BaiShanLin concessions warrant special review

Jul 24, 2015 News

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– Guyana is yet to know how it has benefitted –Presidential Advisor

By Kiana Wilburg

Presidential Advisor on Sustainable Development Dr. Clive Thomas will soon be making recommendations to the Granger administration for all concessions granted to major foreign investors to come under special review.
Dr. Thomas said that the concessions granted to one major company, BaiShanLin, need to be investigated thoroughly.
In a recent interview with this newspaper, the economist said that it is imperative for the new Government to have a “proper understanding” of how the nation is benefitting from the “hefty concessions” which were granted to these companies during the time of the past administration. He stressed that doing this will also help the government to manage how the country benefits in the long term from foreign companies.
“The amount of concessions given to foreign and local businesses during the past administration need to be reviewed. The past administration displayed a wanton abuse for the laws and gave out concessions based on unorthodox methods. We need to change this and we have the chance to do so now. We need to implement a sense of structure for we don’t have that at all in this country. There is no sort of organization and with the amount of concessions the giant company BaiShanLin has benefitted from, no one can be able to truly measure to date, the extent to which we benefitted in the past ten years.”
BaiShanLin’s activities in logging and mining have been under the microscope for over a year now after indications that the company was responsible for exporting large amounts of logs.
In January, the Guyana Forestry Commission, which monitors the forestry sector, disclosed that the company only has “legal access” to 627,072 hectares instead of over one million hectares that was being reported.  These include 344,849 hectares as State Forest Exploratory Permits (SFEPs).

 

BaiShanLin also controls 274,053 hectares of Timber Sales Agreement -Joint Venture Agreements and 8,170 hectares of State Forest Permissions.
The past administration, in the face of critical reports, was defensive over BaiShanLin, which was supposed to put down factories for plywood and other value-added wood products. These are yet to become operational despite the company has benefitted from millions in tax breaks and other concessions.
Last year, several aerial photographs of parts of the BaiShanLin operations in particularly the Kwakwani, Upper Berbice area, were published by Kaieteur News, showing large stockpiles of logs ready for export. It drew widespread criticism over the seeming coziness of the then Government with the Chinese logging firm.
Dr. Thomas said that the Guyana Office for Investment (GO-Invest) should be tasked with the responsibility of doing an economic review of the concessions granted to major foreign companies based in Guyana. He said that such a report needs to provide recommendations on how the nation can reorganize the system of granting concessions and also measure the rate of benefits. He insisted that developmental benefits to the country need to be set as priority.
Dr. Thomas said that this is an important part of managing how the economy grows as well.
Business and Investment Minister, Dominic Gaskin had told this newspaper that a number of new plans for the business sector are being crafted. He said that one includes the restructuring of the system for the granting of concessions to local and foreign investors.
Gaskin had said that he intends to work towards depoliticizing the method used to dictate how concessions are to be granted.
The Business Minister had said, “We need to end this culture where people think that knowing a Minister is going to automatically grant you a ticket to a menu or a buffet of concessions.”
He had said that investors will be informed that they will only get what they are legally entitled to.
Gaskin had emphasized that “there is no place for favouritism in this sector, especially when it comes to granting concessions.”
He added, “You will get concessions based on how sound your plan is and the type of investment it is. We need to clean up those processes and look at what was granted to local entities and foreign companies here to ensure it is within the law.”
“It’s a key step towards leveling the playing field.”
He had revealed too that he has started some work with GO-Invest, especially with the Chief Executive Officer (CEO) Keith Burrowes.
GO-Invest is a government agency which provides advice and concessions, when necessary, to investors looking for the best way to start a business in Guyana. It also enables entrepreneurs from around the globe to tap into the wealth of trade and investment opportunities available in the country.
He had said that some preliminary discussions were conducted with Burrowes and he will continue to follow up on a number of projects under the entity. This would help to make doing business in Guyana easier.
The Business Minister reminded that GO-Invest is going to be the major interface between Government agencies, foreign and local investors. Given what he has discovered thus far with the agency, Gaskin had said that it is clear that the company needs to do its job without political interference. He had said that it needs to ensure that investment agreements are in accordance with the laws of the country.
He said that the company has a very important role to play in terms of helping to monitor the export and import commotion of companies based on the concessions they were granted.
Gaskin said that he does not see government sidelining the agency given its importance. He said however, that the government will of course examine the performance of the company, but not necessarily with a view to conducting investigations.
The Business Minister had said that he is interested in “lifting up Go-Invest.” He admitted that better could be done with the agency as opposed to what took place in the past. He emphasized that the company needs “new life” with its functions strengthened.
Minister of State, Joseph Harmon, had revealed some weeks ago that Cabinet granted the permission for the appointment of a new board for the entity.
Harmon told members of the media that the life of the GO-Invest Board came to an end in 2014 and the company is now operating without one. He said that given this situation, Gaskin made an application for an interim board to be appointed for the purpose of guiding and directing policies for the agency over the next six months until a permanent board is appointed.
Harmon said that Cabinet subsequently gave its approval for the interim board to be appointed. He said that it will comprise persons from the Guyana Revenue Authority (GRA), Lands and Surveys Commission, Ministry of Foreign Affairs, Private Sector Commission, Ministry of Tourism, Ministry of Business and Investment, and individuals in the Diaspora.
Gaskin also secured Cabinet’s approval to appoint persons to the board as he sees fit, and based on the realities of Guyana.

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