Jagdeo demands answers on shady $50M forestry project

The recent announcement of an impending public private partnership in a consolidated Dimension Stockyard has caught the attention of the political Opposition, who are demanding answers on whether due process will be followed.
During a recent press conference, Opposition Leader Bharrat Jagdeo urged that Government come clean on the specifics of the project for which the coalition had allocated $50 million in its 2018 Budget.

“As part of this culture of secrecy, we don’t know what’s going on. It’s very murky… we just read these headlines and gloss over them… $50 million public private partnership to implement dimension stockyard.”
Jagdeo noted that allocations are already in the budget the projects implementation. As such, he questioned exactly who the government’s partner in the project will be. He also queried the process used to select the partner.
It was reported in the state media a few days ago that according to the Guyana Forestry Commission (GFC) Board of Directors 2017 report, the $50 million that was allocated in Budget 2018 to establish a Dimension Stockyard will go towards a public private partnership model.
This, the report noted, was in an effort to strengthen the capacity of Guyana’s forest sub-sector to adapt to sustainable production practices. The report had observed that obtaining quality raw materials (lumber) in sufficient quantity and dimensions are difficult.
“The quality of locally produced lumber is not at the level to make it very competitive both locally and internationally. Only a few operators are producing lumber at the desired quality level,” the report noted.
Further, the GFC 2017 report had stated that the consolidated or dimensional stockyard is intended to bridge the gap while the Public/Private Sector initiative will be managed by an oversight body.

It was noted that the facility will in no way compete with the Private Sector as there will be no price disadvantage or compulsory requirements from the Private Sector.
“The facility will be housed in a central accessible location or perhaps one of the industrial sites. This initiative was actually proposed by the Private Sector as an initiative to improve growth in the sector,” the report stated.
“The funds will be used to set up the regulatory framework of the facility, the governance and administrative structure, site preparatory activities, inclusive of minimal capital equipment and marketing effort,” it added.
The Directors’ report underscored that the facility will also consolidate and facilitate the trading of wood products. The facility will also assist in creating a secondary market for tropical wood products in Guyana.
“This will be useful for operators in the forestry sector who do not wish to take on acquiring and managing a forest concession as well as those operators focused only on downstream processing and value adding,” the report stated.
In Budget 2018, measures such as exemption of Value Added Tax (VAT) on logs and rough lumber came accompanied with a budgetary allocation of $50 million to partner with the Private Sector to establish a consolidated dimensional stock yard.
The forestry sector was one of several industries which showed a decline in the Finance Ministry’s 2017 half year report. The forestry industry showed an 18.2 per cent contraction in the first six months of 2017, compared to the same period in 2016.
Declining production within the forestry industry was due to structural changes in the industry.