Loan officer failed to monitor US$70M wood processing plant - source

Loan officer failed to monitor US$70M wood processing plant – source

Sep 01, 2015 News

Baishanlin’s local boss, Chu Hongbo

GFC Commissioner, James Singh

Questions are being asked how a Chinese logging company that received almost US$70M for a wood processing plant was allowed to divert the monies into other projects, including gold mining and housing.

The monies were received from China Development Bank (CDB) which appointed a special official to ensure the monies were spent properly by Baishanlin International Forest Development Inc. on the factory in Linden.

As part of his responsibilities, the official would have been submitting periodical reports how the monies were being spent.

The loan was released to the logging company since around 2011.

Baishanlin never made it known that it had received funding. As a matter of fact, a while ago the company claimed that it was experiencing problems accessing finance for the plant which would have provided jobs for Lindeners.

The plant is reportedly a critical component of the company’s investment agreement in Guyana. On the basis of construction of that plant, among other things, Baishanlin was granted hundreds of millions of dollars in tax breaks. It also received concessions on vehicles and lands.

It was granted concessions in the Upper Berbice area, Region Ten, and snapped up other lands throughout Essequibo, in questionable joint venture arrangements.

In so doing, Baishanlin became the second largest holder of logging concessions in the country, after Barama Company Limited.

The Chinese loans officer, according to well-placed forestry and Chinese sources, yesterday, was stationed at the Chinese Embassy’s Economic and Commercial Councillors Office, Brickdam.

The Chinese Embassy has been, as part of its duties, pushing investments of its country in Guyana.

Calls to the embassy offices on Brickdam for a comment were not answered yesterday.

Construction in Baishanlin’s housing development, Providence.

This latest development over the Baishanlin issue would continue to raise worrying questions over monitoring of the numerous projects that are under Chinese development in Guyana.

China’s government has been cracking down on corruption with a number of officials given harsh sentences and even sentenced to death.

Baishanlin’s activities in Guyana have been under sharp scrutiny after the company was accused of moving aggressively with its logging.

A flyover had found a huge log pond in Kwakwani, Upper Berbice River.

Baishanlin had presented impressive plans of an exhibition centre for Chinese products and upscale gated community at Providence, East Bank Demerara. Both projects appear to be a standstill.

The company, in addition to lands off the Soesdyke/Linden highway for the wood processing plant, also has areas allocated for ship building.

The company last year acquired significant gold mining lands. It has reportedly been able to use its equipment, granted under concession, unfairly and quite probably illegally in the gold fields.

Baishanlin has also been aggressively competing in the local market using its trucks to fetch logs for operators and barges to transport stones and other commodities for hardware suppliers to bolster its apparently dwindling revenues.

The Baishanlin issue had raised startling questions also about the previous administration’s monitoring of company’s activities especially as Guyana had been moving to reduce log exports.

Over the last year, log exports have increased dramatically, although the Guyana Forestry Commission has insisted that harvesting has remained below the allowable amounts.

Baishanlin has been in Guyana for almost a decade.