President David Granger yesterday announced that government would be seeking to resolve the tensions between the Guyana Sugar Corporation (GuySuCo) and the National Industrial and Commercial Investments Limited (NICIL), while ensuring that the company gets much needed funding in a timely manner to meet its needs.
“I am here to let you know that Government is going to put the relationship between NICIL and the Corporation on a firm footing. The Government asked for a valuation of the Corporation’s assets. NICIL went ahead and received a G$30.0B syndicated bond, to provide financing for the Corporation. That money is coming to GuySuCo. This is in pursuit of a plan. We feel that GuySuCo has a credible corporate plan and we must all work together to achieve a good outcome. Everybody wins if GuySuCo wins. We are going to ensure that that money comes in a timely manner and in sufficient amounts,” Granger was quoted as saying by a Ministry of the Presidency statement during a meeting with management and staff of the Albion Estate at its Training Centre in Albion, in Region Six.
NICIL’s Special Purpose Unit (SPU) and GuySuCo have been in a power struggle for roughly two years, with each accusing the other of undermining its efforts.
Earlier this week, GuySuCo’s Chief Executive Officer (CEO) Dr. Harold Davis Jr refuted suggestions by acting head of NICIL Colvin Heath-London that GuySuCo has not properly accounted for funds it has received through the bond facility. “They are making us the scapegoat for what are their shortcomings,” he told Stabroek News.
According to the ministry statement, Granger, who was accompanied by Minister of Agriculture Noel Holder and Davis Jr, committed to ensuring that a stronger, smarter, sustainable and more profitable sugar industry is built and that workers’ jobs are safeguarded.
Granger explained to workers in the Estate’s factory that his visit to the location was aimed at understanding the challenges facing the Estate so that appropriate decisions could be made at the policy level.
“Our sugar industry is going to recover from the difficulties it is facing. This sugar industry is not on the point of death…I am not here to bury the sugar industry. I am here to find out what your problems are. I have come to fix things. We are in the process of restructuring this industry to respond to changes, which have taken place both externally and internally. It is being restructured so that it can be revived; so that we can make this industry not just sustainable but profitable. We are not here to merely survive; we are here to thrive! We are here to guarantee employees’ livelihoods. We are here to guarantee sugar’s position in the national economy. We are here to safeguard the rural economy,” he said.
According to the statement, Granger noted that despite criticism, since 2015 the government has been doing everything humanly possible to ensure the industry thrives. He noted that following the Commission of Inquiry (CoI) into the industry, a Task Force was established to develop recommendations on its restructuring after which a State Paper on the ‘Future of the Sugar Industry’ was presented to the National Assembly.
He further noted that a Corporate Restructuring Plan (CRP) was initiated following these processes. “Part of that Plan is to produce 147,000 metric tonnes (MT) in the shortest possible time. Part of that Plan is basing production to three mega plantations – East Berbice, comprising the consolidated Albion-Rose Hall plantations; West Berbice, comprising Blairmont; and West Demerara, comprising the consolidated Uitvlugt-Wales plantations. These three plantations will bear the burden of sugar production and Government will give those sugar plantations whatever it can afford and needs to produce that 147,000. That is what we are going to do. We are in the business of sugar and we will produce sugar. We will not produce retrenched workers and obsolete factories,” he said.
‘Reality’
Granger also acknowledged that the consolidation of the Albion and Rose Hall plantations and the Uitvlugt and Wales plantations resulted in the firing of several thousand workers, which the government regrets. However, he said it was not the first time in Guyana’s history that hard choices have had to be made to ensure the sustainability of the industry. “The consolidation that we are talking about is nothing new. It has been going on for 200 years and it didn’t begin in 2015. Let us not forget that the East Demerara plantations – Diamond, Enmore and La Bonne Intention – were consolidated in 1998 and the administrative office for the merged estates was centralised at La Bonne Intention. The Enmore administrative office and field workshop were closed in the same year, 1998. I didn’t do that,” he pointed out.
Granger also noted that the Diamond Estate discontinued cultivation of 4,000 hectares in 2010 and the employees of that estate were transferred to La Bonne Intention, while the La Bonne Intention factory was closed in 2011 and the majority of its workers were transferred to the Enmore factory. The Corporation employed over 20,000 workers in 1992 and by 2015, there were 15,000.
“So, you see that not only plantations were being consolidated, but the workforce was shrinking. This meant that 5,000 were taken off the payroll, either by natural attrition or severance, between 1992 and 2015. We are faced with a situation in the industry where the only thing that is constant is change. Similarly, sugar production has not been static. We were producing an average of 264,963 MT annually in the decade 1996-2005, but declined by 14 per cent to an average of 208,718 MT in the following decade. The production cost has been difficult to bear. It used to be US$0.86 per kg in 2014 while the world market price was US$ 0.31 per kg; for every kg it was losing US$0.55. That is the reality of sugar production and we cannot ignore that reality,” he said.
The statement said Granger believes that the CRP is at the heart of the revitalisation of the sugar industry and the corporation projects that, with effective agricultural management and through capital investments, it can lower production costs to about US$0.40 per kg, making the industry more viable and profitable. Additionally, the Corporation’s plans for the short-term involve the rehabilitation of field infrastructure; the modernisation of production including cost-effective mechanisation; the retooling of factories including energy efficient equipment and technologies; and increasing milling and other processing capacities.
“The Plan is rational, logical and doable. I believe that Albion is the hub of the modernisation programme and we believe that under that Plan and with improvements in marketing of sugar, better infusion of capital and investment, we can produce some of the best sugar in the Caribbean. This is what our ancestors bequeathed to us and I will not bequeath a museum to the children. I will bequeath to them a living thing called Albion Plantation. I am here to make the CRP work, to restructure the industry and to return it to sustainability and profitability. I have come here with a message of hope for the whole of Guyana, the future is bright and you are the future. This industry will thrive and will offer employment to those who seek employment. Albion will survive and the sugar industry will survive,” he was quoted as saying.
Meanwhile, the statement said Granger also told the workers and their managers that he is prepared at any time to engage with their unions to ensure that they understand where the sugar industry is headed. He said he met with the unions on December 31st, 2016, February 3rd, 2017 and on January 19th, 2018 because he is interested in working out with them how the industry will survive. “I do not spurn them or refuse them. They are part of the future of the workers and I want them to understand our plans for the industry,” he said.
Estate Manager Threbhowan Shivprasad was reported as saying that the Albion/Port Mourant Estate, with support from Central Government, can see significant improvements and a turnaround by 2023. He also noted that there are numerous vacancies at the estate, which the company is hoping to fill at the shortest possible time with persons from the Corentyne.
He noted that the visit represented the first by a Head of State to the location.
