Government is relying on dialogue with the opposition, unions and civil society to definitively decide the way forward for the ailing sugar industry, President David Granger said last Thursday while stressing the desire to have unanimity on the choice made.
“The government’s position is that we should seek consensus, that is why we have embarked on talks with members of the opposition and civil society,” he said during `The Public Interest’ after he was asked about government’s decision given that there was no clarity as to whether the intention was to close more factories or sell them.
Granger noted that the sugar industry is a large employer and occupies a large portion of land space.
“So we are not rushing ahead. We have some clear ideas on what has happened to sugar over the years. We know what has happened to Skeldon (estate) – that was a financial catastrophe. We know about the mismanagement that has taken place and brought sugar to the present situation. We have been doing our best. We have been bailing out sugar, spending billions of dollars every year and we feel that the burden on the country should be brought to an end,” he said.
He added that in good faith, “we have sought dialogue with the opposition and the unions and we would like them to bring up ideas. We would like civil society to bring up ideas so we arrive at a consensus that all Guyanese could be satisfied with.”
Granger said too that government was not going to approach the situation with any prejudice except “for the fact that the sugar industry must not be a burden to the Guyanese taxpayers any longer.”
He said though that government wants to save jobs and for Guyana to continue to have a viable sugar industry. It is for this reason that government is “meeting and speaking with people”.
According to the President, government has not agreed on an outcome for the industry. “We will continue meeting and I hope that the dialogue can come to a conclusion as quickly as possible.”
He disagreed with this newspaper’s position that there was no clarity on the way forward, stating that clarity will emerge out of dialogue.
Chairman of the Guyana Sugar Corporation (GuySuCo) Dr Clive Thomas told the National Assembly’s Economic Services Committee (ESC) last Friday that given that the entity was saddled with a $77 billion debt and defaulting on all of its repayment obligations, it makes no business sense to keep it going.
Over the years, sugar officials as well as observers have posited that the industry should be closed down as there is no a long-term plan to save it. So far one estate, Wales, has been closed and government is said to be looking at diversification ventures.
Thomas told the committee that GuySuCo is awaiting guidance from the government on its decisions regarding the industry. A meeting was recently convened by the government with the opposition and the sugar unions on the way forward.
The Chairman stated that from the year 2000, 1.2 million man days were lost and that the employment cost exceeds the revenue from selling sugar. GuySuCo has also not been paying the National Insurance Scheme, which is owed $1.7 billion, the Guyana Revenue Authority, $7.6 billion, the Guyana Lands and Surveys, the Local Authorities, the Guyana Agricultural and General Workers Union, $226 million; pension funds, $665 million; the Caribbean Development Bank, $829 million and for the Skeldon estate, $29.3 billion, while foreign creditors are owed $1 billion.
CEO of GuySuCo Errol Hanoman told the committee that there would be need for some $18.9 billion in aid from the state this year and that figure is expected to climb in the coming years.
The CEO said that in 2014, the industry suffered losses of $17.5 billion, while in 2015 losses amounted to $18.1 billion and in 2016, $12.1 billion. Projected losses for 2017 are $13.7 billion.
But of even greater concern, he said, was the state subvention: $4 billion in 2012, $5.4 billion in 2013, $6 billion in 2014, $12 billion in 2015 and $11 billion in 2016.