Apr 04, 2016 News
– Make it mandatory for concessionaires to engage in value-added processing or revoke their permits
The wanton abuse of Guyana’s State Forests by some foreign companies has left Chartered Accountant, Anand Goolsarran with no choice but to recommend strict measures to the Government in hopes of cleaning up the massive corruption he uncovered in the Forestry Sector.
In his recently released forensic audit report, Goolsarran said that he has observed the measures taken by other tropical timber producing countries to restrict or ban the export of logs, as well as Guyana’s failure to do so.
To correct the latter situation, the anti-corruption advocate strongly recommended that the Government of Guyana in collaboration with the Guyana Forestry Commission (GFC) should restrict the export of certain species of forest produce in log form and allocate quotas to concessionaires desirous of exporting logs from their concessions.
The forensic auditor also recommended that Government also makes it a mandatory requirement for concessionaires to engage in downstream value-added processing, failing which their permits will be revoked.
He said, too, that the Government should provide all concessionaires, both local and foreign, with the relevant fiscal concessions to enable them to engage in downstream valued-added activities.
Goolsarran’s strict recommendations came in light of the fact that the Guyana Forestry Commission (GFC) renewed for Chinese logging company, BaiShanLin Forest Development Inc., a State Forest Exploratory Permit for more than five years. This is in contravention of the nation’s laws which only allows for that permit to last for a period of three years.
His suggestions were also premised on the fact that the Chinese firm has failed for over eight years to establish its long awaited wood-processing facility.
He said, “Since 2009, the Commission had expressed concern about the extent of export of logs. Accordingly, it had proposed a ban on such exports with a view to encouraging downstream processing. However, at a Stakeholders Forum held in the same year, the Commission agreed to an alternative proposal whereby there would be a phased increase in the export commission.”
The Chartered Accountant continued, “For example, the export commission on wamara was seven percent in 2009. This increased to 10 percent in 2010 and 2011. The current export commission for this species is 17 percent.”
Goolsarran said that despite the above measure, log exports in 2014 have increased by75 percent, compared with 2013, from approximately 80,000 cubic metres to 140,000 cubic metres.
He said it is evident that the Commission needs to implement additional measures to restrict the export of logs and to encourage downstream processing in order to maximize the use of Guyana’s forest produce for the benefit of its economy through job creation as well as revenue generation through the production and sale of finished products both locally and abroad.
The forensic auditor noted too that during the period 2007 to November 2015, BaiShanLin and four companies owned/controlled by it, exported a total of 50,928 cubic metres of logs with a Free On Board (FOB) value of US$4.483 million.
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