Ivory is the cocaine of south-east Asia. Millions of people demand it, and the world thinks it can stop them by banning supply. The world is wrong. Today's London conference of Cites, the world wildlife organisation, saw panjandrums from 46 countries meet with British royalty in the painted halls of Lancaster House. Previous Lancaster House conferences liberated Africans from bondage. This one put them back. The Prince of Wales and the Duke of Cambridge pledged to "end the ivory trade" and "secure the future of these iconic species", notably the rhino and the elephant. Never were words so futile.

The futility would not matter if it were not so counterproductive. Cites is to wildlife what the US Drug Enforcement Administration is to narcotics. Its chief, John Scanlon, talks like a hardline cop about the need for ever more "undercover operations and harsher penalties". But however many NGOs and bureaucrats it takes fill a luxury hotel, you cannot defy the law of economics. You cannot stifle demand by banning supply. You merely raise price. One rhino horn can be worth as much as $300,000. That figure is a death sentence on every rhino.

Few people care deeply enough about distant wildlife to challenge those who offer to make them feel good. Hence the ghoulish PR that precedes Cites conferences, of members destroying quantities of ivory in fires and crushers. This time Barack Obama ordered the US to crush six tons and China duly crushed the same. France crushed three tons. This appalling waste merely increases poachers' profits and insults Africa, to which the value of the ivory properly belongs. It is like medieval princes burning food to taunt starving subjects.

When Cites first began flexing its muscles in the 1980s an argument took place between ivory-producing southern Africa and western wildlife charities. The Africans, notably South Africa, Namibia and Tanzania, argued that conservation was best achieved if local people had a vested interest in it – whether from tourism, controlled hunting or ivory sales. As long as people craved ivory, the alternative was massive poaching.

The American writer Raymond Bonner, in his book At the Hand of Man, described how US charity fundraisers overwhelmed the Africans. Big money required "charismatic megaspecies" to be saved from imminent extinction. The elephant was declared endangered when it was not. The world was flooded with pictures of mangled animals and in 1989, the trade in ivory and horn was banned.

Every prediction made by the Africans was right. Prices soared. In 10 years elephant numbers halved, and have continued to plunge by another two thirds. An estimated 22,000 African elephants are killed annually in industrial massacres. The Asian elephant faces extinction. Rhino deaths have gone from a handful a year to more than a thousand, with horns the price per kilo of gold.

It is hard to think of a more desperate failure of world government. Yet those responsible gather at Lancaster House to call for more of the same. Reducing consumption of any product requires reducing demand. Birds of paradise were hunted close to extinction until they went out of millinery fashion. Ivory demand did decline in Japan in the 1980s and China in the 1990s, leading to lower prices and less poaching. The market soon recovered with economic liberation. Illegal suppliers now hold 90% of the Chinese market and rule their empires like Afghan drug lords.

The survival of wild animals depends entirely on those among whom they live. Elephants eat up to 453kg of vegetation a day and, in India, kill up to 200 people a year. They may be glorious creatures but they are destroying their ever-shrinking habitats. Unless local people want to save them, they will be poached to the point where just a few remain in fortified reserves.

The movement for African "community conservation" gained ground in the 1990s, with such ventures as Campfire in Zimbabwe and regulated hunting in Tanzania and Namibia. It has gained little purchase with western conservationists. Tanzania's wildlife director, Alexander Songorwa, had to plead with the US in the New York Times recently "on behalf of my country and all our wildlife" not to ban trophy hunting. His $75m revenue supports 26 game reserves.

Meanwhile Namibia auctions up to five ageing rhinos a year for culling, recently fetching $350,000 each. This is far more than photography tourism could ever generate, and goes straight into wildlife protection and breeding. While more than 1,000 rhinos a year are reportedly poached in South Africa, Namibia's population is rising. Yet the auctions are vilified in the US. Richard Conniff, author of The Species Seekers, wonders that Americans who struggle to preserve the prairie dog "should be telling Namibians how to run their wildlife".

But hunting will not deliver the sort of money for conservation that could come from sales. Here Cites has an example from elsewhere. The killing of wild crocodiles has virtually ceased, demand for skins being met from captive breeding. The South African conservationist Michael 't Sas-Rolfes has already made a powerful case for "ranched horn" from rhinos to underpin their protection.

Vague promises to get tough with ivory and horn dealers will have no more impact than getting tough with drugs growers. Animals will not be protected in the wild unless some value can be imputed to them. They will go the way of the European bear and the American bison. That value must accrue to those who alone can save them – Africa's hard-pressed farmers, now increasingly inclined to turn to poaching. They and China's consumers have a shared interest in wildlife conservation. Why criminalise them both?