Minister of Finance Dr. Ashni Singh said that old thinking and customs in the sugar industry must give way to modern, innovative and creative tools if the dismal fortunes in the sector are to be reversed. To this end not only is Government pumping a further $1 billion into the ailing Guyana Sugar Corporation but an updated strategic plan has been drawn up.
The company is to spend $3.1 billion in 2013 to advance implementation of critical recapitalisation aspects, the Minister said during the budget presentation on Monday.
This year, the industry is projected to produce some 240,000 tonnes of sugar, modest by recent standards and a far cry from the early to mid-2000s when production surpassed 300,000 tonnes.
The Minister of Finance during his budget speech said that this projection was 10.1 percent above 2012 level of production and said it would still take diligent application and management across the industry to achieve it.
“Mr. Speaker, the sugar industry has been beset by issues associated with managerial capacity, unpredictable weather and labour supply constraints, to name but a few. Consequently, annual production levels have been less than acceptable,” Minister Singh said during the reading of the budget.
He said however that the external outlook for sugar remains positive given Guyana’s comparative advantage as a producer within CARICOM and the existence of a captive market protected by the Common External Tariff (CET).
The Minister said that over the last few years, the company undertook initiatives in field and factory operations to counter the labour shortages and the reduced opportunity days arising from changing rainfall patterns.
He said that the company accelerated mechanical harvesting and there are ongoing investments in drainage works and land conversion to mechanically friendly fields.
He said that Guysuco has also been encouraging private cane farmers to take on a greater share in the supply of cane to supplement Guysuco’s production.
The Minister said with regard to the issues at Skeldon factory, a key and critical facility for overall improvement of the industry’s performance, these are being addressed holistically, he said that several modifications and adjustments have been completed to deliver higher levels of output and efficiencies.
“As Guysuco continues to grapple with the challenges of returning to its production potential and profitability, it has to recognise and confront its managerial, industrial, technical, marketing and financial realities. Thus, an updated Strategic Plan 2013-2016 is currently being prepared.
The plan will support the mechanisation and field conversion drive and focus particularly on critical areas,” the Minister announced.
A recovery blueprint for Guysuco for the period prior to 2013 failed to deliver higher sugar production.
Singh said that a strong and committed management response is necessary to deliver the anticipated output from investments. “Industry customs and practices of the past must now give way to modern, innovative and creative tools and techniques to deal with managing a complex organisation in the process of change,” he said.
The Minister said that Guysuco will have to reengineer its management and human relations functions accordingly.
He said that promoting a harmonious industrial relations climate must be a priority and will require accommodation on all sides.
“Management and union will need to put aside the attitudinal and non-productive confrontations in their negotiations,” he said, adding that industrial relations practices are expected to become more interactive and congenial.
He said that whereas Guysuco’s lands are capable of producing in excess of 400,000 tonnes of sugar, “field interventions to address the weather and labour constraints can only be successful with the requisite agronomic inputs.”
He said that agricultural operations must capitalise on the relative advantages of each estate, ensure daily field supervision and return the fields to the former levels of productivity.
According to the Minister, the factory improvement programme will aim at producing sugars to meet the growing market requirements for higher quality and increasing efficiencies at all seven factories. He further stated that a specific element of the plan will be to have the new packaging plant at Enmore operating at full capacity.
