Jul 03, 2016 News
The company scheduled to take over BaiShanLin—most likely Long Jiang Forest Industries Group—should not expect to receive any concessions. However, that is not to say that the Ministry of Finance would not still grant concessions.
Minister of Natural Resources, Raphael Trotman, during a recent interview with Kaieteur News, said that he remains in communication with the controversial company—BaiShanLin—on a range of issues. These issues, according to the Minister include, “the people’s concerns,” and updates on the China State-Owned company that is to fully take over BaiShanLin.
Trotman said that, recently, he had a meeting with BaiShanLin officials and members of the China Development Bank (CDB) “about the way forward.”
The Minister said, “They are all quite aware of the people’s concerns. We also had discussions on the investor that is to take over the company.”
Asked if that is the same company that Minister of State, Joseph Harmon, met during a visit to China; Trotman said that he was given the impression that many Chinese companies have interest in taking over BaiShanLin.
“My sense is that there is more than one potential investor but one showed a strong interest. I did not push for a name so I do not know if it is the same one (company) spoken to by Minister Harmon. It could be,” said Trotman.
When he was defending his controversial trip to China, Minister Harmon recalled that on March 27, 2016, arrangements were made for him to visit Long Jiang Forest Industries Group, a Company situated in Heilong Jiang Province. The Long Jiang Forest Industries Group is a state-owned company that had acquired 55 percent of the shares in Bai Shan Lin. Harmon said that his company intends to fully take over BaiShanLin in 2016.
Apparently in direct reference to the photograph of him with several Chinese persons aboard the a private jet, Harmon said, “Two officials from the Long Jiang Forest Industries Group, along with two officials from BaiShanLin, accompanied me on the aircraft from Beijing to Heilong Jiang Province to attend the meeting.”
The Minister of State used the opportunity to announce in his statement that at that meeting, the Vice Director of the Company, Mr. Wong Dong Xu, in the presence of officials of Bai Shan Lin, assured that the Company’s officials would be in Guyana by May 2016 to complete due diligence for the takeover, and to satisfy and expand on the obligations of Bai Shan Lin to Guyana.
The media has heard nothing about this due diligence since.
Minister Trotman said that the government has told BaiShanLin that it is fully prepared to meet and have discussions with the investor, “so we await a feedback.”
Trotman said that the APNU+AFC government wants it to be made clear that it is not against business. “We just want business done right; we are not going to say no to a credible company taking over another company or investing in Guyana but we want to make sure they know that the laws and people of Guyana must be respected.”
BaiShanLin has been granted concessions by the People’s Progressive Party/ Civic (PPP/C) that seem generous even for the most innovative of projects that a company can come up with.
Among the concessions sought by BaiShanLin were requests for one billion tons of cement, another for 300-plus trucks and a further request for two billion pails of paint. The waivers on the cement and paint alone would amount to just about US$60B in lost taxes, a sum equivalent to 40 years of Guyana’s national budget.
Trotman was asked if the company that takes over BaiShanLin will receive additional concessions. He responded in the negative but said that the possibility somehow exists.
“I would think if you are taking over a company that already had concessions you are hardly likely to qualify for new concessions; because it is not a new entrance into the market,” said Trotman.
However, Trotman said that the final decision in this regard ultimately rests with the Minister of Finance.
“But my view is that if you are taking over a company that has already been given concessions you are hardly likely to be expected to ask for or to receive new ones. That’s not to say that we wouldn’t at some point and time say yes to something or the other.”
Trotman said that currently BaiShanLin is not involved in logging operations of any kind.
He said, “The last information I received is that BaiShanLin’s operation is at a standstill. They are just watching over assets and so forth “
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