GMSA calls for democratically-elected Govt to prioritise resuscitating sugar industry
The Guyana Manufacturing and Services Association (GMSA) has expressed grave concerns after at least one major beverage manufacturer announced that it is contemplating increasing commodity prices due to a shortage of molasses.
As such, it has called for a democratically-elected Government to give priority to the resuscitation of the sugar industry through an approach which involves public-private partnership.
Only recently, Demerara Distillers Limited (DDL) announced that prices for its signature El Dorado Rums might have to be increased due to a shortage of the commodity throughout the country.
In a statement on Tuesday, the GMSA expressed worry over this trend, as it renewed calls for urgent action to safeguard the sugar industry. It was emphasised that the manufacturing sector is heavily influenced by the sugar industry, through its mutual relationship.
Through the non-availability of molasses on the local market, beverage-giant DDL is now footing the high importation bill to meet its demands.
“The Association notes with concern that at least one major manufacturing entity has had to import molasses from overseas to meet its demand for the last two years… While GuySuCo had been able to maintain this supply of approximately 32MT per month for small manufacturers, this has not been the case for at least one major manufacturer,” the release said.
It added, “Demerara Distilleries Limited has had to resort to importation of molasses to meet its demand and this importation has increased due to the inability of the sugar industry to supply. This situation, and the continued decline of the sugar industry, is a major concern of the GMSA.”
The Association further detailed that many key manufacturing entities across the country are dependent on molasses for rum making, food processing and pharmaceuticals. As such, for production to increase, the supply of raw materials must be readily available. At the moment, this situation could affect the country’s competitiveness.
“The GMSA believes that if Guyana’s manufacturing sector is to grow in the future, urgent attention is needed to ensure the supply of raw materials – in this case, molasses. The importation of molasses, while a short-term measure to meet demand, clearly is not sustainable and could affect Guyana’s competitiveness in the long run.”
Downsizing the sugar industry, the GMSA noted, is a move which should be reversed and a new Government should focus on resuscitating the sector.
“The Association believes the downscaling of the industry, with the closure of four of seven sugar estates, has had dire consequences to the economy and other sectors which depend on the industry.
In 2018, the Association had written the APNU/AFC Government to guarantee the supply of molasses to small-scale manufacturers. The three remaining estates – Uitvlugt, Blairmont and Albion – were projected to produce a total of 52,000 tonnes of molasses in 2018. However, DDL’s molasses requirement for that year was some 70,000 tonnes.
Nevertheless, as a long-term solution to this challenge, the company had submitted an Expression of Interest (EoI) to NICIL and the Government for the potential purchase of the now closed Enmore Estate. This would have allowed the company to have a guaranteed steady supply of molasses.
Former Agriculture Minister, Dr Leslie Ramsammy had commented that this confirmed the Opposition’s warning that the closure of sugar estates would have costs way beyond the temporary subsidy Government was making to the industry.