Feb 25, 2016 News
Ever since the disclosure that 100% of Guyana’s productive forest was given out to investors, information
continues to lay bare the operations of the country’s forestry sector.
Recent information from the Guyana Forestry Commission (GFC) indicates that 82 percent of the large concessions was given to foreigners.
Of the 4.5 million hectares of production area allocated for Timber Sales Agreements (TSA) and Wood Cutting Leases (WCLs), some 3.7 million hectares (82%) were allocated to foreigners.
The remainder 0.8 million hectares (18%) were granted to locals. (1 hectare = 2.5 acres)
According to the GFC data, of the Timber Sales Agreements for the foreign companies, the majority are Chinese with the Malaysians and Indians, making up the remainder.
BaiShanLin, a Chinese company under the radar for its activities in Guyana, controls over 615,000 hectares.
It would rival what is being held by Vaitarna- 737,852 hectares.
The largest concession held by Barama, a Malaysian company, holds 1.6M hectares– dating back to the early 90s. This foreign company has established a plywood factory and has sawmills and other processing facilities. Its arrangement with the Government is currently being reviewed.
GFC, according to indications, is now allowing Vaitarna Holdings, an Indian company, to conduct value-added activities using a portable sawmill. This is raising questions about what exactly the GFC considers value-adding.
Significantly, except for Barama Company Limited, Amcar, a French-owned company, Demerara Timbers, now controlled by another Malaysian group, and a few local companies, there is little evidence that any significant value-added processing is being done in the TSAs.
The information was recently released and published on the website of the GFC, http://www.forestry.gov.gy.
GFC is the regulatory body charged with overseeing the sector, but in recent years there have been criticisms that all is not well in the industry with little or no enforcement to ensure compliance to investment agreements by the companies.
Some of the compliance includes the construction of value-added processing to create local jobs.
Guyana has, in recent years, been pushing for less log exports and more processing, even introducing a dis-incentive scheme that saw the export taxes being hiked periodically.
However, it appears that the export tax scheme did little to force operators to construct processing facilities.
In recent weeks, there has been increased focus on the forestry sector after Minister of Natural Resources, Raphael Trotman, said that his Government, shortly after coming to office last year, discovered that millions of hectares of the area set aside for logging and other forestry activities are all gone.
Despite ex-President Bharrat Jagdeo denying it, records and maps confirmed this was true.
There are indications also that the previous administrations of the People’s Progressive Party/Civic, repossessed and re-allocated thousands of hectares of forest lands under questionable circumstances.
A number of them ended up in the hands of BaiShanLin and other foreign companies. These concessions are located in Regions One, Seven, Eight and Nine.
In some cases, the lands were acquired, under questionable joint ventures (JV) and other arrangements.
Some of the concessions that have been re-allocated included those belonging to Kwebanna Wood Products; Caribbean Resources, Unamco, Simon and Shock and Sherwood Forests.
Most of the affected concession holders said that they were fearful of speaking out before.
They said that they were also pressured by the GFC which used “all sorts of reasons” including non-compliance, to force them to sell off.
Significant to note, also, is that the concessions given out did not see any processing taking place there.
Minister Trotman recently told the National Assembly that land grabbing was done without any regard for future generations.
He made it clear that in the context of the national patrimony, this can only be seen as a threat to the nation’s long term viability and security as a people.
The administration is now moving to change the forestry laws.
Stakeholders have been more vocal in recent times with pressure on the new government to reform the forestry sector and GFC.
Guyana also has a US$250M five-year incentive agreement with Norway to protect the forests.
That agreement expired last year and is currently being renegotiated.
The agreement is seen as a lucrative one for Guyana as it allowed operators to continue work but in an environment where periodical checks are made to ensure the country is complying with benchmarks established.
Stakeholders have expressed worry about the current revelations regarding the management of the sector. (See table below)
The information posted by GFC on its website
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