Home Letters Profitability of GuySuCo not the only criterion for closure
Are we to believe that profitability was the only criterion used by the coalition government to callously close the sugar estates? If this was so, then the so-called downsizing or ‘right-sizing’ should have never taken place since there were more compelling reasons why they should not have been shuttered.
There were some who supported the closure since they saw taxpayers’ dollars going down a ‘dark hole’. Even a few pseudo-economists could have only seen that these monies could have been better diverted in providing other public services and given wage increases to public servants. This was adamantly echoed by a visionless AFC leader. These myopic visionaries could not have seen that closing sugar estates would spell the doom for a grossly mismanaged economy where corruption has become endemic.
They reasoned that once a business is no longer profitable then it should be closed. That false premise appealed to some who are ignorant of economics. Moreover, with oil coming as early as 2020, why hold on to a ‘bloodsucking entity’? Oil will be the panacea for all our social and economic ills, they reasoned, oblivious of the ‘oil curse’! Whether this will be so is now very much doubtful given the wholesale give away of our oil resources from corrupt deals brokered by the coalition government. The pre-contract costs, the insignificant royalties, and the lop-sided production sharing agreements are just a few.
Furthermore, the Government, as another of its deceitful elections campaign tactic, is hotly debating how to spend the ‘tons’ of illusory cash; whilst one faction wants to give ‘fishes’, another faction wants to teach ‘fishing’. But what is certain is that the Agriculture sector is faced with imminent extermination. This is a sector which holds the key to our sustained social and economic development. Only a fool will deny that GuySuCo provided numerous benefits to the economy even though it was a loss-making entity. It provided employment both directly and indirectly; it earned scarce foreign exchange which helped to stabilise the exchange rate. It provided medical services to poor people and provided drainage and irrigation services both to residents and farmers. Moreover, all the surrounding communities benefited from the wages and salaries earned by the sugar workers. The closing of Wales, Enmore, Rose Hall and Skeldon estates negatively affected these communities and the domino effect was devastating. These communities are yet unable to cope with the resulting social and economic fallouts. The subsidies given to this entity were well-spent!
It is now the stark reality that it was never the intention of this Government to save sugar but instead it came to be used as another avenue to ferment the many forms of corrupt practices unleashed on this nation and to wreak vengeance for supporting the PPP. It could be recalled that when the $30 billion bond was secured, it was meant to upgrade the remaining estates and to invest in plantain white sugar and co-generation plants. However, after spending more than $17 billion, none of these materialised. In fact, the estates continue to suffer from factory breakdowns, inputs for field operations, and impassable dams resulting in GuySuCo being nearly 35% behind their schedule. This is a fall short by 12,023 tonnes. In the first crop also, GuySuCo had also failed to achieve its first crop target. This is a direct result of the SPU starving the entity of much needed funds to carry out its capital works and maintenance. The old adage still holds true: Too many cooks spoil the broth! The foisting of the SPU on the hapless GuySuCo seems to have one purpose and that is to bring the remaining three estates to such a deplorable and unproductive state that closure becomes the only option. I fully empathise with the management of GuySuCo!
In the meantime, the $30 billion ‘largesse’ is meant to ensure that the fat cats are well-fed and the monies are squandered, filling the pockets of those in the SPU and by extension some in the Government. It must be painfully recalled that even though GuySuCo was given an average annual subsidy of $5 billion, all the estates were operational, foreign exchange in excess of US $100 million was garnered from exports, jobs were saved and workers were enjoying a reasonable standard of living, communities were thriving, and the US dollar was stabilised. In addition, there was little flooding, residents were getting assistance from GuySuCo but today, the resources-starved entity could hardly help itself. Now the NIS contribution has dwindled, thereby, resulting in the entity being unable to meet its financial obligations.The CoI saw these benefits to the economy and advised against any closure!
However, the economy and the people of Guyana can be deemed collateral damage! These should have been the foremost criteria for any Government worth its salt!