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Fresh cut logs photographed in Laos. Photo: EIA
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Revealed: how the Vietnamese military fuels destruction of Laos' forests

Faith Doherty

28th July, 2011

Undercover filming by the Environmental Investigation Agency has unearthed shocking evidence of military involvement in the illegal timber trade, all to feed western demand for stylish wood products, according to Faith Doherty

Stand amid the lush, ancient landscapes of land-locked Laos and you’re in some of the largest and last intact expanses of primary rainforest left in the Mekong region of Southeast Asia.

Home to such iconic large mammals as the tiger and Asian elephant, and many endemic and endangered species, Laos’ forests harbour a wealth of biodiversity and also support the livelihoods of millions of rural and indigenous people who rely on them for a host of services such as food, fuel, building materials and medicine.  

But these forests are seriously threatened by over-exploitation, resulting in escalating deforestation as illegal logging supplies the voracious timber processing industries of neighbouring Vietnam, China and Thailand, while simultaneously feeling the mounting pressure from infrastructure development, hydropower projects, mines and plantations.

Indonesia’s previously chaotic, ravaged forests are moving evermore towards the respite of improved governance in the form of its Voluntary Partnership Agreement (VPA) with the European Union (EU), signed earlier this year, while Laos’ neighbours have implemented strict controls of logging inside their own borders.

But still the clamour for timber grows and it is Laos’ forests which are meeting much of the demand at such an unsustainable rate, the country’s ban on the export of raw timber routinely flouted on a massive scale as a veritable river of timber cascades through porous borders to feed the factories and end up as stylish finished wood products in the key markets of the US and EU.

Sounding the alarm

The Environmental Investigation Agency (EIA) has already sounded the alarm about the threat to the forests of Laos and others in the region posed by Vietnam’s furniture industry in its 2008 report Borderlines.

Our investigations throughout 2010 and 2011 were focused more sharply on the extent and nature of the illegal logging in Laos, steadily uncovering a trail of corruption and inadequate enforcement which drew us to the inescapable conclusion that one of the biggest players in illegally spiriting raw timber out of that country was the Vietnamese military.

The allegations and evidence are featured in the new EIA report Crossroads: The Illicit Timber Trade Between Laos and Vietnam, which is released this week.

Through investment in logging, plantations and hydropower projects, Vietnamese firms have appropriated large swathes of Lao forests, yet the only winners in Laos are corrupt Government officials and well-connected businessmen. Meanwhile, Vietnam, which exports billions of dollars worth of wood products annually, is smuggling hundreds of thousands of cubic metres of logs from Laos every year to help feed its booming factories.

Undercover filming

Undercover investigators first encountered the Vietnamese Company of Economic Cooperation (COECCO) in October 2010 during a visit to Qui Nhon port, central Vietnam, documenting huge piles of logs bearing green paint marks and tagged with yellow labels bearing a Vietnamese name which translated into Company of Economic Cooperation – Ministry of Defence (or COECCO). A port worker told us 95 per cent of the logs had come from Laos and most were owned by the Vietnamese military; specifically Military Zone 4.

Similarly marked logs were observed in a huge storage area between the two formal checkpoints at the Bo Y border crossing and we were eventually able to confirm that most of them had come from logging operations linked to the construction of the nearby Xe Kaman 1 hydropower dam.

To uncover more details of the company’s operations, our investigators travelled to COECCO’s headquarters in Vinh City, Vietnam, in May 2011 and learnt COECCO has been in the timber trade and logging business in Laos for more than 20 years, that it sources most of its logs from Lao dam clearance sites and that it is one of a handful of companies permitted to carry out logging in these areas.

A well-connected Lao company is also making a fortune trading logs to Vietnam; the Phonesack Group, the boss of which is connected with the Lao Government, prefers to send logs across the border while its own wood processing struggles to get supplies of raw material.

It’s a sad fact that nothing substantial has changed since EIA first exposed the illicit log trade between Laos and Vietnam in 2008, but we believe the situation is far from hopeless.

The governments of Vietnam and Laos urgently need to work together to stem the flow of logs and curb the over-exploitation of Laos’ forests before it’s too late – for first steps, the Government of Vietnam should respect the policies of its neighbour and block log imports, while the Government of Laos should effectively enforce its log export ban.

And, of course, the Vietnamese military must be fully cut out of all logging operations in Laos.

The EU’s new Timber Regulation comes into force within European markets in 2013, effectively prohibiting the import of illicit timber. Both Vietnam and Laos have a lot at stake and urgently need to work with the European Union with a view to securing VPAs of their own.

And it’s not just a case of leaving corrective measures to big government – consumers and companies can also play a significant part by insisting on proof that wood products sourced from Vietnam are not derived from logs imported from Laos.

Faith Doherty is a senior campaigner with the EIA

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