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Agriculture Minister

Zulfikar Mustapha

August 12 ,2020

Source

The Guyana Sugar Corporation (GuySuCo) requires an additional $1.6 billion up to the end of this year for capital and operational investments to stay afloat as revenue generated from its sale of sugar and molasses will be insufficient to meet the corporation’s financial needs.

The poor financial standing of the sugar corporation has already negatively impacted the first crop of 2021, Agriculture Minister Zulfikar Mustapha informed yesterday during a virtual press conference.

GuySuCo remains in a financial crisis as the corporation has once again found itself in a position of not being able to pay staff.

According to Mustapha, “The Corporation will not be in a position to pay wages from the week ending 21st August. Under the previous administration, a request was made to NICIL (National Industrial and Commercial Investments Limited) for an amount of $1 billion but only $550 million was received to date.”

For the past four months GuySuCo has been struggling to survive and has been dependent on external funding to meet its payroll obligations. In May, the corporation had made a request to the then-administration for $1 billion to meet payroll and operational expenses

Mustapha emphasised that GuySuCo’s three operating factories are in dire need of capital investments which has resulted in frequent downtime. He noted that the Uitvlugt Estate has been severely affected by mechanical issues.

“(The) Capital programme suffered from a lack of funding and will result in future crops being adversely affected. For this year from a budget of G$3.24 billion, the Corporation could only expend $82 million due to external funding not being made available,” he said.

Due to the lack of funding, the recently sworn-in Minister stressed that the First Crop for 2021 will continue to be weak due to low achievement of tillage and replanting targets thus far for this year.

 “Achieving consistent and adequate cane supply is a problem across the industry… There is a shortage of essential inputs like fertilizers and chemicals which are vital to canes in the second crop and unless they are procured, cane growth will be adversely affected [which will] directly impact future production,” he noted.

Nonetheless, Mustapha vowed that under the PPP/C administration they will work to revamp the sugar industry and “return prosperity to those sugar workers who were sacked by the previous administration.”

Asked if his ministry has been able to ascertain how much money will be required to bring GuySuCo to a profitable state, he responded in the negative and noted that a study will have to be done.

He stressed that they will have to examine the $30 billion bond agreement  between NICIL and GuySuCo. He noted that with the deal being shrouded in secrecy they will have to go through the particulars as even the Board of Directors is not aware of how much money has been raised via the bond and what are the payment terms.

“NICIL is disbursing funds to GuySuCo but they are not telling GuySuCo how much money has been drawn down from the $30 billion and they are not telling GuySuCo about the terms of repayment. If it is GuySuCo money, then they have to know about it,” the minister declared.

He argued that the APNU+AFC government, through NICIL, undertook a loan of $30 billion under the guise of assisting the corporation. To date, only $10.2 billion has been made available to GuySuCo and the Corporation has a total liability of approximately $9.5 billion.

Timeframe

Touching on his government’s campaign promise to reopen the sugar estates, Mustapha said that there has been no discussion on the timeframe for the reopening of the closed sugar estates. While assuring that reopening the Enmore, Skeldon and Rose Hall sugar estates remains a priority, he stated that they will have to undertake an assessment to determine the way forward.

The Agriculture Minister noted further that the assets of these estates have been placed in the custody of NICIL and they will first have to return them to GuySuCo. He stated too that from his understanding, parts of machinery from some estates have been moved and they will have to determine what needs to be replaced at the estates.

“Those measures will be taken shortly and hopefully then we will know when we will be able to start this survey,” Mustapha said while noting that he plans to hold discussion on this at the next cabinet meeting.

GuySuCo recorded a shortfall of 9,461 tonnes in production for the First Crop of 2020 from a target of 46,476 tonnes. Only 37,015 tonnes of sugar were produced.

The Second Crop for 2020 began during the week of August 7. Albion/Port Mourant Estate started grinding on July 31, while the factories at Blairmont and Uitvlugt estates would have started operations by August 4. A release from GuySuCo said that the budgeted target for the Second Crop is 69,480 tonnes of sugar. Operations at Albion and Blairmont will extend over seventeen weeks while Uitvlugt’s is projected to extend for ten weeks.

During the Second Crop, the release said that the Corporation will be shipping bulk sugar to markets in the Caribbean, North America and Europe, while both bulk and direct consumption sugars will be sold on the local market.

Immediate Past President David Granger was written to by Chairman of the Board of Directors for GuySuCo, John Dow, on the corporation’s financial dilemma.

In May, Dow appealed to Granger “… to use your good offices to arrange for funding to prevent the impending closure of the industry.” In the letter, he also said that GuySuCo needed funds to be able to survive after the second week of June, 2020.

Dow had told the then President that the current estates – Albion, Blairmont and Uitvlugt – in 2015 were in dire need of upgrades and that considerable sums of money were required to fix the deteriorated infrastructure in the field, in particular, bridges, dams, revetment repairs, and to provide for replacement equipment in field tractors, drain-digging equipment etc and factory pumps, motors etc. He explained that considerable sums were, and still are, required as a result of the neglect to provide the routine capital required for many years prior to 2015.

The APNU+AFC administration, which assumed office in 2015, was heavily criticised for its handling of the industry. Similar criticisms were faced by their predecessors, the PPP/C.

Original Post

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Man, these men are unbelievable. Mustafa is on his own, nobody going hear from Ali and Jagdeo.

No money for sugar bcz dem blasted PNC crooks thief out all the money.

Cooolie ppl being set up.

I warning Mustafa, "Whatever you do bro doan borrow the money from the Chinese. If you do, kiss Guyana goodbye. I do not believe Guyanese can run any industry to mek profits. No profits no payment. Suh, you doan pay the Chinese dey coming fuh the whole country. We know Jagdeo loves the Chinese, Skeldon Estate."

Granger iz nah the President no more, so no prayers going up to heaven. There was no covid when Granger was at OP. 

But isn't a promise, a promise. Vote for us and we will restore the sugar industry. Now reality sinks in. 

The Agriculture Minister should not have any problems sourcing government fertilizers and chemicals. As RO he was completely in charge of its distribution to the farmers, at a very high cost.   

 “Achieving consistent and adequate cane supply is a problem across the industry… There is a shortage of essential inputs like fertilizers and chemicals which are vital to canes in the second crop and unless they are procured, cane growth will be adversely affected [which will] directly impact future production,” he noted.  

@Tola posted:

But isn't a promise, a promise. Vote for us and we will restore the sugar industry. Now reality sinks in. 

The Agriculture Minister should not have any problems sourcing government fertilizers and chemicals. As RO he was completely in charge of its distribution to the farmers, at a very high cost.   

 “Achieving consistent and adequate cane supply is a problem across the industry… There is a shortage of essential inputs like fertilizers and chemicals which are vital to canes in the second crop and unless they are procured, cane growth will be adversely affected [which will] directly impact future production,” he noted.  

There was a shortage of cane cutters. All that is about to be changed. I hope. Actually they never said how they are going to do it. If they don't fulfill their promise, then in 2025 they are gone.

@Ramakant-P posted:

There was a shortage of cane cutters. All that is about to be changed. I hope. Actually they never said how they are going to do it. If they don't fulfill their promise, then in 2025 they are gone.

There is shortage of cane cutters, because of the uncertainty of the sugar industry and people work hard, not to be paid on time by Guysuco. 

People have to fight for lorries to take them to the back-dam, first aid truck don't wait for emergencies and workers have died in the field, punts are not available that day and workers have to spend more days just to load the cane. Thus losing days with no additional pay.  You ever see a manager drive dem vehicle in the sugar cane trench at 1 pm, because dem drunk ?  This was before 2015. 

How will the system change when there is no money for improvements ? Maybe more Chinese will provide loans, with dem own workers and eventually take over Guyana.  

@Ramakant-P posted:

There was a shortage of cane cutters. All that is about to be changed. I hope. Actually they never said how they are going to do it. If they don't fulfill their promise, then in 2025 they are gone.

Which scenario you hoping for? This is the unfortunate fallout of the PNC actions following their loss.  No one will trust them even if the PPP does not keep their promises.  And don’t blame the people, blame the PNC.

The PNC ain’t seeing power for a long time. Maybe when today’s unborn reaches voting age. The harm done to their image is incalculable.

I am still trying to find out the difference between fulfilling a campaign promise or bailing out a sector that's running at a loss every turn of the way. I would suggest selling these estates or privatize them. If $1.6 billion to keep the sugar estates afloat until December 2020, how much would it cost to revive them to make a profit and to pay a mere 10,000 employees? I can't figure a timeline.  

Last edited by Former Member
@Former Member posted:

I am still trying to find out the difference between fulfilling a campaign promise or bailing out a sector that's running at a loss every turn of the way. I would suggest selling these estates or privatize them. If $1.6 billion to keep the sugar estates afloat until December 2020, how much would it cost to revive them to make a profit and to pay a mere 10,000 employees? I can't figure a timeline.  

The Chinese will be most willing to provide loans, so the present government can keep their campaign promise to the sugar workers.  But eventually own that part of Guyana, when the sugar industry completely collapse.

Governments who invite the Chinese, fail to understand their possessive nature in other countries.     

@Prashad posted:

It is better for the government just to pay the sugar workers to retrain in a skill.

This is a good suggestion, because many of the sugar workers are school graduates who cant find another job. 

@Prashad posted:

Guysuco needs to get out of sugar and focus on other industries.

All they know is cutting cane.  It's a good suggestion, but it will take millions to retrain them.   It would be nice if the oil revenues are paid to the government early.

@Ilum posted:

If a foreign country brings money into Guyana and end up with land they can't take out did Guyana really lose that land?

No! They can't take the land because the US owes China trillions and the Chinese can't do anything about that.

Cane cutters knows a hell of lot more than cutting cane. Some here should spend time talking to them in the field, or travel in the trucks with them to the back dam. 

Some are high school and university grads, but if you are an Indian the PNC will not hire you and if African the PPP will not hire you.  So they maintain their family and pay their bills the only way possible, cut cane. 

Retraining is one of the ways possible for a better job, or maybe starting their own business like repairing computers or cell phones. Guysuco had computer training centres on some estates, but it fell by the way side, due to lack of maintenance.  

@Ramakant-P posted:

No! They can't take the land because the US owes China trillions and the Chinese can't do anything about that.

US/China relationship is no match for what China has already done to some developing countries.  By possessing projects, when a loan cannot be paid and Guyana is no exception. The US can use their clout against China, but what clout does Guyana have ?   

@Tola posted:

US/China relationship is no match for what China has already done to some developing countries.  By possessing projects, when a loan cannot be paid and Guyana is no exception. The US can use their clout against China, but what clout does Guyana have ?   

They have the UN charter of rights.

@Tola posted:

US/China relationship is no match for what China has already done to some developing countries.  By possessing projects, when a loan cannot be paid and Guyana is no exception. The US can use their clout against China, but what clout does Guyana have ?   

The Chinese People's Liberation Army soldiers are guarding their oil wells in Sudan.

@Prashad posted:

Construction skills is the key. Train the cane cutters in construction skills. Buildings, roads, plumbing, glass bottle making etc.

I agree here. I always stressed on retraining the sugar workers to meet different skills set to go beyond sugar. The one time I agree with Ramjattan is when he said Jagdeo only want them to work in mud and water for their entire life.  

@Former Member posted:

The one time I agree with Ramjattan is when he said Jagdeo only want them to work in mud and water for their entire life.  

Instead Ramjattan put them in a bread line that had no bread.

In light of the PPP's election promise, the discussion  now should not be about retraining the retrenched sugar workers.  The discussion should be about why the closed estates are not open as yet and why has the PPP as they pledged not acted immediately to address the plight of the sugar workers.

I think Gerhard should be brought in as Chief retraining officer. If he can figure out how to build a computer from Guyanese wood then he can figure out how to implement a low-cost retraining program for Sugar workers in construction skills.

Last edited by Prashad
@Tola posted:

Cane cutters knows a hell of lot more than cutting cane. Some here should spend time talking to them in the field, or travel in the trucks with them to the back dam. 

Some are high school and university grads, but if you are an Indian the PNC will not hire you and if African the PPP will not hire you.  So they maintain their family and pay their bills the only way possible, cut cane. 

Retraining is one of the ways possible for a better job, or maybe starting their own business like repairing computers or cell phones. Guysuco had computer training centres on some estates, but it fell by the way side, due to lack of maintenance.  

I would like you to show me one University Graduate cutting cane in Guyana. I know of one person ,now living in Canada that used to cut cane then studied at night, passed his O Levels GCE, received a Bookers scholarship went to UWI got a degree in Business, then returned to work at Bookers Head Office. He was well known in WCD.

 There are lots of private companies in Guyana that pays much more than the Government, Banks, Insurance Companies, hospitals just to name a few.

 As a little boy going to school, the teachers would tell the students, if you don't study and do your home work, you will end up being a cane cutter. I also remember one boy said he wants to be a Saddar, teacher asked why, he replied" well I will get a bicycle, an umbrella and a cork hat to go Back dam.