Friday, 2 November 2007

M'sian logging firm refuses to pay Guyana fine

M'sian logging firm refuses to pay Guyana
Oct 25, 07 10:32am

A Malaysian timber company has refused to pay a US$480,000 (RM1.6 million) fine to the government of Guyana, which accused it of under-reporting the number of logs harvested from local firms. "We wouldn't pay until we have all the due process," Barama Company Limited chief executive Peter Ho told AFP.

He added that current business and investment plans would be shelved until the current issue is resolved. Though the company has a stockpile of logs, Ho warned that both the fines and suspension of the forest concessions could force the company to cut production and retrench some of its workers.

He could not say how soon workers would be retrenched because the company was still assessing the impact of the rulings by Guyana's forest regulator, the Guyana Forestry Commission (GFC). The Malaysian-owned firm has been operating in the northwestern Amazon jungle of the impoverished South American country at least 15 years.

BCL appealed to the GFC to hire internationally-recognised auditors, forestry consultants and other experts to investigate the issues, and determine the breaches, fines and suspension in a fair manner. "The penalties imposed by GFC are severe, unclear, and in our opinion, arbitrary," the company said in a statement.

Illegal logging. The company, however, conceded there were a number of anomalies including unintentional mixing of tree tags between areas, and harvesting in areas where permits were still being processed.

But it denied the company did not declare to the GFC all the logs harvested. The GFC said its probe found that BCL declared less logs than it harvested in July from privately owned Guyanese companies. Guyana's agriculture minister, Robert Persaud, said he was dissatisfied with the responses given by BCL and the three Guyanese timber companies and he "further directed that all the prescribed sanctions be imposed immediately."

According to environment group Greenpeace, Barama won an investment contract, giving the company rights to log 1,690,000 hectares - about eight percent of the country - in the northwest of Guyana, near the Venezuelan border.

Barama is wholly owned joined venture incorporated in Guyana between Samling Strategic Corporation of Malaysia (80%) and Sunkyong Limited of Korea (20%). Greenpeace said that Barama has a 25-year logging licence, automatically renewable for another 25 years, with a five-year tax holiday automatically renewable for a further five years for the export of raw logs, sawn lumber, veneer and processed plywood. Barama's parent company, Samling, has been criticised by environment groups for its logging practices both in Malaysia and overseas.