MINISTER of Agriculture, Dr. Leslie Ramsammy on August 16 in a meeting held at the Guyana Rice Development Board, urged farmers to bear in mind that it was the Opposition that voted against the Bill to increase the debt ceiling in Parliament, when it was presented by Minister of Finance, Dr. Ashni Singh.

Dr. Ramsammy noted that over the past few weeks, meetings have been held with the bankers and millers to deal with the payment issue that farmers have been faced with. The result has been a positive outcome for investments in the rice industry, provided that the Government stands as guarantor on the loan agreements.
He said that the Government of Guyana standing guarantor to any loan is a debt to Guyana, therefore, given the non-passage of the Bill to increase the debt ceiling, the guaranteeing of the loans to the millers is not a decision the Government can make.

HYPOCRISY
“You all recall that somebody went to Parliament and voted against a Bill introduced by the Minister of Finance to increase the debt ceiling in Guyana. The guaranteeing of any loan is a debt, because when we guarantee that loan, it is our debt, and that increases our debt. So, how you, on one hand, would instigate the farmers to come to the Guyana Government who must take that loan, but you forget that you voted against an increase in the ceiling,” he explained.
Additionally, he expressed his concern on the hypocrisy of the AFC, since they were the ones that in Parliament opposed the $500M Budget for the rice industry, saying that it was a handout to farmers. “Now they are speaking different language with the farmers that we are not giving enough. It is hypocrisy and it is fooling people, misleading people,” he said.

REDUCING PAYMENTS
The Minister stressed that the main goal of the Ministry of Agriculture, along with the Guyana Rice Producers Association (RPA) and the GRDB, is to reduce the monies owed to farmers to “zero” before harvesting of the second crop and also implement measures that will ensure that this issue does not arise again.
“We are close to bringing it down to zero…The monies paid are greater than 90 per cent of the amount of what was owed, with outstanding payments amounting to approximately three to four per cent of the total amount,” he said.
Dr. Ramsammy added that due to payments being made everyday, the percentage of rice farmers owed will also decrease.
He explained: “I remember one time I said about 14% is outstanding, I can remember another time I said about 10% is outstanding, and I can say to all of you today that the outstanding amount is about 4% of approximately $23B of paddy that was sold by the farmers to the millers in the first harvesting season of 2014. Therefore, the rumors of the Minister, the President, the RPA General-Secretary and General Manager of the GRDB are all lies and should be dispelled.
“The amount is about $23B in payments due to the farmers, this is the actual amount, not some estimated cost of the paddy, this is what the agreements, the actual cost of the paddy farmers sold to mills. That is a huge amount and we want to make sure that the millers pay the farmers all of the $23B, that is why some of the payments, approximately $22B have been paid by the millers to the farmers at various stages during the year. If we add accumulatively, it will be in excess of $4B Guyana has put in, some have been paid back to us and that has gone back to pay the farmers, so that is the revolving nature of it.”

With the ongoing issue of payments to the rice farmers, a group of farmers from the Essequibo earlier this month met with the Private Sector Commission (PSC), where they reported that approximately 25 per cent of the farmers are yet to be paid, which was also communicated to the minister by the PSC.

In light of this, the minister is calling on the PSC to ask the alleged group representing farmers to provide the names of the 25 per cent of farmers in Guyana that have not been paid, which on an average sums up to at least one thousand farmers.
He said, “If I were part of that commission present I would ask them the logical question, can you give us the evidence for this, because you can have formal meetings and people saying what they want to say, because this is what I know and again if I’m wrong somebody needs to come forward and show me where I am wrong.
“We at the GRDB have the list of names of all the millers, who they bought rice or paddy from, so we know what each miller procures. I am saying it comes to me as a shock, my data shows different. Since I want to help the farmers I want that list and either they bring it forward or they shut up. I would like my comrades at the Private Sector Commission rather than wasting people’s time to simply ask, because why you want to get involved with a whole set of thing that may not be a issue.”
However, the Agriculture Minister acknowledged that farmers are still owed in Region 3 (Essequibo-Islands/West Demerara) due to the formation of a co-op, which backfired.
According to him, only the large-scale farmers in this rice-producing region have outstanding amounts. He indicated that the farmers sold approximately $100M of rice and paddy to the co-op.
Dr. Ramsammy said that the Government of Guyana believes that rice farmers must be paid on a timely basis and this must be done fully and fairly.
“The first thing about payment is that farmers are not being paid on a timely basis, part of the problem is the phenomenal increase in the cash movement, the cash flow movement, because whilst farmers harvest twice per year and therefore expect their payments during that period, the millers sell for 12 months, so they receive their payments over 12 months and therefore that cash flow issue is a problem,” he explained.

REVOLVING FUNDS
The minister recalled: “In 2000, there was a cash flow of around eight billion dollars, whereas in 2014, that cash flow that moved from one set of hands to the next set of hands would be $47 billion. In other words, it’s about 5.7 times more than in 2000.
“Therefore, the ability of the millers and the bankers, because the bankers need to be part of the stakeholder, to meet that huge increase in cash flow has been challenged and that is where the Guyana Government comes in because there is talk about a revolving fund of a couple million Guyana dollars.”
A revolving fund is a fund or account that remains available to finance an organisation’s continuing operations without any fiscal year limitation, because the organisation replenishes the fund by repaying money used from the account.
Dr. Ramsammy noted that there is currently a Government revolving fund of two to five billion dollars.
“This revolving fund was formed as a result of the bankers and the millers’ inability to meet the $46B in 2010 and not so long ago it was $30B.
“Moving from $8B to $30B, you had the problem and in any country they will tell you, when it comes to agriculture banks are very skeptical of having large amount of monies out because you can have a disaster and then in trouble to receive this money. So this is the struggle we have gone through, quietly, without a big fuss,” he said.
Minister Ramsammy stressed that the Government of Guyana, at various intervals, injected $2 to $5B as a bridge between the banks and the millers, to ensure that the farmers are paid. However the revolving fund has not allowed for timely payments but it has allowed all farmers to be paid during a crop.
“If we add accumulatively, it will be in excess of $4B Guyana has put in, some have been paid back to us and that has gone back to pay the farmers, so that is the revolving nature of it. If the Government didn’t intervene then the outstanding amount would have been over 20%. So the millers themselves have paid a large amount,” he reiterated.
The Agriculture Minister added that he had meetings with the banks to ensure that instead of the Government’s money being utilised as a bridge that the banks use their money with the millers, but fear has been expressed about investing.
“The banks have already expressed fear that they have already invested money, because there is something else that we should take into consideration, when you were dealing with 300,000 tonnes for the year versus 600,000 tonnes, there is a problem of storage, of drying etc. that millers have to invest in, so they already have significant loans at the bank, because it’s chicken and egg, you going to produce more in the fields we also have to increase our capacity and somebody has to invest in it,” he said.
The first rice crop brought in a record-breaking 315,000 tonnes, which is not only the largest single crop, but also surpassed the annual targets made by the industry prior to 2000. For the second crop, some 225,000 acres of rice was cultivated, with a production target of 310,000 tonnes with the prices depending on farmers’ yield of bags per acre.

(By Sandy Agasen)