BSL joint ventures due to forest underutilisation- Forestry Commissioner

WHILE aspersions continue to be hurled by a section of the media on the operations of Chinese logging company, Bai Shan Lin, Commissioner of the Guyana Forest Commission, James Singh has outlined the conditions under which BSL received joint ventures for 274,000 hectares of forest. 

At a news conference on Monday at the headquarters of the Forestry Commission in Kingston, Singh disclosed that up until the advent of the 2009 Forestry Act of Guyana, “there was no requirement for companies to seek GFC approval prior to entering into joint ventures of transfers.”

The Commissioner, in the same breath, refuted claims that the agency tasked with Forestry oversight does not make conditionality for joint ventures between consenting entities. According to him, “a company is the one to request the joint venture, the GFC does not impose any condition on behalf” of any entity.

BAI SHAN LIN HOLDINGS
Commissioner Singh noted extensively that Haimarokabra Logging Co. was subject to a joint venture in 2006 between Mr. Danny Chan and the original holder, Mr. Roy Kharie. Chan in mid-2007 transferred all his shares in Haimorakabra, as well as Karlam Sawmill to Mr. Chu Wenze of Bai Shan Lin International Forest Development Inc.
Singh added that these agreements were not restricted to Chan and BSL along since other joint ventures which occurred around the same time involved Willems Timber and Nagasar Sawmill Limited.
After the Forestry Act was set in place, GFC stepped up to the plate and became the sole authority approving of joint ventures between consenting entities. Wood Association Industries Company (WAICO), for which the principal was Mr. Danny Ameerally had received approval from the Commission’s board for joint ventures with BSL through Mr. Chu Wenze.
It was also revealed that Sherwood Forrest Inc. with the principals Dr. Patrick Williams, Dr. Gary Clarke and Ms. Yvonne Belle had received joint venture approvals with BSL in August 2009. Puruni Woods Inc. with principles Messrs. Mohabir, Dinesh, and Satish Singh received approval in March 2014, for a joint venture with Mr. Chu Hongbo representing Heilongjang Forest Engineering and Processing Development Inc.
And finally, the Commissioner disclosed that Kwebanna Wood Products Inc. through Messrs. Yacoob Ally and Ram Alli were granted approval on joint ventures with BSL in April 2014.
Singh maintained that these applications were subject to full scrutiny by the process of submitting an application, which was reviewed and forwarded to a technical sub-committee of the Board and later to the full Board where it was approved.
This means that BSL “has legal access to a total of 627,000 hectares not 960,000 hectares as is erroneously reported in the print media.”
Of these 627,000 hectares, approximately 345,000 are a State Forest Exploratory Permit (SFEP), which are accompanied with the obligation to complete an Environmental and Social Impact Assessment (ESIA), a Forest Inventory (FI), as well as a Business Plan (BP) “to the satisfaction of the EPA [Environmental Protection Agency] and GFC before they are recommended for conversion to a TSA [Timber Sales Agreement].”
Similarly, 274,000 hectares have been issued as TSAs under the joint venture agreements, WAIMO, Haimorkabra, Puruni, and Kwebanna and finally, 8170 hectares issued as State Forest Permissions (SFPs).

FOREST UNDERUSE SOLUTION
The Commissioner made it clear that both the Board of the GFC and the Government expressed concern that some concessions were being underutilised.
“We have taken action including repossession of several foreign TSAs [Timber Sales Agreements] and WCLs [Wood Cutting Licences] such as CLR [Caribbean Resources Limited].”
“The total annual allowable cut under sustainable management principles is 1.6M cubic metres but the actual production last year was just under 400,000 cubic metres. This is obviously a grave concern not only to the GFC and the Board but also to producers themselves because they have invested in the forestry sector”, the Commissioner expounded.
A solution to this dilemma was derived, Singh explained, after “we met with forestry stakeholders, and at these arrangements, the Forest Producers Association and forestry stakeholders … highlighted their inadequate capacity to produce because they did not have the finances… they did not have the machinery.”
Short term measures were derived to remedy these concerns, one such measure was joint venture arrangements, “after the requisite due diligence was done.” The second measure was for the GFC to allow companies that lacked adequate or appropriate machinery to rent from third parties.
This arrangement allowed not only for improved lumber extraction but also value-added production, the Commissioner said adding that such a measure allowed for the generation of “additional employment opportunities.”
It was reported that the stakeholders agreed on the procedure for reviewing joint ventures for which justification must have been made by the Company that has legal access to the state forest. An assessment is then completed and the GFC Technical Sub-committee conducts a review and makes a final recommendation to the full Board of Directors which issues as final decision.
The GFC made it clear that several companies have not only taken full advantage of this facility by the agency’s board, but these approved joint ventures and rental agreements have resulted in an increase in production.
“Even with these joint ventures and rental agreements, there is still tremendous room for increasing the annual allowable cut within the frame of sustainability,” Commissioner Singh noted.