Misappropriation of ivory funds threatens rhino horn sale


Over 900 rhino have been killed this year in South Africa. The majority have been in the Mpumalanga section of the Kruger National Park, with nearly 600 poached. With few options left and a growing illegal trade, the environment department is planning to ask for permission to sell rhino horn.

The department has argued that this would stop demand for illegal horn by “flooding” the black market. When she announced that er department would start consultations on legalised trade, environment minister Edna Molewa said, “The reality is that we have done all in our power and doing the same thing every day isn’t working”.

The pragmatism behind this decision has been widely questioned by environmentalists. Opponents say putting more rhino horn on the market will grow demand instead, something which happened each time elephant ivory was sold in legal, once-off, sales.

If Molewa’s department chooses this route, it will approach the Convention on International Trade in Endangered Species (Cites) in 2016 and ask for permission to sell its rhino horn stockpile. This is the body that lists whether species are endangered, and how much of each species can be traded. Trade in rhino is illegal, as most of the species are endangered. The Southern White Rhino – which constitutes the majority of South African rhino – is listed as near threatened as births still just exceed deaths.

The trade in ivory was banned in 1989, when elephants were listed as an Appendix One species by the Cites. Seventy-five thousand elephant a year were being poached.

The ban meant countries with large herds of elephant were left with huge stockpiles of ivory from culling and natural deaths, which had to be safely stored. This cost money. In 2008 Cites gave permission for a once-off sale of ivory to South Africa, Botswana, Zimbabwe and Namibia.

South Africa sold 47 000kg of ivory, at a value of $157 a kilogram, to the Chinese and Japanese governments.

The Cites permission came under the condition that the money be ring-fenced and ploughed back into conservation. It said the funds must be “used exclusively for elephant conservation and community conservation and development programmes within or adjacent to the elephant range”.

Cites said this week that to the best of its knowledge this condition had been adhered to. In Mpumalanga the money was meant to be placed in the Problem Animal Fund. It did not end up there, but the abuse of the fund before this serves as a warning of how misappropriation can happen.

This was started in the 1990s as an account to hold money raised from killing animals that had escaped from parks in the area. These, normally Big Five animals, were a danger to people and property. At first anyone was allowed to hunt them and this was abused. An internal memo from the province’s Wildlife Protection Services said one night “three hippo were shot and another wounded on a wild hunting spree”.

The Mpumalanga Tourism and Parks Agency then started giving permits to hunters, who would pay to hunt the escaped animals. The money raised went into the Problem Animal Fund.

Internal correspondence between the Agency and its Wildlife Protection Services Unit in 2009 — seen by the Mail & Guardian — said: “Funds generated would only be utilised for the management of problem animals and associated issues.”

The correspondence, in the form of a memo, casts the fund as a saviour, at a time when departmental budgets were shrinking. It allowed provincial wildlife workers, who did much of the work in their extra time, to fix fences and buy specialist conservation vehicles. For a decade all the rhino horn chipping in Mpumalanga was also financed by the fund, it said.

But the memo also warned that there was “no proper control over the income and expenditures generated from the fund”. This meant that “large amounts of money had not been accounted for”, it said.

In 2009 private investigator Paul O’Sullivan found that money in the Fund had been historically used for ad-hoc expenses. In his report, released earlier this year, he found that the “tens of millions” of rands that flowed through the fund had by-passed normal procurement processes.

People he interviewed in provincial conservation referred to the Fund as a “slush fund” that could be used for anything. The money raised from selling elephant horn had eventually not gone into the fund, he said.

Juan Carlos Vasquez, a spokesperson for Cites, said the once-off sale of ivory had come under strict conditions. If there was non-compliance, Cites could “decide to cause the trade to cease partially or completely”. He said the South African branch of Cites would investigate the issue further. But to the best of Cites’ knowledge, none of the funds had been misappropriated.

Vasquez could not comment on how this breach would affect any future proposal for a once-off sale of rhino horn because no formal proposal had been received. But if South Africa did ask for permission in 2016, it would only be done under the strictest conditions and if the species was not harmed.

Albi Modise, spokesperson for the environment department, said it was not aware of any cases where ring-fenced funds were abused. It had received reports from all of the entities which benefited from the ivory sale. There was no timespan for the use of the funds, so the Mpumalanga Parks and Tourism Agency had to “still develop project proposals” for the expenditure of the funds, he said. The agency would then consult with the environment department before they were implemented.

He could not comment on the impact of the alleged discretions on any future sale of rhino horn, because “a final decision on a possible proposal relating to legal commercial trade in rhino horn has not been taken”.

For the article on the Mail & Guardian click here.