Last year, the European Union (EU) gave Guyana 24.4 million euros ($5.4 billion) in aid to support its adjustment to the loss of the Union’s lucrative market. But more than seven months later, questions still remain about exactly how the Government will be using this money.
Despite being an important stakeholder in the local sugar industry, the Guyana Agricultural and General Workers Union (GAWU) is in the dark on the Government’s intentions. According to GAWU President Komal Chand, the silence surrounding the money is a concern.
The labour representative noted that the EU’s intention in giving Guyana the money was that it would be used in the sugar industry. But in the absence of any Government-facilitated consultations or budgetary plan, Chand could only surmise that the money was still with the Government.
“The money was delayed. I know the Government did receive the money. But we don’t know what they have done with that money. It comes as a result of the (EU) commitment to the sugar industry, after the price of sugar was cut by 36 per cent.
“So, they distributed money to the sugar industry over a number of years. The last payment was last year, but it was not released to the sugar industry. It was intended for the sugar industry; the money came about due to certain performance in the sugar industry.”
Chand acknowledged that Government might be considering other uses for the money, such as meeting expenditure from the Consolidated Fund, paying wages to public servants and the execution of project works. But he noted that the bottom line was for the money to be used in the sugar industry.
European Commission Director General for International Cooperation and Development, Stefano Manservisi (right) with Finance Minister Winston Jordan
For years, the African, Caribbean and Pacific (ACP) Group of States has provided sugar to Europe on a quota system. In fact, Europe accounted for over 150,000 tonnes in sugar exports from Guyana.
But the EU’s quota management system for sugar will end on September 30, 2017 and is expected to lead to a fall in prices towards the international sugar price and a decrease in sugar exports from the ACP, with particular impact on Caribbean producers. Government has been downsizing the sugar industry, a move fiercely resisted by GAWU. Last year, the operations of the LBI Estate were amalgamated with those of the Enmore Estate in order to make both estates more efficient, according to GuySuCo.
GAWU has noted that thousands of persons stand to be affected by the closure of this East Demerara Estate, which employs some 2200 persons in the field, factory, security, administrative and managerial sections.
Government has announced plans to close the Enmore and Rose Hall Sugar Estates, sell the Skeldon Sugar Factory, reduce the annual production of sugar, and take on the responsibility of managing the drainage and irrigation services provided by GuySuCo.
Agriculture Minister Noel Holder claimed that this process would result in improving the relationship with some cane cutters, estate staff and about 1710 private cane farmers, adding that GuySuCo’s sugar operations will be limited to the Albion-Rose Hall, Blairmont and Uitvlugt-Wales Estates. The estates will be complete with factories and will have cane supplied from all locations, according to the Agriculture Minister.
The International Monetary Fund (IMF), along with the Opposition, has warned the Guyana Government about the social impact of the measures it is taking. There has also been criticism of the downsizing, in light of the absence of a socio-economic study.
