MINISTER of Agriculture, Mr. Robert Persaud and representatives of Guyana Sugar Corporation (GuySuCo) appeared before the Economic Services Committee of Parliament and gave an update on developments to ensure the viability of the industry.

The follow-up to a previous meeting in July 2008 took place in the Parliament Chamber of Public Buildings, with People’s Progressive Party/Civic (PPP/C) Member of Parliament (MP), Ms. Gail Teixeira in the chair.

Others present were People’s National Congress Reform/One Guyana MPs, Mr. Winston Murray and Mr. Dave Danny; Alliance for Change (AFC) MP, Mr. Khemraj Ramjattan; PPP/C MPs, Reverend Kwame Gilbert, Mr. Dharamkumar Seeraj and Mr. Farouk Khan.

Among those representing GuySuCo were Chief Executive Officer (CEO), Mr. Errol Hanoman; Chairman, Dr. Nanda Gopaul and Financial Director, Mr. Paul Bhim, who all answered questions and provided information on the current state and future of the industry.

Minister Persaud said, since the last appearance on July 11, 2008, there has been some significant developments within the corporation, many of which have been positive.

However, there still remain some of the challenges previously identified although there is a changed of management arrangement, following the end of the Booker Tate contract.

“And we have since put in place a new board that we think has a variety of skills and competence to deal with the current emerging and, certainly, new challenges that the corporation will face,” Persaud assured.

He said work is still in progress but, recognising the numerous challenges confronting the industries across the world, GuySuCo had to seriously and, some may say radically, relook at its plans and programme.

Persaud said, with the European Union (EU) Sugar Protocol, the Government submitted the national action plan, of which the success was the Sugar Action Plan, within which certain strategic decisions were taken to “rescue, save, sustain and make viable the Guyana sugar industry.”

Recognised

He said many countries within this region and elsewhere decided to close their industries but the Administration recognised the potential socio-economic difficulties that can pose and that sugar, itself, can be part of the overall national development plan going forward.

Persaud said Government took a conscious decision to stay with sugar and changes had to be made and those have been accelerated since the last interaction with the Committee.

“And, in some regard, we have seen implementation or at least the commencement of implementation of some of those strategic decisions which were captured within the Guyana National Action Plan for the strategic plan to save, rescue, sustain and make viable the Guyana sugar industry,” he said.

Persaud said some of those actions included the commissioning of Skeldon Sugar Factory, which is a mammoth investment.

He touched on the role of private cane farmers who surpassed their target by more than 50 per cent, noting that there is renewed interest by them.

Referring to the strategic blueprint for success, Persaud reminded that the turnaround plan is to ensure that it is workable and practical, consistent with the overall strategic objectives of the industry.

He posited that, on many counts, the objectives, targets and activities identified within the strategic blueprint for success have been met, such as reducing cost production, which is very significant.

Persaud said GuySuCo has been able to cut expenditure by more than $2 billion and has lowered the expense of cultivation for a hectare, which was in the vicinity of $650,000 per hectare average, to about $500,000 per hectare.

He said management budget was cut and there has been greater efficiency in terms of procuring and managing resources.

About challenges and reality of the industry, Persaud said GuySuCo will lose in excess of $10 billion this year because of the lower EU price and the corporation has to ensure it gets larger areas under cultivation to increase production.

He said it is estimated that the break even point is above 310,000 tonnes o
f sugar and there are challenges of managing industrial relations, too.

Confronted

Persaud emphasised that those are being confronted.

He said: “I want to make it absolutely clear that the Government is fully committed to the viability of the industry.”

The Board will have to take the necessary measures in working with management to ensure that the corporation is viable and respond to the various stakeholders’ needs and concerns, re-emphasising the importance of this area for economic development, Persaud said.

He gave the assurance that Government will continue to explore and support the corporation and has already made several investments, as testimony of its ongoing commitment.

Persaud went on:“I want to make it absolutely clear that there is absolutely no plan to lay off any worker in this regard.”

He said, despite the challenges, positive changes have also taken place and, in 2010, “the clear mandate is to ensure we stay on this course and, in fact, accelerate in many of these areas.”

Answering questions from the committee, Hanoman said, in terms of changes that have been made to ensure the viability of entity, the strategies include improving production, value-added activities, maintaining cost efficiency and focus on building and improving the GuySuCo team.

Other issues raised were about the state of industrial relations and the Skeldon Sugar Factory, among others.