May 28, 2013 News
…Govt promoting company without full disclosure
The Government is keeping closed, the arrangements it has with Chinese company, Bai Shan Lin, which has announced massive investment plans here.
The company has been granted a forestry concession that amounts to close to one million hectares of rainforest, from which it plans to extract logs and ship them out of Guyana. The company estimates that it will make US$1,800 from each hectare of land, giving it profits totaling US$1.7 billion.
In addition, it has been granted permission to dig up a 20-kilometre stretch of river to look for gold.
Other plans include setting up what it is calling a Guyana-China Timber Industry Economic and Trading Corporation Park plus a 400-acre real estate development.
The plans were announced last November by Chu Wenze, the chairman of Bai Shan Lin, at the Second World Congress on Timber and Wood Products Trade in Taicang, China.
Those plans were announced even before Guyana knew of it. The country became aware of what was happening only when Bai Shan Lin officials visited Guyana and held discussions with President Donald Ramotar and other Government officials.
Strange enough, Mr. Chu Wenze named President Ramotar, former President Bharrat Jagdeo, Prime Minister Samuel Hinds, Ministers Robert Persaud and Irfaan Ali, along with Ambassador to China, David Dabydeen, as part of its promotion team.
The nature of the agreements the government has with Bai Shan Lin has not been shared with the public or the National Assembly.
Bai Shan Lin is part of a group of 11 companies which have been granted permission to operate in Guyana.
The state information agency, GINA, reported that Bai Shan Lin has been in Guyana over the past eight years with operations through the Bai Shan Lin Forest Development Inc., Haimorakabra Logging, Karlam South America Timbers, Wood Associated Industries, Kwebanna Wood Productions, Sherwood Forests, Bai Shan Lin Housing Construction, Mining development Inc., and Bai Shan Lin Ship Building and Heavy Industries Inc.
It has been contended that the law does not allow one logging company to take over another, unless the President so agrees. However, reports are that Bai Shan Lin took over operations of the concession of Demerara Timbers Limited without this permission.
The law stipulates that forest concessions must not be traded, but that it was to be re-advertised by the Guyana Forestry Commission and be open for bidding.
Bai Shan Lin plans to set up its exhibition centre at Providence, East Bank Demerara.
Earlier this year, the company had sought 1, 000 Guyanese workers for its wood processing operations in Region Ten.
Commissioner of the Guyana Forestry Commission, James Singh, has said that by July 2013, construction machinery/materials, such as, concrete mixers and steel framing for the factory will be in Guyana.
Construction is scheduled for a 2015 completion, he said, with US$60 million in financing secured.
He said that the Linden Wood Processing Factory will be an integrated factory, beginning with log/lumber intake and resulting in the large-scale production of high-end furniture; flooring (parquet, multiple layered, outdoor quality); veneers; doors; mouldings; finger jointing and lumber, among others.
However, he has not given any timelines by which Bai Shan Lin intends to move into the different phases of its operations.
However, James has dodged several questions by researcher Janette Bulkan. For example, he has not said what raw materials would be used at the wood processing facilities. Bulkan had asked about species, dimensions, volumes, and quality of timbers.
According to Singh, Bai Shan Lin has 180 local workers who function in various capacities. He admitted that the ratio of Guyanese workers to Chinese workers is currently high because of the need for the critical expertise in this start-up phase.
However, the company has committed to employing an additional 200 Guyanese by the end of 2013, which would further increase the percentage of Guyanese employed to 74 per cent. By 2017, Singh said the ratio of Guyanese to Chinese will be 85:15.
The Guyana-China Timber Industry Economic and Trading Corporation Park has been announced by Bai Shan Lin as a state-level park programme in which there would be national subsidy for loan interest. Further, the company stated that in the park would be entitled to “subsidy for carrying back resource.”
The company said that under the Park arrangement, it would provide preferential forest tenure, land price for plan construction and the enterprise may also co-establish a joint company with Bai Shan Lin.
Bulkan has called on the Natural Resources Sectoral Committee of the National Assembly to ask serious questions of the Ministry of Natural Resources and GFC and Bai Shan Lin.
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