CABINET has approved the release of $3.8 billion from a sum of $16 billion earmarked for GuySuCo this year to keep the ailing sugar industry alive and help it to return to a state of viability.The Government is expecting that production returns from the corporation will remain steady and at least 60 percent of the total sum invested will be repaid to the national coffers.

Speaking at his weekly Cabinet briefing, Minister of State Joseph Harmon said Agriculture Minister, Noel Holder has been mandated to lead a drive that will ensure Guyana finds better markets for its sugar.
“Cabinet was briefed on a number of countries to which our sugar is sold but we need to have a better and deeper appreciation of those particular markets that we can get a better price for our sugar,” Minister Harmon told reporters.
Some 60 percent of local sugar is sold to the European Union (EU) market where the decline in prices has been acute.
Guyana is facing a situation where the cost of production of sugar outstrips the returns on sales of the commodity. In this light, there have been calls from some sections of society for the Government to seriously review investments in the sugar industry.
The Minister of State said the Government has asked for a full-fledged inquiry into the continuous failure of the sugar industry, pointing out that the outcome will determine the way forward.
NO EASY DECISION
“It is not something you wake up (and) easily make a decision that will affect the lives of so many thousands of Guyanese people. Sugar is like the mother of the trade union and labour movement in this country,” he said, contending that once the weaknesses are corrected, then Government would not be pouring money down a dark hole.
CORRECTIVE STEPS
And the new Administration has already begun to take corrective steps. The Board and Chief Executive Officer of GuySuCo have been removed and an Interim Board installed, an inquiry will be launched into the industry and through mopping up of unnecessary services the corporation has already been able to save US$14,000 per month.
According to Harmon, Minister Holder has presented to Cabinet some of the measures being taken by GuySuCo to ensure the actual expenses of the corporation are brought down significantly.
In the request for funds, GuySuCo has taken into consideration the need to pay wages and salaries, current outstanding payments to the National Insurance Scheme (NIS) and the Guyana Revenue Authority (GRA).
Aside from these, there is also the need to release monies for purchase of fertiliser to secure the first crop in 2016 cane, the purchase of critical spares for factories to secure the production of the second crop, and the purchase of fuel and lubricants and to meet outstanding payments to suppliers.
Minister Harmon reported that the corporation is already late in the application of fertiliser, and pointed out that given the current financial state of GuySuCo, limited payments will be made to suppliers. The corporation, therefore, has been negotiating with suppliers in this regard.
For the period August to December, GuySuCo is expecting an income of US$13.056 million and expenditure of US$19.511 million, a shortfall of about US$6.455 million.
“This shortfall is attributed mainly to declining prices being received for sugar, which is more acute in the European Market, where 60 percent of local sugar is sold,” Minister Harmon said, noting that income and expenditure for this period is currently being reviewed to determine whether income should be increased and expenditure reduced, with further trimming of cost.