Dear Editor,
The Rice Factories (Amendment) Bill 2010 – Bill No. 8 of 2010 – makes clear, if it was not clear before, the government’s lack of understanding and failure to adequately address the issues affecting the rice industry in Guyana. It further demonstrates that the government is incapable of solving the problems of our sinking economy while making its primary concern the satisfaction of its friends. In the process, the bigger picture is missed.
In 1998, the principal Rice Factories Act Chapter 95:05 was repealed and the Rice Factories Act 1998 (Act number 8 of 1998) replaced it. Since then, under the pretext of ensuring that farmers are paid on time, the government revisited this piece of legislation with amendments in 2006, 2009 and now again in 2010. Despite these interventions, the government still cannot get it right. May I clearly state here that, I support the right of rice farmers to be paid a fair price in a timely manner for their produce. After all, rice farmers are hard-working people facing severe challenges on a daily basis with families to provide for.
In 2009, for example, the amendments included a change of the conditions under which a miller’s licence could be issued. The act at the time provided that millers could not owe farmers more that 5% of the total value of the paddy purchased and qualify for a licence. That was changed to say that a miller could not owe any individual farmer more than 5% of the value of paddy supplied unless the Board approved.
Now in 2010, the government proposes to place additional pressures on millers by way of the punitive provision of either a deposit of 10% of the value of the paddy purchased during the previous year with the Board, or a bank guarantee to the value of 25% of the value of the paddy purchased during the previous year.
In my respectful view, this amendment will not solve the problem which the government claims it is setting out to solve. In fact, I see it placing more severe challenges in the path of the rice farmers. Could you picture investors in the rice industry packing up and leaving Guyana and Guyanese rice farmers on their own, with no market for their paddy? Or could you imagine the government’s objective of frustrating certain large millers into leaving, resulting in the monopolising of the industry by a few friends of the government? Will that result in relief to the rice farmers?
If, in the view of the government, financing on the part of the millers is the humbug to timely payments to the farmers, then sanctions against millers cannot be the solution. The solution has to be rooted in the establishment of an enabling environment which is supportive of the business of the millers, in the context of the very nature of the export of rice and the known payment arrangements between millers/exporters and their overseas clients.
Such a solution ought to have components such as a rice industry intervention fund, long asked for by industry operatives and/or an Agricultural Development Bank to support the industry and farmers in general. There should also be the support of crop insurance for rice farmers to compensate for loss of their crops due to disaster.
The issue of financial support by a development/agricultural bank is nothing new. There was the Gaibank. Gaibank had a presence in just about every region in Guyana. Its mission had to do with agricultural and developmental support. The fact is that, the very government which now chases its tail in search of a solution to rice farmers’ financially based problems, is the expert body which closed the doors of Gaibank.
The figures will show that, over the period 1989-1992, the foreign and local investors in the rice industry, moved rice exports from 25,000 metric tons to 350,000 metric tons per year. Back then, the rice bulk loading facility in Kingston facilitated the easy loading and export shipping of our rice. The farmers had Gaibank’s support and the industry boomed.
At this moment, the rice bulk loading facility in Kingston, the only one in all of Guyana, is no longer available to rice exporters. It is now the operations site for possibly Guyana’s largest contractor – BK International Inc. The public is not clear about how this occupation and possible ownership evolved.
However, the effect it has on the export of rice is enormous. At the wharves in Georgetown, containerised shipping has priority.
Exporters of rice must be like virtual beggars at wharves as they seek to get their product to the export market.
One would remember also, the benefits of the OCT route to the local rice industry. One will also remember that it was under this government that Europe terminated the OCT route resulting in difficulties in the rice industry. When confronted with the facts on this matter by PNCR MP James McAllister in the National Assembly, the government responded that it was ill-advised.
One will remember that, not so long ago, the government subsidised bakeries. One will also remember that, it was precisely at the same time that this was being done, the government was beating its chest and advertising in the national newspapers its “Rice Price Buster Programme.” Is a subsidy to the bakeries not indirectly a deliberate governmental policy to support foreign wheat farmers? How could a government support foreign wheat farmers, while at the same time “price busting” the rice farmers of their own country? Having done that, how could the same government now pretend to have the interest of the same rice farmers at heart?
The truth is that, they don’t. They only have the narrow interest of their friends in the milling and export of rice at heart. The story of their concern for farmers is an empty, shameless appeal for political support from what they see as their constituency.
But times have changed. Rice farmers have come to a clear understanding of their situation and the government’s manoeuvres which seek principally to use them as the vehicle by which means, the government could realise its objective of establishing absolute control of the rice industry through friends of high officials and at the expense of the farmers.
Rice farmers recall that during the 1990-1996 period millers were in a position to, and often did offer them advances to facilitate land preparation and planting exercises. They now question what really caused the economic change which adversely affects them and their families.
Maybe, the government could say what went wrong for millers and by extension the rice industry in Guyana since. Perhaps, the principals of the Mahaicony Rice Mills may wish to share with the Guyanese public, the whole story of their closure some time ago, the effect on rice farmers and the resulting emergence of another large miller.
After all this, the PPP still expects that it can spin stories to get the votes of the rice farmers and their families.
Yours faithfully,
Mervyn Williams, MP
