Dear Editor,
In your news item ‘Roger Khan company, Harry Rambarran in court battle over Willems Timber’ (Sun Stabroek, September 14) you repeat the assertion from the Guyana Forestry Commission (GFC) that “prior to the new Forests Act of 2009, there was no requirement for companies to seek their approval before entering into joint venture arrangements . . .” This assertion was made in slide 27 of the 42-slide presentation by Commissioner James Singh at the press conference on the Chinese transnational logger BaiShanLin on August 18. The slide set is accessible on the website of the Ministry of Natural Resources and the Environment under the notably inaccurate title ‘Setting the record straight on the forestry sector: the Bai Shan Lin investment.’
The GFC has been repeating this false statement about ‘joint ventures,’ better known as landlording and covered in my letter ‘Concession holders who cannot operate their forests should lose their grants, not be allowed to transfer them without a competitive bidding process’ (SN, July 10, 2007), with regard to similar illegalities involving Barama Company Limited:
“‘Landlording’ is the practice in which the legal holder of a forest harvesting concession gives up managerial control and rents it out to another enterprise. This practice is illegal under Forest Regulations 1954, [regulation] 12 – ‘No transfer of any lease or timber sales agreement shall be made by any forest officer without the prior approval of the President where such lease or timber sales agreement grants exclusive rights to any person over an area estimated to exceed three thousand acres or is for an unexpired period exceeding three years.’ Landlording is illegal under Condition 13 of the Timber Sales Agreement which states ‘The grantee shall not transfer, sublet, mortgage or otherwise dispose of any interest arising under this agreement except in accordance with the Forest Regulations and any purported disposition made except in accordance with such regulations shall be null and void.’”
There is no evidence in the public domain that the President (then Bharrat Jagdeo) had given such prior approval.
Among the various documents recently provided on request to the Guyana Manufacturing and Services Association (GMSA) by the GFC, on September 4, 2014 is the model wording for Timber Sales Agreements (TSA). This model agreement continues to include the above-cited condition, now re-numbered as 12 but with the same wording. The GFC also provided to the GMSA the following TSAs which have been rented illegally to BaiShanLin:
TSA 01/1999 WAICO – Wood Associated Industries Company Limited, 26427 ha for 25 years from 21 January 2000;
TSA 01/2007 Puruni Wood Products Inc., 110253 ha for 25 years from 27 July 2007;
TSA 04/2009 Kwebanna Wood Products Inc., 87356 ha for 10 years from 07 April 2009;
TS 01/2011 Haimorakabra Logging Company Inc., 52894 ha for 10 years from 04 November 2011;
All these TSAs contain the same Condition 12, so none of them should have been rented to BaiShanLin without prior presidential approval.
The reasons why the private renting of public forest assets is bad for Guyana were summarized in the second part of ‘Transparency and accountability in the regulation of Guyana’s forestry sector’ (by the Transparency Institute of Guyana Inc in SN, September 2). The need for a transparent, equitable, objective process for allocation of State Forests is clear in the forest concessions policy prepared by the GFC in 1993. In the forest management chapter (30) in the National Development Strategy the recommended principles for forest concessions included:
“(b) some form of phased competitive bidding for the rights of these blocks [of forest eligible for natural forest management concessions. Page 17 of the chapter mentions auctioning the concessions – in order to secure a premium for government revenue].
(c) establishment of blocks of different sizes, to provide opportunities for investors of different scales;
(d) making all the new concessions minimum of 80 years in length, and maximum of 100 years. Eliminating all shorter permits and concessions, in order to put an end to the “mining mentality” with respect to forest resources;
(e) clear specification of property rights such as exclusivity, transferability and enforceability;
(f) clear establishment of obligations, and performance bonds for concessions;
(h) development of a standard agreement so that all potential and actual concessionaires will face the same conditions in regard to fiscal provisions and forest management requirements.
The GFC does still sometimes recognize some of these principles from the National Development Strategy and their later incorporation into the National Forest Policy (1997, slightly revised in 2011). For example, when the rescinded CRL concession TSA 04/1989 was passed to the Indian high street retailer Café Coffee Day – subsidiary VHPI in Guyana – as TSA 01/2010 on
payment of a premium of US$ 600,000. However, VHPI acquired this 346,000 ha concession without passing through the State Forest Exploratory Permission stage, which was questionable as VHPI had no prior experience of management of natural tropical rainforest and the GFC cannot have completed a due diligence check with respect to this India-based company. There is no evidence in the public domain that BaiShanLin has paid a premium into government revenue for any one of the eight TSAs which it now controls through renting (what the GFC calls ‘joint venture’) among its 1.3+ million hectares of State Forest in Guyana.
I draw attention also to the two short-term (2-year renewable) adjacent State Forest Permissions – Ess 08/2014 and Ess 09/2014 totalling over 8,000 ha in 2014. According to the documents provided by the GFC to the GMSA, these two SFPs were issued under Regulation 7 (B) (1). However, in the current Forest Regulations 1954/1982, there is no Regulation 7 (B) (1). This may be a reference to new draft tegulations which, according to the Law Revision Commission’s Notes on Subsidiary Legislation, “are shortly to be made.” In the meantime, it is not legally correct to issue licences under draft legislation whose contents are not publicly known. Instead, the GFC should have used Regulation 10 in the current Forest Regulations. This is just another example of the GFC’s casual attitude towards law, in spite of the claim of the GFC’s Corporate Secretary to be a “stickler for legality.”
Readers should note that the 12 documents relevant to BaiShanLin which the GFC sent to the GMSA are only a small proportion of the list requested by Shadow Minister for Natural Resources, Joe Harmon, as preparation for his public debate on BaiShanLin with Commissioner Singh of the GFC (‘Harmon accepts GFC’s challenge for public debate on Bai Shan Lin,’ Kaieteur News, August 18). This limited response from the Government of Guyana is not congruent with the commitment to transparency in the MoU and Joint Concept Note signed with Norway in November 2009.
SN reported on September 14 that BaiShanLin also has an agreement with Harry Rambarran regarding concessions TSA 10/85 and TSA 01/91. So we must add another 112,600 hectares to BaiShanLin’s forest holdings in Guyana. BaiShanLin now controls over 1.4 million hectares (Mha), Barama 1.6 Mha and VHPI/Café Coffee Day 738,000 hectares. These three Asian loggers now hold at least 3.8 Mha or over 55 per cent by area of all Guyana’s forest concessions. All are focused on log exports, not on in-country processing, as advocated by Guyana’s national forest policy and the manifestoes of all the political parties.
Yours faithfully,
Janette Bulkan
