The Amazon.com of Japan is the world’s biggest online retailer of elephant ivory and whale meat

The Amazon.com of Japan is the world’s biggest online retailer of elephant ivory and whale meat
By Gwynn Guilford @sinoceros March 18, 2014
Countries around the world are burning ivory stockpiles. It’s a powerful symbol against the illegal trade in elephant tusks that resulted in as many as 30,000 elephant deaths last year. But those demonstrations can only be so effective when a legal market for ivory trade exists. And according to a new report (pdf) from the Environmental Investigation Agency, an NGO, one of the world’s biggest digital companies is facilitating not only a brisk business in illegal ivory, but also the sale of meat from endangered whales.
Rakuten Ichiba—the Japanese online marketplace of Rakuten Group, a digital giantthat recently bought messaging app Viber—offers products made from endangered animals that can fetch up to ¥2,640,000 ($28,186) (link in Japanese), shows EIA’s investigation. This might be morally outrageous, but it’s not—at least on the face of it—illegal; Japan claims exceptions to international bans on the the commercial trade of elephant ivory and whale meat. And it shows how futile laws protecting threatened animals are as long as they have loopholes.

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The effect of poaching on elephant populations.CITES & Traffic
How did those loopholes get there? As elephant poaching hit catastrophic levels in the 1980s, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) instituted a global ban on the elephant ivory trade. That made ivory prices drop sharply and drove poachers out of business.
However, in 1999 CITES allowed Japan (and, in, 2008, China too) to buy stockpiled ivory from African countries. While the Japanese government is supposed to make sure only this “legal” ivory fuels the domestic trade, it doesn’t enforce that, so poached ivory floods the domestic market, says EIA.
So at least some of the ivory items for sale on Rakuten are legal. The problem is that it’s extremely hard to tell legal from illegal. That perpetuates demand for poached ivory. As of Feb. 2014, Rakuten Ichiba featured 28,000 ads for elephant ivory products, most of which were for hanko (link in Japanese), the seals used in Japan to sign documents. These ranged from ¥3,800 to ¥320,000 ($36 to $3,126). However, EIA reports that the site also sells ivory from endangered elephants in Central Africa. It surmises this based on the size of the items for sale, since large tusks almost certainly come from new sources (pdf, p.61).
When it comes to whales, things are slightly different. Japan is, along with Iceland and Norway, the only country in the world that demands an exception to international ban on commercial hunting of whales, which it does so under the auspices of “scientific research.” Arguing that whale meat is the “byproduct” of said research, the government subsidizes the industry, paying $9.8 million a year to fund whale hunts. However, unlike with ivory, domestic demand is flagging. That probably explains why, of the nearly 800 whale meat ads on Rakuten Ichiba as of February, most cost the equivalent of only a few dollars.
Still, as with elephants, the end result is the same: The creatures are slowly disappearing.

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About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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