Drivers for REDD in Guyana

President Bharrat Jagdeo’s visit to Europe last week was reported enthusiastically in Guyana’s newspapers. Headlines like “The Norway climate deal a significant step forward” and comments such as “Guyana is getting significant backing, including financial support, from Norway, for its model to push saving rainforests as a central platform in the global plan to avert climate change disaster,” both from the Guyana Chronicle, are typical.

REDD-Monitor recently received the following anonymous contribution which challenges the claims that President Jagdeo and his consultants McKinsey have been making about Guyana’s forests and questions what is really driving REDD in Guyana.

Drivers for REDD in Guyana

Forests under-valued and under-taxed

1. Through the independent daily newspapers in Guyana in 2006-7, President Jagdeo (who is Minister of Forestry and has retained several other Ministries in his own hands) became aware that the potential value of Guyana’s natural tropical moist forest was much greater than he had supposed from the information apparently supplied by the national forest service, the Guyana Forestry Commission (GFC). Guyana has very low rates of forest resource access and forest production (royalty) taxes, by international standards. For timbers of similar technical specification, Malaysian (Sarawak) royalty rates are 6-20 times greater than those in Guyana. The largest logger in Guyana, the Malaysian-owned Barama, pays an annual access fee of about US$2019 for its 1.61m ha, equivalent to US$0.0013 per ha which is 1/154 of the rate paid by Guyanese concession holders.

2. Export commission on unprocessed logs is likewise very low. The 2 per cent rate on declared FOB log values was raised to 7 per cent from January 2009 but this is no deterrent to export when undeclared net profits by log traders are of the order of US$320 per m³ on logs with declared FOB values of US$120 per m3. Even the increase from 2 to 7 per cent was a result of information in the independent daily newspapers, not because of the GFC. There is no national policy in favour of export of unprocessed logs. All the national policy statements favour on-shore processing for adding value to forest products. Even the 2006 election manifesto of the Party-in-Power is explicit about favouring national processing of timber.

3. Most or all of the large-scale loggers in Guyana maintain large and long-standing debts of unpaid forest taxes, but are still allowed to operate.

4. Through regulatory capture over nearly 20 years and through their one-sided foreign direct investment (FDI) arrangements concluded secretly with the Cabinet or Party-in-Power in Guyana the Asian-owned loggers have made it very difficult, perhaps practically impossible, for the government now to place the arrangements on a transparent and equitable basis, including reference to OECD guidelines for multinational enterprises. The FDI stability clauses in the Asian-written contracts would penalise the government of Guyana for any changes which would have negative effects on the profitability of the Asian enterprises.

5. Also through regulatory capture and through the rentier behaviour of Guyanese holder of forest concessions, the four Asian enterprises now have effective managerial control over 98 per cent of the 25-year logging concessions.

6. It seems unlikely that the Party-in-Power would try to challenge the forest crimes of the Asian loggers in court – there have been many opportunities during 2007-8 – in case the extent of the corruption to the apex of government were to be revealed by cross-examination by lawyers associated with the political opposition parties.

7. Manipulating the existing forest concession system for timber production thus appears to afford to the President of Guyana little opportunity for capturing more value from the natural forest.

Coastal flooding and drought

8. 90 per cent of the population of Guyana lives on the coastal plain, which was empoldered during the 1700-1900s and lies below the level of high tide. The effectiveness of gravity drainage depends on keeping the canals free of silt, the dams in leak-proof condition, and the sluices fully functional. During the decades since independence from colonial rule in 1966, the drainage and associated irrigation system has been much neglected, so that even slightly higher-than-average rainfall leads to flooding of farmland and urban areas.

9. Dams and canals are also important in retaining rainwater from the hinterland for irrigating the sugar cane and rice which are the main products of the empoldered lands. The irrigation canals have also been neglected for decades.

10. Mangrove forests have been cleared for fuelwood over the last three centuries and the seaward dams are thus liable to erosion by tides and wave action. Whether the coastline is accreting or receding depends on the position of the huge off-shore mudbanks which move along the northern cost of South America from the estuary of the Amazon river in Brazil.

11. There are excellent analyses of the state of the drainage and irrigation system, summarised in the national development strategy 1995-6, with a reduced version issued in 2001: see http://www.guyana.org/NDS/chap40.htm for the 1996 version and http://www.sdnp.org.gy/nds/chapter15.html for the 2001 version.

12. The ethnic African and East Indian Guyanese on the coastal plan generally know little about the forest-covered hinterland of their country. But they are naturally concerned when their homes and farms are flooded for days and weeks. The government failed to declare a State of Emergency during the January 2005 floods, and thus delayed or prevented the delivery of international government-to-government assistance. Heavy flooding again occurred in January 2009. The government response is a small and weakly managed programme of canal de-silting by private contractors associated with the Party-in-Power. There have been allegations that East Indian villages have been drained while more flooded African Guyanese villages have not; the Party-in-Power is East Indian.

13. This weak and delayed response to poor water management is perennially criticised, even in the government-owned daily newspaper. If President Jagdeo is to secure electoral support for reforming the national constitution 1980 to allow himself a third term of power, he needs to address effectively the drainage and irrigation problem because this cuts across the ethnic divide and the lines of the political parties. As the President is a micro-manager, he brings the responsibility for action onto himself. He therefore needs a lot of money to rehabilitate the long-neglected water management system. For many years, the World Bank and European Union have provided small tranches of funding, especially for repairing the seaward dams and sea walls, but even their corruption-tolerant financial management is unlikely to provide the very large sums which the President desires.

Climate adaption/mitigation funds

14. There are funds which could be called on to rehabilitate the coastal drainage and irrigation, especially if endorsed by the Small Islands Developing States (SIDS), of which Guyana is a member. However, Guyana does not make use of SIDS channels, possibly/probably because of its great aversion to genuine multi-stakeholder processes.

REDD

15. The President thus requires access to new and large amounts of money. If such money can be obtained from sources which are unfamiliar with the poor standard of governance in Guyana, the lack of transparency in contract procurement, the failures to monitor and manage government-awarded contracts, the proliferation of over-lapping but ineffective government agencies, the possibilities of diverting money into Presidentially-favoured enterprises are all the greater.

16. It would also be helpful if the new sources are unfamiliar with the poor record of Guyana in relation to IMF loans and Canadian government credits.

17. The still developing procedures for REDD appear to offer great possibilities for Guyana. However, the President has repeatedly indicated that he wishes the current logging (piratical, unsustainable, effectively uncontrolled because of regulatory capture) to continue; presumably because, as argued in paragraphs 4 and 6 above, he cannot risk seriously antagonising the Asian loggers. There are some small possibilities for REDD to compensate for the damage and waste caused by the uncontrolled logging (the Avoidable Degradation). However, the 1953 Forests Act and 1953 Forest Regulations could be used to insist on the application of the reduced impact logging techniques prescribed in the GFC Code of Practice for Timber Harvesting. The GFC does not require loggers to follow the second edition (2002) of this Code. There is thus no need for external funding for the application of this Code. What is missing is the political will. It is absolutely untrue that sustainable logging has been going on in Guyana for 100 years, with no loss of biodiversity (except in the sense that there is no record of a species becoming extinct) or carbon stock. Notably, the forests in the Intermediate Savannas have been progressively degraded over decades by uncontrolled logging and burning. The GFC has abundant surveys to demonstrate this degradation.

18. The President also has some difficulty with the low rates of deforestation. The coastal plain reclaimed by empoldering has never carried natural forests, except for mangroves on the sea shore. In the hinterland, the 9 Amerindian ethnic groups mainly pursue subsistence-level rotational agriculture because the ancient soils are too infertile to support sedentary cultivation. Their customary rights are recognised by the national constitution 1980 and protected by the Forests Act 1953 and the Amerindian Act 2006. Under present law, the Amerindians cannot be prevented from forest burning for agriculture within the 77 or 97 legally titled Amerindian Village Lands. Outside these titled lands, they can be prevented by the Forests Act 1953 which applies to the State Forests in which the approximately 39 untitled Amerindian communities reside. It was a condition of independence from British colonial rule in 1966 that [all] the Amerindian communities would receive titled land, but the government of Guyana is still far from fulfilling that obligation. The government puts very little effort into the titling process, and the award system is essentially arbitrary and dependent on the whim of the President.

19. It is unclear how the President counts 155 Amerindian communities.¹

20. The >4 per cent annual deforestation rate suggested to the President by the McKinsey Consultants in December 2008 does not appear to be supported by reliable data.

21. Whatever the deforestation rate due to Amerindian agriculture, it is unclear what sustainable alternative livelihoods and food security are being offered to them through the proposal by President Jagdeo. There is no agricultural research or extension service for the hinterland.

22. Amerindian communities are traditionally polite and agreeable to visitors. It is customary for them to agree to proposals made by outsiders. It is natural for them to agree to Presidential proposals of whatever nature; such agreement normally leads to valuable gifts at election time, such as outboard motors and boats, music sound systems and other consumer items. Whether the Village Captains (‘Toshaus’) and Village Councils are contacted in their villages or by being brought to hear Presidential monologues in Georgetown (the capital of Guyana), they will surely agree with his proposals.

23. This agreeable nature, and a tendency not to regard community decisions as binding, has led and does lead to Amerindian communities allowing outsiders to log their forests unsustainably and mine gold and diamonds from their soils, at “give-away” prices. It would not be surprising if the Toshaus agreed orally in Georgetown to a ban on forest burning for customary farming, even if they and their communities continued with this traditional practice. The Amerindian communities have little to do with “coastlander” politics and do not use their 9.2 per cent share of the national population in any political sense. They tend to have a poor knowledge of statute laws and regulations, and how such coastlander practices as written law might affect their customary ways of life.

24. It would be more true to say that Amerindians do not understand the culturally inappropriate coastlander consultations than (as President Jagdeo claims) that they are getting tired of them.

25. It is unfortunately only too easy to see how President Jagdeo’s proposal could lead to cultural dispossession of the Amerindians, given his lack of understanding of their decision-making processes, and given his disregard for the national constitution and existing statute law.

McKinsey Consultants report, December 2008

26. The estimates of areas of soils for sustainable farming in the McKinsey report appear to be derived from an oral source, as no written references are given. The Guyana Lands and Surveys Commission does not offer soils maps to the public for most of the areas suggested by McKinsey. Given the hundreds of years since European colonisation of Guyana, and the pre-existing Amerindian populations, it would seem remarkable that large areas of high-grade farmable soil should suddenly be discovered in this country.

27. McKinsey does not question why the government forest charges for usufruct of the State Forests are so low, or why Guyana needs to be subsidised when the export log trade is uncontrolled as to volume, almost uncontrolled as to species, and very profitable to the log traders.

28. McKinsey appears to assume that all the estimated gold reserves would actually be mined. The retreat of the Canadian Omai consortium from Guyana suggests that only a small fraction of the gold reserves is actually minable.

Multi-stakeholder processes

29. The National Assembly has 65 part-time members with sittings for c.40 days per year. Members are appointed by leaders of the political parties, not elected by geographic constituencies. The National Assembly is thus unable to call the Executive (President and government agencies) to account, or even to answer questions about their stewardship of public assets.

30. The political procedure Democratic Centralism in Guyana is not as it was developed and used in Leninist Russia. As interpreted by the East Indian Party-in-Power, it means that the Executive can set aside laws, regulations, procedures, policies and national strategies if the Executive deems that such set aside would be “in the national interest”. Democratic Centralism is not set in the National Constitution, and there are no published criteria for what might be “the national interest”. As in Stalinist Russian, Democratic Centralism in effect allows the President and the Party-in-Power to do whatever they wish; as the judiciary is also under Presidential control.

31. In these circumstances, it is not surprising that the opposition political parties use opportunities outside the government system to challenge the Executive, as the normal processes of democratic debate and government have been set aside. This is one major reason why President Jagdeo is reluctant to admit genuine multi-stakeholder processes. The same fear applies also to the Guyana Forestry Commission. The President and the GFC are also not accustomed to debates which are independently and professionally facilitated, and where the government does not have a dominating role.

32. Government meetings tend to be by invitation only, with some compulsion on the invitees to attend. Government has had no hesitation in opposing participation in donor-funded meetings by people regarded as opponents of the Party-in-Power.

33. However meetings are convened, the Executive usually pays very little attention to conclusions or recommendations. This has been notably true for the consultations on national security and after major flooding. It is possibly one of these consultations which the President had in mind when proposing to extend the scope of existing consultations rather than initiate a REDD-specific process.

Strategic allocation plan for State Forests

34. So far as I know, there are no major logging concessions which are not used, whether legally or illegally (by Asians renting from Guyanese concession holders or by simple stealing of timber from concessions, a common practice). The National Forest Policy 1997 and the National Forest Plan 2001 both prescribe a strategic allocation plan, which should resolve the current discontent of the national small-scale loggers being allocated under-stocked and over-exploited degraded forests, while Asian loggers receive the unlogged primary forest). No such strategic plan has been prepared by the GFC.

35. There are over 5m ha of State Production Forest not yet allocated. Perhaps 2.3m ha are covered by Amerindian land claims and so should not be offered for concessions (although the GFC often ignores its own rules on this matter). The remaining 2.7+m ha are currently too remote or too steep to be loggable by caterpillar tractor or skidder, the usual machines in the long-term concessions in Guyana; there is no use of high-lead or helicopter logging systems.

36. A strategic allocation plan is highly desirable, to match the intention of maximising net social benefit stated in the National Constitution. Such a plan should allow for assignment of forests near to communities (both indigenous and coastlander) to be managed by properly constituted local associations using improved technology such as mobile high-strain thin-kerf bandmills, leaving the residues to decay in the forest instead of being a commercial nuisance in town sawmills. Forests remote from communities could be allocated to larger-scale enterprises which have the capital for heavy tractor and trucks. Forests which are sufficiently well-stocked to be managed sustainably could and should be harvested with reduced impact logging techniques.

37. This is not a matter of a shortage of skills or techniques, but absolutely because of lack of political will.

Other support for REDD capacity building and action in Guyana

38. Note that WWF Guianas and Conservation International have declared support for REDD capacity building in Guyana. Norway should be aware of the international contexts and agendas for each of these organisations (their larger policies and strategies) within which such support is being provided.

39. In the case of Conservation International (CI), the policy staff have been seeking an opportunity to put into practice an approach to conservation derived from negative experience in Bolivia. CI has proposed that a natural tropical forest should be thoroughly logged of all commercial species and dimensions, and then closed against all further timber extraction, with the management after logging being carried out by a designated conservation organisation. If the President of Guyana could be sure of securing an income sufficient to replace the (small) current income from the State Forests, for example, through REDD funding, then he might be willing to cancel some or all the logging concessions now operated by Asian-owned companies from which the country derives little net benefit. Those concessions could be handed to CI for management on behalf of the people of Guyana.

40. The current technical assistance funded by bilateral donors through WWF Guianas for community-scale forest management could be expanded to include carbon management. However, as the mentoring of the communities in this project is in the unreliable and misleading hands of the Guyana Forestry Commission (evidence from the training booklets developed and distributed with UNDP funding in 2006), such mentoring almost certainly is not focused on the major needs of the communities.

Ownership of carbon

41. The McKinsey Consultants report and the Jagdeo proposal do not seem to have considered the ownership of carbon. The Mining Act (Cap 65:01, 1989) deals with minerals. Article 2 of this Act provides definitions – “mineral” includes ore or compound of any mineral, any metal and precious stone and includes any radio-active mineral, but does not include water or petroleum. So the Act does not define mineral as such. The Concise Oxford Dictionary defines “mineral” as – (substance) obtained by mining; (belonging to) any of the species into which inorganic substances are classified.

42. Neither above-ground nor below-ground carbon (in the sense of soil carbon, not in the sense of coal of different types) thus appear to be definable as mineral, and therefore the Mining Act of Guyana does not seem to apply. This also means that Article 6 of the Mining Act does not apply – subject to other provisions of this Part, all minerals within the lands of Guyana shall vest in the State.

43. By default, therefore, the Amerindian Act (no.6 of 2006) seems to apply. Article 14 (1) of this Act – subject to the other provisions of this Act, a Village Council may, in exercise of its functions, make rules governing . . . (d) the management, use, preservation, protection and conservation of Village lands and resources or any part thereof. However, Article 15 – a rule, and any amendment to a rule, made by a Village Council comes into effect when – . . . .(b) the rule has been approved by the Minister [of Amerindian Affairs] and published in the [Official] Gazette. As usual in Guyana, the criteria which a Minister should use for giving or withholding approval are not provided in the law.

44. It is my understanding that very few Amerindian Village Councils have made any by-laws under Article 14 (1) of the Amerindian Act 2006, partly because so few people have seen the text of the Act and partly because the unnecessarily complicated legal language would be difficult for the Village Councils to understand anyway. A recommendation of August 2006 to the Minister of Amerindian Affairs for a simplified and explanatory text were finally accepted in 2008, but the booklet was drafted by the main writer of the original legal text!

Name and address supplied.
8 February 2009.

1. Note by REDD-Monitor: On 7 February 2009, Kaieteur News reported that a national consultation would start in two months. While he was in Norway, President Jagdeo said that all indigenous peoples will be involved in the consultation. He said that the elected leaders of all indigenous communities (155, according to the president) will be invited/brought to Georgetown for a two-day long consultation workshop.