Sugar Betrayal

Mar 25, 2011 Editorial

The LBI sugar factory has been closed and the workers are up in arms. They are out on strike, even though management has assured them that they have alternative employment at the Enmore factory. Basically the issue is one of trust, or more precisely a lack of trust in the promises of the managers and ultimately the government, the owner of the industry.
The workers feel betrayed at several levels. A decade ago, when there was a vigorous (and healthy) debate about the direction and future of the industry, the government, in the person of the President himself, assured the workers that there would be no closures. This message was delivered personally to workers at meetings convened on the estates, specifically for this purpose. In light of uncertainty in the preferential markets in the EU being maintained, some analysts felt that the high costs at the Demerara estates might have to be truncated severely.
The EU’s subsequent unilateral abandonment of their signed agreement with the ACP sugar producers (including Guyana) and their 36% price reduction placed the government in a pickle. They knew that the original criticism had been spot-on and that costs in the sugar industry, especially in Demerara, had to be reduced. In fact that was the stated aim of all the plans for the industry that were being unrolled. The promise, therefore, not to close any factories in Demerara, was not based on economic grounds: it was solely a political calculation.
Every Guyanese knows that the workers in the sugar industry form the most solid core of the governing party’s support base. The government did not want to ruffle any feathers in that base. But the hard economic facts would not go away: in fact they became aggravated in the face of some unforeseen factors. The Skeldon expansion became bogged down in a confluence of factory malfunctions and field non-expansion that conspired to actually raise overall production costs rather than bring them down. Inclement weather and poor management responses also served to keep costs in the stratosphere. The inordinate production costs in Demerara could not be hidden.
But rather than level with the workers, the political directorate kept up asserting that closures were not on the cards. The workers are also upset with GAWU, their union, because they feel that the latter was also stringing them along.
They believe that it was only when personal issues between the leadership of the union and the President arose, that the union began to show some ‘spunk” on behalf of workers’ issues. And even within that spat that broke out into the open, the union did not lay the cards on the table about the LBI closure.
What has particularly aggravated the workers is their knowledge that there is no way that they can all be employed in the Enmore factory. There has been no significant installation of new equipment at the facility and the new packaging plant is highly capital-intensive.
But the workers have a suspicion of an even greater betrayal in the making.
They do not understand how they could be assured that the Enmore factory could process all the canes from LBI – especially since the latter had already taken in cane from Diamond on the East Bank, when that factory was closed. Enmore just does not have the capacity to process over 50,000 tons of sugar annually.
The issue of costs also re-enter the picture. Cane from Diamond now has to travel over a greater distance on mud dams that are not in the best of shape to begin with. The longer wait will allow canes to dry out and raise dissatisfaction from harvesters, since their tonnage will decrease exponentially. The workers believe that acreage will be definitely taken out of cultivation to fit the capacity of Enmore. Yet they are not being told the truth.
And that truth lies in the political realm. The decision to close the LBI factory must have been hard enough. It was precipitated by the bankrupt state of GuySuCo: the betrayal in field operations will be held off until after the elections.

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Sugar Betrayal

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