Logging scam warning: NO BLACKMAIL

Logging scam warning:
NO BLACKMAIL
By Mark Ramotar
Guyana Chronicle, 26 October 2007
http://www.guyanachronicle.com/topstory.html#Anchor---------23881

ON PROTEST: Barama Company Limited employees on the tarmac of the 1763
Monument Square in Georgetown yesterday
THE government yesterday said it will not be blackmailed by coercive
tactics into reversing the sanctions imposed on Barama and other
logging companies caught in a major multi-million dollar scam.


Agriculture Minister Robert Persaud, reacting to a protest in
Georgetown yesterday by Barama employees, declared “threats of protests
or other unbecoming stance will not change the government's position on
this matter.”

He said from information available to him at this time, the Guyana
Forestry Commission (GFC) investigation into the breach of procedures
involving Barama and three local forestry-based companies was
“systematic, detailed and objective”.

Barama Company Limited (BCL), owned by the Malaysia-based Samling
group, was slapped with a $96.4M compensatory fine earlier this week
and ordered to immediately suspend sub-contractual operations with the
three local firms for breaching stiff forestry regulations.

Barama reacted by temporarily closing its operations in protest,
claiming the penalties imposed by GFC this week are “severe,
unclear…and arbitrary”.

Scores of Barama workers travelled to the city yesterday to protest and
show solidarity with the company - the country’s largest exporter of
logs.

In a statement the Guyana Chronicle obtained yesterday, but which was
sent to other media houses the previous day, Barama appealed to the GFC
to allow a “fair process in determining the breaches, fines and
suspension” where the company said it acted as contractor in
third-party concessions.


SEEKING SOLUTION: Chairman of Barama Mr. Girwar Lalaram
Barama said it is “prepared to engage internationally recognised
auditors, forestry consultants and other experts to investigate the
issues, with the involvement and cooperation of the GFC.”


But Persaud, at a news conference with GFC Commissioner Mr. James
Singh, maintained that the charges instituted on Barama and the other
logging companies “were specific and based on concrete evidence which
is available for scrutiny by all stakeholders, including
internationally-recognised auditors, forestry consultants and other
experts”.

He, however, said that any such scrutiny must be at the financial cost
of the requesting company and must include oversight by the GFC.

Persaud also confirmed that the compensation figures arrived at by the
GFC were in keeping with established and approved GFC procedures and
said the companies involved can appeal the charges and sanctions
imposed.

JOBS AT STAKE
Chairman of Barama, Mr. Girwar Lalaram, in the press statement, said
his company is deeply concerned that the penalties will cost jobs and
have a detrimental impact on its investment in the country.

“Such a sudden suspension means there will be workers without jobs
immediately,” Lalaram contended, adding, “Our preferred choice is to
come to a swift resolution to save jobs as soon as possible.”

Persaud said that in the interest of the workers, his ministry is
prepared to allow access to raw materials for Barama’s Land of Canaan
plywood factory, “but only as part of a transition process that will
eliminate any approved sub-contractual arrangement by December 31,
2007”.

He said this must, however, be done through a process based on
“constructive engagement rather than the manipulation of issues and
processes and the issuance of threats and reckless statements”.

“This is to ensure that it (Barama) is prepared to undertake sufficient
extraction of Baromalli from its own concession or make other
arrangements for sourcing raw materials.”
Persaud said Mr. Carvil Duncan, President of the Guyana Labour Union
which represents Barama employees, was informed about this offer.


“We want to ensure that workers do not suffer as a result of the
breaches committed by the companies.”

Persaud said although a total of 1,611,195 hectares have been issued to
Barama, the company’s current level of utilization of this concession
acreage is about 20%.

Based on the annual plan inventory data submitted to the GFC by BCL for
2007, the minister said he has been advised that BCL can harvest about
43,000 cubic metres of Baromalli logs that are 40 cm and above in
diameter (used for plywood production) as opposed to their current
extraction of only 14,585 cubic metres up to September 2007.

He told reporters that for 2006, only a total of 12,319 cubic metres of
Baromalli logs were harvested from BCL's concession area.

His contention is that these figures reflect that BCL is not making
maximum use of the extensive acreage leased to it and this is an area
of great concern to the GFC and his ministry.

“I have quoted these figures to emphasize the point that whilst BCL is
claiming that the suspension of the sub-contracts with neighbouring
concessions would adversely affect its raw material supply, and lead to
downsizing of its operation, yet it is under harvesting significantly
in the concession issued directly to BCL.”

The GFC earlier this week announced that after a month-long
investigation into suspected breaches in log declarations, Barama, A.
Mazaharally & Sons, N. Sukul & Sons, and Barakat Timbers Limited were
found culpable of breaches.

As such, the sub-contractual operations of all four logging companies
were suspended with immediate effect.

The GFC said it has also been identified that ineffective monitoring of
the concession areas by two of its Field Officers resident at that
location contributed to the breaches of procedures by these companies
and have been dismissed.