The Forestry Sector

The Forest Resource Base

Guyana has vast forest resources, which cover over three-quarters of the 83,000 square miles landmass. This is approximately 16.5 million hectares or 76.6% of the country’s total land.

The Guyana Forestry Commission (GFC) is responsible for the administration and management of 9. 1 million hectares of land classified as State Forests.

Forest resources provide for a wide and varying range of economic, social and environmental goods and services. Forest industry activities contribute approximately 5% to the country’s Gross Domestic Product (GDP). The sector contributes significantly to national revenues via taxation, and provides employment, both direct and indirect, for approximately 20,000 persons. Guyana’s forest resources continue to attract an increasing interest from international timber companies, eco-tourism groups and others with an interest in non-timber products.

The species, which are intensely exploited, include greenheart, mora, baromalli, purple heart, crabwood, kabakalli, womara. The forest resource consists of in excess of 1,000 species of trees; of these 120 such species are being logged in various forms. Between 12 and 15 of these are being logged on a commercial scale.

The entire forest area is dissected by many large rivers, which provide the main form of transportation for the removal of forest produce to the conversion

and further processing centres. Logging in Guyana is governed by a Code of Practice for Forest Operations, the regulations under the Forest Act and an Environmental Protection Act 1996. Operations are monitored, evaluated and appraised by the field staff of the Guyana Forestry Commission.

Guyana is a net exporter of timber and timber products. There is no quantitative restriction on the export of timber or processed timber products.

Forest industries development is encouraged by the Government of Guyana in order to improve the technologies, increase employment and improve the forestry sector’s contribution to the Gross Domestic Product (GDP).

Production, currently 564,671 cubic metres per annum, is expected to expand to over 1 million cubic metres within the next three to five years, with an export value in excess of US$ 100 million as production management technologies improve, investments into the sector increase and down stream value-added processes develop.

Markets for timber can be found traditionally in Europe, North America and, more recently, in the Far East.

Types of Concessions

• State Forest Permissions (SFP) - A one-year lease for acreage of less than 20,000 acres
• Woodcutting Leases (WCL) - A ten-year lease for 20,000 acres but not exceeding 60,000 acres
• Timber Sales Agreement (TSA) - A twenty-five year lease for an area greater than 60,000 acres.
• Exploratory Permits (EP) - A permit to undertake an investment appraisal of the area which the permit covers.

The guiding principles for the forestry sector have been established in accordance with the Rio Declaration on Environment and Development and Guyana’s commitment to a path of sustainable development emphasised in the National Forest Policy within the framework of the draft National Development Strategy.

Among the conditions set out for investors are:

• Limitation on log exports and emphasis on value added downstream production agreement to allow effective multiple use of forested areas by different users.
• Special efforts to promote income earning from non-timber uses including eco-tourism.
• Provision to allow for portions of allocated lands to be recalled to facilitate national priorities such as protected areas.
• Provision to allow for adjustments to recognise and accommodate Amerindian settlements.
• Undertaking to maintain strict observance of environmental norms, good forest practices and utilisation of environmentally friendly technology.
• Respect for the rights of the Guyanese people and more especially the indigenous people and workers employed by the investor.
• Provision of supplies for local value added activities.

These conditions are based on the policy of the Guyana government that our natural resources must be utilised in a sustainable manner while making a significantly greater contribution to the national economy.

Forest Policy Review

Among the matters addressed in the forest policy review are:

• Development of the wood processing sector

  The forest policy encourages the development of the wood-processing sector to increase income, employment and foreign exchange earnings. It addresses improved production, management, quality control and value added manufacturing and the establishment of facilities and mechanisms that will allow the local forest products industry access to capital.

• Smaller logging and chain sawmill operators

  Small forest-based operations are having an increasing impact on the resource and on industry. The forest policy addresses the role of small operations and establishes a strategy supporting their development as well as procedures for monitoring and regulating activities.

• Marketing of forest produce

  Better arrangements for the marketing of forest products and a process aimed at improving marketing capacity are necessary to ensure more efficient utilisation of forest resources and greater returns to the national economy. The complementary roles for the Forestry Commission and industry in marketing are being defined. Standards for both export and domestic markets, and how these standards will be implemented and controlled, are being considered.

• Education and training

  An integrated national forestry training strategy for professional technical and vocational levels is being pursued. The Forestry Commission in close consultation with the private sector will co-ordinate this.

• Forest research and information

  A research strategy and an information strategy are being developed. A policy on forest sector information and on raising public awareness of forestry issues through publicity and public education is also being developed.

• Reforestation

  A reforestation strategy will address the long-term production of timber and fuel wood from the forest estate and will provide for the rehabilitation of degraded forestland.

Investment Opportunities

Investors are encouraged to participate with existing operators in activities to produce:

• furniture
• plywood and veneers
• parquet, floor tiles
• kiln drying and wood preservation activities

Investors may wish to enter into joint ventures or special arrangements with holders/operators of concessions in the industry.

Basic procedures for obtaining a Timber Sales Agreement (TSA)

An investment proposal/business plan must be submitted to the Guyana Forestry Commission. This should include:

• Inventory of forest products, etc.
• Operation Plan
• Environment and Social Impact Assessment Statement
• Management Plan
• Investment Proposal
• - Capital Layout
• - Technical
• - Marketing Survey
• - Production, producer, volume, value
• Return on investment
• Export strategy
• Forest lands to be identified
• Exploration agreement to be signed

Steps to be taken to operate a Sawmill

• Submit a plan describing the technical details of the mill, layout of equipment, etc.
• Prepare and submit a project document/proposal.
• Evaluation of proposal by officers of the GFC.
• Complete and submit application on prescribed form for operation of plant.

All applications must be submitted to the Guyana Forestry Commission for processing. The Forest Products Association is the representative body of operators in the sector.