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    China Business
     Nov 10, 2012

Chinese tastes push lethal abalone trade
By Gavin du Venage

Poaching of rare species to serve a growing demand in Asia is a sore point for conservationists in Africa. But as a recent haul of ivory in Hong Kong attests, the authorities in China are aware of the problem and are beginning to address it. For some species, however, it may be too late.

While the focus is on high-profile trade in rhino horn and elephant tusks, less-glamorous species slip through the cracks. One such is abalone, a humble mollusc that is being pushed to the brink of extinction off the South African coastline.

An unholy alliance of South African drug gangs and Chinese criminals has resulted in reefs being stripped bare of the creature; the proceeds of the poaching are ending up in sprawling slums on


the outskirts of South Africa’s cities, fueling a deadly drugs trade.

"We're not making much headway... we're not winning the war" Johann Augustyn, South Africa's head of fisheries research and development told a special parliamentary hearing recently. Augustyn said Chinese syndicates were behind most of the poaching. These groups were also heavily involved in drug smuggling and human trafficking, he told parliamentarians.

Under-resourced and undermanned, local environmental authorities are helpless to slow, let alone stop, the trade. Abalone is rarely consumed in South Africa, but it is a delicacy in the Far East. It can be bought at markets in Hong Kong and Shanghai, where it is sold openly on the streets. Unlike rhino horn or ivory, it enjoys no special international protection.

Found mostly along the southern coastline where the cold waters of the Atlantic mix with the warmer Indian Ocean, the abalone cling to rocks below the waterline. Poachers, equipped with scuba gear and thick wetsuits to keep out the chill, use crowbars to pry the creatures off the rocks. Diving from high-powered rubber boats, they gather abalone in sack-loads, which are then transported to waiting four-wheel drive vehicles on the beach. Occasionally environmental officers arrive on the scene. Often outgunned and outnumbered, they are frequently driven off in a hail of bullets.

The poachers themselves are usually from poor coastal communities, where unemployment runs as high as 80%. They sell the abalone on to representatives of gangs based in Cape Town, South Africa's second-largest city, and home to some of the most violent criminal organizations in the world.

With names like "The Americans" and "Fancy Boys", these gangs run large sections of the outlying low-income areas of Cape Town, a world beyond the graceful streets and cloud-capped Table Mountain that tourists associate with the city.

The gangs hand the abalone to Chinese criminals, who pay not in cash but with crystal methamphetamine, imported from China, India and Pakistan. This is then cooked into a lethal local drug known as "tik". Authorities here say at least 300,000 people use half a gram of tik a day - a demand of 150 kilograms daily that must be fed.

As a result, dozens die each year from drug-related overdoses and related hazards such as gang violence: in September, for instance, a six-year-old girl was shot in the head as rival gangs battled it out while she was playing outside her home in the Cape Flats, a poor district outside Cape Town. On November 4, police fought rioters outside the town of Hermanus, an hour from Cape Town, after they attacked officers who had arrested suspected poachers. A 13-year-old boy was shot in both legs and a police officer was badly burned in the incident.

Security in these areas has become so bad that Helen Zille, the premier of the Western Cape province, has appealed directly to the national government to send in the army to aid the outgunned police. She also wants the area to be put under a state of emergency, akin to martial law.

Substance abuse cannot be blamed on Chinese operators of course; but the current trajectory of exploding methamphetamine use can be linked directly to the demand for abalone. "It's no secret that organized Chinese gangs - triads - are behind this," says Shaheen Moola, a lawyer and MD of Feike, a firm of natural resource management firm in Cape Town. "This level of smuggling and drug importation would not be possible without them."

Until 2003, methamphetamine was virtually unknown in the Western Cape region, where a damp climate makes drying of its basic ingredients difficult. But abalone is usually sold in its dried form, an art that is familiar to Chinese purveyors although virtually unknown in South Africa. Dried abalone are also easier to store and transport. The result is dozens of drying factories, often operated out of private homes scattered around the country, says Moola.

"The price of abalone depends very much on the skill with which it was prepared and dried," notes Moola. "Drying is an art and very few South Africans can do it."

t was the realization that drying ovens used to prepare abalone for shipment could also be used to dry crystal meth that was the catalyst for a whole new drugs trade in the region.

For the poaching and drug dealing syndicates, it's an especially lucrative tradeoff. An investigation by The New Age newspaper in Johannesburg found that a night's haul of abalone could be exchanged for at least 100kg of ephedrine, the key component of crystal meth. This would be sold to a drug gang for $3,500. Once cooked into 'tik' it would be sold for up to $350,000 - a huge return for a night's work at sea.

The effect on the abalone population has been devastating, and along with it, the commercial fishermen it once supported.

In 2005, around 300 holders of legal commercial fishing rights and their families depended on harvesting abalone. As the stocks plunged however the authorities were forced to reduce the total annual allowable catch from 615 tonnes to 125 tonnes for the 2006/7 season and 75 tonnes for the shortened 2007/8 season. In February 2008, South Africa took the unprecedented step of banning harvesting entirely.

Stopping the illegal trade is complicated by the lack of international protection. Previously, South Africa had abalone listed with CITES, the Convention on International Trade in Endangered Species of Wild Fauna and Flora in 2007. This had provided legal ammunition for importers such as Hong Kong to check that abalone stocks had valid export permits and were from legally harvested sources.

In 2010 the South African government withdrew the listing because it lacked the resources and manpower to implement it properly, says Markus Burgener, senior program officer for TRAFFIC, the international wildlife trade monitoring body.

The CITES implementation was so shambolic that all it did was threaten the livelihood of the few remaining legal exporters, who struggled to get the permits they needed to authorize shipments. When exporters threatened to sue for lost export earnings, the government delisted abalone.

"By exiting the CITES agreement the South African government removed the only international legal tool the Hong Kong authorities had to monitor whether imports were legally harvested or not," says Burgener. As a result, up to 90% of abalone exports to the territory are now probably from poached abalone, he says.

While cross-border trade in ivory and rhino horn is being tightened up, the abalone trade is largely ignored. Lacking the appeal of elephants and rhinoceroses, the abalone's future is bleak.

Gavin du Venage is a business writer in South Africa, specializing in commodity and investment analysis.

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