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Blood teak for the super rich props up a cruel regime

Serdar Vardar | Pelin Ünker
March 2, 2023

Myanmar's forests are under threat from the lucrative trade of valuable wood. An investigation has revealed how despite sanctions, teak is flooding Europe.

Deforestation INC
Image: Ricardo Weibezahn - ICIJ

One of the most expensive woods on the market, teak is predominantly found in the dense jungles of Myanmar. Growing slowly over decades, it is durable and has a uniform golden brown color that makes it highly desirable, particularly for high-end furniture and luxury yachts. Just one square meter (ca. 10.7 square feet)  of teak decking can cost up to €1,000 ($1,066).  

A large yacht under construction in a shipyard.
View of a teak-decked yacht being built for Amazon founder Jeff Bezos. Image: Guy Fleury/AP/picture alliance

But the pricetag has done little to slow its popularity. Demand from the €8.5 billion yacht industryis fuelling teak logging in the forests of Myanmar. According to the United Nations, the southeast Asian country’s forests are already facing devastation, with almost 15 million hectares lost between 1990 and 2015 — more than the entire forests of Germany. 

Much of the timber — often dubbed "blood teak," as it funds the brutal military junta that has killed nearly 3,000 people since a February 2021 coup — is exported illegally. Such are the findings of Deforestation Inc., an investigation by the International Consortium of Investigative Journalists (ICIJ) and various media outlets, including DW. 

The investigation into Myanmar's teak trade was based on leaked tax agency files, publicly available trade data, and interviews with traders in 11 countries. The confidential files ー mostly from 2021 and 2022 ー were shared with the ICIJ by the human rights group Justice for Myanmar, the UK-based news outlet Finance Uncovered, and the online data transparency group Distributed Denial of Secrets. 

Sanctions fail to prevent teak imports 

When the junta seized power from Myanmar’s democratically elected government two years ago, the EU, UK, Canada and the US responded with sanctions on relevant individuals and state-owned enterprises. This included Myanmar Timber Enterprise (MTE) which has a de facto monopoly over the country’s timber sector.  

The aim of the sanctions was to limit the military leadership’s income from exploiting Myanmar's natural resources. Yet according to DW’s analysis of trade data, timber ー including teak ー worth almost €45 million has entered the EU since the military coup. 

Under EU regulations, timber only has to be inspected at the port of arrival. Once it is in the bloc, it can be shipped from one country to another.  

And although states such as Germany, Belgium and the Netherlands have ceased direct imports from Myanmar, EU trade data suggests that is not true for Croatia, Greece and Italy — which has become the hub of the teak trade in Europe. 

Deforestation Inc. found that some Italian yachtdeck manufacturers and timber merchants import teak products from Myanmar through middlemen, who obscure the origin and harvest date of the wood, and then export the goods to customers in other European countries. 

Leaked files from Myanmar’s tax agency show that between April and September 2021 alone, Comilegno Srl, who describe themselves as "importers and suppliers of timber for flooring in the nautical industry," imported more than €665,000 worth of teak. Comilegno Srl is just one of 27 companies mentioned in the leaked documents.

Teak logs heaped up on the grass
Teak is a very durable hard wood, which makes it highly desirableImage: Barbara Walton/dpa/picture alliance

Lieutenant Colonel Claudio Marrucci of the Italian Forestry Service, interviewed by the Italian investigative platform IRPIMedia as part of Deforestation Inc., said Italy takes a lenient approach towards teak because it is crucial for the country's almost €2.8 billion boat industry. 

"It is a crime," he said in reference to the imports of teak despite sanctions, "but considered as serious as the killing of birds."

Getting teak into the EU via Turkey

Because the Turkish government didn't impose sanctions on importing materials from Myanmar after the coup, companies across Turkey have been freely able to continue importing valuable teak.   

In fact, since the sanctions imposed by the EU and others, teak imports to Turkey have skyrocketed. In 2021 imports to the tune of €2.2 million were recorded officially, while preliminary figures for 2022 put the value at €10.6 million. And early figures for the first month of this year suggest that Turkish traders imported teak worth more than €3.2 million. But some of it is moved on to other countries. 

A Turkish teak importer, speaking to DW on condition of anonymity, said he had been approached by Italian companies asking that he change the documented origin of Myanmar teak and sell it them.   

"Italian companies are very aggressive on this issue," he said.  

Though he said he knew of no Turkish companies that had bowed to pressure from Italian traders, official statistics analyzed by DW show that in 2022, Turkey exported €500,000 worth of teak to Italy. It was the first teak export for more than 20 years. 

According to records shared with Deforestation Inc., construction company Cengiz Insaat Sanayi ve Ticaret A.S. imported Myanmar teak worth €3 million in just six weeks towards the end of last year.  

The company's chairman, Mehmet Cengiz, who has a close friendship with Turkish President Recep Tayyip Erdogan, is estimated to be worth €2 billion. According to the World Bank, Cengiz Holding is one of the top three companies in the world with most public tenders won between 2002 and 2020. 

At the time of publication, Cengiz Holding had not responded to DW's request for comment on the planned use of the teak.  

Besides Turkey and Italy, Deforestation Inc. revealed that India, Japan, New Zealand, Singapore, South Korea, Taiwan, and USA also kept importing considerable amounts of Myanmar teak. 

An elephant transports a teak log in the jungles of central Myanmar
An elephant transports a teak log in the jungles of central MyanmarImage: David Longstreath/AP Photo/picture alliance

The devastating effects of a drive for luxury goods 

The continued teak trade not only helps to fill the coffers of the military junta, which according to the UN Refugee Agency, has waged a campaign of mass arrests and caused the displacement of more than a million people since coming to power. It is also having a devastating impact on Myanmar's once pristine forests. 

As they are cleared at an unprecedented rate in bid to generate income, the junta has been cracking down on environmental activists and their families. 

According to the UK-based NGO, the Conflict and Environment Observatory, the situation is dire. The group says deforestation in Myanmar could become one of the worst environmental disasters in the world's conflict zones, with severe consequences for local ecology and the people who depend on it.  

"Justice for Myanmar" spokeperson Yadanur Maung says the only option is to stop sourcing teak. "No yacht or deck chair can justify the fatal cost of this trade to the lives of the people of Myanmar, and the destruction of its forests." 

Contributing reporters: Scilla Alecci Reporter, Jelena Cosic, (ICIJ), Giulio Rubino (IRPIMedia).

Edited by: Tamsin Walker