Guyana: Proposals floated to sell off several sugar estates – talks begin

Guyana: Proposals floated to sell off several sugar estates, shed non-core operations

Proposals to sell off a number of estates of the bankrupt state-owned Guyana Sugar Corporation and shed non-core operations like drainage and health services were Saturday shared with the unions and the opposition People’s Progressive Party Civic (PPPC).      

The talks come against the background of claims and counter-claims for the poor state of the industry. They include the 36 percent cut several years ago of Europe’s preferential price for the sweetener, labour unrest, and an all-time low production of 189,000 tonnes this year due to perceived bad management including plant husbandry, high operational costs and poor weather.

President of the National Association of Agricultural, Commercial and Industrial Employees (NAACIE), Kenneth Joseph said the documents were shared with representatives of his union, Guyana Agricultural and General Workers and the PPPC meeting held at the Ministry of Agriculture’s Board Room.

The unions and the PPP have been given time to study the documents and return for a second round of talks,  even as Joseph said GuySuco and government are considering shrinking the existing estates to three: Wales-Uitvlugt, Albion-Rose Hall and Blairmont.

He said the plans include the sale of Skeldon’s estate, factory and co-generation facility possibly to an American firm, the exclusion of a section of Rose Hall’s field operations and the closure of the Rose Hall factory, and the possible sale of Enmore as the potential buyer appears interested in taking advantage of the packaging capacity there.

Joseph said other major aspects of GuySuco’s planned overhaul include the stripping of drainage, health and activities that “have little or no direct connection with sugar.” Joseph said government planned to provide the unions with the projected savings from such a plan.

“It appears that GuySuco will no longer be responsible for these services whether or not the industry’s operations are contracted,” Joseph told Demerara Waves Online News.

 

While government appeared eager to decide GuySuco’s future, the NAACIE President said Minister of State, Joseph Harmon assured the delegations that a decision would not be taken until the talks have ended. This appears to be a done deal but Harmon said this isn’t a done deal and no decisoon will me made until a conclusion of the discussions,” Joseph said.

The trade unionist, whose union represents mainly factory and office workers, expressed cautious optimism about the outcome of the talks, even as he maintained that there is no need to close any of GuySuco’s operations.

“We are saying that there is a possibility and if they are interested as the owners of the industry and a proper discussion is held with all of the stakeholders,  there is a possibility of improvement and increasing the foreign exchange from sugar to deal with purchases for foreign exchange coming into Guyana,” he said.

Joseph said Saturday’s meeting showed that before GuySuco had not been making any real effort for the unions and other stakeholders to be part of the corporation’s decision-making.  GAWU has declined invitations to sit on GuySuco’s board of directors.

Meanwhile, the PPP  demanded that the contents of several technical and non-technical documents and memorandum of understanding between government/ Guysuco and the prospective investor be shared with the party. “We got a clear commitment that they will provide them,” he said.

PPP General Secretary, Clement Rohee confirmed that the closure of other estates was discussed at the meeting, but maintained in the talks that it did not support the closure of any of the estates. “The party has always maintained that it is not in favour of the closing of any estates, we are not in favour of the privatisation of any of the estates,” he told Demerara Waves Online News.

The PPP wants government to give more consideration to a Commission of Inquiry that has been conducted into GuySuco’s operations and the role of the bipartisan parliamentary committee on economic services. “We are happy that we were invited as a stakeholder because we have a vested interest in that and we are happy too that the unions were well represented,” he said.

The Ministry of the Presidency said the government team was led by Vice President and Minister of Public Security, Mr. Khemraj Ramjattan and included Minister of State, Mr. Joseph Harmon, Minister of Agriculture, Mr. Noel Holder, Minister of Social Protection, Ms. Volda Lawrence, Minister of Natural Resources, Mr. Raphael Trotman, Minister of Business, Mr. Dominic Gaskin and Minister within the Ministry of Finance, Mr. Jaipaul Sharma, while the Opposition team was led by General Secretary of the People’s Progressive Party, Mr. Clement Rohee and included Mr. Irfaan Ali, Mr. Dharamkumar Seeraj and Mr. Juan Edghill.

GAWU and NAACIE were represented by their Heads, Mr. Komal Chand and Mr. Kenneth Joseph, respectively. Representatives from the various sugar estates including Wales, Albion, Skeldon, Enmore and Uitvlugt were also present.

Leading the Government team, Mr. Ramjattan, in an invited comment at the conclusion of the meeting, said that Cabinet took the decision at its last sitting, to have the consultations begin at the soonest possible time. Registering his satisfaction with this initial meeting, the Minister said that consultations are being conducted to ensure that the best interest of all stakeholders will be considered.

“I am happy to state that indeed it was very civilized. We made a major decision at last Cabinet that we do have to have consultations and it will be extended now. The documentation that we gave them as to the options proposed to us by GuySuCo has been shared and they said that they needed time to study it and we agreed with that because they only got them this morning. They have asked for some further additional reports and studies as to what made GuySuCo come to the decision and to set out these options. I agree with them because they must have source documents and so it is important that they be part and parcel of the decision-making or at least know how we are thinking and that is important. I am very pleased with the entirety of the meeting,” Minister Ramjattan said.

Minister Harmon echoed similar sentiments, noting that despite the late notice members of the Opposition, the Unions and the estates still attended and were actively involved in the discussions, which will ultimately result in decisions being taken with regard to the sugar industry.

“I think they are all understand what the position is. We shared documents with them and I believe that we are going to have some fruitful consultations going forward since the [sugar] industry is a very important industry. It is of national significance and so decisions that are made in that regard must take into consideration those factors,” Harmon was quoted as saying in a statement issued by the Ministry of the Presidency.

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Comments

  • Leslie Chin  On January 2, 2017 at 1:30 am

    Sugar has been blamed for causing diabetes and other health problems so the demand for sugar has been decreasing. There are many low/no calories sugar substitutes (sweeteners) which are displacing sugar. One solution for decreasing sugar demand is to convert sugar production to ethanol (alcohol) production for use as a fuel for automobiles. Brazil has done this successfully and now runs almost entirely on ethanol. Many countries also blend ethanol with gasoline for automobile fuel.
    The non-profitable sugar factories should be converted for ethanol production. We can learn from the Brazilians and the Americans who use corn as the feedstock. Conversion will provide continuing employment for displaced workers and use of the land, punts and canals. It is futile to keep obsolete plant in operation in an era of falling demand for sugar.

  • Albert  On January 2, 2017 at 4:20 pm

    Politicians in action….all talk. Granger should have dealt with this problem much earlier while he had some political credit. The PPP is going to make it into a political issue. The sugar industry should not have been nationalized. Its nothing but a financial liability.

  • demerwater  On January 3, 2017 at 6:29 am

    I was there when it was BSE Ltd. I was there when it was nationalized into GUYSUCO. I left when it appeared that the sugar industry was living up to a quote attributed to Benjamin Disraeli “…something that soothes infants and comforts old age should so often occasion a political disaster”.
    The potential for disaster lay in waiting in the marketing aspects. Serious doubts were expressed that Guyanese would be able to market sugar effectively.
    But we had two aces. One was Ian McDonald. The other was the Commonwealth Sugar Agreement. We seemed to comprehend that neither would last forever. We seemed to comprehend that sugar as a product for human consumption was a dwindling market; consequently a dwindling down of a major export of the country. Hence the OCD.
    The Other Crops Division explored black eye production at Albion. Milton Latcha and I showed that it could be done – agriculturally. Others looked into the economics.
    At Wales a bountiful cucumber crop was brought in, thanks to the efforts of Genghis Khan, Frencho (did he have a proper name?) and Derek Williams. Again, the economics was left to others.
    If sugar was losing its market share, what would replace it?
    It would have to be something that would employ the displaced labor force. The cane farming model at Wales offered a path forward. Find a crop, offer a land settlement scheme (Black Bush was a model) and let the people who know best how to; produce and profit from their efforts.
    I am sure that the technical skills are available. Hopefully there is a Faculty of Agriculture at UG. Most of all, I hope that the Extension Branch of the Ministry of Agriculture still retains its place and reputation as the “Best in the Caribbean.”
    The burning question persists; it just will not go away, will it?
    Is there the political will to make all this happen?

  • Albert  On January 3, 2017 at 3:09 pm

    Demewater your piece did not say one thing which I am sure you would agree……the sugar industry should never have been nationalize. The industry was organize originally as a private enterprise operation. That gave it the ability to respond effectively and quickly to changes in the global marketing situation; largely free from political considerations, and to make relatively efficient management decisions.
    Most people do not know that once nationalization took place businesses the world over that did business on credit with Bookers wanted cash up front from the nationalize company. Insurance companies raised their premiums because of increase risks and credit agencies cut Guyana off. The politicians were not aware of the ramifications of their action.
    Politicians making decisions on a large private operation is a recipe for failure.

  • demerwater  On January 4, 2017 at 4:33 am

    “…one thing which I am sure you would agree… the sugar industry should never have been nationalize.”
    I am sorry to have to disagree with your presumption.
    It is futile to have political Independence without economic independence – the control of the resources of one’s country.
    A good place to start is with the you tube presentation by Mr. Shashi Tharoor; “Does Britain owe Reparations?” For every mention of ‘India’, substitute ‘Guyana’ or any other ex British colony.
    After that, you will appreciate the exploitation of a mineral wealth of Guyana – Bauxite. In both quantity and quality the product excels. Yet, British Guianese paid more for aluminium pots and pans than Canadians did.
    Perhaps you can get someone knowledgeable in Commerce to explain the business architecture of Bookers Bros. McConnell & Co. which enabled the conglomerate to maximize its income from Le Ressouvenir Estates Ltd. (LBI/Ogle Estate) for Britain rather than British Guiana where the sugar was produced. It was explained to me but I have no head for business matters.
    So much for the impersonal.
    On the emotional plane, ask any old timer about when a tractor ran into a trench. (S)he will probably tell you that the “Manjah’s” first question was about the ‘welfare’ of the tractor rather than the operator.
    I often wondered about my grandfather’s vehemence, “If ANYBADDY evah raise dey foot at you, CHAP AM OFF!!!” I got an insight from an old employee (Rambharose) at Uitvlugt. He told me that the expatriate overseers could not command a mule; so each had a local “mule-boy”. The head of the youth was probably at about the level of the overseer’s stirruped boot. Language was an ever present barrier; and in frustration the rider would “lash out” his foot at the mule-boy’s head.
    My grandfather had been a mule-boy.

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