US companies are importing teak from Myanmar despite sanctions, shows data

A report on global trade data shows US companies were buying teak wood from Myanmar as early as last month, even as the government held on to its military last year after imposing sanctions on the country.

Teak is a tropical hardwood tree found in Thailand, India and Myanmar. The wood is used to make furniture, flooring, window frames and bridges. According to Britannica, it is one of the most valuable types of hardwood, making it desirable for construction around the world.

The US Treasury announced sanctions against Myanmar in April 2021 and banned any import or trade with the Myanmar Timber Enterprise (MTE). Any form of transaction between people and companies within the US and Myanmar is prohibited.

However, data from the Panjiva global trade database shows that US companies ignored sanctions and are accepting shipments of teak imported from Myanmar as recently as December.

At least 82 separate shipments of teak were reported between February 1 and November 30 last year.

Myanmar is the world’s largest exporter of teak, and is one of the country’s most valuable industries, earning millions of dollars in export duties and taxes each year.

The European Union is grappling with a similar trend in illegal teak shipments after implementing similar restrictions in June.

Data shows American companies are still buying teak from Myanmar despite the US imposing sanctions on the country after the military seized power last year. Above, a young Burmese boy, labeling logs for export, climbs atop teak wood marked for export at a government-run lumber garden in Pyin Ma Bin, Myanmar, on June 11, 2003.
Paula Bronstein / Getty Images

Human rights group Justice for Myanmar compiled the data. It is urging the US and other governments to crack down on the teak trade in line with sanctions against the country’s military leadership.

Those US Treasuries have also imposed sanctions on the country’s military-appointed Natural Resources and Environmental Protection Minister.

The report said that by buying through middlemen, however, importers are evading restrictions.

“Given that the sanctions are intended to block trade with the MTE, and that the timber exported from Myanmar is basically auctioned by the MTE,” the report said, the military is still receiving funds from the trade. Receives “It does not matter who officially exports the timber.”

It urged the US government to enforce sanctions and investigate possible breaches of sanctions.

It is unclear where teak ends up, as it is imported by suppliers of lumber for construction and other manufacturers. But teak is often used for patio furniture, decking and boats because of its flexibility and durability.

Myanmar’s military, led by Senior General Min Aung Huling, overthrew the elected government of Aung San Suu Kyi’s National League for Democracy on February 1, 2021. Suu Kyi was arrested and charged with about a dozen crimes. On Monday, the 76-year-old Nobel Peace Prize laureate was sentenced to four more years in prison, on top of the two-year sentence he was ordered to serve on earlier counts.

According to an exhaustive list compiled by the Assistance Association for Political Prisoners, the military takeover has attracted nonviolent nationwide demonstrations, which have been ended with lethal force by security forces, in which more than 1,400 civilians have been killed.

Peaceful protests continue, but an armed resistance to action is building, to the extent that UN experts have warned the country could slip into civil war.

Local news reports said a teak auction in June 2021 of about 10,300 tonnes of illegally harvested wood confiscated by Suu Kyi’s government yielded $5 million in revenue.

Reports say that Myanmar’s military sold about 200,000 tons of that wood from illegal timber stockpiles.

Myanmar began allowing private companies to set up teak and other timber plantations in 2006, ending the state’s monopoly on the industry. In 2014, the government banned the export of all raw wood, lifted the ban for wood from state-run and private plantations, but kept it in place for wood from natural forests.

The export of teak is subject to a special approval process.

But a large part of the teak shipped out of the country is smuggled across land borders. Panjiva’s data only included teak shipped directly from Myanmar, not other exports through intermediate destinations such as Eastern Europe, Taiwan and Thailand.

Coup-related restrictions implemented to protect tropical forests underpin other restrictions on teak imports, given that teak and some other species are at risk of extinction in the wild.

The European Union has strict requirements to document the origin of each log or wooden plank. Myanmar suppliers often do not provide clear evidence that the timber being exported has been harvested legally, reports from environmental groups and the European Union have shown.

The Associated Press contributed to this report.