Production woes continue
As if the turmoil in the bauxite industry were not enough to place doubts on our continued healthy economic outlook, unrest in the key sugar estates of Berbice signals that if the trend continues, our growth figures might soon change from black to red.
In the case of bauxite, while we are a far way from the employment and production figures of the pre-nationalisation days, the industry had evidently stabilised after hitting rock bottom in the 1980s. Its lower production rate is a consequence of soft global demand for aluminium.
Its present travails are more of a political than an economic question. The social services formerly provided by the bauxite company, including the subsidisation of electricity tariffs, were assumed by the government when the Linden operations were privatised.
The residents of Linden, of which only a few hundred are now employed in the industry, are protesting the government’s decision to equalise their electricity rates in line with those of the rest of the country. The protests, which have taken the form of disrupting the traffic flow through the gateway community to the interior, have unfortunately caused the bauxite plant to be closed for the last few days.
In the interest of the long term recovery of the industry, we hope that the protesters take into cognisance the long term effects of its induced disruption on bauxite production. Guyana’s bauxite production fell into a tailspin after nationalisation when we could not keep our delivery schedules.
Even for our high quality bauxite, which is used for making industrial kilns, customers turned to lower quality suppliers – ironically such as China, the present owner of Bosai – because they delivered on time. Bosai should indicate whether the present hitch in production will affect its contracted deliveries. Lindeners should know that there are other sources of bauxite that both Bosai and Rusal can exploit to meet their commitments and they will be leery to place more eggs in their Guyana basket for the future.
On the sugar front, the strike by cane-cutters at Albion, on the heels of a previous strike at Rose Hall estate, might be the straw that will break the sugar-camel’s back of production this year. The target for 2012 has already been severely reduced. For the first crop which ended in May, GuySuCo produced only 70,027 metric tonnes of sugar as against its target of 101,813. This was the lowest first crop production for over 20 years.
The Corporation then set a new production target for the year of 236,307 tonnes of sugar, 33,693 tonnes less than the 270,000 tonnes target initially set at the start of the year. At the time of setting the new target, many observers felt that GuySuCo was being overly optimistic.
The present mood in the industry, telegraphed by the strike at Albion, may prove that the doubts were justified. What makes the strike problematic is that its cause lies in continued communication breakdowns between workers and management.
Surely the corporation is aware that canecutters are paid by the weight of cane cut and since the canes that were left uncut from the last crop would have lost weight (mainly water) during the intervening months, there would have to be some formula for compensating them for the lost weight. That workers were willing to strike immediately after two months lay-off, indicates that management will be facing a very militant workforce for the rest of this year.
We ask once again: what has been the fate of the decision to have a union representative sit on the Board of GuySuCo? This move would have opened up the facts on the operations of the industry directly to workers’ representatives as well as having access to their opinions of management policies. Finally, some outside experts had been hired to fix some of the problems at the Skeldon factory and we hope that the latter will finally be ready to deliver on its promised production.
Politics is about making decisions of allocating the resources of a country: it becomes more problematic when those resources are reduced.