With Ivory Ban Imminent, What Will Happen to China’s Legal Stockpile?

China could store, crush or dump its legal stockpiles of ivory, but after years of promoting the industry, the government is in a tricky spot.

After years of defending and supporting a legal domestic trade in ivory, China made a big announcement in September: It’s shutting down the trade.

The United States is, too. Together, the presidents of both countries have made an unprecedented public pledge to put a stop to all ivory trading—legal and illegal.

The U.S. is on track to approve new regulations within a year that essentially would fulfill its promise under the September pledge to take “significant and timely steps” to end the ivory trade. But the joint pledge doesn’t have any deadlines, and the Chinese government hasn’t said what time frame it’s aiming for.

The Chinese government may, however, consider an ivory buyback program, says Li Zhang, a professor at Beijing Normal University who is studying the feasibility of such a plan. The idea is that the government would use an eco-compensation fund, similar to those Beijing has used to improve watersheds, to buy back legal raw and unfinished ivory owned by licensed carving factories.

China’s state-sponsored industry has resulted in legal ivory from government stockpiles eventually mingling with illegal ivory, fueling the black market and driving the relentless poaching of African elephants.

If the killing goes on unabated at the present rate, believed to be about 30,000 elephants a year, African elephants could be extinct in the wild within 20 years. That’s according to Dune Ives, a senior researcher at Vulcan, the philanthropic organization backed by U.S. billionaire Paul Allen that is funding a count of Africa’s elephants. Poachers have killed 100,000 African elephants from 2010 to 2012, according to a 2014 study.

Zhang, who plans to present his findings to the government, just published his recommendation for a buyback program in an article in the journal Nature. He found that it would cost about $500 million to buy back the legal ivory already distributed to carving workshops. He believes it’s one of the fastest ways China could begin to implement a total trade ban.

“The Chinese government can use other methods to handle this, not only buybacks,” he says, suggesting a government-funded program that would help ivory carvers and retailers transition to a different business. But, he said, “I think a buyback with an eco-compensation fund is the quickest one. We need an immediate ban so we can have more time to save the elephants.”

U.S. policy changes also provide an opportunity to help end the slaughter of elephants for ivory.

“Many Americans are surprised to learn that our nation ranks among the highest in the consumption of wildlife and wildlife products, both legal and illegal,” said Under Secretary of State Catherine Novelli, who leads the State Department’s policy making on environmental issues.

“With this announcement,” she said, “two major consuming nations have sent an enormously important signal to the world that we must all undertake concrete measures, as quickly as possible, to reduce demand.”

China’s Legal Ivory

Beijing has actively encouraged the ivory trade in recent years, licensing new carving factories and retail stores and declaring ivory-carving to be part of its cultural heritage.

A ban on the international ivory trade has been in place since 1989, but in 2008 China got approval from the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the body that regulates the international wildlife trade, to buy ivory in a one-time sale from Botswana, Namibia, South Africa, and Zimbabwe.

China took home 73 tons.

Beginning in 2009, China has sold about five tons a year from its stockpile to licensed carving workshops, according to China’s top CITES official, Meng Xianlin.That means about 35 of the 73 tons of legal ivory will have entered the market by the end of 2015. At that rate, China likely has less than eight years’ worth, or about 40 tons, of ivory left.

Chinese law, according to Zhang, doesn’t allow licensed workshops and supplies to simply be shut down, so implementing a ban is delicate.

The government may slowly begin to pare back how much ivory it sells to carving workshops each year, according to a Washington Post interview with China’s top CITES official, Meng Xianlin, in June. He didn’t provide further details about when that would begin or how long it would take to reduce the quota to zero.

Neither China nor the U.S. has said what the plan is for China’s remaining ivory stockpile. The Chinese embassy did not respond to requests for comment.

A spokesman for the State Department, which negotiated the joint pledge, said China’s stockpile, as well as its carving factories and state-sponsored retail stores, will be part of “further discussions” with Chinese officials.

“This is a commitment, from the highest levels of the Chinese government to move to halt the domestic ivory trade,” a spokesman said. “It is this high-level commitment that encourages us to believe that they will overcome the bureaucratic challenges inherent in developing and implementing a near-complete ban.”

The movement of ivory will still be allowed for museums and a few other exceptions. For example, scientists who do genetic testing to identify poaching hotspots will still be allowed to import samples of ivory seized by law enforcement officials. And law enforcement officials will still be able to import ivory to use as evidence when prosecuting violations of U.S. law.

China’s Options

According to the State Department, China is undertaking an expedited review of its ivory laws and regulations to figure out what updates are needed.

No matter what Beijing decides to do with its remaining ivory, it’s in a tough place politically, said Ross Harvey, a senior researcher at the South African Institute of International Affairs who published a study in August about how best to conserve elephants. One of the keys, according to Harvey’s research, is obliterating ivory stockpiles simultaneously.

China “is having to backpedal on its post-2008 efforts to support and fully legitimize the commercial ivory trade,” Harvey said. “Losing face in that way is delicate, so I understand the ambiguity in its statements. It has created powerful commercial interests that now have a political voice that the Politburo can't simply ignore.”

One of three things could be done with its ivory stockpile: store it, sell it off before a ban becomes effective, or destroy it.

If China stores it, “it risks sending a signal to the market that it’s not serious about actually closing down the domestic trade,” Harvey said. Keeping it in storage wouldn’t do much to suppress demand and could even fuel the black market—it’s always possible that corruption and bribery could allow ivory from the stockpile to leak onto the black market.

Zhang, the researcher at Beijing Normal University, thinks this is a likely option. “I don’t think the government of China will crush the legal ivory,” he said, adding that the government is under pressure to preserve it as part of traditional culture. “I may suggest [giving] those legal ivory stockpiles to museums as appropriate, for educational purposes and ivory carving culture preservation.”

As for dumping it all on the market before the ban—that’s unlikely, Harvey said. It would be “a bit like Goldman Sachs selling toxic assets to its clients while actively betting against those same assets.” The risk of exposure and loss of face is likely too great a risk for this to happen. Besides, enforcing the ban after that would be that much harder—and more expensive—with more ivory out there.

That leaves destroying it. “If China puts its stockpile beyond commercial use, it will send as unequivocal and credible a signal as one could hope for that the trade in ivory is over,” Harvey said.

But even destroying it comes with potential problems. It’s possible if China’s legal supply of ivory disappears that traffickers might begin raiding other countries’ stockpiles more aggressively, especially if they feel pressure to boost their own stores before further clamping down on the ivory trade.

America’s New Rules

The U.S. Fish and Wildlife Service is in charge of implementing the joint pledge, which comes more than a year after the U.S. first announced it was taking significant steps to tighten restrictions on commercial ivory sales.

The new regulations, proposed in July, would almost entirely shut down what little commercial trade in ivory now occurs.

Commerce across state lines would be limited to certain antiques, as well as manufactured products with a small amount of ivory. Intrastate commerce is regulated by individual states, many of which have passed or are considering laws to restrict ivory sales within their borders.

The new federal regulations would also limit sport hunters to bringing home no more than two trophies, such as tusks, feet, skulls and skins, a year.

Chinese officials see the U.S.’s acceptance of ivory trophies as a serious loophole. Meng called out the U.S. for its trophy hunting policies in his interview with the Washington Post in June.

In October, China imposed a one-year ban on ivory imports from sport hunting. In the U.S., the proposed regulations to limit elephant trophies is a step in that direction, but pressure from groups such as Safari Club International and the National Rifle Association make such changes difficult.

The U.S. and China will keep tabs on each others’ progress through high-level and working-level phone calls and meetings, according to the State Department. And the ivory trade is on the schedule for next June’s major annual U.S.-China meeting in Beijing, which will address a range of economic and strategic issues.

This story was produced by National Geographic’s Special Investigations Unit, which focuses on wildlife crime and is made possible by grants from the BAND Foundation and the Woodtiger Fund. Read more stories from the SIU on Wildlife Watch. Send tips, feedback, and story ideas to ngwildlife@natgeo.com.

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