The Htoo Trading Company, owned by Burmese tycoon U Tay Za, has been harvesting teak and other hardwoods from the largest reserve forest in Arakan State for export.

"The Htoo Company will generate over 1,000 tons of teak and several tons of other hardwoods from the Mayu reserve forest this year. The company is felling many trees in the forest now for the timber," a forest department official in Buthidaung said.  

The company produced 1,200 tons of teak in addition to other hardwoods from the reserve forest in 2009 and sold the timber in international markets, said a source from Maungdaw.

The Mayu reserve forest is located in Maungdaw Township on the western Burma border and covers 56,196 acres. Teak has been cultivated in the forest for the last 50 years, while other hardwoods grow in the area naturally.

"As far as I know the Htoo Company has exported the teak to Malaysia, Signapore, and India, while other hardwoods are going to neighbouring country Bangladesh," he said.

The company is now felling all teak in the Mayu Forest that has reached a trunk diameter of four feet, and many teak logs are being piled up beside the Buthidaung-Maungdaw motor road for transport to Rangoon.

Htoo Trading Company was granted permission by the military regime last year to harvest wood from the Mayu reserve forest after the government mooted a plan to cultivate rubber in the forest.

It is not known how much the Htoo Company paid the junta for the right to harvest trees from the forest. A businessman from Sittwe said the government permitted the harvesting by the company without floating a tender in Naypyidaw for the contract.

"If there was a tender for the harvesting of wood from the forest, Arakanese businessmen would not have been able to compete with U Tay Za. In Arakan State, the government has auctioned off many public buildings and structures, but the most important tenders have been won by Htoo Company, because the company has a lot of capital and U Tay Za is a close associate of the junta authorities," he said.