New Barama forest deal for Cabinet consideration before month-end

Sep 03, 2016 News

Government is preparing to consider and approve a new contract for Asian logger, Barama Company Limited (BCL), before the end of this month.

An aerial shot of Barama’s operations at Land of Canaan, East Bank Demerara.

According to the Ministry of Natural Resources yesterday, a review is currently ongoing with the contract, looking at the forest concessions and tax incentives that have been granted to the company.
Barama, a Malaysian-owned company, is the biggest forest concession holder, with 1.6 million hectares. It has been exporting logs and has a plywood manufacturing operation at Land of Canaan as well as sawmilling facilities at Buckhall, along the Essequibo River, Region Seven.
The company came here in the 1990s and with the Guyana Telephone and Telegraph Company (GTT), the two were described as the largest foreign investors.
However, in recent years there has been increased scrutiny of especially the foreign loggers, with growing pressure for more downstream activities, or more value added operations.
With an emphasis to ensuring Guyana is benefitting, the David Granger administration had vowed to review the arrangements with foreign loggers and other large investors.
Yesterday, the Ministry of Natural Resources denied that a sloth in the contract being renewed will likely see workers losing their jobs.
“The facts are that the Barama Co. Ltd has been continuously informing the Ministry of the Natural Resources and the Guyana Forestry Commission about its loss of market share in Asia which is affecting its profitability, and challenges experienced by bad weather conditions,” the ministry disclosed.
“The Ministry of Natural Resources rejects any assertion that the loss of jobs is tied to the renewal of Barama’s contract and calls on the company to set the record straight.”
The administration said that last year, Barama requested a renewal of its contract which is set to expire next month.
”Cabinet gave its ‘no objection’ to the continuing of the relationship with Barama Co. Ltd, and at the same time, recommended the convening of a Task Force to examine the request.”
According to the ministry, the Task Force was deemed necessary given the “rapacious activities of some foreign companies operating in the forests of Guyana, and some not so positive observations that had been expressed about Barama in particular”.
The Task Force comprised representatives of the Ministries of Business, Natural Resources, Public Infrastructure and Indigenous Peoples Affairs, the Guyana Revenue Authority, the Guyana Forestry Commission and a Legal Consultant.
The Task Force met on several occasions and even visited the Barama Co. Ltd’s operations at Buckhall, the ministry said.
“Thereafter, the Legal Consultant began reviewing the existing contract, forest concessions, and tax incentives previously enjoyed by the company while other members of the team examined critical issues such as workers’ rights, value added operations and environmental management practices to name a few.”
The ministry made it clear that the Government takes the responsibility of workers’ welfare and rights “very seriously” and is asking for understanding and forbearance whilst the matter is being addressed.
“It is the Task Force’s intention to have the final proposal for Cabinet’s review and approval before September 30, 2016.”

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