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The problems at Skeldon are costly

Jan 10, 2009 Features / Columnists, Peeping Tom

I have often refused to reply to my critics because I feel we need to encourage as much as possible, persons who hold a different opinion. I am however at this time forced to respond to some of the criticisms I made in response to the high costs incurred in testing the new sugar factory at Skeldon.
One of the criticisms of my column has been that the people of Berbice are happy about the factory. I have no doubt that there are many persons who are happy within the Ancient Country about the building of this facility. There are an equal number if not more that are happy about the construction of the Berbice River Bridge. But are all of them happy about the tolls that are being charged.
It is one thing to be happy about the bridge and another thing to be happy over the tolls charged.
Similarly, it is one thing to be happy about the new factory and another thing to be happy about the high costs said to be US$3M for testing.
Another related criticism is that this is a turn-key project and thus the government only assumes responsibility when the factory is handed over and it will only be received when the government is satisfied that it is working properly.
Whether the factory is a turn-key project, there remains the huge expenditure which has to be spent for the testing of the factory.  All and sundry must be concerned about these losses which I hope are recoverable from the contractors. This is an aspect that needs public clarification.
We know for sure that the contractor is liable for payments for late completion of the project. But what about the huge amounts that are said to have been expended in testing the new factory? Are these recoverable from the operators of the factory? Or are they to be borne by the taxpayers of Guyana?
I was disappointed that none of our newspapers tried to ascertain just whose responsibility it is to finance the test runs. If it is GuySuCo, then we do have serious problems in Guyana because neither the corporation nor the national treasury can afford the US$3M which has been expended so far.
I do hope that if any compensation is received from the contractors that this sum will be plowed back into the industry and not be given to the Treasury.
Money also had to be spent to have the old factory put in shape after it became obvious that the new factory would not come on stream in time for the last crop. Millions no doubt would have been spent to have the old factory in a state of readiness, a cost which would have to be borne by the industry which for this year is likely to show a massive loss.
GuySuCo has had a disastrous year in 2008. We are now told that there is going to be a new Board in place along with a new management. It would be interesting to see just who is chosen to spearhead the recovery effort.
I do hope that persons knowledgeable about the industry will be selected so as to ensure that the situation does not deteriorate further.
The government must be congratulated for at least moving forward with a shake-up of both the management and the Board of the corporation.
At least in this instance some action has been taken, and for this we must give the President the credit that he deserves.
It was shocking to learn that the sugar factory was built but that the private cane farmers were not in place to supply the quantity of sugar which has been projected to have come from that source. I cannot understand how something like this occurred.
It was not as if this factory suddenly appeared overnight. In fact the project was delayed for many years until the approval was given by the international financial institutions. Therefore, there was no shortage of time in which to ensure that there were sufficient private farm lands in place to deal with the anticipated demand.
The labour shortage in the industry is not going to get better and therefore the sugar industry has to look increasingly towards private farmers. It may have been far too ambitious to expect 35 per cent of the cane for the Skeldon factory to be supplied by private cane farmers, but even this mistake does not explain the significant shortfall in cane from private sources.

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