Amid a torrent of criticism and a threat of street protests by the opposition PPP, government yesterday assured that plans are in the pipeline to cushion the impact of the closure of the Wales sugar estate and factory.
“None of the farmers’ cane will be in jeopardy…We are looking to see a more waterborne way (of transporting the sugarcane from Wales to Uitvlugt)…that is being addressed now. We have one year to put new arrangements in place. Nothing is happening to jeopardize the operation or people’s employment, nothing…Wales estate will not be closed before the 31st December 2016,” Minister of Agriculture Noel Holder told reporters at the Ministry of the Presidency during the post-Cabinet media briefing yesterday.
According to Holder, most of the factory workers will be absorbed by Uitvlugt but there will be a few persons who will be made redundant and they will receive severance. “The people who will really be affected will be some workers in the Wales factory. Now there are substantial vacancies at the Uitvlugt factory, so a lot of the workers from the Wales factory will be absorbed…there will be a few who will become redundant and they (will) receive severance,” he said.
Government on Monday announced its intention to close the Wales Sugar Estate, the first major decision it has taken on the beleaguered industry which has seen slumping production over the last decade and swingeing debt.
Minister of State Joseph Harmon who called the financial cost of running the estate “an economic nightmare,” also assured that the estate’s closure later this year will not impact on private sugarcane farmers as every economic avenue is being explored and analysed to maximise profitability of the move.
“The funds that were required to pump into it…it became an economic nightmare to really continue the things we were doing before,” he said.
Harmon explained that at last Tuesday’s sitting of Cabinet, the agriculture minister “was at pains” to point out that the decisions pertaining to Wales estate were contained in the Guyana Sugar Corporation’s (GuySuCo) budget for this year and Action Plan 2016 which was developed last year. He informed that the decision to close the estate “does not bear any specific relationship to the Commission of Inquiry (CoI) which was set up to enquire into GuySuCo.”
However, Harmon said, more importantly, Holder indicated to Cabinet that the management and Board of GuySuCo agreed to the decision as it pertains to the Wales estate.
Holder, meantime, rubbished claims by Opposition Leader Bharrat Jagdeo who said that the CoI report was not looked at when the decision was made on Wales as it did not recommend closing it.
According to the minister, the matter of sugar is of so much importance to Guyana “that it is not something that should be addressed lightly.” As such, he said, he tabled the report in parliament so that the whole country is made aware of sugar’s position and can have input into the way forward for the industry. “It is now before the parliamentary committee of economic matters and will bring persons named in the CoI to answer questions on the document,” Holder said.
Questioned if consultations were done with the cane farmers before the decision was announced, Holder pointed to the administration’s plans as set out in their manifesto and said a cane farmers’ conference and other activities were held.
He said the Wales operation was not feasible and that was the reason for its closure.
“What is being closed is the Wales factory and you are dealing with a factory that is basically 100 years old that you can’t get spare parts for. That if you have to change and repair the boilers and so forth, you have to buy new ones…you had a factory working at 50% capacity and Uitvlugt at 50% capacity so what is being done is getting Uitvlugt, which is a far more modern factory, far better condition, 95% efficiency compared to Wales’ 85 or less, and move the cultivation or cane to that factory. The 3000 acres of GuySuCo’s land will not be cultivated but none of the farmers’ cane will be affected,” Holder asserted.
“We are improving the efficiency and trying to maintain the industry in West Demerara,” he added.
Further, the Agriculture Minister said there are no immediate plans for the overall closure of sugar in Guyana and any alternative must be a foreign income earner with the potential to surpass sugar’s impact on the country’s economy.
“You have to diversify but whatever you diversify to has to be a foreign exchange earner. The problem is the strength. Why this country has to hold on to sugar, certainly for the short run is that it is a big block of foreign earnings. Sugar might be making a loss on the financial account but as this nation is concerned, it is probably making a profit on the economic account…Take a company like say Banks DIH. It does not export, it doesn’t really earn foreign exchange, it makes millions and billions of dollars of profits on its local account but if Banks want to buy a bottle or a cork to put on the bottle, they have to go to rice or sugar or gold to borrow that money because the man abroad don’t want local currency. He ain’t gonna take no Guyana dollars on no bottle top, he want hard currency so a nation like Guyana has to look at its hard currency earnings in order to survive,” he explained.
“Divesting GuySuCo to someone who will go into real estate, that will want to cut it up for housing is not going to help this nation because it is not (a) foreign (exchange) earner so this is the dilemma. Whatever we do with sugar has to be a foreign exchange earner. It’s a big lot of land, a lot of people are involved and a lot of services GuySuCo gives,” he added.
