Rice millers finally paid $1.5B owed from APNU/AFC’s flawed Panama rice deal 

The Government has been able to recover some $1.5 billion from the Government of Panama following a flawed deal that was struck under the previous A Partnership for National Unity/Alliance For Change (APNU+AFC) Administration in 2018 that not only plunged local rice millers into debt, but also forced some of them out of business.
The Panama rice market was initially secured back in 2014 under the previous PPP/C administration, and the arrangements between the two countries were going “smoothly” until the 2018 issue.

On April 13, 2018, a contract was signed between Panama and APNU/AFC government for the supply of rice on credit through the Guyana Rice Development Board (GRDB). In fact, that year, two consignments of rice, each weighing approximately 20,000 tonnes, were shipped to Panama on credit.
Reports indicate that after the rice was shipped, a partial payment was made, but the balance had remained outstanding with no move by the then Coalition Government to recover the millions owed.
When the People’s Progressive Party/Civic (PPP/C) government took office in 2020, attempts were made to recover the money, and after failing to resolve this matter at a bilateral level, Guyana filed legal proceedings at the International Chamber of Arbitration in France.
According to the Agriculture Minister, President Dr Irfaan Ali had subsequently engaged the Panamanian President, who agreed to pay the principal on the money owed if Guyana withdraws the arbitration.

“We give them an undertaking that as long as the principal is paid and the millers are paid, then we will ensure that we withdraw that arbitration. I believe an agreement was signed after that, and we have now the money was paid into the account of the GRDB,” the Minister noted.
As a result of these efforts, 19 millers on Wednesday received approximately $1.5 billion in total from the monies they were owed since 2018. Among those owed were six small millers who were forced to shut down operations.
Preamwatie Baliram, a rice farmer of De Hoop, Mahaica, East Coast Demerara was one such person who had to lay off 18 workers and close her mill – D. Suklall Rice Industry. Now she is looking to restart those operations.
“Well, it gonna be a little difficult [to open], because the cost goes up for everything. And seeing that the mill was down for so long, it will be more costly to reopen. But we want to get back [into operation],” she explained.
According to Baliram, they have been planting rice for over the years, and because their mill was out of operation, they were forced to sell their paddy to another miller. She noted that the money they received for the 10 containers of rice they supplied to Panama in 2018 will go a long way to help restart their mill.
“It’s going to help us a lot, because we don’t owe anybody. We’ll [use it] to start service back the mill and get it to start up back,” she added.
Another person who was put out of business because of the 2018 deal was Dereck Ramroop, who recalled the failure of the previous administration to assist them after they lost the Panama market. He noted that they were stuck with the rice and forced to resell paddy for less than what they bought it for.
“We ended up in millions of dollars in losses, and from since then I close my operations… We had to close, send home workers, and then we had to try to survive by doing other things, too, to make a living,” he related.
With the current administration investing heavily in the rice industry, Ramroop indicated that he too is mulling reopening his mill operations at Mahaicony.
“I can think about it in the near future…It’s not something you can start immediately, it takes some time, it takes money to get this thing started,” he noted.
Meanwhile, now that the millers have received their outstanding money, arrangements have been put in place for them to settle their debts, especially with rice farmers.
“Some of y’all have some accounts to settle with GRDB. I hope y’all settle those accounts, too…And if anybody owe small farmers, I told GRDB to deduct the money after consulting with the farmers and the miller, and we will pay the farmers,” the Minister stated.
According to Mustapha, apart from signing that flawed 2018 deal, the APNU/AFC Government had lost the lucrative Venezuelan market – all of which led to the near-collapse of the rice industry.
“You didn’t have market; proper infrastructure in the system; you had land rental and D&I charges increase from $3500 to $15,000; you had VAT on the agricultural machinery; VAT on pesticides & chemicals, and on agricultural input, causing the cost of production to go up. Now we’ve taken out all of those things, and all the monies are back into the pockets of farmers,” Minister Mustapha has said.
“Rest assured that the Government will continue to support this industry. This is a very important industry. What we’re seeing now around the world is a demand for grain, and Guyana is a major player,” the Agriculture Minister noted. (G8)