Natural Resources Minister Raphael Trotman has disclosed that following months of negotiations with Barama Company Limited on renewing its investment agreement, Government has submitted a draft proposal to the Malaysian-owned company.
Talks are still ongoing for renewal of Barama’s agreement
Trotman told reporters during a press conference on Friday that over the past 10 months, talks have been ongoing between the logging company and Government to renew its 25-year-old Investment Development Agreement, which expires this month; however, he noted that these talks have not yet concluded.
“We have shared with the company our latest draft and the company is to respond, but we expect, of course, that some more negotiations may come with their counterproposals, but the expectation is before the end of the year, the Government and Barama will be renewing their relationship – one with the other,” the Natural Resources Minister posited.
Barama is one of Guyana’s biggest foreign investors with operations at Buck Hall, Essequibo River, and at Land of Canaan, East Bank Demerara. Back in 1991, the company was allocated some 1.6 million hectares of State production forest, the biggest forest concession for any one company in the country.
In September last year, Minister Trotman had visited the company’s Buck Hall operations to get a first-hand look at the operations and working conditions there. He had noted that the Government would like to see more value-added production from investors in Guyana and he would ensure that this component was included in any agreement.
During that tour, the company’s General Manager Mohindra Chand had stated that the company was determined to continue its operations in Guyana, stating that while it was faced with many challenges, it never considered closing its operations here. Barama’s operations consist of forest management, timber harvesting and manufacturing of various wood-based products such as plywood, sawn timber, and flooring products.
While its plywood operations was said to be its largest, there have been reports that it scaled down that operation and was moving into other areas, such as gold mining. When asked about this, the Natural Resources Minister told reporters at Friday’s press conference that he was not aware that the company was going into mining activities, but noted that within its concession miners are mining, which the Guyana Geology and Mines Commission (GGMC) has permitted.
“Because of the slowdown in Asian markets, there has been a pulling back, but they have been doing plywood and specialised timbers for decks, decking and other applications like that. So they have been doing value added, we’d like to see them do more value added and as I said, given the slowdown in China and in Asia generally, we have seen a scale-back in some operations,” Trotman pointed out. With its $43 billion investment into local operations, the Barama Company was said to be one of Guyana’s biggest employers, employing approximately 1000 Guyanese.
The company contributes about $400 million in taxes, royalties and other fees annually, with some $1.6 billion paid out for local services and goods.
