The GuySuCo interim board yesterday submitted a five-year plan for improvements in management, significant cost cutting measures and maximum productivity in the field to lift the country’s key foreign exchange earner out of a production slump.
Chairman of the interim board, Dr Nanda Gopaul handed over the document billed as “GuySuCO’s Blueprint for Success” to Agriculture Minister Robert Persaud and expressed hope that the successful implementation of the plan will see production at the sugar company increase to approximately 450, 000 tonnes of sugar annually at the end of five years. The document will now be considered by the President, Cabinet and other stakeholders.
The handing over of the proposal comes approximately three months after the company was placed under new management. On January 14, Agriculture Minister Persaud, at a joint press conference with Head of the Presidential Secretariat Dr Roger Luncheon, announced the management shake-up that saw the longstanding Booker-Tate management contract end and the installation of a new Interim Board and Chief Executive. Gopaul was appointed interim chairman in the place of Ronald Alli, while Errol Hanoman was appointed the new Chief Executive of the company replacing Chief Executive Nick Jackson who stepped down to take up a new position in Swaziland.
At that press conference Persaud said that the interim board would produce the blueprint within a month’s time. Persaud said yesterday that the initial time line of one month was perhaps unrealistic given the amount of work that needed to be done. He said, however, that he was always in contact with the board during the time the document was being prepared.
Speaking at the handing over ceremony yesterday, Gopaul, one-time General Secretary of the sugar union NAACIE, said that strong emphasis needed to be placed on management and called for maximum use of the “opportunity days”. He said that part of the way forward was to reel in the amount of strikes in the industry. He said that frequent strikes only put the future of the industry at risk in addition to that of the employees. He said that various changes have already been made to ensure greater management efficiency and called on all the stakeholders involved, including the unions and workers to ensure that strikes were kept to a minimum.
The Chairman said that plans are on course to make up for lost ground as quickly as possible. He said that during this year, the company’s management is hoping that there is a 20 percent replanting exercise all geared at mechanizing harvesting and after five years to have the at least 75 percent mechanized if not all. By this time, the Industry should have arrived at its turn-around state, Gopaul said. At the end of this period, Gopaul said that the sugar corporation would reach a production level of 400,000 tonnes of sugar and move towards 450, 000 tonnes of sugar.
The Chairman also said that training of personnel was also an important factor that needed to be done. He said that government would be emphasizing the training of persons in the sugar industry. This was also stressed by Minister Persaud.
Persaud said yesterday that “the Industry is at the crossroads” and stated that major decisions have to be made “to ensure its survival and return to profitability.” He emphasized that “simply pumping cash into GuySuCO is not a viable solution.” He stated that the company’s “cost base is unaffordable more so in light of the very significant reduction in the price of sugar sold to the EU market.”
The Minister suggested that greater challenges await the industry and said that 2010 will see the “full effect of the 36 percent reduction in the EU sugar price which amounts to $9 billion.” He said that “to allow the status quo to continue would destroy the industry.”
He stressed that “the reduction of cost through increased productivity and elimination of wastage and corruption is of paramount importance.” According to Persaud, he has been informed that the Strategic Plan reportedly looks at options to cut costs by $3 billion for this year.
Meanwhile Persaud emphasized that while the intention is to “mechanize” and “semi-mechanize” the industry, this does not mean that sugar workers will lose their jobs.
He explained that while machines will be used, the workers will still be needed and that there is no fear of retrenching or widespread job losses. He said that in fact moves will be made to expand the industry and this would have positive repercussions such as larger areas coming under cultivation.
Chief Executive of GuySuCo Hanoman in his brief remarks underscored the importance of team work. He said that the workers, unions, management and all the stakeholders had to work as a team. Hanoman stated that a lot of work needed to be done and emphasized that major decisions have to be made in relation to the company.
Meanwhile, GAWU President Komal Chand and General Secretary of NAACIE Kenneth Joseph were both present at yesterday’s meeting and both expressed hope that the plan will lead to an improvement in the struggling industry.
Finance Minister Dr Ashni Singh in his budget presentation in February had emphasized the revival in the country’ sugar industry as being key to the country’s economic stability during the year. He said then that the turn around of the industry depended significantly on the successful implementation of the board’s blueprint. Singh projected a sugar production level of 290,000 tonnes for the year, which is the same as was predicted for 2008. However, last year the country fell short of its target badly, only producing 226,267 tonnes, which represented a 15 .1% decline from the 2007 output.
Gopaul yesterday did not comment on the production targets for this year but said by the end of next month the management will be better able to pronounce on its production target for this year. He explained that steps are being made to make up for lost time and this is being carefully monitored.
The new state-of-the-art factory at Skeldon has posed start-up problems which have prevented GuySuCo from grinding the amount of sugar projected. Liquidated damages are to be applied against the Chinese contractor CNTIC for the turn key project.
