Group wants Norway to delay payment to Guyana

Mar 28, 2011 News

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– attempts to undermine commitments to combat climate change – Govt.

Just days before Norway’s Minister of Environment and International Development, Mr. Erik Solheim is scheduled to arrive in Guyana an open letter has been sent to him by a group of 18 persons aimed at convincing the Norwegians to delay the payment of the Money under the MoU it signed with Guyana.
The letter sought to point out to the Minister what they say were eight key problems with the operation of the MoU.
The Office of Climate Change (OCC) in Guyana in retaliation debunked the letter saying that it was sent by a group of persons well known for their anti-government and destructive politics.
According to the OCC, the letter is clearly written with the express intention of undermining the joint commitments of the governments of Guyana and Norway to an international effort to combat climate change through the funding of a Low Carbon Development Strategy for Guyana.
“The letter is woefully short on facts and long on political rhetoric and, sadly, reveals a fundamental ignorance of the REDD+ model and its mechanisms,” the OCC stated.
In the letter that was sent to the Norwegian Minister, it was pointed out that, “The signatories of this letter include members of civil society with diverse backgrounds and two Members of Parliament who have followed developments in Guyana closely since signature of the agreement, and who are particularly familiar with some of the detailed local issues which are raised.”
The signatories to the letter are Diana Abraham, Malcolm Alli, Seelochan Beharry
Janette Bulkan, Tanya Chung Tiam Fook, Anand Daljeet, Everall Franklin, MP, Malcolm Harripaul, Christina Jardim, Tarron Khemraj, Allison Lindner, Colette McDermott, Alissa Trotz
Karen Jardim, Edward Meertins-George, Sharon Ousman-Arjoon, Christopher Ram, Khemraj Ramjattan, MP, Oma Sewhdat, Charlene Wilkinson, Fitzgerald Yaw and David Yhann.
The letter documents that Norway transferred US$30M to the Guyana REDD-plus Investment Fund (GRIF) before Guyana had developed any ‘Low Carbon Development Strategy’-related proposals and before any attempt at independent verification of the claims from Guyana about progress in reducing forest carbon emissions.
It states that months later, and in spite of criticism of the donors by the President of Guyana, there is still only a single (draft) proposal on the table, “a technically inadequate project for titling and demarcation of Amerindian lands forwarded by Partner Entity United Nations Development Programme, apparently without quality control and without significant participation by indigenous Amerindians themselves.”
The Norwegian US$30 million now languishing in the GRIF and listed in the national budget of Guyana since mid-January 2011, together with an anticipated further US$40 million from Norway, comprises nine per cent of the Guyanese government’s budget for 2011, according to the group.
“We believe that transferring the original US$30M in advance of verified progress on the agreement with Norway sent quite the wrong signals to a country with daily allegations in the independent press of corruption and malfeasance in government procurement and other expenditure.”
The group also stated that deforestation appears to have increased, not decreased which suggest a contradiction.
“Because of technical deficiencies in the work of Poyry New Zealand and the Guyana Forestry Commission (GFC), it is not possible to make any definitive conclusions about the absolute rates of historical or current deforestation. However, even allowing for those technical deficiencies, the relative rate of deforestation in 2009 and 2010 appears to have increased three-fold, not decreased in comparison with the reference period.”
The grouping also pointed to what they call a need for strong and consistent safeguards.
The MoU originally stated that the Guyana REDD+ Investment Fund, through which passes Norwegian payments for Guyana’s progress, would be subject to the World Bank’s ‘fiduciary and operational policies’.
According to the grouping, that requirement was subsequently dropped and no reason was given for, “this potentially serious weakening of safeguards.”
The grouping stated that President Bharrat Jagdeo has objected to the delays from the due diligence procedures of the World Bank.
“The President prefers to work with the Inter-American Development Bank (IDB), as shown by the transfer of the Forest Carbon Partnership Facility ‘delivery partner’ to that agency from the World Bank. We suggest that Norway should be concerned by the switch to the IDB, which has provided much of the credit for a large recent increase in the country’s external debt, in spite of providing for a large HIPC-related cancellation of prior debt in 2007.”
“Weak participatory process” is also a bugbear for the group, which they say has been unsatisfactory in the past, adding that, “examples of the lack of effective consultation and coordination are the two LCDS projects to install solar panels for low-wattage household electricity, and to distribute a netbook/laptop to each family (OLPF).”
The grouping also documents what it calls risks of the Amaila Falls Hydro Project.
The President of Guyana proposes to invest US$40 to US$60M of the Norwegian US$250M ‘REDD’ money in purchasing equity in the Amaila Falls dam, even though the entire justification for the dam remains just 1½ page in the LCDS version of May 2010.
The Guyana Energy Agency national policy has not been updated since 1994, and does not even mention the Amaila Falls project, according to the Group.
“There is no practical possibility of the unqualified, inexperienced and under-capitalised contractor, who was awarded the contract under questionable circumstances, completing the access road to the dam in the specified time period or to the specified road bearing strength, in spite of being loaned US$ 1.5M from a government ‘off-the-book fund’ to buy second-hand construction equipment…This delay is even admitted by the Government’s own technical adviser.”
The access road construction is now less than 25% complete, whereas some 65% should have been completed, according to the original schedule.
The group says that it is currently unlikely that the two Chinese investment entities, which are reported by the President to have committed to funding the dam, would provide the US$500M for the bulk of the dam construction while the road is incomplete.

“Thus there is a large question mark over when, or indeed if, the dam will be fully funded and constructed, and if any Norway-provided equity in the dam would be effectively applied…As we understand it, the Amaila Falls project cannot be presented to the GRIF until such time as the project proposal has been approved by the Board of the IDB, and this cannot happen until such time as the Advisory Expert Panel has completed its work, which we understand will not be for 6 months or so…The project’s developer, Sithe Global Power LLC, has today admitted that there may be delays in securing funding for the project.”
The group says that there appears to be no ‘Plan B’ for using the Norwegian money already in the GRIF, “but remaining unspent, let alone any plan for alternative use of any additional funds for 2010-11.”
The group said that given the circumstances they submit that the risk of misuse of the funds is unacceptably high.
The group also raised with the Norwegian Minister what they called, Inadequate Independent Verification Report and restricted access to government information among others.

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