th and early 20th centuries went to war with each other in the attempt to gain control of it. No decree from these same powers banning ivory trade is likely to resonate with the African owners of the resource today.

And quite rightly. In a developmental context there can be no balance of trade if Africa needs to import all the specialised products manufactured by overseas countries but, in turn, is restricted by a cartel of overseas NGOs from exporting the specialised products that give it a global competitive advantage.

What will keep elephants on the land in Africa? At the outset, the Malthusian problem needs to be recognised. Some 855 million people live in the countries making up the elephant range in Africa, of which 546 million live in the rural areas. Elephants generally cannot co-exist with people when the human population density exceeds 20/km2. This density has been exceeded in 21 of the 37 countries in the range.

As a result, the elephant range in Africa has shrunk by 41% since 1995. However, far from being alarmed at their present status, we should be pleasantly surprised at how well elephants are surviving among a burgeoning human population.

This year, southern Africa will experience an environmental disaster of extraordinary magnitude. Millions of people will be without food and water before the end of the year. Unless southern Africa can find higher-valued land uses than the present subsistence agriculture and marginal livestock husbandry, disaster appears inevitable. Those preoccupied with Cites trade bans do not see this bigger picture.

The incentives needed to ensure a future for elephants outside state protected areas are, first, a full devolution of authority to those on whose lands elephants live to enable them manage the elephants to their own long-term advantage. Second, for the state to actively promote a high value for elephants and remove all restrictive legislation and bureaucracy that creates perverse incentives.

An annual budget of $1.5m is required to protect 5,000 elephants in a national park of 10,000km2, which can easily be met from the trade in ivory produced from natural mortality and a low level of problem animal control.

Cites has had 27 years to assess the efficacy of the ivory trade ban and it is clear to any impartial observer that it has not worked.

‘There is no evidence that ivory sales provide any significant benefit for local people or elephants’

Dr Andrew Seguya, executive director, Uganda Wildlife Authority and member of the African Elephant Coalition who have put forward a proposal that would strengthen the ivory ban

Once again, elephants face a threat to their survival from the ivory trade. Results released by the Great Elephant Census confirm that around 144,000 savannah elephants – 30% of the continental population – were lost between 2007-14.

There is a clear answer to this crisis: ban the ivory trade. This would break the chain linking legal and illegal markets, eliminate demand and stop the killing. An earlier total ban by the Convention on the International Trade in Endangered Species (Cites) parties in 1989 put African elephants on the most protected Appendix I. Ivory markets crashed, prices dropped and poaching stopped almost overnight. Yet in 1997, parties weakened the ban by “split-listing” some elephants on the less-restrictive Appendix II, contradicting the convention’s own rules.

At the insistence of four southern African countries – Botswana, Namibia, South Africa and Zimbabwe – Cites agreed to experimental ivory sales from their stockpiles. The largest of these sales to Japan and China in 2008 provoked a dramatic acceleration in elephant poaching across Africa (pdf). The main beneficiaries have been ivory poachers, smugglers and traders.

Nevertheless, some libertarian economists continue to argue for ivory sales.

Such arguments assume there are simple market solutions to all the world’s problems and that wild animals and their body parts should be treated like agricultural commodities. Perhaps these economists also live in ivory towers, oblivious to the real world where criminal syndicates operate as multi-product firms in complex markets.

The tide is turning: China, Hong Kong and the US have already pledged to close their major markets. Since 2011, 21 countries have destroyed about 20% of the world’s stockpiled ivory at public events, sensitising people to the threat from poaching and ivory smuggling, and the determination of Cites parties to end it.

Through its members, the African Elephant Coalition of 29 countries has submitted a proposal to Cites CoP17 [the 17th meeting of the Conference of the Parties], which meets in South Africa this week, to remove ambiguity by putting elephants from southern Africa back on Appendix I.

Namibia, South Africa and Zimbabwe have submitted counter proposals to resume ivory trading, with Botswana now a notable exception in southern Africa. These proposals are likely to be rejected by an overwhelming majority of Cites parties, but some governments, NGOs and the European commission seek a diplomatic “solution” by getting all the proposals withdrawn and maintaining the unsatisfactory status quo.

A legal ivory trade cannot save elephants, now or ever. As the saying goes: “Ivory belongs on elephants; in national heritage, not in markets or ornaments.”