Sri Lanka Customs ‘Rosewood’ sale sparks controversy
Sri Lanka Customs has been embroiled in a controversial ‘Rosewood’ sale three days before Monday’s cabinet reshuffle in which Finance Minister Ravi Karunanayake took over the Foreign Minister’s portfolio, trade union officials of the department told the Business Times.
The Customs incurred a loss of more than Rs. 1 billion due to improper tender procedure followed by the department in the selling of this large stock of ‘Rosewood’ which was in official custody for more than two years, they alleged.
The value of the stock of around 420 metric tons of this valuable timber is estimated at US$10.5 million in the world market while the local value is Rs. 1,596 million.
Customs had sold this stock without calling for proper tenders through local and international advertisements, they said.
The department had called for bids from few parties and selected a bidder known to a powerful politician of the ruling party, a trade union leader disclosed.
The bids were closed by awarding the tender at a price of $7500 per metric tons and the sale finalized at total price of Rs. 478.8 million, resulting in an estimated loss to the department of Rs.1,117.2 million, he added.
Customs spokesman Dharmasena Kahandawa told the Business Times that on February 18, 2015 officers of the Customs Bio Diversity Cultural and National Heritage Protection Branch had busted a huge international Rosewood smuggling operation and seized 420 MT of the rare timber meant for transshipment from the Colombo Port.
The detection was the largest ever made by any border agency against Rosewood smuggling, he said adding that Customs officers had information that smuggling operations of Rosewood from African countries through sea routes passing Sri Lankan waters by international racketeers.
The Department had called for tenders on 38 times to sell 28 containers full of his valuable timber during the period of over one year but there were no bidders, he disclosed.
“Customs cannot keep such a large stock of timber for a long period under its custody and it has to face audit queries by doing so,” he said.
Thus the department had no alternative other than disposing of this large stock as soon as possible by calling a normal tender.
Only a single bidder applied for the tender and the tender board decided to award it to him, Mr. Kahandawa said.
“Rosewood is considered one of the most valuable tropical hardwoods that are found in Madagascar, East Africa, Brazil and south East Asia,” he said.