Oct 14, 2017 News
– Rose Hall, Enmore closures confirmed for year-end
– workers offered harvesting, cultivation, transportation contracts
Cash-strapped Guyana Sugar Corporation (GuySuCo) is already letting go of staffers from two estates that it will close before the year is out.
Amidst worry by sugar workers, GuySuCo officials yesterday confirmed that
up 1,500 could be let go from Rose Hall and the East Demerara estates by the end of the crop. The industry has 17,000 workers. It wants to reduce that by at least 5,500 more, a total of 7,000 – to finish at 10,000.
This past week alone, 300 staffers were affected between the two, it was disclosed yesterday.
The state-owned sugar company is also planning to use the remaining three estates – Blairmont and Albion in Berbice and Uitvlugt, West Demerara – to produce up to 150,000 tonnes of sugar, come 2020.
The remaining three estates – Enmore (East Demerara) and Rose Hall and Skeldon (East Berbice) will be up for offers of divestment and privatization.
The 150,000-tonne target from the three estates will be similar to the lowly 150,000-160,000 tonnes that is being announced for this year.
The disclosures of making GuySuCo profitable or “cash positive” in three years were made yesterday during a press conference by senior officials at the National Communications Network studios, Homestretch Avenue.
With Wales Estate, West Bank Demerara, closed last December as part of the re-organisation of the sugar industry, which has been struggling badly to stay alive, the questions of what is happening at Rose Hall and Enmore, two factories earmarked to be closed, have been up in the air.
Present at the press conference yesterday were Finance Director and Deputy Chief Executive Officer (CEO), Paul Bhim; Gavin Ramnarain, Head of the Agricultural Research Department; Yusuf Abdul, Technical Services Manager; Deodat Sukhu, Chief Industrial Relations Manager, and Audreyanna Thomas, Senior Public Relations Officer.
With some protected markets in the region, a re-organised, lean-and-mean GuySuCo, minus its troubled new kid-on-the-block, Skeldon, will be targeting CARICOM for higher prices, through value-added packaged sugar and what is known as ‘plantation white sugar’- a lesser quality of refined sugar.
GuySuCo is facing major problems, with little answers now, and is $82B in debt. It is producing at high of US$0.42 cents per pound but selling at a massive loss, at US$0.17.
The government has given and committed $21B to GuySuco for the past 12 months, a situation that is angering taxpayers, but defended by the sugar unions, whose existence is under threat.
At Wales Estate, 200 acres of rice was planted under a $200M diversification project, and funded by the Guyana Rice Development Board. The project fell short of the 35 bags-per-acre target, with 28 bags recorded.
Already, a special purpose unit has been established and has invited expressions of interest for Wales, Skeldon, Rose Hall and Enmore estates.
At the Albion Estate, GuySuCo will focus on bulk sugar, plantation white sugar, co-generation, and molasses. Production of bagged and packaged sugar will be done at Blairmont while at Uitvlugt Estate, GuySuCo will focus on bagged and plantation white sugar.
GuySuCo is also hoping to supply the local market, which consumes approximately 20,000 tons of bagged and packaged sugar yearly.
“In addition to that, we have a small US quota of about 13,000 tons…so we’re going to be satisfying that quota as well,” Bhim noted.
The corporation is also looking to move into new markets, particularly plantation white sugar which is a substitute for refined white sugar. There is potential at Uitvlugt Estate for increased sugarcane cultivation with private cane farmers, senior PRO Audreyanna Thomas noted.
GuySuCo is looking to tap into the Caribbean market for plantation white sugar. Bhim pointed out that the Caribbean Community (CARICOM) annually imports approximately 190,000 tons of refined white sugar. While 10% of refined sugar is used for manufacturing of food and beverages, “the rest could come from plantation white sugar”.
The sugar entity is collaborating with Jamaica and Belize, members of the Sugar Association of the Caribbean (SAC), to urge CARICOM governments to grant a Common External Tariff (CET).
“Where white sugar is coming in extra-regionally, some sort of a tariff will be imposed. We’re not sure as yet what percentage we’re looking at…in order to make our plantation white sugar competitive,” Bhim explained. To be competitive the tariff the sugar corporation is seeking has to be in the range of the charge attached to brown sugar, which is in the range of 30-40%.
The officials made it clear the GuySuCo as a business should be re-oriented to run as a profitable one.
Already, GuySuCo is targeting sugar-dependent communities to find out ways to ready them from the fallout of factories being closed.
Almost 500 workers have indicated they wanted training that GuySuCo was offering as part of the severance deal – from sewing, catering, masonry, electrical works and computer training.
According to Bhim, 70 percent of Guyana’s overseas market is in Europe, where prices have almost halved to just US$300 per tonne. With regards to Wales, another 285 acres will be put to more seed paddy.
Sukhu said that some 389 workers have received severance pay of over $338M. However, the official said, about 200 Wales workers are refusing to take up jobs at the Uitvlugt estate.
The officials made it clear yesterday that GuySuCo will be offering contracts of planting, transportation, and harvesting. There will even be contracts for uniforms.
According to Sukhu, the major problem facing GuySuCo is the number of strikes and protests by workers – one of the highest this part of the hemisphere.
At Skeldon, when divestment or privatization comes, almost 2,000 workers will have to be treated when the time comes, the officials said.
The reduction of the workforce, a bruising subject for the Opposition and a touchy one for Coalition Government, would see GuySuCo saving in about $5B-6B – the current wage bill is over $18B annually.
Recently, to rescue GuySuCo with monies to pay workers and other expenses, government agreed to buy some lands for housing. GuySuCo will be asking for more before year-end, Bhim admitted.
GuySuCo is targeting land sales to raise money for expansion and critical repairs to its aging factories.
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