World enews: Chinese-Run Company Aided By Govt Officials Exports Charcoal And Timber Despite Ban, Threatening Nigeria’s Forests

In May 2019, the National Environmental Standards and Regulations Enforcement Agency, or NESREA, ordered a Chinese-run factory in the southeastern Nigerian state of Enugu to cease operation over illegal charcoal production and export.

NESREA, established in 2007 by the Nigerian government to enforce environmental laws, said it would prosecute Kwo-Chief Investment Limited for running illicit operations.

The company suspended operations but its employees were back to work a year after, according to factory workers at the site in Obimo, a village dotted with sandy hills in Nsukka.

The company’s owners were neither arrested nor indicted. Rather, the agency officially reopened the factory last October. According to the National Environmental (Control of Charcoal Production and Export) Regulations of 2014, companies that contravene its provisions risk not less than N5 million in fines on conviction and an additional fine of N50,000 for every day the offence subsists, as well as a fine not less than N1 million or a term of imprisonment of not more than five years for individuals.

NESREA, in a statement, says it filed a civil matter for a court order to seal the facility pending the submission of post-impact environmental assessment and other environmental permits, and the facility was sealed until those documents were made available.

But an investigation by SaharaReporters shows that NESREA and Federal Ministry of Environment officials broke the country’s charcoal export ban and other charcoal regulations to restore the company’s operations, posing dire consequences for Nigeria’s carbon-absorbing forests.

Nigeria officially banned charcoal export in 2017 when the Federal Department of Forestry stopped giving charcoal export permits, but the Chinese-run company has gotten around the regulations with the help of government officials tasked with enforcing the rules.

The company exports timber as well, despite the prohibition.

Complicit and contradiction by regulators

A Nigerian manager at the charcoal factory told SaharaReporters that the company gave a bribe of over N30 million to regulatory officials to reopen the factory. He refused to mention the agencies or officials that received the kickback to bend the rules. SaharaReporters has not been able to verify his claims.

Pele Egbagiri, the NESREA staff who was at the reopening of the charcoal factory last October, denies the allegations and describes them as “baseless and unfounded.”

His boss, Aliyu Jauro, director-general of NESREA, says it is untrue that the agency collected bribes to reinstate production at the factory, demanding proof of the alleged bribery.

Jauro says he was not aware that the company was also trading in wood, adding that the company had obtained necessary permits which he relied on to reopen the factory after their operations were suspended.

“The agency only has powers to enforce environmental impact assessment and national environmental permits,” Jauro says in a statement. “The agency does not issue permits for production of charcoal, nor does the agency issue permits for exportation of charcoal.”

Some of the permits Jauro referred to are issued by the Office of Environmental Assessment Department at the Federal Ministry of Environment but the department absolved itself of the blame for reopening the charcoal factory in Obimo.

“My department does not enforce infractions,” says Abbas Suleiman, the director of the Federal Department of Environmental Assessment, who oversaw the issuance of a post-impact assessment certificate to Kwo-Chief Investment.

Suleiman adds that “PIA issuance in the ministry follows a process where an application is made, an environmental study is carried out and the ministry then evaluates that study and issues approval for the post-impact assessment.”

The action of Nigeria’s Federal Ministry of Environment is questionable because it gave an operational license to a company producing charcoal specifically for export when it had already banned charcoal export.

NESREA and the Federal Department of Environmental Assessment are both under the environment ministry but they are blaming each other for the restoration of Kwo-Chief Investment’s charcoal production and export which is illegal, according to existing rules.

The National Environmental (Control of Charcoal Production and Export) Regulations of 2014 requires charcoal exporters to obtain a permit from the Federal Department of Forestry by submitting, among other things, a reforestation plan for their area of production.

But charcoal-driven deforestation continued unabated over the years across the country, prompting the National Council on Environment to recommend a ban on charcoal export in 2017 and the Federal Department of Forestry stopped issuing export permits entirely.

Federal Department of Forestry’s director, Adekola Kolawole, told SaharaReporters that he did not give any permits to Kwo-Chief Investment.

“The department did not grant a permit to export charcoal or wood to anybody,” he states in a text message. “There’s currently a ban and suspension on the export of the two commodities respectively. Whoever is still exporting them is committing an illegality.”

Another entity that played a role in the reopening of the charcoal factory is the Enugu State Government. Under Nigeria laws, forests are owned by states and Kwo-Chief Investment cannot operate the factory without the endorsement of the state.

Chijioke Edeoga, the state’s commissioner of environment, declined to comment on the charcoal factory.

“You can direct your inquiries to the forestry commission and to the commissioner for information,” Edeoga insists, despite supervising the forestry commission.

The last bastion that could stop illegal charcoal and timber export is the Nigeria Customs Service by ensuring that the company does not export the products without valid export permits but Customs’ spokesman, Joseph Attah, told SaharaReporters that they did not have a record of the company exporting products through the Nigerian ports.

Charcoal-driven deforestation

Kwo-Chief Investment Limited had begun an unprecedented industrial charcoal production in Nigeria towards the last quarter of 2018 after the country started the export restriction to rein in charcoal-fuelled deforestation.

The factory is about the size of six football fields.

Sturdy Nigerian men hack off hardwood with chainsaws and stack the logs inside brick ovens. They shovel out the hot charred remains after some days, and then bury them in the sand, forming a heap, when SaharaReporters visited the factory.

Women with wheelbarrows harvest the charcoal later. They cut, grade and pack the charcoal in corrugated boxes, each weighing about 10 kilograms.

Despite not having a charcoal export permit, the company still exported its product to South Korea in 2018. It was a long time that the Nigerian charcoal was imported into the east Asian country after $7,000 worth of charcoal import in 2012 and another import in 1995, according to Comtrade, the United Nations import and export database.

In 2019, the Nigerian charcoal imported into South Korea was 3.6 million kilograms worth $3.7 million, amounting to a 1,405 percent increase from the previous year. The value of the charcoal import was $2.8 million in 2020, according to the UN Comtrade.

However, Nigeria underreported its charcoal export to South Korea with only $60,089 in 2018 and none in the following years, according to UN Comtrade.

The inrush of Nigerian charcoal into South Korea, one of the top five importers of charcoal globally, could have been more if NESREA had not temporarily shuttered the Kwo-Chief Investment’s factory. The coronavirus pandemic also frustrated operations at the factory as the country went on lockdown for a few months last year.

From Asia to Europe and America, high-income countries look away from imported illicit charcoal from Africa. For example, charcoal is not covered by the European Union Timber Regulation and therefore illegally imported tropical charcoal can be sold in member countries, according to World Wildlife Fund, a non-profit environmental organisation.

Such regulatory gaps reveal certain weaknesses in global climate action policies whereby countries with strong forestry protection allow imports of illicit charcoal from countries like Nigeria, where forests are being decimated to satisfy these demands.

Most forest degradation in Africa is caused by charcoal and firewood, according to the Food and Agriculture Organisation of the United Nations. The continent accounts for about two-thirds of global charcoal production.

As the world’s second-largest producer of charcoal, Nigeria has lost most of its forests. But this depletion is not caused by charcoal alone as timber, farming and construction also accelerate deforestation. The country moved from having 12.2 percent of forest area in 2007 to 7.7 percent in 2017 – deforestation of a landmass bigger than Belgium in a decade – according to the World Bank’s The Little Green Data Book.

Illicit charcoal trade is rampant in Nigeria and elsewhere in Africa, but the production has been informal, driven by local artisans who produce it through mound earth kilns and traded by middlemen.

Kwo-Chief Investment’s charcoal production is unequalled by these small scale local producers.

“It’s very rare to have foreign investors in charcoal production,” says Tuyeni Mwampamba, a Tanzania native and research professor at the Institute of Ecosystems and Sustainability Research in Morelia, Mexico.

Mwampamba observed that almost everywhere in the Global South where charcoal is produced, the business tends to operate in a “fuzzy area between illicit but openly conducted, legal but non-compliant.”

“A lot of rules are knowingly broken; a lot of regulators are knowingly complicit. It’s fertile ground for corruption and given the high stakes associated with charcoal, it makes it a very difficult sector to control, monitor or reform,” Mwampamba says.

In addition to charcoal export, Kwo-Chief Investment exports wood to China despite Nigeria’s prohibition of rough or sawn timber export.

At Obollo Afor, about 56 kilometres from the charcoal factory, a proportion of the company’s staff work at a field that has a collection of wood. Truck-mounted forklift haul logs numbered with white chalk into 40-foot containers.

When SaharaReporters visited the depot in May, two Chinese workers were seen supervising locals operating the chainsaw and arranging the logs of wood.

The company exports them to China. The wood is sourced from Benue, Cross River, Kogi, and Taraba states in Nigeria and as far as Cameroon, suppliers who are Nigerians told SaharaReporters.

Nigerian on paper, Chinese in operation

Kwo-Chief Investment claims in its incorporation “to carry on the business of building construction, construction of fields and paints, supply and distribution of construction equipment, real estate and properties” – a claim hard to square with its charcoal and timber trade.

The company listed three Nigerian directors – Adullahi Abubakar Baba, Alhassan Baba and Yunusa Ibrahim – who are all bearing as its shareholders, according to the company’s incorporation documents obtained by SaharaReporters from the Corporate Affairs Commission.

But the brainchild of the company is Mohammed Abubakar Balo, a local politician who represents Qua’an Pan South Constituency in Plateau State House of Assembly, according to workers at the charcoal factory, government officials and his colleague at the state assembly who spoke to SaharaReporters on condition of anonymity for fear of displeasing the politician.

When NESREA ordered the charcoal factory to cease operation in May 2019, Balo went to Abuja to meet the director-general to ease the enforcement.

In a phone conversation, Balo admitted that he had been interceding for the company, adding that the company has a partnership with Chinese investors. But he claims that the company belongs to his brother, promising to avail his brother and their consultant in Abuja who would respond on behalf of the company.

He later declined to do so and reacted angrily to allegations that the company bribed NESREA and Federal Ministry of Environment officials to resume operations.

“This allegation is not true. Don’t say it to me again. Don’t talk to me again,” Balo says.

On paper, the company says it is owned by Nigerians, but a Chinese investor steers the company’s charcoal factory and timber trade.

A factory worker told SaharaReporters that the Chinese investor who oversees the workplace moves around the site with two gun-wielding Nigerian police officers.

They called him “Eye” without knowing his real name. About a dozen Chinese employees who manage over a hundred local workers live at the factory and are guarded by local security men.

Since the factory began operation, locals supply the feedstock from forests across the state and have started going to the neighbouring states of Kogi and Benue states to get the wood, according to a logger who supplies to the factory.

Mathew Mabele, an environmental scientist in the Department of Geography and Environmental Studies at the University of Dodoma in Tanzania who has published peer-reviewed articles on charcoal says natural forest formations in Africa could mitigate climate change impact.

“Having industrial charcoal production in such forests would have a heavy toll on the international and regional efforts in addressing climate change,” Mabele says.

There is no international tracking system for charcoal. And it is difficult to determine the species used in tropical charcoal, unlike timber. A study by scientists at Thünen Institute of Wood Research in Hamburg, Germany and published in AWA Journal, a publication of the International Association of Wood Anatomists, shows that a 3D-reflected-light microscopy technique can be effective in uncovering the origin of imported tropical charcoal.

But even when countries know that the charcoal landing on their shores come from endangered tropical forests, they have not taken action, negligence that some experts attribute to nationalism and tribal thinking in response to climate change.

Makuachukwu Ojide, a development economist and a lecturer at Alex Ekwueme Federal University Ndufu-Alike in southeastern Nigerian state of Ebonyi, told SaharaReporters that Nigeria is losing so much both in environment and revenue to charcoal production.

“They will prefer to have us destroy the ecology here to produce charcoal which they buy at a very cheap rate, unlike if they have to buy the logs of wood and produce the charcoal in their own country,” Ojide says.

This story was supported by GRID-Arendal.