CHINESE logging company Bai Shan Lin is nowhere close to fulfilling its contractual agreement of setting up a wood-processing plant here. Minister of Governance Raphael Trotman, who oversees the Department of Natural Resources and the Environment, said based on his last discussion with the Chinese company, it is in no position to establish the wood- processing facility which would have allowed it to manufacture value- added products.
“When I last spoke with them about three weeks ago, they were in no position to have the mills which are expected within the next 10 months. They have asked for two years,” Minister Trotman noted. In response, the government would have asked Bai Shan Lin to consider the usage of alternative mills that could be sourced in and around the Region.
According to Minister Trotman, the company’s operations are at a “pause,” explaining that it is in the process of restructuring. He added that in light of restructuring, Bai Shan Lin is soliciting financial assistance from the Chinese Development Bank – a financial institution in which he would have met with recently. When the restructuring process is completed, Minister Trotman said the company will move to re-engage the government, noting that the establishment of the wood-processing facility is dependent on Bai Shan Lin securing new finances.
Shortly after taking office, the government had issued a warning to Bai Shan Lin, indicating that failure to honour its agreement by the end of the year could result in the termination of its contract. The Chinese company, which operates in close proximity to Linden, Region 10, had failed to make good on its promise to establish a wood-processing facility while operating under the People’s Progressive Party/Civic (PPP/C) government. Realising the loopholes within the system with respect to the management and utilisation of the country’s forestry resources, the government through the Department of Natural Resources and the Environment started the process of reviewing the agreements and concessions awarded to the company. According to Trotman, this review is still in progress.
According to Bai Shan Lin, in 2014 it invested more than US$160M in developing its operations here. The company had further pointed out that back in 2008, it had applied to the Guyana Office for Investment (GO-Invest) and other agencies to access lease lands for the establishment of a wood-processing factory and to engage in value-added production. “We were granted that lease for the construction of our processing plant four years after we applied for it. The lease is around 200 acres of lands located in Region 10.” However, the company had said that it would have preferred lands closer to port Georgetown, but the then administration insisted that the factory be set up in Region 10 in order to create jobs.
Despite its inability to fulfil its primary objective, the company had said it remained committed to fulfilling its social responsibility, noting too that it had every intention of setting up the plant here. “Specialist engineers in China drew up the layout and design of this factory in the beginning stages of our company’s engagement in Guyana. The estimated cost of setting it up is in excess of US$80 million. We began clearing the lands, but encountered difficulties with the administration of Region 10. Objections were made about processing 100,000m³ logs per year,” the company had complained. According to the company, US$30M has been spent on preparatory work for the wood-processing plant.