TED Case Studies

US China Rhino and Tiger Dispute




          CASE NUMBER:          77 
          CASE MNEMONIC:      USCHINA
          CASE NAME:          US China Rhino and Tiger Dispute
A.        IDENTIFICATION

1.        The Issue

     Despite international and domestic bans on trade in
rhinoceros parts and products, Chinese and Taiwanese markets
are flourishing in the sale of rhino horn products.  China has
promised, and is obligated, to restrict this trade as a
signatory to the CITES agreement, but evidence suggests that it
has failed to do so.  In an effort to curtail international
commerce in these products and to protect this endangered
species, the United States has threatened and imposed trade
sanctions against China and Taiwan.  Both countries have
responded and made some progress in stemming trade in rhino
products and parts.

2.        Description

     Rhinos are among the world's most endangered mammals. 
Consequently, when the Convention on International Trade in
Endangered Species (CITES) entered into force in 1975, rhinos
were one of the first species to be included in the CITES
appendices.  Two species of rhino in Asia (Javan and
Sumatran) and one sub-species in Africa are on the edge of
extinction.  In the past 20 years the number of black rhino has
plummeted from an estimated 65,00 to 3,000 and is near
extinction in large areas of Africa.  The southern white rhino
and the Indian rhino are relatively well conserved, but their
total world population is only in the low thousands.  The
continued survival of the rhino family as a whole is by no
means guaranteed (see RHINO case).

     International trade is perhaps the most important
contributing factor to the decline in rhino numbers.  The most
direct impact comes from international trade in rhino horns and
other rhino products to satisfy consumer demand for use in
traditional Chinese medicine.  International commerce in other
products, such as timber, indirectly impact rhino populations
by causing a serious loss in rhino habitat -- particularly in
the rain forests and flood plains of Asia.

     Acting to protect these endangered species, the U.S.
Interior Secretary issued, pursuant to the Pelly amendment (see
HAWKSBIL, SHRIMP, TUNA, and TURTLE cases), a certification to
the President of the United States indicating that China and
Taiwan are continuing to trade these products and consequently
undermining CITES.  Actions under the Pelly amendment give the
President broad discretion to impose trade penalties up to and
including total prohibition or importation of goods.

3.        Related Cases

     TIGER case
     RHINO case
     TAIGA case
     MEDICINE case
     INDIA case
     ELEPHANT case

     Keyword Clusters         

     (1): Trade Product            = TIGER
     (2): Bio-geography            = TEMPerate
     (3): Environmental Problem    = Species Loss Land [SPLL]

4.        Draft Author:  Julie Ferguson

B.        LEGAL Clusters

5.        Discourse and Status:  DISagreement and INPROGress

     In response to U.S. allegations, China announced a
prohibition on the sale, purchase, importation, exportation and
possession of rhinoceros horn.  In May of 1993 the Chinese
Government announced that traders had six months to dispose of
stocks of rhino horns, including medicine which contained the
parts or products of rhinos.

     Taiwan is also responding.  In November, 1992, the
government banned trade in rhino horn.  Taiwan's Council of
Agriculture sent officials to South Africa, the United States,
and to the UNEP Conference Between the Rhinoceros Range States,
Consumer States and Donors on Financing the Conservation of the
Rhinoceros.  Additionally, Taiwanese and South African police
have cooperated in training programs addressing rhino horn
smuggling.  The Taiwanese Government also supervised the public
burning of 25 confiscated rhino horns and over 700 kg of ivory
in an effort to comply with a standing committee recommendation
which called for the destruction of all seized contraband rhino
horns in Taiwan.

6.        Forum and Scope:  CITES and MULTIlateral

     The United States has acknowledged that China and Taiwan
have made some progress in stemming the trade in rhino and
tiger parts, but still remain in violation of the CITES
agreement.  In a separate but related action, the CITES
standing committee recommended that the 120 nations that are
signatories to the convention halt trading of plant and animal
products with China and Taiwan (see ELEPHANT, RHINO, and TIGER
cases).  The recommendation could affect millions of dollars in
trade in flowers, timber and aquarium fish (see THAIBIRD case). 

7.        Decision Breadth:  120 (CITES signatories)

     Trade in rhino products and parts is governed by the
CITES.  Nevertheless, the United States took action with a view
to forcing bilateral resolution as well. 

8.        Legal Standing:  TREATY

     The CITES agreement is an international treaty.

C.        GEOGRAPHIC Clusters

9.        Geographic Locations

     a.   Geographic Domain : AFRICA
     b.   Geographic Site   : Southern Africa [SAFR]
     c.   Geographic Impact : CHINA

10.       Sub-National Factors:  NO

11.       Type of Habitat:  TEMPerate

D.        TRADE Clusters

12.       Type of Measure:  Import Ban [IMBAN]

     The measure actually includes both import and export bans. 
Retaliation is also permissible under the agreement when
countries are in violation.  

13.       Direct vs. Indirect Impacts:  DIRect

14.       Relation of Measure to Environmental Impact

     a.  Directly Related     : YES  RHINO 
     b.  Indirectly Related   : YES  PHARMeceutical 
     c.  Not Related:         : YES  RETALiation 
     d.  Process Related      : YES  Species Loss land [SPLL]

15.       Trade Product Identification:  RHINO

16.       Economic Data

17.       Impact of Measure on Trade Competitiveness:  BAN

     Some studies have shown that demand for rhino horn is
rather inelastic.  Most users have a centuries-old faith in its
healing powers and are unlikely to cease including rhino horn
in their potions, regardless of the price.  If the rhino
disappears, stockpiles of derivative products become gold
mines.  Rather than deter poaching and illegal trade, sanctions
may actually encourage such illicit practices.  The Clinton
administration deployment of sanctions over continued rhino and
tiger trade is first time the United States (or any country)
had used legal trade measures to protect the environment. 
Sanctions on Taiwan equalled about $25 million, coral, mollusk-
shell jewelry, and lizard, snake, and crocodile skin shoes, and
other leather products.  Overall trade with Taiwan is $25.1
billion.

18.       Industry Sector:  PHARMaceutical

19.       Exporter and Importer:  KENYA and CHINA 

     The three East African countries of Kenya, Uganda and
Tanzania are the leading exporters of rhino horn.  East African
exports peaked at approximately 3,400 kg/year (1,180
rhinos/year) in the 1970's.  Customs statistics show that China
directly imported 13 percent of East Africa's declared exports
from 1949-76 and most likely imported more via entrepots.  When
China became a party to CITES in 1985, it banned the use of
rhino horn in new products, but domestic use continued.  China
was a major manufacturer of medicine containing rhino horn to
re-export.  Until the recent prohibitions it was using
approximately 600-700 kg annually.

     China imported 10,621 kg of African horn and 433 kg of
Asian horn from 1982-1986.  The origin of these imports was not
declared, but believed to be from North Yemen, Hong Kong, Macau
and Taiwan, with smaller quantities smuggled in from Singapore
and Thailand.  Mandatory registration of stocks in 1988
revealed 9,874 kg in various medicine corporations -- this
excluding stocks in retail medicine, museums and private
ownership.

     Taiwan was also a major importer of horn for the period
1979-1985.  Its supplies came mainly from South Africa, Hong
Kong, and Singapore.  Taiwan is not a member of CITES because
it is not recognized by the UN.  Nevertheless, the government
banned imports and exports of rhino horn in 1985.  Internal
trade continued, however, at least until 1989.  Taiwan is
believed to be stocking horn and acting as an entrepot, since
Macau and Singapore imposed successful bans on both imports and
exports of horn in 1985 and 1986.  The government also
undertook a legally mandated registration completed in 1990
that produced a stock of 1,456 kg for 410 registrants. 
However, surveys in 1991 showed that approximately 1,800
pharmacies stocked horn and suggested stockpiles of at least
3,712 kg and possibly as much as 8,943 kg.

E.        ENVIRONMENT Clusters

20.       Environmental Problem Type:  Species Loss Land [SPLL]

     The whole family of rhinos have been placed on Appendix I
(endangered species).  These include four species -- Sumatran,
Javan, Indian and Black -- and two sub-species -- Northern
white and Southern white.

21.       Name, Type, and Diversity of Species 

     Name:          Rhinoceros (Rhinocerotidae)
     Type:          Animal/Vertibrate/Mammal/Odd-Toed Ungulate
     Diversity:     51 mammals per 10,000
                    km/sq (South Africa)

22.       Resource Impact and Effect:  HIGH and PRODuct

     Notwithstanding incomplete trading statistics, researchers
have attempted to match volumes of horn traded and changes in
rhino numbers.  Using annual statistics of average volume of
horn trade during the 1970's in Yemen, Taiwan, Japan and South
Korea, they estimated that a minimum of 8,000 kilograms by
volume changed hands per year.  The supply was predominantly of
black rhinos and the volume represents the deaths of
approximately 2,800 rhinos a year during this period.  The
volume of trade in the 1980's was estimated to have dropped to
3,000 kg/year.

23.       Urgency and Lifetime:  SHORT and 30 years

     The Javan and Sumatran rhinos in Asia and the northern 
white rhino in Africa are already on the edge of extinction. 
The number of black rhinos has fallen from 65,000 to 3,000 and
is locally extinct over large areas of Africa.  The southern
white rhino is well conserved in limited areas in southern
Africa, as in the Indian rhino in India and Nepal but their
numbers are still small. 

24.       Substitutes:  LIKE products

     Water buffalo horn has already been substituted for rhino
products in Yemen.

VI.       OTHER Factors

25.       Culture:  YES

     The (former) demand in Yemen for ceremonial daggers and in
East Asia for medicinals are the two leading causes of the
animal's decline.

26.       Trans-Border:  NO

27.       Rights:  NO

28.       Relevant Literature

Cohn.  "Halting the Rhino's Demise".  Bioscience 38: (1988):
     740.
Convention on International Trade in Endangered Species of Wild
     Fauna and Flora 27 UST 108, TIAS 8249 (1973).
Endangered Species Act of 1973 16 U.S.C. 1531 et seq.
     50 C.F.R. 23 et. seq. (implementing the Convention on
     International Trade in Endangered Species of Wild
     Fauna and Flora).
Favre, D.  International Trade in Endangered Species: a Guide
     to CITES (1989).
Fitzgerald, S.  International Wildlife Trade: Whose business is
     it? (1989).
French, Hillary.  "Reconciling Trade and the Environment."
     Lester Brown, ed. State of the World 158 (1993).
Kenworthy.  "U.S. Pressures, China, Taiwan on Animal Trade."
     Washington Post (June 10, 1993): A28.
Leader-Williams, N.  "The World Trade in Rhino Horn: A Review" 
     (Traffic International 1992). 
Low, J.  "The Smuggling of Endangered Wildlife Across the
     Taiwan Strait" (Traffic International 1991).
Nowell, C. and Pei, K.C.J.  "The Horns of a Dilemma: The
     Market for Rhino Horn in Taiwan" (Traffic
     International 1992).
Martin and Barzdo.  "The Volume of the World's Trade in Rhino
     Horn."  Traffic Bulletin 6 (1994): 3.
Martin and Martin.  "Combatting the Illegal Trade in Rhinoceros
     Products."  Oryx 21 (1987): 143.
Martin and Martin.  "The Taiwanese Connection: A New Peril for 
     Rhinos."  Oryx 23 (1989): 76.
Notice.  Federal Register 32/260 (July 15, 1991). 
"ROC Serious About Eliminating Rhino Horn Trade."  Central News
     Agency, June 30, 1993.
Sheeline.  "Is There a Future in the Wild for Rhinos?"
     Traffic USA 7 (1987): 1.
TRAFFIC.  "Measures Taken to Control Trade In Rhino Horn and
     Tiger Bone as USA Threatens Sanctions."  Traffic
     Bulletin 14 (1993): 1.
Vigne and Martin, Taiwan.  "The Greatest Threat to the Survival
     of Africa's Rhinos." Pachyderm 11 (1989): 23.
Yearwood. "Survival Mode."  Dallas Morning News (August 8,
     1993): 37A.

                          References


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