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Cablegate: Cites: Chinese Seen As Willing to Pay More at Ivory Auction

VZCZCXRO7591
RR RUEHAST RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD RUEHTM
DE RUEHKO #2886/01 2902256
ZNR UUUUU ZZH
R 162256Z OCT 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC 7988
RUEHC/DEPT OF INTERIOR WASHINGTON DC
INFO RUCPDOC/USDOC WASHDC
RUEHZN/EST COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 5867
RUEHWD/AMEMBASSY WINDHOEK 0040
RUEHOR/AMEMBASSY GABORONE 0039
RUEHSB/AMEMBASSY HARARE 0092
RUEHSA/AMEMBASSY PRETORIA 0301
RUEHNR/AMEMBASSY NAIROBI 0493
RUEHKM/AMEMBASSY KAMPALA 0109
RUEHKI/AMEMBASSY KINSHASA 0067
RUEHFK/AMCONSUL FUKUOKA 0414
RUEHNAG/AMCONSUL NAGOYA 8475
RUEHNH/AMCONSUL NAHA 2767
RUEHOK/AMCONSUL OSAKA KOBE 4160
RUEHKSO/AMCONSUL SAPPORO 0987

UNCLAS SECTION 01 OF 02 TOKYO 002886

SENSITIVE
SIPDIS

STATE FOR E, G, OES, OES/ENRC - CDAWSON, and EAP/J - VMURRAY
USDOC FOR NOAA - NDAVES and CYATES
INTERIOR FOR US FISH AND WILDLIFE SERVICE (USFWS)
GENEVA FOR USUN

E.O. 12958: N/A
TAGS: SENV KSCA ETRD CITES JA
SUBJECT: CITES: CHINESE SEEN AS WILLING TO PAY MORE AT IVORY AUCTION
THAN JAPANESE BIDDERS

REF: A) 04 TOKYO 5751 B) 06 TOKYO 5194

TOKYO 00002886 001.2 OF 002


SENSITIVE BUT UNCLASSIFIED, PLEASE PROTECT ACCORDINGLY

1. (SBU) Summary: A total of 108 tons of stockpiled ivory in four
southern African states (Botswana, Namibia, South Africa, and
Zimbabwe) will be auctioned to Japan and China from late October to
early November 2008. The auction was approved by the CITES Standing
Committee in July 2008. Japan's Ministry of Economy, Trade and
Industry (METI) recruited ivory traders and sent a list of auction
participant candidates to the four countries in late September. An
NGO reports, however, that potential Japanese buyers are afraid of
losing out to Chinese bidders. End Summary.

Auctions Set for Late October to Early November
--------------------------------------------- --

2. (U) At the July 2008 CITES Standing Committee in Geneva, members
approved a one-off sale of 108 tons of ivory stocks from Botswana,
Namibia, South Africa, and Zimbabwe to Japan and China. METI, which
is organizing the auction for Japanese enterprises, posted a notice
on its Website September 11 announcing the four African countries
will hold ivory auctions from late October to early November 2008
(see www.meti.go.jp/press/20080911002/
20080911002.html -- Japanese only). It also published the four
countries' notices with details of the auction. According to the
METI website, the auctions will be held as follows: Namibia -
October 28, Botswana - October 31, Zimbabwe - November 3, and South
Africa - November 6. See more at
www.meti.go.jp/policy/paper_consumergoods/
ivory_auction_condition.pdf (in English).

METI Advertises on Website for Auction Participants
--------------------------------------------- ------

3. (SBU) METI also recruited Japanese vendors for the auction and
published application procedures on its website (applications were
due September 19). Deputy Director for METI's Paper Industry,
Consumer and Recreational Goods Division, Manufacturing Industries
Bureau, Mr. Masaki Fujita told Post METI used the following criteria
when evaluating applicants: 1) history of compliance with CITES
rules and Japan's domestic law (Law for the Conservation of
Endangered Species of Wild Fauna and Flora); 2) agreement not to
re-export imported ivory; and 3) registration as "Particular
International Species Vendors" under the Law for the Conservation of
Endangered Species of Wild Fauna and Flora. Fujita said the four
African countries are reviewing the list and checking information of
each candidate for the auction. The four African governments will
make a final decision on who will participate. Each country's
conditions are available at
www.meti.go.jp/policy/paper_consumergoods/
ivory_auction_condition.pdf (in English). According to Fujita, the
GOJ is considering whether GOJ officials will attend the auctions.

4. (SBU) According to Mr. Masayuki Sakamoto, Secretary-General for
the Japan Wildlife Conservation Society (JWCS) and a long-time ivory
trade watcher, METI did not advertise for potential bidders before
the previous one-off sale in 1999 when Japan purchased 50 tons of
ivory from Botswana, Namibia, and Zimbabwe. At that time, METI used
a closed process conducted by the Japan Federation of Ivory Art and
Craftwork Unions to choose 13-14 enterprises to participate in the
auction. Sakamoto said METI maintained the bidders were chosen "at
the request of the southern African countries," but parties excluded
from the auction were dissatisfied with the process. Sakamoto
stated METI had changed the system this year to improve
transparency. Still, METI's Fujita declined to tell Post how many
bidders were on the list.

Japanese Fear Chinese Will Outbid at Auction

TOKYO 00002886 002.2 OF 002


--------------------------------------------

5. (SBU) Sakamoto said Japanese buyers are afraid of losing out in
the auction, as Chinese competitors are willing to pay higher
prices. In Japan, most ivory is used to manufacture "hanko" (the
small cylindrical-shaped Japanese signature stamps or seals).
Meanwhile, the Chinese make sculptures such as Seven Deities of Good
Fortune, which sell with much higher prices than hanko. He said
Japanese auction participants would be able to pay USD 476 to 571
per kilogram, whereas the Chinese could pay USD 666 to 761 for the
same weight.

-----------------------------
Japanese NGOs: Elephants Lose
-----------------------------

6. (SBU) Japanese environmental NGOs assert the threat of increased
poaching exists regardless of whether the ivory at auction ends up
in Japan or China. They argue one-off sales, even if legal,
directly contribute to increased poaching. Environmental NGOs also
assert the loopholes in Japan's ivory distribution system (Ref B)
make ivory smuggling viable.

SCHIEFFER

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