– Says President Bharrat Jagdeo

President Bharrat Jagdeo and Agriculture Minister Robert Persaud unveil plaque to commission modern Skeldon sugar factory

President Bharrat Jagdeo has said that the commissioning of the Skeldon Factory will only be a success when GuySuCo starts producing enough money to cover all its costs and to contribute to the national treasury.

The President made this remark at the commissioning ceremony of the new US$181M facility at the Skeldon Estate at a gathering which included Prime Minister Samuel Hinds, Agriculture Minister Robert Persaud, other ministers, Regional Chairman Mr. Zulfikar Mustapha, GuySuCo Chairman Dr Nanda Gopaul, Chief Executive Officer Mr. Errol Hanoman, Guyana Agricultural and General Workers’ Union (GAWU) President Mr. Komal Chand, other trade union representatives and members of the diplomatic corps.

Mr. Jagdeo stressed that the modern factory reflects a serious commitment of his Government to ensure the survival of the industry.

“We can’t wait to the end of 2011 to have 1.2 million tonnes of canes in the field; this has to be done now, next year we have to start working on this, and even if it means the state providing a bit more resources, we have to find innovate ways of getting this done, it could be done from all that I have heard, the President said.

“We are going to make a serious effort. I want the Board to understand that and the minister will have to push this to ensure that this happens,” the Guyanese Head of State underlined.

Value for money
He said Government demands value for money and every single cent spent in the industry must be rigorously tested.

“The question must be asked, are we getting value for money? And, if the answer is no, the procedures have to change,” the President told the gathering.

He said the Government expects accountability on the part of managers for performance, and those who prevail will be rewarded and those who fail will be appropriately penalised.

State-of-the-art Skeldon Sugar Factory

Mr. Jagdeo emphasised workers have a right to full compensation and the Corporation must constantly try to enhance their pay package; but he reiterated that they too must understand their roles in ensuring the survival of the industry and engendering its success.

Mr. Jagdeo urged the workers to be reasonable sometimes, pointing out that they have to look at the financial situation of the industry.

“You can’t break the industry when it is trying to emerge and build these big investments,” he underscored, adding that the Government is trying to secure the industry in the long term.

Diversification
The Head of State also said there is need to push diversification aggressively, not only in sugar, but in other products as well.

He said “it is a tragedy” that only a decade ago Guyana started packaging sugar, noting that there are many ways its value can be enhanced and he feels the energy and drive in this regard is absent.

The President stressed that GuySuCo has to produce more sugar and he believes it can produce 400,000 tonnes of sugar and a significant part can go into markets in different forms, as specialty sugar for instance, as is being done by smaller countries.

He lauded the Chinese Government for its generosity and support in making the Skeldon project a reality, particularly the contractors, who have managed to overcome the hiccups to deliver the product.

He said even though his Government’s plan for restructuring the sugar industry started in 1998, it was only in 2005 that the first pile was driven.

Too vital to fail
The period in between, the President recalled, was spent trying to convince the multilateral agencies that sugar was too vital to fail in a country like Guyana.

“What I find very ironic today is that the same people who argued, against this, that the investment was too large, it was close to 25 per cent of GDP at that time, (today it is about 15 per cent of GDP), they are claiming that there are sectors and industries in the United States of America, Britain and the developed parts of the world, too large to fail, and therefore they are pumping billions of state dollars into these companies to ensure their survival and these are larger economies,” he observed.

Sugar contributes close to 16 per cent of GDP and some $35B in foreign currency revenue.

“We probably could have had the investment done ten years ago, long before the EU cut prices on sugar, and maybe we wouldn’t have been in the same kind of difficulties now that we experience, when we just have a start-up of a new investment coinciding with a major cut in revenue of 36 per cent in the same year. But that’s all water under the bridge,” he added.

Mr. Jagdeo pointed out too that the Government is faced with the same kinds of arguments with the hydropower project, and disclosed that if all fails with private investment, the state will find a way in investing in that area, as it has done with the Skeldon project.

New chapter
Minister Persaud described the colossal investment as a new chapter in the saga of the country’s sugar industry.

“This particular episode has been scripted after a profound assessment of where the sugar industry is poised today, the challenges it faces and the identification of what is needed to facilitate a globally competitive industry that would continue to contribute to the development of our country and the well being of our people,” he informed the gathering.

He said the factory reflects the unfolding of a vision long before the threats that now confront the sugar industry surfaced.

“Our party and President recognised that sugar, given its share in our GDP, its contribution to national employment and foreign exchange earnings, as well as to societal welfare, could not be left unattended to face the raging tempests of a hostile external environment,” Persaud reminded sugar workers.

The minister said labour must be responsible and responsive to the financial standing of the company and management must be held to a higher level of accountability.

Working together
He stressed that the industry must be managed differently from the past, and workers and management must make the necessary sacrifices in ensuring GuySuCo returns to profitability.

“Any extended losses by the sugar corporation will mean hardships and difficulties for all stakeholders. Simply put, the future of workers is tied to the viability of the industry,” Persaud noted.

He said the Government is seriously contemplating the setting up of a refinery plant at Skeldon; and if this proves to be a viable enterprise, it will create more jobs and deepen and diversify the industrialisation of the industry.

Persaud said the vision for sugar is a structured and diversified industry which will allow Guyana to attain global competitiveness in production, products, and create new hubs of cane and sugar related activities.

Chinese Ambassador to Guyana Mr. Zhang Jungao said the investment has brought the two countries closer together as it marks a new milestone in their relationship.