GFC to repossess BaiShanLin’s concessions over $80M debt
The Guyana Forestry Commission (GFC) will be moving to repossess concessions currently being held by BaiShanLin International Forest Development Inc. (BIFDI) following the company’s failure to pay its debts.
According to the Commission, “the decision came after the company failed to deliver on agreed actions to introduce investors to the Commission and having been given time to prove that it had an acceptable plan to clear an approximately GY$80M debt.”
In a statement on Tuesday, the GFC said it met with BIFDI on April 8, 2016, to provide an update on its plans to clear the debts.
During the meeting, representatives noted that the BIFDI had suffered financial constraints which affected the establishing of the intended wood processing facility and that the company was engaging a new partner that would contribute significantly to their investment in Guyana.
Following a visit to China by Minister of State, Joceph Harmon in March 2016, which evoked many criticisms in the media, a statement was released which stated that Long Jiang Forest Industries Group which acquired 55 percent of the shares in Bai Shan Lin is intended to fully take over the company in 2016. This was disclosed as he attempted to explain a photograph of himself and BaiShanlin officials aboard a jet.
The GFC Board was assured of the financial strength of the new partner who had committed to pay off the debt owed by the company and a request was made for BIFDI to submit information about its operations in Guyana, settle its arrears and submit a letter of commitment from the new partner.
However, “to date, the BIFDI has failed to fulfil any of its commitments to the Government of Guyana; effectively failing on the obligations it made, which were accepted in good faith.”
BIFDI was incorporated in September 2006 under the Guyana Companies Act 1991 with the main objective of timber harvesting and establishing downstream wood processing operations in Linden.
The Forestry Commission says the actions being taken against the company are in keeping with Forest Governance Practices.