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Peru Governor Accused in China Wood Trafficking Network

CHINA AND CRIME / 10 NOV 2021 BY MARK WILSON EN

A Peruvian governor is accused of playing a lead role in a timber trafficking network that involved Chinese logging businesses – in a case that provides further evidence of the growing involvement of Chinese actors in Peru's illicit timber market.

Luis Hidalgo Okimura, governor of the Madre de Dios department, is under investigation for allegedly taking bribes to provide logging concessions and transport permits to timber firms, Dionisio Quicaño, a prosecutor in the anti-corruption unit of the Attorney General's Office, told Peruvian media outlet Punto Final. Among the beneficiaries of the concessions are five companies belonging to Chinese businessmen Xiadong Ji Wu, who is also under investigation after prosecutors raided one of his properties and discovered planks made from a protected tree species, according to Punto Final.

A logging business connected to Ji Wu benefited from a 42,000-hectare concession being moved to a protected area of Madre de Dios in the Amazon region, according to the report.

In a series of audio recordings published by Punto Final, Ji Wu and his associates can allegedly be heard discussing bribes to forestry officials. Hidalgo can also be heard discussing a meeting with Ji Wu, who is referred to as "Fidel." One of Ji Wu's businesses allegedly paid for the governor to travel to China in 2019.

Hidalgo admitted to Punto Final in irregularities in the concessions provided to Ji Wu but denied he had played any part. He claimed that it was all done under the purview of the region's former head of forestry, who was detained as part of the investigation.

SEE ALSO: Yacu Kallpa: Illegal Timber and Impunity in Peru

The investigation into the illegal wood network has been gathering speed in recent months. The first operations occurred on August 25, when authorities arrested 17 people and seized 21 Cusco and Puerto Maldonado properties. A search of Hidalgo's house then occurred on October 12. About a week later, prosecutors asked that Hidalgo and nine other people be placed in preventive detention.

Nearly 30 officials – including government officials, police officials, customs agents, and even prosecutors involved in investigating environmental crimes – are under investigation, according to Mongabay.

InSight Crime Analysis

If investigators prove a deal between Hidalgo and Ji Wu, it would prove that certain fraudulent Chinese companies are directly corrupting officials in Peru to facilitate the illegal timber trade.

China has become a significant driver of the illegal timber trade in Peru. According to data collected by the Centre for International Environmental Law, more than 70 percent of timber exported from Peru to China via the port of Callao port was on the "red list." This means that the exporting company either faces legal proceedings or has been sanctioned for crimes related to illicit timber.

Chinese companies linked to illegal logging have even processed illegal timber at deforestation sites using mobile sawmills, according to Rolando Navarro, the former director of Peru's Agency for the Supervision of Forest Resources (Organismo de Supervisión de los Recursos Forestales – OSINFOR). 

This allows them to move the wood within the Amazon region with "much greater ease and versatility," Navarro told InSight Crime.

SEE ALSO: Organized Crime and the Environment in Latin America: A Fatal Encounter

China is currently the world's largest importer of timber, and the country has no restrictions on the import of illicit wood.

InSight Crime has documented extensively how corruption routinely greases the wheels of the illicit lumber trade in Peru, which includes the dozens of loggers, transporters and middlemen who harvest and move the timber, the export companies that launder the illegal wood, and the corrupt officials who receive bribes to facilitate the schemes.

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