The Central Asia Connexion: How Belarus bypasses the European embargo on timber exports

After sanctions have been imposed by the European Union on the export of Belarusian potassium fertiliser and timber, the amount of smuggled cigarettes coming into Lithuania decreased considerably. In keeping with Lithuanian Customs figures, intercepted smuggled tobacco merchandise from Belarus to Lithuania decreased over 2.5 occasions in 2022. Earlier than that, confiscated cigarette contraband grew exponentially. In 2019, 8.6 million packs of cigarettes have been intercepted on the border. In 2020, they have been twice as many (16.88 million); In 2021, 22.4 million. However in 2022, the amount of smuggled cigarettes fell to the 2019 degree.

Customs officers consider the quantity decreased as a result of the sanctions record contains items wherein cigarettes are historically hidden. These embrace timber and wooden merchandise.

Regardless of the sanctions and scandals listed in our previous investigations, Belarusian timber continues to enter the EU. Nevertheless, the Belarusian authorities have redirected a number of the exports to China. Wooden deliveries to China elevated by one-third in 2022. However some nonetheless finds its solution to the EU. 

Belarusian pellets go to Europe

We have now proof that sanctions on Belarusian timber have been the catalyst for brand spanking new monetary alternatives for a number of businessmen.

The Polish firm PLRBL– on the books – offers with development in Jap Europe. It ended the yr 2020 with a lack of $77,500.

Nevertheless, a number of months after the sanction on Belarusian wooden, in August 2022 it signed a contract with the Kyrgyz firm Admit to produce wooden pellets. Via December 2023, Admit is contracted to produce PLRBL with gas materials value €1.5 million.

This alone would not be an issue if the wooden used to make the pellets was not purchased in Belarus, after which offered to the EU. One PLRBL government, Belarusian Very important Leshyk, doesn’t even disguise it.

Our Polish colleagues from Frontstory.pl, beneath the guise of patrons, organized a gathering with firm government director Leshyk. He traveled from Biała Podlaska to Warsaw to fulfill with potential shoppers. Whereas negotiating, Very important let slip that he may assist the shoppers purchase Belarusian pellets.

Earlier than assembly Leshyk, some preliminary analysis gave purpose to suspect PLRBL of participating in shady schemes. For instance, we’ve got the corporate’s worldwide consignment notice for the pellets in query from Kyrgyz Admit. It states {that a} truck was allegedly loaded with over 22 tonnes of wooden pellets on October 14, 2022 in Bishkek. Eight days later, Belarusian customs marked the consignment notice, that means the cargo crossed the Belarusian border. Judging by the paperwork, the cargo was delivered to Belarus by the Minsk transport firm Euro-2006. In Lithuania, the wooden pellets have been transported to Vivalsa’s warehouse in Vevis by native haulier Versatio. This cargo was intermediated by PLRBL.

The products declaration was signed by Kyrgyz customs officers and the certificates of origin was issued by the Chamber of Commerce and Trade in Osh, Kyrgyzstan.

In keeping with the PLRBL government, they do enterprise not solely in Poland and Latvia but additionally in Kyrgyzstan and Kazakhstan. They purchase wooden in Belarus, and ship it to Kyrgyzstan or Kazakhstan, the place it’s processed into pellets. Paperwork are drawn as much as make it look as if the uncooked supplies come from Kyrgyzstan or Kazakhstan.

We additionally referred to as a PLRBL consultant in Belarus beneath the guise of a shopper. We talked to Aleh Yanovich. who confirmed the corporate does provide pellets, however refused to debate particulars over the telephone. He mentioned he was afraid of being “arrange”.

Figuring out ourselves as journalists, we contacted PLRBL proprietor Sergejs Azubins. He mentioned he didn’t know the main points of every transaction, however denied allegations this firm had violated European sanctions. He mentioned his firm had anti-sanction measures in place.

By the way in which, Admit, the Kyrgyz firm that provides gas pellets, has already been talked about in our investigations. Its homeowners are Belarusians Dzianis Pytko and Uladzimir Miruk. 

Admit additionally equipped wooden to Lithuania from Kyrgyzstan. Nevertheless, our Kyrgyz colleagues from Present Time Asia (Nastoyaschee vremya Aziya) media, following that investigation, went to Admit’s registration tackle and located no pellets manufacturing there.

Representatives of Kyrgyz media Kloop.kg additionally visited the location. Their journalists have been additionally unable to search out the ghost firm’s manufacturing.

Admit obtained the obligatory producer’s certificates from the Kyrgyz Chamber of Commerce and Trade. Does this imply that Chamber officers by no means checked whether or not the manufacturing really existed? Our colleagues spent fairly a while attempting to get the native authorities to reply, however to no avail.

We managed to get by means of to Admit to ask if the agency had a manufacturing facility that our companions in Kyrgyzstan may go to. However Admit co-owner Dzianis Pytko refused to speak to us.

We discovered that from July to November 2022, PLRBL delivered some 2,000 tonnes of pellets value €740,000 to Lithuania, and from August to December 2022, Admit delivered 2,500 tonnes value €860,000.

From Uralsk-based Pinskdrev with love

It appears to be like like Belarusian state-owned manufacturing giants are additionally attempting to avoid sanctions. We have now paperwork not directly suggesting that Pinskdrev could also be concerned in doubtful schemes.

10 out of 10 Polish and Lithuanian firms interviewed instructed us by telephone that after the ban imposed on Belarusian timber, they began importing plywood and pellets from Kyrgyzstan or Kazakhstan. These sudden export alternatives caught the eye not solely of Belarusian businessmen, but additionally of Pinskdrev’s administration.

Only a month earlier than the sanctions towards Belarus timber took impact on 6 Could 2022, a brand new firm Manufaktura Plus was registered in Karaganda, on the tackle of Pinskdrev’s official commerce consultant workplace in Kazakhstan. The founders of the corporate are Natalia Slokva and Torgovyi Dom Mebel KZ. The only real proprietor of the latter is ZAO Kholdingovaya Kompaniya Pinskdrev.

The Manufaktura Plus web site says the corporate is the official vendor of Semipalatinsk Wooden Processing Plant No. 1. This agency is the one producer of large-size plywood in Kazakhstan. Does this imply that Belarus-based Pinskdrev created the corporate to promote its competitor’s merchandise in Europe?

We referred to as Manufaktura Plus and requested whose merchandise the Belarusian consultant in Kazakhstan promotes. These of the Semipalatinsk plant, was the reply.

We additionally despatched an official enquiry to Pinskdrev. There was no reply thus far.

Let’s assume Pinskdrev has nothing to do with this scheme. It nonetheless appears to be like like Polish and Lithuanian firms are importing wooden merchandise from nations that merely shouldn’t have sufficient forests to promote wooden in giant portions.

We have now already reported on the export miracle in Kazakhstan and Kyrgyzstan following the imposition of sanctions on Belarus. From June 2022 to January 2023, gross sales of wooden merchandise from Kazakhstan to the EU elevated by an element of almost 137, and from Kyrgyzstan by an element of 12,000. These figures transformed in revenues of as much as €58 million in eight months.

Kazakhstan is a forest-deficient nation. Its panorama is desert and steppe. Solely 5 %  is roofed by forest, eight occasions much less by share than in Belarus. Kazakhstan is 10 occasions bigger than our nation, so the forest space there’s greater than in Belarus. Nevertheless, half of those forests are saxaul, quick timber with principally crooked trunks.

Kyrgyzstan timber exports in such portions appear miraculous. This nation is comparable in measurement to Belarus, and its forest cowl is lower than 6 %. Tien Shan spruce dominates, whereas the recent circumstances of the Altai are beneficial for juniper and floodplain species.

We linked these details with Pinskdrev. Underneath the guise of a shopper, we referred to as Manufaktura Plus and ordered 1525×1525 mm, 15 mm thick plywood sheets. We have been particularly excited by 27-sheet packages. The corporate confirmed they’d them out there.

In keeping with market sources, solely Pinskdrev provides plywood within the 1525 x 1525 format with a thickness of 15 mm in 27-sheet packages.

We tried to verify this data with an official request to the agency in Belarus, however haven’t but obtained a reply.

As well as, an nameless supply within the transport trade has instructed us that Pinskdrev ships its plywood to Uralsk. There, the products are stickered with the Semipalatinsk Wooden Processing Plant logos. The merchandise are then loaded onto vans with Kazakh and Lithuanian license plate numbers and shipped to Europe, thus circumventing sanctions.

We came upon that on the Semipalatinsk plant, whose merchandise Manufaktura Plus claims to promote, plywood with the identical measurements is packed in 26-sheet moderately than 27-sheet packs. We may hear the workers within the background referring to the Pinskdrev plywood once we referred to as the manufacturing facility.

Manufaktura Plus equipped plywood to Lithuanian, Polish, Bulgarian, Estonian, Hungarian and Latvian firms. It seems that state-owned Pinskdrev, whereas sanctioned, arrange an organization in Kazakhstan and continues to make cash.

In lower than a yr, the corporate paid over 2 million {dollars} in value-added tax in Kazakhstan alone. That is the tax on the merchandise Manufaktura Plus imported from the territory of the Eurasian Financial Union nations. The corporate formally employs not more than 5 individuals.

Evidently not solely personal merchants, but additionally the state-owned timber large Pinskdrev have discovered how you can circumvent sanctions on Belarusian timber. This questions the effectiveness of any extra sanctions imposed by the European Union on Belarus.

High quality certificates for Belarusian prisons

Along with direct sanctions the EU has imposed on Belarusian timber, there are a number of different circumstances meant to forestall unlawful shipments of products. When promoting timber to the EU, one has to offer a doc proving the uncooked materials was obtained ethically, and that no compelled labour or violations of environmental rules for sustainable use are allowed.

That is one other twist within the story.

As we came upon throughout a joint investigation with the German publications Paper Path Media and Der Spiegel, Belarusian prisons managed to acquire worldwide “ethics” certificates for his or her merchandise. That is although compelled labour is used, together with political prisoners. 

“Detention circumstances within the penitentiaries as an entire are sometimes a type of merciless inhuman degrading therapy, Viasna human rights activists famous of their experiences. In addition they gave examples of violations of prisoners’ labour rights, together with circumstances of business accidents and the response of the correctional facility administration to them,” Pavel Sapelka, a lawyer on the Viasna Human Rights Centre, instructed BIC.

Whereas working as a part of the Worldwide Consortium of Investigative Journalists (ICIJ), we discovered violations within the certification of Belarusian woodworking enterprises.

Shortcomings have been recognized within the work of the 2 largest unbiased moral labeling organizations , FSC and PEFC. With out their certificates, import into the EU continues to be doable, however the majority of huge European timber patrons won’t settle for such items. EU patrons typically demand a certificates even from small producers. 

As just lately as 2021, eight Belarusian penitentiaries offered their merchandise with certificates renewed by the FSC. Regardless of repeated experiences by activists of human rights violations in penitentiaries, the certificates have been solely withdrawn on the finish of 2021. Earlier than then, in accordance with Earthsight investigators, items produced by political prisoners and others entered Europe unhindered. 

“Certification is carried out beneath tight deadlines with a restricted variety of specialists, […] so the group making use of for certification might attempt to disguise some manufacturing elements. And the certifying group might overlook some inconsistencies. This may be finished intentionally, however most probably it wasn’t intentional on this case,” environmentalist Inessa Balotsina mentioned of the violations.

FSC acknowledged that “compelled labour shouldn’t be an inherent concern of all penal colonies” and that FSC audits within the prisons had confirmed that prisoners weren’t compelled to work, and have been paid, “even when at a low price”. The FSC Board claimed that “certification our bodies terminated the FSC certificates of penal colonies in Belarus in 2021 on account of issues about human rights violations (following the 2020 elections)”, however didn’t clarify, if this was the case, why the terminations weren’t listed as ‘terminated and blocked’, or why they took so lengthy to happen.

The second Belarus organisation, PEFC, didn’t freeze its certificates recognising timber from Belarus and Russia as “battle” till 2022, when the Russian Federation attacked Ukraine. Earlier than the battle, the organisation’s certificates have been nonetheless legitimate, regardless of human rights violations within the nation. In Belarus, this worldwide organisation is represented by the state enterprise Belgiproles. This implies Belarusian officers conduct audits of the state forest enterprises. That’s, they examine their very own enterprise.  

We despatched a request to PEFC however haven’t obtained a response.

It isn’t solely timber from Belarus that finds its solution to Europe, evading regulators and sanctions. This was confirmed by our colleagues from Der Spiegel as a part of the Deforestation Inc. undertaking. Particularly, regardless of EU sanctions towards the costly teak wooden, which is used, for instance, for decks on yachts, is coming into Germany.

This investigation was carried out in partnership with Siena, Fundacja Reporterow, Re:Baltica, Kloop, Vlast, with the help of CyberPartisans and OCCRP.

👉 Authentic article at BIC