— says Minister Mustapha
By Navendra Seoraj
GUYANA’S sugar industry has been considered a liability for years, with a poor financial standing and low productivity, but the new People’s Progressive Party/Civic (PPP/C) administration is hoping to “lift the industry from the ashes,” starting with the appointment of a new board of directors to the Guyana Sugar Corporation (GuySuCo).
Reconstruction and resuscitation of the industry is expected to start with a top-down approach, and it is to this end that Minister of Agriculture, Zulfikar Mustapha, said a new board of directors will be appointed soon.
“Well, I am working right now on that… I have to discuss it with the President because GuySuCo is a public corporation, and the same principles that apply to agencies that fall under the Ministry of Agriculture, does not apply in this case,” said Minister Mustapha in an invited comment, on Thursday.
The last board, which was appointed by the previous administration in September, 2018, was chaired by agriculturist, John Dow, and other members of the board included John Browman, Richard Cumberbatch, Paul Cheong, Fritz Mc Lean, Vishnu Panday, Ramesh Persaud, Nowrang Persaud, Roy Hanoman and Claude Housty.
Mustapha did not say if any of those names will reappear on the list of new appointees, but he assured that a new board will be appointed soon.
“I foresee that we will have a GuySuCo board shortly… the corporation is faced with serious financial difficulties, so the operations there need to be looked at,” said the agriculture minister.
In a letter to former President, David Granger, on May, Dow had said the sugar corporation was in a “dire financial crisis” with billions in debt, and insufficient finances to execute critical factory maintenance.
“Despite improvements in the productivity of cane, GuySuCo’s sugar production for the last two crops has fallen short of expectations and the current COVID-19 pandemic has exacerbated the problems experienced in meeting the 1st crop 2020 production targets…. As a result, the cash generated from operations cannot meet the ‘outgoings’, particularly when external funding has been difficult to obtain,” Dow said as he painted a vivid picture of the financial challenges facing the sugar industry.
At the time of the complaint, GuySuCo was only able to offset labour and fuel expenses. The corporation’s financial department had estimated that it would be out of cash by the second week of June.
With its “back against the wall,” GuySuCo had turned to the National Industrial and Commercial Investments Limited (NICIL) for a “bailout” of $1 billion, but only received $550 million.
“The APNU+AFC Government, through NICIL, undertook a loan of $30 billion under the guise of assisting the Corporation. To date, only $10.2 billion was made available to GuySuCo. The board received no answer as to how much was actually disbursed to NICIL and plans on repayment of the loan. To date, the corporation has a total liability of approximately $9.5 billion,” Mustapha lamented in a recent report.
MORE MONEY REQUESTED
He told this publication that the request for a bailout has since reached the new administration, but has moved from $1 billion to $1.6 billion.
“They said they need $1.6 billion in order to stay afloat until the end of the year… as it relates to this request, I was hoping to meet them (management of GuySuCo) today (Thursday), but we have to wait until the COVID-19 results (ministers were tested for COVID-19) come out,” said Mustapha.
Through his meeting with the management of GuySuCo, the agriculture minister hopes for some justifications as to why $1.6 billion is needed. These “justifications” will be taken to Cabinet today, if all goes well.
GuySuCo has undoubtedly been in turmoil for years, and even former President Granger had said his government made “hard decisions,” which included the retrenching of workers. But, despite the scaling down of the industry and provision and future provisions of government bailouts, he said there is no guarantee that the corporation could produce sugar at world market prices and function economically.
COULD BE REVIVED
Contrary to Granger’s belief, President Irfaan Ali believes that the sugar industry could be revived.
In 2017, the APNU+AFC Coalition Government had announced the closure of several sugar estates across the country, leaving thousands of those employed without a job or source of income. Without alternative measures in place, many of the sugar workers struggled to provide for their families.
President Ali, however, pledged the PPP/C Government’s commitment to ensuring the livelihoods of the sugar workers are rebuilt.
“The upliftment of those families and the rebuilding of the sugar industry are as strong as it was when we promised. I assure you that we will work assiduously, at not only securing these lives and livelihood for them; we will work hard at creating new opportunities on advancing new opportunities to full the promises we would have made in our manifesto,” the Head of State remarked.
The sustainable management of the sugar industry has always been a priority for the PPP/C administration. Moreover, the PPP/C has stood in solidary with its workers when several estates were shut without warning.
“On this point, the workers of this country – the bedrock of our nation – have been made to suffer untold hardship. Once proud men, who worked in the sugar industry from sun-up to sundown, never complaining about the back-breaking nature of their jobs, are today barely scratching a living,” President Ali said in his inaugural speech.
He said the rash decision by the previous administration has placed anguish on almost 7,500 workers to earn a decent wage as well as to feed their families, plunging many households into a financial depression.
“The sugar industry has virtually been abandoned in the past five years, and the workers have been deserted,” the President said.
He added that no attempts were made to seek a new path by which aspects of the industry could be salvaged for the production of profitable sugar-based niche products, which would maintain jobs and the dignity of labour.
“While we are still putting together the torn fragments …we intend to rise up the industry and to help it, and its workers, to resume the once proud place in our economy,” he said.