Logging scandal…Harmon shuns Persaud’s defence on absence of value-added processing

Sep 17, 2014 News

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By Abena Rockcliffe
A Partnership for National Unity (APNU) Member of Parliament, Joseph Harmon, who sits on the Sectoral

Committee on Natural Resources, has dismissed what he referred to as a frivolous excuse put forward by Natural Resources Minister, Robert Persaud, as he sought to justify the absence of value-added processing in the timber industry.
In this context, value-added is the process of turning timber into lumber, furniture, paneling, flooring, cabinets, musical instruments, veneer, plywood, house logs and a host of other wood products. Because these products are worth more than raw timber, such manufacturing is called “value added processing”.
Harmon said that the Minister has to come better when defending such a big issue and has to stop thinking of the Guyanese people as naïve.
Harmon’s comments were made in response to the defence put up by Minister Persaud as he addressed the fact that Guyana is failing to maximize the potential of the timber industry by not enforcing value-added export as a must.
Persaud recently told a gathering at the Guyana Forestry Commission that it is all fancy talk if one of the biggest hurdles of value-added processing—cheap energy—is not crossed.
The minister was at the time addressing a seminar on issues that “are beneficial to stakeholders in the value-added sub-sector.”
The seminar was scheduled after Chinese company Bai Shan Lin and Indian company Vaitarna were criticized for exporting large amounts of logs even though years-old promises for value-added forestry have gone unfulfilled.
The Minster said, “We can talk from here to the top of Mount Roraima about value-added in any area of our economy, but unless and until we definitively address the matter of energy we would just be having a good talk.”
Persaud said that government has been insisting that foreign companies investing in Guyana include value-added products as part of their agreement. He said too that the concept of value-added produce is something the administration has been pursuing for a number of years in all sectors of the country’s economy.
But Harmon is not in full agreement with the Minister’s take on the issue. The MP told Kaieteur News that while cheap energy is crucial to any manufacturer, the companies that have actually signed up for these value-added products should have and most likely known before  about the conditions under which they were going to operate in Guyana.

“Persaud is being a little disingenuous when he is seeking to say that because you don’t have cheap energy is almost an excuse for these people not to perform their legal obligations under the incentive regime given to them. They know the constraints they are coming to deal with and it is not something they just stumbled upon. All these foreign companies get all these benefits and are failing to honour their promises.  Persaud should not provide excuses for Vaitarna and Bai Shan Lin for failing to do what they were supposed to do years ago,” Harmon stated.
He conceded that cheap energy is essential for a vibrant manufacturing sector, but said that the companies have actually signed on to deliver on the value-added products and will be under the microscope, “there is no excuse for them.”
Harmon sought to explain in layman terms that “Before a woman goes into a relationship with a man she assesses him and does a background check. She examines the man for loyalty and his moral and financial standing and then decides whether she wants a relationship with him. She does not enter the relationship and then complain that the man cannot afford to buy her even a pair of slippers. Similarly, the foreign companies, Bai Shan Lin and Vaitarna, cannot enter into a business relationship with Guyana without first examining what the country has to offer and what constraints it can afford to deal with. The Minister of Natural Resources cannot come and say that cheap energy is the reason why there has been a delay in the companies fulfilling their obligations. There is no excuse.”
Even though Bai Shan Lin International Forest Development Inc. is yet to actually receive a logging licence, the company has teamed up with four companies in joint ventures to export billions of dollars worth in timber monthly.
Many Guyanese, through letters to the editors, have expressed dissatisfaction in what is happening and both the Alliance for Change (AFC) and APNU have been vocal on the issue.
AFC Chairman Nigel Hughes had told Kaieteur News that if the Party gains executive power at the upcoming elections it will promote value-added processing.

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