TURNAROUND OR TURN BACK?

Dec 06, 2009 Features / Columnists, Peeping Tom

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The company with the greatest assets in this country is the Guyana Sugar Corporation. It is also the largest employer and without question the one that is the country’s principal foreign exchange earner.
It is even said to be seeking billions of dollars for the sale of some of its non- performing assets. Last year we were told it earned over 200 million by disposing of some of these assets.
So tell me, does this look like a company that is unable to pay its workers because some boat arrived late to uplift sugar?
Understandably, the sugar corporation has had its problems caused by the decline in sugar prices. But those problems did not drop suddenly from the sky like the global financial crisis did a few moons ago. Those problems were known to be coming and in fact the politicians in this country like to boast about being prepared for the reduction in the prices paid.
Last year, the corporation lost a lot of money. It ended its long-standing and high costing management contract with Booker Tate, a move that would have saved it hundreds of millions. The government installed an Interim Board and asked that Board to come up with a turnaround plan. When this plan emerged, it was said that it would allow the corporation to save billions of dollars this year, meaning that the corporation was expected to earn a profit this year. Is this the same corporation which cannot pay its workers on time because a sugar boat was late?
How many sugar boats have not been late in the history of this country? Not even in the hard guava season of the PNC did the sugar corporation find itself in a situation where it is so illiquid that it had to delay the payment of wages. Why is it that a corporation with the asset base of the Guyana Sugar Corporation could not raise this money immediately from its bankers to pay its workers what we are told is under 300 million dollars?
Is the sugar corporation bankrupt? Is there something terminally wrong with the finances of this corporation? Surely, this cannot be. Surely a corporation the size of GuySuCo cannot find itself in such dire straits.
There is something not right about this whole scenario. It comes at a most unusual time. It comes firstly just as the Arbitration Tribunal is about to hand down a ruling which will determine whether sugar workers may be able to enjoy a traditional Christmas Day chicken meal. It comes as the crop is coming to an end and the year is also about to come to a less than impressive end. In short, it comes at the wrong time.
This unprecedented development raises the specter that GuySuCo may be on the verge of a financial meltdown because it is hard to comprehend how a corporation of this magnitude should find itself in the position whereby because one boat is late, the workers cannot be paid. Something is not right here and there needs to be a detailed demand for the state of affairs of the corporation to be made public through the appointment and report of a special investigative commission of inquiry.
This is certainly something that the Public Accounts Committee of the National Assembly should consider as a matter of urgent importance. We do not wish to wake up one morning and discover that a company, on which so many thousands of Guyanese depend directly for their livelihood, is bankrupt.
There are other worrying signs within this larger process of the management of the economy. The government is once again moving to the National Assembly for a massive supplemental provision of in excess of US$20M.
Now these provisions are not unusual. They happened before. But what they do suggest is that there are serious problems with Budget forecasting and management. We have not had any major national emergencies this year which could have resulted in us having to move to the Assembly for such a supplementary provision.
The problems earlier this year in the rice sector certainly deserved attention but not in terms of the $400M which simply places more funds in the hands of the agriculture ministry. Next we are going to learn that the El Niño phenomenon also requires a few hundred millions for interventions. But even these developments do not explain how it is that yet again the government with all the millions that has been pumped into institutional building of the Office of the Budget could have so underestimated its expenditure needs when it presented the 2009 Budget Estimates.
And this is the same government, mind you, that has told us that there is a turnaround plan for the sugar industry. Well, let us hope that the sugar boat does not turn back because if it is late and workers cannot be paid, imagine what is going to happen should the captain decide to change course.

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