Bitter sugar politics…It’s better we invest in ethanol and aqua farming – APNU

Mar 12, 2014 News

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By Kiana Wilburg
Evidence has shown that billions of dollars are simply not the cure for the ailing sugar industry. The sector has sunk to an all-time low in 23 years with production just under 190,000 tons. Meanwhile the country continues to suffer millions in losses.
Many have questioned if there is any hope for the industry as its issues with poor management continue to be further complicated by a disgruntled labour force, a de-motivated management structure and a board of directors who are “totally unprepared to run this major industry efficiently.”

This was the main focus of the political opposition coalition; A Partnership for National Unity (APNU) at a press conference yesterday at its Hadfield Street headquarters.
APNU is calling for the government to seriously consider including the opposition in more of the decision-making activities of the corporation and in the search for more profitable and feasible avenues, which may very well mean scrapping the now “elusive dream” of having a viable sugar industry.
This notion was expressed by APNU’s Executive Member on Agricultural issues, Anthony Vieira.
His declaration was based on comments made by Clement Rohee, General Secretary of the People’s Progressive Party/Civic (PPP/C) on Monday last during a press conference held at Freedom House. Rohee blamed the international community for the dire straits in which the industry now finds itself.
He said that the international community was responsible for the plight of sugar industry in Guyana by removing the preferential price starting from 2006.
But Vieira debunked these allegations.
He told members of the media that the government was given some €140M (Euros) starting from 2006 which was compensation for the loss from the European Union. It was for the Guyana Sugar Corporation (GuySuCo). It was supposed to be invested into the corporation since 2006 to offset the loss of that preferential price for both making the local industry more economical and/or to diversify the sugar industry to a more profitable enterprise.
However Vieira noted that the former Minister of Agriculture, Robert Persaud, did not see it fit at the time to give the industry that money. As a result, he said, money necessary to make the industry more competitive on international markets has not been given to the industry and in 2008 GuySuCo’s Albion factory capital rehabilitation was slashed from $529 million to $183 million.
“Rose Hall’s request for $414 million dollars was slashed to $193 million. Two years after the protocols, EU compensation was flowing to the country; the industry slashed the factories allocation by 50 percent from $5.4 billion to $2.7 billion, a reduction of 50 percent.”
This, he explained, was done at a time when the EU had started to let the cash flow to make the local industry more economical.
“The money was taken by the government even as the industry was deprived of it. This systematic starvation of funds to do important works on the other estates was done to keep the money out of the hands of the workers and the cane farmers, and some was used to keep the Skeldon project afloat.”

After explaining the drainage issues that plague the Skeldon estate, the former member of Parliament pointed out that apart from the shortage of labour, issues relating to the supply of cane in the factory has not been resolved neither has the poor management of Skeldon.
Vieira then referred to a sugar brief in 2008 from his website. He said that there have been a lot of unrealistic expectations of the company, especially since Guyana lost the preferential price.
He stated for the record that the preferential price was withdrawn from the African, Caribbean and Pacific Group of countries.
“But whilst everyone was contracting their industry in view of the 33 percent lower price announced by the EU, we incredibly were expanding ours, despite the fact that we are not an economic producer …”
“In Guyana we burn our canes before we harvest it and because the canes are very vegetative it is taking tons of cane to make a ton of sugar. Especially if you are keeping canes in the dock for three to four days, the quality of the juice is deteriorating and instead of sucrose, you have reducing sugars, and that is of no use in the manufacture of Sucrose Cane sugar.
“Given how Skeldon is performing, it would be far better if it was producing ethanol when one takes into account the fact that the canes are vegetative, and the length of time it takes to harvest and grind it. It is better to produce ethanol, because no matter how old it is it will always produce the ethanol, since one ton of cane is equivalent to ten gallons of ethanol.” He added as well that the industry should make moves to increase its production in alcohol.
He reminded too that the first intention of Skeldon was for the purpose of cogeneration. This concept, he explained, involves grinding tons of cane per hour, and since the Skeldon plant uses a diffuser instead of a mill which crushes the cane, the surplus of bagasse would be used to produce steam. However, “they have not produced one watt of power from that system. It has been a complete failure.”
He also explained that the government’s decision to hire a company to construct the estate with its parts being bought from different manufacturers has caused additional problems.
“It has to be re-modified and it is probably the reason why they have so many problems. In addition to this, we continue to complain that everything GuySuCo does happens in complete secrecy. I don’t think they have a published report since 2009 and they are required to table in Parliament their annual report …”
Vieira added that it would be wise to move in a most systematic way from relying on cane production and make moves towards ethanol production and aqua farming. He added that immediate partnership with Ecuador would be best to secure the success of such a project.
“We should produce sugar for the EU and take the profits and import sugar. I have done the work and we would be making two billion US a year rather than billions in losses.”
The Executive member of APNU stressed that the government needs to stop making excuses for its inability to run the sugar industry by removing political control and secrecy from all of GuySuCo’s activities to offset the poor returns on investment.

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