The private sector today called on the government to stay its hand on any closure of estates citing the range of likely repercussions.
A statement from the Private Sector Commission follows:
The Private Sector Commission (PSC) and its affiliates, the Georgetown Chamber of Commerce & Industry (GCCI), the Guyana Manufacturing and Services Association, the Upper Corentyne Chamber of Commerce and Industry, the Linden Chamber of Industry, Commerce and Development, the Region 3 Chamber of Commerce and Industry, the Central Corentyne Chamber of Commerce and the Berbice Chamber of Commerce and Development Association
PRIVATE SECTOR EXTREMELY CONCERNED OVER DOWNSCALING OF SUGAR INDUSTRY AND CLOSURE OF ESTATES
The Guyana Sugar Corporation (Guysuco) came into being as a state owned entity in 1976, when it was nationalized. The sugar industry has continued to play a significant role in the overall economy of Guyana.
The industry remains the largest employer other than Government and the main foreign currency earner. Guysuco’s role has expanded to include providing Drainage and Irrigation for many communities and other sectors as well as providing community health services.
In recent years, however, the corporation has delivered financial losses and has become dependent on Government/taxpayers subvention to enable continued operation. Many factors have been attributed to the declining performance of the industry, not the least of which was the loss of the preferential pricing of the lucrative EU market. There is the view that these could be addressed to turn around the industry.
Government has expressed its intention to downscale the sugar industry and to commence with the closure of estates.
In recognition of the critical importance of the sugar industry, the private sector makes the following observations:
1. The Government-initiated Commissioner of Enquiry (COI) did not recommend closure of any estate but, on the contrary, recommended divestment into private hands (See Volume 1 of COI page 36, section 7, sub-section 1, 11,111,1V).
2. A review of Guysuco’s audited financial statements for the year 2015 reveals that more than G$10.0B would be removed from private employment income should Government proceed with the closure of estates. This, in turn, would have a direct negative effect on consumer spending in the communities which, directly or indirectly, depend upon income, from sugar. Such a decline in consumer spending would also have a diminishing impact upon all commerce with concomitant negative spin-off effects on the economy as a whole.
3. Guysuco is a major earner of foreign exchange. Closure of any estates would, therefore, severely impact upon the availability of foreign exchange and increase the price at which it is sold.
4. The restoration of Guyana’s economy is inevitably, and intimately, linked to the future of sugar.
It would be sad to lose the sugar industry and realize five years later that this would have been a success story. We must learn from the history of the scrapping of the railway which would have opened up our country to development
Our members are located across the length and breadth of Guyana and the survival of their businesses depends upon a public that spends on goods and services. Most income generation is derived from employment and when this is reduced significantly it affects the entire chain, from manufacturing and importation to household consumption.
The private sector calls on Government to hold its hand on the current approach towards closure of estates.
The private sector stands ready to place its considerable experience at the disposal of and to work with Government to explore all possible options to avert closure.