Sugar and politics have always been closely connected

Jan 29, 2016 Letters

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Dear Editor,
I thought it was very strange when the high powered Guyuco COI arrived at their conclusion that privatization was the solution to the interminable woes of the industry. However, I was relieved when the President stated that Government had no obligation to fully conform with GuySuCo s recommendations. “The COI is not gospel.” He said, ”We have practical measures to consider and in the case of Wales it is very practical to close the estate.” And in the same breath the President stated, “Maybe it is an opportunity for a wider application of the principle of peasant cane farming. So it is not as if the sugar industry is in jeopardy but I believe that peasant cane farmers can take up the land and that has been tried already in some parts of West Demerara.”
From these statements it can be deduced that:(1) It is definite that Wales Estate (factory and administrative office) will be closed; and, (2) no feasible decision has yet been made regarding (a) the “redundant” or displaced labor, (b) peasant cane farming, and (c) the land.
Both the COI recommendations and the President’s statements leave one to wonder to what extent, if any at all, that the principles of development economics (not to be confused with economic development) and agriculture economics are being employed in policy and decision making. It is also disturbing that politics (it appears) is again playing a major role in decision making.
True, politics has always been synonymous with sugar in Guyana and in most parts of the world. Below the sweet surface of sugar is the bitter taste of politics, local and international. Ironically, politics has been the downfall of sugar. The decision to invest US $200 million in Skeldon and contract it out to the Chinese was more political than economic. And now we are tasting the bitter reality. I can only hope that decision makers would avoid this pitfall and be more rational and nationalistic, and employ more economic principles in charting a new course for Guysuco, and specifically, the principles of development economics.
Development economics is about restructuring and transformation of the means, forces and relations of production as well as markets; hence it incorporates social and political factors to devise particular plans. The use of development economics (econometric models and quantitative methods for project analyses) helps not only to promote economic development, economic growth and structural change but also in improving the potential for the mass of the population, for example, through health and education and workplace conditions, whether through public or private channels.
Sir Arthur Lewis spent practically his whole life articulating models for developing countries, in particular those that are predominantly agrarian with a surplus rural labor, and enjoying a comparative advantage in agriculture production. For him, agriculture, along with agro-based industries, was seen as the engine of growth that would transform over time the economic, industrial and institutional structure of an underdeveloped economy. For this he was awarded the Nobel Prize in economics. Unfortunately, his expertise was not adequately utilized in the Caribbean. Today, the Caribbean, a place that has such great soil, and a population of about six million people, has a food import bill of $2 billion and more every year. What lesson is there for Guyana, the bread basket of the Caribbean, to learn?
But, let us coming back to Wales and the issues of displaced labor, peasant cane farming and utilization of land.
(1)   How feasible and practical would it be to send cane cutters who usually start their day at 5.00 AM, from Wales 20 -30 miles to Uitvlugt, (and as one “expert” suggested, across the river to Enmore which is even farther than Uitvlugt)?
(2)   Secondly, pursuing and expanding peasant cane farming at Wales and transporting canes to Uitvlugt is not a viable, nor is it a long term solution, for (a) It will be more costly;(b) Eventually Uitvlugt will also be closed; (c) From figures obtained at Wales, peasant cane farming at Wales is relatively more expensive than Guysuco in terms of tons cane/acre, and tons sugar/acre; (d)This option ignores the real problem. It is the cost of Guysuco producing RAW SUGAR that is the problem. The punt system, drainage and irrigation, and labor supply are directly connected to the tremendous comparative advantage Guysuco has in going the diversification route, and this further reinforces the economic model propounded by Sir Arthur Lewis. And, in similar context, I would also recommend readers to revisit my article on “Guysuco and Diversification” published by GC and KN, August 12 -15. 2015.
Gokarran Sukhdeo

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