PPP plans to inject $20B more into ailing sugar industry if elected

Apr 06, 2015 News

Despite the direction the global market is taking and reports showing that the sugar industry has been burdening the local economy, the People’s Progressive Party/ Civic (PPP/C) says it will pump at least $20B more into the local sugar industry should it be re-elected to govern.
As Regional and General Elections inches closer, the ruling party yesterday released excerpts of its manifesto captioned: “Our Vision: Guyana Version 2.0”, which reveals the multi-billion dollar plans for the struggling sugar industry among other key sectors of the local economy.

A part of a cane cutter’s day’s work

In the excerpt, the party said that it will support the sugar sector with a “minimum investment of G$20B.”
This money, it said, will be used for the continued viability of the industry, to invest in refinery and distillery capacities and increase production of packaging and specialty products.
The plans of the PPP/C come at a time when the sugar industry is operating at a loss. Last week, the price for a pound of sugar on the world market went down to US$0.12 but GuySuCo’s top officials told Parliament last year that the entity is producing sugar at more than US$0.35 per pound.
In effect, this means that GuySuCo is producing sugar at almost US$800 per ton and is selling back at US$300 per ton. This is a clear indication that the company is losing big time.
While the two main political parties, the PPP/C as well as A Partnership for National Unity and Alliance for Change (APNU+AFC), have signaled their support for the sugar industry, many have painted a dismal future for the industry.
One of them is former Member of Parliament, Stanley Ming who recently opined that politicians are continuing to support the failing industry because they focus primarily on their constituents.
Focusing on the direction that the global market is taking, coupled with reports showing that the sugar industry has been burdening the local economy, Ming is convinced that the possibility of sugar reaping success no longer exists.
“Every year, we hear from the government that they’re restructuring the Board of the Sugar Corporation… that they’re bringing in this person from this other country to fix the Skeldon plant. Every year is a new excuse.”
He had said that over the years, the excuses being offered for the production and costs have shifted between being the estate and the weather.
“Sugar all over the world is now being reduced by substitute sweeteners and the price that sugar is being sold for now in the world is less than our cost of production. There is no way we can bring the cost of production down to meet what is the world cost for sugar,” Ming lamented.
“What is happening in Guyana is that politicians think about what they need to do in the next four years to win the votes at elections.” Ming said that politicians seldom think of the long term future of any country. Rather, they focused on brain-washing the constituents.
Additionally, the multi-billion dollar Skeldon Sugar Factory has been encountering many problems, including the expansion of its cultivation.
In fact, last year was one that ended with the flagship Skeldon Sugar Factory again, recording one of the worst performances of all the four Berbice estates.
It debts have also been mounting. In recent months, GuySuCo reportedly took almost $4B in loans from a Jamaican bank to finance expenses for its second crop. Over $20B (US$100M) is owed for the new Skeldon Sugar Factory to the World Bank, China EXIM Bank and Caribbean Development Bank (CDB).
Between 2013 and 2014, Government through the National Budget plugged $10B (US$50M) into GuySuCo despite misgivings from the Opposition.
In addition, the PPP/C said that the creation of jobs, increased income and greater wealth “will be driven by a balanced approach to ensure buoyant and sustained growth from both traditional economic sectors such as sustainable mining, forestry, sugar, rice – and from new economic frontiers made possible by a prudent and business-friendly macro-economic framework.”
Moreover, the party added that increased domestic and foreign direct investment will be facilitated in sustainable agriculture; agro-processing and agro-business; environmental and climate services; large scale mineral, oil and gas exploration and extraction; information and communications technology services and tourism and hospitality.
To achieve this, the PPP/C said a number of essential policies and measures will be pursued.
“The PPP/C has delivered on its commitments, not making promises it will not or cannot deliver, and not making unrealistic or irresponsible commitments,” the party said. The main Opposition leaders have pledged their support for the sugar industry at public rallies but are yet to release their manifesto.