Minister of Finance Dr Ashni Singh says it is vital that stakeholders in the sugar industry confront the challenges facing it as government has made huge investments to secure its long-term viability.
Singh told the Govern-ment Information Agency (GINA) that at a time when other countries have stopped producing sugar and closed their industries government has identified emerging opportunities from those developments and has made major investments in modernising the local industry. The minister made these comments in response to current discussions related to the financial status of the company.
According to Singh the programme was designed to achieve the specific objectives of enhancing the industry’s competitiveness and securing its long term viability, both in the interest of sugar workers and the economy.
He also said that government recognised early that certain critical investments would be needed in the industry to ensure its ability to compete in the global marketplace and to adapt to changes taking place in its main destination markets. These objectives include reducing the average cost of producing sugar and diversifying the product base into higher value, branded and premium products.
At the same time, government recognised that if the Guyana Sugar Corporation were to meet the cost of these major investments itself, it would have impaired its cash flow “with inevitable and obvious consequences for workers.” As a result, and in order to ensure that the long-term interests of the workers were protected, central government injected large sums into the industry through lending and other financial arrangements. The minister said government injected US$5.1 million to finance a drainage and irrigation project aimed at improving water management systems on GuySuCo’s estates in Berbice and Demerara.
Government also invested a total of US$113.1 million into the Skeldon sugar factory, augmenting other public sector resources to ensure the construction of a modern and efficient, state-of-the-art factory, designed to reduce significantly the unit cost of producing sugar. The factory cost over US$180 million. GINA also said more recently government provided US$12 million to finance construction of a packaging plant at Enmore. The contract for this project was signed earlier in the year. When completed, this plant will allow the company to produce value-added output and penetrate more lucrative markets.
Singh said all of these investments reflect the importance of sugar to the nation and it is imperative that all stakeholders recognise the challenges confronting the industry and discharge their respective roles in a manner that addresses them.
