– concerns raised over company’s ability to meet payments
The Sugar Industry Labour Welfare Fund (SILWF) was intended to be financed in part from levies on every tonne of sugar exported; but as of 2016, over $1.4 billion in levies have been owed by the Guyana Sugar Corporation (GuySuCo). This is contained in the SILWF Committee’s Annual Report for 2016, which was recently laid in the National Assembly.
According to that report, GuySuCo owes the committee a total of $1.488 billion. Of that amount, $1.404 billion minus interest is attributed to outstanding levies.
According to the Sugar Industry Labour Welfare Fund Act, interest is calculated at six per cent per annum for payments exceeding the 90-day requirement.
In addition, the sugar corporation owes $83.7 million in loan remittances to the SILWF, which, among other things, has been providing housing loans to sugar workers at concessional rates.
SILWF’s official mandate includes improving housing, roads and social and public health conditions for sugar workers. Besides its interest-free loans, it has been involved in allocating house lots, conveying Certificates of Title, and providing workers with water subsidies.
The report shows that for 2016, a total of $8.388 million in loans was repaid. This includes $8 million in payments made to the SILWFC’s Duke and Barrack Streets, Georgetown office, and $386,400 in loan remittances from GuySuCo.
Can GuySuCo repay?
Sources have expressed concern as to whether GuySuCo would ever be able to clear these massive arrears to the Fund, considering the dramatic downturn in sugar production and export over the past few years. In 2016, the operations of the LBI Estate were amalgamated with those of the Enmore Estate.
Government also has plans to privatise the Skeldon Estate and close down the Rose Hall and Enmore estates. The only ones slated to remain open are the Blairmont, Uitvlugt and Albion estates.
Sugar output in Guyana fell by nearly a quarter from last year, with close to 140,000 metric tonnes being produced in 2017. This was the lowest output in over two decades, and has been one of the factors blamed for Guyana’s unfortunate balance of payments situation. And while the Government is eyeing a sugar production target of 115,447 tonnes, industry stakeholders are unconvinced that this could be achieved.
The Guyana Agricultural and General Workers Union (GAWU), for instance, had contended that the sugar production target for 2018 is unrealistic, since only three estates would remain operational. This, they said, is because the Guyana Sugar Corporation (GuySuCo) is expected to fall behind its 2017 production target, which is expected to be the lowest in 27 years.
“The budget tells us that sugar production will reach 115,447 tonnes next year from the three estates that will remain under GuySuCo’s management. This year, those three estates have produced aggregately 88,116 tonnes sugar…and therefore are budgeted to record a 31 per cent improvement in 2018.
“For the GAWU, which has been associated with the sugar industry for decades now, this is a magnificent improvement, and we cannot help but wonder whether it is grounded in reality,” the Assistant General Secretary of the Union, Aslim Singh, noted.
In his 2018 Budget speech, Finance Minister Winston Jordan said the Special Purposes Unit (SPU) is tasked with examining and articulating the way forward with respect to the divestment of the Skeldon, Rose Hall, and East Demerara estates. He noted that the SPU would also work to reconfigure operations to guarantee economic viability at the Uitvlugt, Albion and Blairmont estates.
