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Strikes put sugar’s turnaround plan under stress – Dr. Luncheon

Feb 23, 2012 News

 

The government has expressed concern that strikes in the sugar industry threaten the financial viability of the sugar corporation and have put the Corporation’s turnabout plan under stress.
“Canes are there to be harvested, labour discipline must prevail,” Head of the Presidential Secretariat, Dr Roger Luncheon declared yesterday.
He said the government plans to heighten its engagement with stakeholders in the sugar industry in hopes of getting production going.
Harvesting was stalled after workers downed tools to demand their Annual Production Incentive (API), which the Guyana Sugar Corporation (GuySuCo) now says it will pay on March 16.
Luncheon said that the strike action was ill-advised, and it threatened to set back the production target for this year.
“Essentially, Cabinet was informed that canes were ready for harvesting at the estates, but labour stoppages were a constant threat to targets and ultimately financial viability,” he stated.
GuySuco on Tuesday said that it has a debt of $8 billion and was therefore constrained in paying the incentive.
The government is now blaming the opposition parliamentary parties for supporting the striking workers.
“The antics of the Parliamentary opposition parties were deemed counterproductive, visiting work sites, addressing striking workers, thus encouraging them in unjustifiable and ill-conceived pursuits,” Luncheon charged.
He emphasized that the industry’s turnaround plan was under stress, given the strikes, and the GuySuCo board was demanding improved performances in the industry, particularly at estate management, especially in what he said was “the current context of workers flouting conventions.”
He said that the vexing issue that caused the strike is not “of such substance to reduce the financial viability of this industry to the level this industrial action is leading to.”
In a letter to the GAWU, the union which represents most sugar workers, Minister of Labour, Dr Nanda Gopaul, registered GuySuCo’s concerns over the frequent strikes which are resulting in serious financial impacts on the industry and emphasised that if this continues, the Corporation’s ability to make payments on time will be in jeopardy.
The Minister said that the industry has certain marketing commitments, and unwarranted work stoppages can impede its recovery process. Additionally, given the current weather patterns, it is important to maximise the opportunity days for harvesting and grinding of sugar cane to the fullest, Dr Gopaul stated.
GuySuCo has spelt out its current financial status and appealed to workers to appreciate the industry’s difficulties.
The Corporation said the delay in payment of the API is due to two main reasons, namely, the late start of the first crop and its inability to obtain working capital from a foreign bank which has not only affected the payment of the API, but has also resulted in the Corporation lagging way behind in its payments to creditors.
GuySuCo said its short term debt currently totals $8 billion.
“This is a significant amount owing and the Corporation is finding it very difficult to source additional short term financing to meet its working capital requirements,” GuySuCo stated.
As such, an improvement in the Corporation’s financial position is very much dependent on producing sugar and then receiving cash from the sale of that sugar, the Corporation pleaded, saying this has not been possible so far due to sugar production being way below the estimate for the crop to date.

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