$900M revolving forestry fund launched to provide loans

– to benefit small to medium-scale loggers, current & future generations

The $900 million revolving forestry fund has fittingly been launched on World Forest Day, with Finance Minister Dr Ashni Singh stressing the importance of beneficiaries ensuring they repay their loans to ensure that future generations of loggers can benefit.

Finance Minister, Dr Ashni Singh

The launch of the $900 million revolving fund took place at the Arthur Chung Conference Centre (ACCC) on Tuesday. Dr Singh delivered the feature address and spoke of the opportunities the fund presented, especially for small loggers.
He also lauded the role played by Demerara Bank, which is contributing $600 million to the fund. But the Minister also warned the beneficiaries of the importance of them servicing and repaying their loans, so that the fund can continue to be sustainable.
“The expectation is that these loans will be serviced and repaid, on time. So that the fund can revolve… I’m saying this in particular because I don’t want there to be a mistaken impression that this is a grant, people get money and they don’t have to pay it back. You’re running a business. And you’re in business with the objective of making money.”

A section of the expected beneficiaries

“I’m saying this in the interest of the stakeholders in the sector. Because we don’t want one generation to benefit from this fund and then no subsequent cohort benefits. That’s not the intention. The intention is that successive cohorts will benefit from the fund. So, I’m appealing to those who will borrow from the fund, please go into this understanding that we expect you to have a viable business proposition,” the Finance Minister further said.
Dr Singh further pointed out that the fund’s interest rate of four per cent is a rate the beneficiaries could not get anywhere else for a business loan. He, therefore, stressed the need for them to take the opportunity and use it to grow and even reach a point where their business is self-sustaining and no longer needs the fund.
Meanwhile, Demerara Bank Chief Executive Officer (CEO) Pravinchandra Dave explained that loans under this revolving fund will not only have reduced interest fees but that his bank will also expedite them. Further, he noted that the bank’s motivation for coming on board with this initiative is to partner with the Government and the people of Guyana.
“When we lend money at a rate of four per cent, it is not a very good commercial proposition. But we are lending money at four per cent, because we want to be a partner with the Government and the people of Guyana, in developing this. We are trying to make this as simple as possible… as part of my instruction to the branches, any loan application comes they are to respond to that applicant within 48 hours.”
“Because one of the arguments against the bank, people are afraid of going to the bank asking for loans… (is that) so many questions are asked, so much paperwork is required. Processes are required and aimed at safety, but what we wanted to (do) is make this process as easy as possible. If you look at the documentation required, it’s not very high,” Dave said.
The $900 million revolving fund was launched last year, in response to persistent concerns over access to financing. The investment emphasises the development and expansion of small and medium-scale loggers, and community loggers’ associations.
President Dr Irfaan Ali had announced that some $300 million from the State’s coffers has been set aside for this revolving fund, while this sum would be further supplemented by $600 million more provided by Demerara Bank Limited.
The Head of State had further said that through a partnership with the Guyana Forestry Commission under the Ministry of Natural Resources, a committee would be established to ensure that persons are adhering to and abiding by what is expected of them, that is, the sector itself and its various associations.