Dear Editor,
I have read the interview with Mr Ramotar in your issue of 2nd November 2011 and there are several misleading, if not deceptive comments contained therein, which I summarize below. I am writing in my personal capacity and not as a Director of GuySuCo, and what I write in this letter should not be interpreted to be an official statement from that corporation.
- Walchandnagar Industries Ltd of India had the lowest bid to supply the parts for the Skeldon Factory; I have written on this before. If my memory serves me correctly, we spent US$15 million more dealing with the Chinese company which ultimately ended up with the contract. It had no experience in this type of work, never having built a sugar cane factory before, and did not manufacture sugar-cane factory components, whilst Walchandnagar Industries is a full service sugar-cane factory manufacturing company.
Mr Ramotar confirms that his government’s venture into the production of ethanol as a way to supplement the income of GuySuCo, was ongoing, with a small trial in the Albion factory. This is ludicrous, since we are living next door to the world’s greatest proponents of the science of the production of ethanol from sugar cane who are currently producing 6 billion gallons of the stuff. That’s where we should have started. A friend of mine, Asad Ishoof, acting as an agent of Walchandnagar once told me that if the government had bought the Skeldon Factory from Walchgandnagar Industries, they would have gotten in addition, a distillery for the same price they paid the Chinese for the junk they sold us.
- Mr Ramotar said, “…we could have done a joint venture with them [GuySuCo and Guyoil] to do a blend so that 10% of the gasoline that is being used could have been partially from ethanol.” There is no necessity to have a joint venture between these two state entities; it is the kind of thinking which has led us to this situation. GuySuCo can produce fuel grade ethanol and sell it to GEA, which would sell it to the local gas agencies and they would mix it to 10% which is the maximum allowable mix without modifications to the current engines. Whilst Mr Ramotar’s government was mulling an unnecessary joint venture between Guyoil and GuySuCo to produce ethanol as a gasoline fuel additive, 20 other countries have passed laws mandating it. Twenty countries may not sound like much, but 20 sugar-producing countries is a lot.
- He said that “our plan was to make the industry flexible like the Brazilian sugar industry is. When the price of sugar is high in the world market then they produce more for the world market, when the price is low then they produce more ethanol and sell abroad and so forth.” To the best of my knowledge his government never seriously approached Brazil to help us to do this. These people are literally begging us for access to the ocean and to be partners with us in numerous ventures, and he very easily could have asked for their help. He did not.
- Contrary to what was stated by SN in the article, I have seen no evidence anywhere that the Brazilian sugar industry is heavily subsidized by the government. I am not saying that it isn’t; I am saying that I cannot find it.
- Incredibly the following observation was made as background to the interview: “The sugar sector has received over $26 billion in budget support from the European Union (EU) since the end of preferential pricing. However, GuySuCo remains $82 billion in debt.” This summarizes the condition Mr Ramotar’s government left the industry in after 23 years in office, ie, a complete economic disaster.
- I have not heard that the COI has convinced the government that the only way forward is to close the industry down, but it is true that the COI has determined that the salary of the average cane-cutter can be as high as $2.9 million per year.
- It seems to me from reports of friends who attended the weekend meetings of GAWU that the workers are not the ones pushing to take industrial action at this time; it is Mr Komal Chand of GAWU. In view of his political affiliations and in view of the corporation’s reasonable position that the wage talks be delayed until the release of the findings of the COI, I would say that this strike is certainly suspiciously political. In view of the recent good weeks of production the industry has been showing, is the PPP jealous that after only less than 6 months in office, with the coalition government’s handling of the day-to-day management of the corporation, the industry seems to be thriving at last? And their only response is to interrupt this flow of production with wildcat strikes? Is this reasonable or acceptable?
- The cost of labour today in the industry is $20 billion; what does it mean? It means that the total expected sales of GuySuCo in 2016 will be 20 billion, ie, they will just cover the cost of labour. The other $16 billion the corporation needs to carry out its other functions ‒ milling, capital, etc ‒ will be losses. I am shocked that the PPP can embark on this process of sabotage of the industry’s production for narrow political ends. At this time with an industry tottering on the brink of insolvency, to encourage the workers to strike in violation of the ‘avoidance and settlement of disputes’ agreement between the union and the corporation, to the detriment of the workers, the government and the people of Guyana who have to support this industry with their hard-earned taxes, is contemptuous.
Yours faithfully,
Tony Vieira
