Bulk of funds was spent elsewhere – Govt

Government continues to lay the blame of the current state of affairs of the sugar industry at the feet of the previous People’s Progressive Party (PPP) Administration, noting that had the G8 billion support from the European Union been directed to its original purpose, then the sector would have been a much better form.
Minister of State Joseph Harmon said on Friday that it is clear that the previous Government did not use the fund in areas it was intended. He was speaking at the weekly post-Cabinet press briefing on Friday, responding to questions on whether or not the sugar industry benefited from the EU fund.
EU Ambassador to Guyana, Jernej Videti? on Thursday told journalists that the European Union will no longer be pumping money into Guyana’s sugar industry. Last year was the final tranche of the $348 billion budgetary allocation.
The main purpose of the grant was to assist Guyana with the reform of its sugar industry, however, according to Harmon the money was directed elsewhere.
He said when the A Partnership for National Unity/Alliance For Change (APNU/AFC) Government took office in 2015, it made decisions the previous Administration was afraid to take, all in the interest of saving the industry and those who depend exclusively on it.
“What we are doing is to try to save it… We are working in the interest of the people of this country, the people of the sugar industry and working to ensuring that there is still an industry going forward in Guyana, albeit at a different stage”.
The EU Sugar Grant was established to compensate for the 36 per cent cut in preferential market price after the World Trade Organisation (WTO) had ruled that the preferential market access violated global free trade rules.
A total of 1.28 billion euros was allocated for disbursement to the sugar protocol countries benefiting from the programme to help them adapt to the new market conditions. Guyana received its first instalment in 2006.
According to Ambassador Videti?, the EU grant was to support the restructuring of the sugar sector and not for a policy design. The latter, he noted, is the sole competence and responsibility of Government.
In fact, Head of Cooperation at the EU Mission in Guyana, Christof Stock, pointed out that while the monies were to support reform within the sugar sector, the EU had no actual involvement in that process.
“…When we are doing budget support programme, which is to increase the ownership of the country of the programme, the money goes into the Treasury and the only influence we have is to check against the indicators – how the indicators are reached and that’s out of our responsibility. But this is a system which basically follows the millennium goals agreed and in order also to give those countries benefiting from budget support, the possibility to increase their ownership and to integrate the funds into their respective policy,” he explained.
The Guyana Government has moved to downsize and diversify the heavily indebted and cash strapped sugar industry; a move, which has since attracted countrywide protest action with many, including the parliamentary Opposition and the largest sugar representation body – Guyana Agricultural and General Workers Union – calling on the coalition Administration to reverse its decision.