Guyana and the Wider World

Part 1 Problems of measurement For my remaining columns commemorating the Third World Debt Crisis (TWDC) I shall focus the discussion on Guyana’s public debt situation since 2006. 

In this and the next couple of columns to follow, I shall broadly address Guyana’s public debt situation since the eruption of the Third World Debt Crisis (TWDC) in 1982, the year in which Guyana also announced its first default on its public debt obligations.

Global financial meltdown My efforts to draw readers’ attention to the fact that the Third World Debt Crisis, which started 30 years ago in Mexico (and as I noted Guyana also) is alive and well today is by no means intended to diminish the magnitude of today’s sovereign debt problems, which now centre on the First World economies.

Measuring debt burden As I proceed with the discussion of the debt crisis, the first issue that should be clarified is how to determine the burden of public or sovereign indebtedness among countries.

When I began my last series of Sunday columns (September 2, 2012) on the topic ‘Revisiting the political economy of the Guyana sugar industry’, which I concluded last weekend  (December 23),  I did not anticipate it would take as many as 17 weekly columns for a reappraisal of the industry with recommendations for its reform.

Part 2 This week I shall conclude my discussion of the reform of Guyana’s sugar industry started on September 2, 2012.

Mature industry Framing the reform of GuySuCo and the sugar industry must necessarily start with an identification of the major dynamics driving both.

Introduction Last week’s column covered the strategic role of maintenance in GuySuCo’s efforts to modernize the sugar industry.

Three policies For much of the period of the 2000s (and indeed for most of the presentation in this series of columns on sugar) attention has been chiefly directed towards the failure of the Skeldon Sugar Modernization Project (SSMP).

Introduction Recently, while examining the archival material in my possession on GuySuCo, I came across three documents which I believe readers would find instructive at this stage of my consideration of the sugar industry.

Introduction In last week’s column I urged the point of view that, the most important performance indicator for GuySuCo during the period of the Turnaround Plan, which has elapsed so far (2009 to the first crop 2012), is its annual sugar production.

Introduction Guyanese are rightfully concerned that all major industries in the economy are performing well.

Introduction Last week’s discussion on sugar in the economy focused on those long-run performance indicators, which would aid an evaluation of the viability of GuySuCo.

Introduction Last week I argued the realisation of sufficient economies of scale for Guyana’s sugar industry to make it globally competitive is unlikely simply because these would not result in a substantial lowering of the long-term average cost of production at output levels of 450,000 tonnes.

Globalisation and Sugar Today’s truly fundamental defining feature of the condition of the Guyana sugar industry (and Guysuco more particularly), is that, several decades ago it became mature, and from all appearances since the 1960s, it has entered a long-run declining phase, as described in classic industrial and firm theories.

Introduction In last week’s column I presented a graph, which illustrated both the downward trend and the wide variations in sugar production for Guyana over the last half-century or so.

Indicator Perhaps the single most revealing performance indicator of the state of Guyana’s sugar industry is to be found in its annual production figures.

Introduction Communications I have received concerning last week’s column have all expressed indignation at the remarks, which were reportedly made by the European Union (EU) Ambassador when speaking about GuySuCo and the Guyana sugar industry. 

As I observed last week, with stunning condescension the European Union (EU) Ambassador, at the signing ceremony for the agreement on “EU budgetary support for Guyana’s ailing sugar industry” was reported in the press as remarking: “Sugar is the industry of the future.” 

Introduction Today I continue appraising the sugar industry (and GuySuCo) in view of the considerable European Union (EU) support and the further $4 billion transfer to GuySuCo from the National Budget 2012.