Sugar is dead. The funeral is to be announced later

Dec 21, 2017 Features / Columnists, Peeping Tom

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The decline in sugar production is a direct response to the signals that the workers in the industry were receiving from the government.

Following the decision to close Wales, it became evident to the workers that their days with the corporation were numbered. They therefore did what any threatened species does. They took flight.

The exodus is going to continue now that it is clear that only three estates are going to be allowed to continue production. Those employed in those three estates are also going to take flight, perhaps at a slower rate. Sugar will die a fast death.

The government sent the wrong signals. It decided to keep three estates, one in each region, no doubt in the hope of reducing the overall impact of estate closure. By keeping one estate in each region, the government feels that it can at least hope to have some form of employment in those areas.

It is a misguided strategy. The better plan would have been to close the Demerara estates and leave open the Berbice estates, since this is where the best lands are, and where alternative employment is more difficult to find. The government, however, was more interested in form rather than substance. And so it has decided to close two estates which had the best potential to recover, Rose Hall and Skeldon.

The present plan of the government is not going to save the sugar industry. The workers saw the smoke signals from the first day the APNU+AFC Coalition took office. They had been told before that APNU was going to privatise sugar. They saw the COI and they knew that privatisation meant closure. And so from day one, the workers began to withdraw their labour and look for other work. This accounts for the dismal performance of the industry since 2015, not its terminal illness.

Nothing that the government does is going to save the sugar industry. It is best now that the government makes a ‘bad’ job of an ill-considered plan. It is best that they opt to close the entire sugar industry, because it makes absolutely no economic or financial sense to keep the industry going to produce 150,000 tonnes.

The better option would have been to restrict production to Berbice alone and privatise to private cane farmers the West Demerara Estate, while doing away totally with the East Demerara operations. The Skeldon factory is a problem, but Skeldon can be fixed.

The sugar corporation could have been diversified further. The corporation was already producing electricity before that aspect ran into problems under the APNU+AFC Government, even though it has attempted to place the blame for the collapse of co-generation at the feet of the PPPC.

The sugar company was producing packaged sugar. That plant now is likely to be closed, even though the government could have encouraged its operations by limiting the sale of bulk sugar locally. Albion had plans for ethanol. Albion now will concentrate on planting sugar, while estates such as Rose Hall, upon which so many communities depend for their livelihoods, are going to be closed.

The sugar workers should not have been punished this way. They were not responsible for the closure of the industry. It was the sugar corporation which has a serious cash flow problem and which ran into problems. It was the sugar company which could not grind the canes at Skeldon at a suitable TC/TS ratio. This was not the fault of Skeldon workers or the workers at Rose Hall.

The Guyana Sugar Corporation should stop trying to ask workers to transfer to the estates where production is taking place. This was tried before when the previous government closed Diamond, and in the past when other estates were closed. It makes no practical sense for workers to transfer from one estate to the other. Historically, it made good sense to live near to the estates. Work near to where you live is what sugar workers have always done.

It will be hard for the government to convince sugar workers that they are not being penalised for their traditional support for the PPPC. They will feel that the industry could have been saved but that the government has a political axe to grind.

Those who abandoned the PPPC will run back to the party. There are persons who feel that Jagdeo is making wild promises to pay sugar workers until an alternative is found, if his party wins in 2020. If it is one thing that Jagdeo knows about, it is finding money to pay workers. He did it with the Barama workers who were sent off following a problem which developed with a boiler.

Jagdeo is a ‘fix man’. Fixing GuySuCo was a problem for him. But finding money to continue to pay workers who were sent off is going to be a walk in the park for him.

APNU+AFC should have continued to support sugar. The social cost of not doing so is higher than the value of the present subventions. The sugar corporation only needed temporary assistance. They planned to break even by 2020. That is not going to happen now, since workers will not go back to work that 150,000 tonnes which is the projected production cap.

Sugar is dead. The funeral is to be announced later.

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