REMARKS BY THE MINISTER OF AGRICULTURE WITH RESPONSIBILITY FOR FORESTRY, HON. ROBERT M. PERSAUD, MBA, MP TO A PUBLIC CONSULTATION ON A POLICY FOR LOG EXPORTATION

February 17, 2006

 

 

Today’s consultation is as a result of a process which started after separate meetings held with Forest Products Association (FPA) and the Guyana Manufacturers’ Association (GMA) on November 17, 2006.

 

Arising out of those meetings, a Ministerial Committee that comprised one (1) representative (and alternate) each from the FPA and GMA was convened by the Guyana Forestry Commission (GFC) and chaired by the chairman of the GFC Board of Directors. The mandate of the committee was to arrive at a consensus paper that would be presented at a national consultation aimed at contributing to the formulation of a log export policy.

 

Two meetings were convened by the GFC. At the first meeting on December 9, 2006, the Chairman outlined the Terms of Reference (TOR) for the committee. The FPA, GMA and GFC were requested to prepare position papers to be delivered at the second meeting, and which would form the basis of the consensus paper.

 

At the December 9, 2006 meeting, a request was also made by both the GMA and FPA for an additional representative this request I immediately approved. At the second meeting of January 18, 2006, the three (3) presentations were made. It was agreed by all present that the GFC presentation was a suitable document that could be used at the National Consultation Forum. 

 

Sadly, there could not have been a timely agreement and given the importance of this policy, we needed to involve other stakeholders and concerned parties in contributing to a policy position.

The contributions of the Forestry Sector to Guyana’s economic development continue to grow despite the challenges, both internal and external. In 2006, the export sales from forestry were US$58.7M compared to US$48.6M in 2005, an increase of 20.8%. This is indeed testimony to the sound policies, programmes and plans of the Government of Guyana over the years, though some may argue this is due in a significant way to log exports alone.  

 

Breakdown of the export earnings:

Logs	21.6 M (US)
Sawn Wood	20.7 M (US)
Round Wood	2.1 M (US)
Split Wood	1.2 M (US)
Plywood	8.9 M (US)
Other values added (Furniture & building component)	4.1
Fuel wood	0.1 M (US)
TOTAL Export Value	58.7 M (US)

 

 

Of recent, there has been a number of significant initiatives within the forestry sector which have contributed to the sector’s good performance, principal among being the extensive training and capacity building for planners, managers and practitioners as well as efforts of the newly established Forest Marketing Council to consolidate existing markets while at the same time seek out new and emerging markets for Guyana’s Forest Products within CARICOM and beyond.

 

As well, the initiatives towards having an Audit of the Log Tracking System, the Establishment of the Legal Verification System and the support to forest producers by GFC have in no small measure served as a catalyst to improve forest management practices.

 

The Government of Guyana remains committed to enhancing economic, social and ecological benefits through increased operational efficiency, improved quality and volume of value-added and non-timber forest products and better environmental stewardship. This has been reflected within the National Development Strategy (2001-2010), the National Competitiveness Strategy for Guyana, and more recently, the PPP/C 2007-2011 Manifesto.

 

It is within this context that a National Forest Plan has been formulated, based on the need for:

• Stimulation of greater foreign and local investments in the sector.
• Promotion of value-added products and value-added industries
• Promotion of sustainable management approaches in the sector through reduced impact logging and forest certification initiatives
• Increasing in export earning through increase in quantities, quality and product range.
• Increasing direct and indirect employment through value-added industries and new investments.
• Increasing community access to and management of forestry resources; and
• Training and capacity building at all levels in the sector.

 

Over the next five years, Government will be implementing actions to realize these objectives. $338M will be spent to enhance the institutional capacity of the GFC to better manage the sector. Some of the interventions planned by the GFC for 2007 include:

• Finalize the SFP Conversion process. Currently there are several concessions that are held as State Forest Permissions (SFP’s) even though they are in excess of 20,000 acres. There is need to convert them into Wood Cutting Leases, or Timber Sales Agreements depending on their acreages so that they operate under Forest Management Plans.
• Development of a national Procedure to establish Permanent Sampling Plots (PSPs) countrywide to collect data on growth and yield, and mortality in standing forest
• Complete computerization of databases so that staff can have real time access to a wide range of information, to assist the decision making process
• Continued provision of Training activities and  extension services, especially through the Forestry Training Centre Inc

 

The export of logs has been the subject of much discussion and debate of recent with many perspectives being offered.

 

On another but related issue, we must ensure that when investors receive concessions for value-added activities in the forestry they honour the conditions of those concessions. I am personally concerned about this matter and had cause to call in two such companies – Barama and Jaling.

 

Following my meeting with the senior management of Jaling Forest Industries Inc. in November 2006, the company subsequently presented an implementation plan which in summary addresses the following:

• Progressive reduction in percentage of foreign staff from 28.7% in January 2007 to 18% by April 2007, to 15% by August and 13% by December 2007.
• Commitment to start processing of logs locally at 505 of monthly production by February 2007; 70% by April 2007; 80% by July 2007 and 90% by October 2007.
• Commitment to construct sawmilling and veneering plant at Port Kaituma by December 2007.

 

And after my meeting with the senior management of Barama Company Limited, the Company has submitted an implementation plan re: the Buck Hall complex, for 2007 which is summarized as follows:

• Jan-March 2007: Installation of Kiln Drying facilities; Installation of new pony saw and commencement of 2 nd shift re: sawmill operations; construction of a workshop to start the dry dock activities, and sizing of the co-generation plant.
• April –June 2007: Commence construction of Veneering building; begin construction of the first barge, installation of the 3 megawatt co-generation plant; installation of the finishing plant.
• July-Sept. 2007: 3 rd shift of the sawmill operation to be implemented; installation and commissioning of the Veneer plant; start construction of the second barge.
• The number of expatriates to be employed over the period Jan-Dec 2007 would be 57, whilst local employment would be a minimum of 360; this figure will be increased by at least an additional 125 when the second and third shifts at the sawmill and veneer plant become effective. The minimum figure of 360 locals is equivalent to a percentage of 86.3%.

 

These commitments are being monitored closely.

 

In our deliberations today, we need to examine this practice within the context of our long term objective of enhancing economic, social and ecological benefits through sustainable forest management, while at the same time being cognizant of the realities of the sector. As practitioners, you would all be too familiar with the challenges of the availability and cost of timber production, transformation and transportation coupled with the technological ability to produce to specification.

 

Clearly, there is a need to articulate a policy position based on sustaining growth while at the same time arriving at a consensus position on short, medium and long term actions to expand the benefit stream from forest industries. 

 

 

Ladies and Gentlemen, today’s Public Consultation is another demonstration of Government’s commitment to developing and promoting strategies in partnership with all stakeholders in the sector. We believe that the sustained growth of the forest sector is hinged on a successful public-private sector partnership which is already established among forestry stakeholders.

 

I would like to take this opportunity once again to thank you for your participation as we look forward to full day of constructive deliberations and which will be very useful for Cabinet’s deliberation on a comprehensive Log Exportation Policy.

 

Thank You!