Wood Matters
Editorial
Kaieteur News
April 11, 2007
We all know that practically three quarters of our country is covered with trees of one type or another. We all know too, after being assured by every politician even before independence, that this offers us great “potential” for lifting us out of poverty since trees translate into wood and wood products that are in great demand in the rest of the world.
Yet we still remain an officially recognised Highly Indebted Poor Country while our forest resource is, at the very best, mostly exported as logs for other countries to reap the benefits of high value added wood products.
There has been a heated debate about the merits and demerits of our forestry policy but we believe that the focus of the debate needs to be widened somewhat to include what we ought to be doing in a pro-active way to make better use of our forest resource.
There is no dearth of Guyanese trying to add value to our logs. All across Guyana , in every village there is at least one enterprising citizen who has established a furniture manufacturing facility.
We therefore have a resource and we also have the people that have the will to exploit that resource so as to improve their lot. Unfortunately, the quality of the products is, by and large, very spotty: we do not, evidently, have the requisite capacity.
There are a few companies, however, amongst the forest of producers who have demonstrated that it is possible to achieve standards that can satisfy the most stringent demands of the world market. Precision Woodworking is one of those companies.
After shipping garden furniture directly into the European market for years, they announced last week that some new regional markets were secured. While the latter may seem to be an easier undertaking, the reverse is actually true because of the entrenched lack of respect for Guyanese manufacturing capabilities and standards in Caricom.
The question is, how can we transfer the sterling example shown by the Bulkans of Precision to the rest of our manufacturers? One way would be to let the “know-how” slowly filter into the field as workers from Precision move into other companies or open up their own companies.
The benefits through this “externality” route, however, are very uncertain, especially given our extremely high emigration rates. The Newly Industrialising Countries (NIC's) in the Far East have executed a different strategy that suggests a path for us.
When there is an identified industry that shows promise for generating exports, profits and employment, those governments took an active role in ensuring that the industry was nurtured and allowed to take root and grow. They accomplished this task through several stratagems.
One, which could be adopted by us, was to provide funds to create facilities to provide key services in industrial estates centred on the given activity so that the costs of those services could be shared.
Take, for instance, the manufacture of quality wood products for the world market as demonstrated by Precision. The wood must be kiln dried to the specifications of the importing country.
This is one of the most glaring omissions of the bulk of our Guyanese manufacturing community and has earned the ire of many importers (this was the major cause of our regional black mark) who discovered too late that beautiful pieces of furniture bought in Guyana quickly shrunk and separated.
But it is beyond the capability of a vast majority of our manufacturers to establish and maintain kilns on their own. The answer may seem obvious that the costs could be shared but it just has not happened. Given the nascent state of the industry, it is unlikely that it will occur soon.
This is where governments come in. When the community linkages and the market forces have failed to institute necessary coordination to produce a good, then the government must intervene to correct the obvious market failure.
Not that the government has to enter the production process itself, but just to facilitate it through soft loans, as it in a sense did in the necessary construction of Buddy's Hotel for the World Cup.
The Government itself mentioned the creation of a coordinated industrial estate for the wood industry a short while back and it is time that it makes a concrete move.