A “concerned citizen” has sent out a wake-up call for all stakeholders – the State, unions, workers and the GUYSUCO management – to do all it takes to save the sugar industry.In a letter published in our edition yesterday (21/01/16), the writer called for re-positioning of all senior staff employees, what he described as “trimming the top” and relocating personnel, where necessary. From his point of view, the closure of the 100-year-old Wales factory would not have been an option if staff rationalisation had been implemented.
But, as it appears, shifting around the staff would be a palliative, not a cure, for the disease that has afflicted the sugar industry. For starters, under the previous government there was political interference with the administration of the sugar industry. Political appointees, including Donald Ramotar, (whilst he was PPP’s General Secretary and later adviser to President Jagdeo) and N.K. Gopaul, (before he was promoted to Minister of Labour), were foisted on the GUYSUCO board. Another key political appointee was Raj Singh, who was made CEO whilst he lived outside of Guyana. The sugar industry was thus reduced to the unstable status of a political football.
That was the genesis of the decline of the industry, with poor decisions following one after another. One of those was the selection of the contractor for refurbishing the Skeldon factory, which was taken over by the Jagdeo government before a proper trial run. The factory was handed over with major technical faults, and was reduced almost to a “white elephant.” Since 2011, then President Jagdeo, who boasted that Guyana would produce 500,000 tonnes of sugar annually, pledged to fix the factory and, in spite of intervention by several experts, the factory limped along. Sadly, some $47 Billion had been spent on this factory, which was tantamount to throwing water on a duck’s back. We never came close to the ambitious production target. Instead, production fell from an average 300,000 tonnes in the 1960s to just over 200,000 tonnes between 2012-2014.
Poor management led to the industry sinking to the lowest production levels even at a time when the price of sugar on the world market had fallen and the European Union had threatened to end our access at preferential prices. Financial help from the EU to rehabilitate the industry was diverted and wasted. Nothing was spent on the hapless sugar workers. Instead, when GAWU threatened to take strident action to safeguard the workers, the Jagdeo administration wanted to ban the union and silence the workers’ voices.
Besides low production, the Jagdeo regime experimented with factory closure, the notorious example being that of Diamond where the lands were hived off to friends and cronies. Other sugar lands were bought over by the government and doled out even whilst sugar workers suffered from land hunger. It is recognised by all that the sugar industry had reached the crisis point under the PPP government. In 2000, GUYSUCO made a loss of $2.8 Billion, which the “Jagdeo touch” escalated to $7.1 Billion in 2012 and $17.4 Billion in 2014. GUYSUCO was forced to rely on loans and handouts to survive. GUYSUCO racked up $82 Billion in debt and the State intervened with successive bailout packages amounting to some $60 Billion over recent years.

GUYSUCO was bankrupted by the time this new government was elected to office only eight months ago, and the new government immediately went to the rescue of the cash-strapped corporation by advancing just under $12 Billion to pay wages to sugar workers. It also revamped the board and administration, and withdrew the dead hand of political interference that had paralysed the industry.
A Commission of Inquiry (CoI) was established to do a comprehensive examination of GUYSUCO, and the reports have been laid in Parliament for examination by all Members of Parliament. In the meantime, some semblance of increased production was being restored, and for the first time since 2004, GUYSUCO not only met its target, but surpassed production levels with 214,000 tonnes of sugar produced.
That showed hope that GUYSUCO could recover. But the major ingredient for success was how to cut the cost of production. The first innovation was bringing efficiency to the Skeldon operations. By year-end, the factory was producing more sugar at reduced cost. The second was to bring efficiency to all other factories. Wales factory was producing at a nearly $2 Billion annual loss and sending canes to Uitvlugt was an option to help the sugar industry survive. The announced closure of the old, run-down Wales factory next year would appear to be a sudden decision, and if the GUYSUCO board were to be blamed, it is not for the merit of the decision. It has made a clear case. But it is the way the announcement came which gave the opposition an issue on a platter to crow about and exploit for political /ethnic gain.
The letter writer referred to earlier took a balanced view and made several careful recommendations for the survival of the sugar industry. He said, “People will have to realise the importance of saving sugar and the long-term effects on the country for generations to come. It is survival of the industry.” We couldn’t agree more.