Estates closure next year will harm economy – GCCI President

With Government set to close several sugar estates across the country next year, the Georgetown Chamber of Commerce (GCCI) is warning that it would be difficult to recover from the economic harm that this will cause.

Speaking at a recent press conference, GCCI President, Deodat Indar, pointed out that despite being such a major sector in the local economy, the projected percentage of the sugar industry in the Gross Domestic Product (GDP) at the end of the year is somewhere around 1.3 per cent.
“This is an industry that has been in the double digits in the past, and we believe that shutting down these four estates will cause economic harm to the country, and it will be difficult to recover,” Indar said.
According to the GCCI President, the country does not have the periphery of the other sectors to mop up the job losses from the sugar industry once the estates close.
“So you will have people unemployed, and unemployment means lack of spending; lacking of spending means lack of consumption; and lack of consumption means reduced importation and reduced manufacturing. So is a whole spin-off of issues you have there,” he posited.
However, during the presentation of the White Paper to privatise the cash-strapped and heavily indebted Guyana Sugar Corporation (GuySuCo), back in May, Agriculture Minister Noel Holder had noted that even with major restructuring of the industry, GuySuCo is required to retain many of its workers for all operations on the merged estates, or factories, and those employees are to receive leased lands from the sugar company to engage in crops to be decided by both GuySuCo and the Ministry of Agriculture.
Holder had announced plans to close the Enmore and Rose Hall sugar estates by year-end, sell the Skeldon Sugar Factory, and reduce the annual production of sugar. This will see three estates and three sugar factories in operation: Blairmont, on the West Bank Berbice, Albion-Rose Hall on the Corentyne Coast East Canje Berbice, and the Uitvlugt-Wales estate in West Demerara.
However, State Minister Joseph Harmon had two weeks ago said that the closure of the Rose Hall and Enmore estates would not take effect until next year, since systems are not yet in place for the post-shutdown period.
On Monday, during the 2018 Budget presentation, Finance Minister Winston Jordon told the National Assembly that sugar production is expected to decline further, come next year.
Government had, under the National Industrial and Commercial Investment Limited (NICIL), established a Special Purpose Unit (SPU) at the cost of $130 million to manage the divestment of GuySuCo’s assets, including the estates and factories.
Last week, the Unit announced that three firms who met the October 30 deadline for tender for International Financial Services Provider have all made presentations to a NICIL evaluation team. The three contenders: PricewaterhouseCoopers, Ernst & Young, and Deloitte.
Head of the SPU, Colvin, Heath-London, said the second stage — the process of selecting an international financial services provider — was done on Monday last, and the Unit is expected to announce a selection by mid-December.
In the meantime, the SPU has been meeting with the management of the Guyana Sugar Corporation (GuySuCo) as well as with other industry stakeholders, including the Guyana Agricultural and General Workers Union (GAWU) and the National Association of Agricultural, Commercial, and Industrial Employees (NAACIE).
According to a statement from the SPU on Monday, both GAWU and NAACIE have expressed support for the Unit’s efforts to keep the estates operational in the interest of the economy and the workers.
The Opposition has since said that the SPU set up by the administration in order to sell assets belonging to (GuySuCo) is nothing but a vehicle for corruption completelThat completely bypasses the established privatisation procedures and the sale of State assets.