Continuing with efforts to revitalise the ailing sugar industry, the People’s Progressive Party/Civic Government has injected $2 billion into the Guyana Sugar Corporation (GuySuCo) for capital works.
Uitvlugt Sugar Estate
This was announced by senior Minister with responsibility for Finance, Dr Ashni Singh, during the presentation of the 2021 National Budget themed “A Path to Recovery, Economic Dynamism and Resilience.”
Minister Singh disclosed that $2 billion has been allocated for critical capital works at the sugar corporation.
“Given the importance of sugar in the domestic economy, and the manner in which this sector affects overall socio-economic conditions in rural Berbice and rural Demerara, we shall continue to work with all stakeholders, in particular the Private Sector, in ensuring that the viability of this industry is preserved,” the Finance Minister posited.
Only last year, in its emergency budget, the PPP/C Administration plugged some $7 billion to recapitalise the sugar industry.
Looking back at the sector’s performance last year, Dr Singh revealed that the sugar-growing sector is estimated to have contracted by 3.7 per cent, with production falling to a low of 88,868 tonnes. This, he noted, was primarily due to a shortfall of more than 17,000 tonnes in the second crop which resulted from the protracted lack of capital investment in factories, causing downtime and reducing the volume of sugar extracted from canes.
Additionally, high rainfall in November and December resulted in the flooding of some fields and restricted access to canes.
The Finance Minister pointed out that the downsizing of the sugar industry via the closure of four estates – Wales, Skeldon, Rose Hall and East Demerara (Enmore) – by the APNU/AFC coalition caused a rippling effect throughout Guyana’s coast, spreading shock, dismay, disbelief and a state of hopelessness. He noted that in addition to the 7000 workers who were placed on the breadline, the closure also directly and indirectly affected small and micro businesses, while small market vendors were decimated as businesses dried up, and entire communities were devastated.
Singh added that the three estates that were reluctantly kept open – Albion, Blairmont and Uitvlugt – were left to limp along with little to no capital investments during the APNU/AFC’s tenure.
“By the time we entered office, sugar production had plummeted to its lowest level ever and GuySuCo was in dire financial straits. Notwithstanding the prophets of doom, this PPP/C Government stands ready, willing, and resolute to deliver on our policy and manifesto promises to the sugar workers and to all Guyanese,” the Finance Minister reassured.
To this end, the PPP/C Government has installed a new Board and management of GuySuCo that are charged with the responsibility to conduct a detailed diagnostic of the sugar industry, in order to reboot the industry to make it fit for the purpose for sugar and value-added opportunities including diversification into non-traditional areas.
In fact, Minister Singh posited that work is currently ongoing on developing a master plan, estate by estate, to guide the future of the industry. He added that GuySuCo would concentrate on redirecting its efforts towards an optimised product mix, a shift away from the current low-value bulk-sugar market. This would allow the corporation to quadruple its sales into the packaged sugar market both locally and internationally over the next five years.
Against this backdrop, the Blairmont Packaging Plant could be expanded by three new packaging machines and an expansion of the storage bond so that inventory can be available at all times to service the international market with the world-famous Demerara Gold packaged sugar. Further, the Enmore Packaging Plant could be expanded to five operational packaging lines.
Further, the Finance Minister highlighted that at the Albion, Blairmont and Uitvlugt Estates, more than 60 per cent of the access roads are in a deplorable state, and more than 50 per cent of the fleet of land preparation and tillage machines were allowed to deteriorate beyond repair.
Additionally, more than 40 per cent of the cane transport fleet, especially the punts, were left to deteriorate to the point of disuse.
“Targeted investments will be needed to correct the situation over the medium term. Investments in cane cultivation will ensure that ratoons that are currently over 10 years old will be replaced over a five-year period at the rate of 20 per cent per annum, helping to revert to the standard procedure of replanting every five years,” he contended.
Regarding the closed estates, assessments on the damages and the cost to rehabilitate are ongoing in order to make the estates profitable cost centres, including but not limited to introducing public-private partnerships, agro-industrial and agro-energy opportunities, and pursuing product diversification, and retraining where necessary.
Nevertheless, Minister Singh noted that restructuring the sugar corporation, alongside the recapitalisation of sugar estates, will see improved production and productivity, not only in 2021 but over the medium-term.
In fact, he disclosed that the sugar industry is projected to grow by 9.6 per cent this year with the world market prices for sugar projected to increase by 2.3 per cent.
Earlier this week, GuySuCo’s Chief Executive Officer, Sasenarine Singh, told Guyana Times that GuySuCo has to continue its efforts to fix the factories, conduct land preparation, and revamp the cane transport system in 2021.
Added to this is the work that has to go into GuySuCo’s land preparation and into the timely transport of sugar cane from the fields to the factories. (G8)
