GuySuCo’s money runs out - Chairman says accountants resign; credit being refused

GuySuCo’s money runs out – Chairman says accountants resign; credit being refused

Jun 10, 2020 News

The smaller-sized state-owned Guyana Sugar Corporation (GuySuCo) says it has no money and wants the Government to help.

GuySuCo said it is facing closure after running out of money.

According to the largest union for sugar workers, the Guyana Agricultural and General Workers Union (GAWU) yesterday, it has learnt that GuySuCo is facing the prospect of closure having exhausted its finances and was desperately requiring the support of the Government.
In a letter of May 15, 2020 from GuySuCo’s Chairman, John Dow, appealed to President David Granger for his intervention “…to use your good offices to arrange for funding to prevent the impending closure of the Industry”.
In the letter, Dow told President Granger that “…GuySuCo needs funds now to be able to survive after the second week June 2020.”
The GAWU said that it learnt through its representative on the GuySuCo Board, that the President did not respond to the corporation’s request.
“For the thousands of Guyanese who directly and indirectly still depend on the sugar industry for their livelihoods, this is most disturbing news at this time.”
Since coming to office in 2015, the Coalition Government closed four estates across the country, leaving three, placing about 7,000 workers on the breadline.
The coalition said the corporation was bleeding billions from the treasury, placing a strain on the economy.
According to the letter from GuySuCo asking the President for help, the last two crops fell below expectations, with the COVID-19 pandemic exacerbating the financial situation.
The corporation said it can only afford labour, fuel and cane farmers payment until mid-June. It has no money for spares and materials for the mid-year out-of-crop maintenance.
The situation, unless checked, will severely impact the second crop, GuySuCo said.
Dow said it has a backlog of $2.1B owed to creditors with likely scenario of further credit being halted.
GuySuCo has so far expended $9.6B in a bond.
Dow said that the Government-established Special Purpose Unit has been selling GuySuCo’s assets- scrap iron, tractors, punts, etc. GuySuCo said it has not been told how much was paid.
“A provision for a subvention is desperately needed from the 2020 budget. This budget is obviously months away, whereas GuySuCo needs funds now to be able to survive after the 2nd week June 2020.”
The financial situation is so dire that the two accountants on the board, Ramesh Persaud and Paul Cheong, have both resigned.
The three-estate GuySuCo- Uitvlugt, Blairmont and Albion- have over 10,000 workers.
Sugar has been the biggest foreign currency earner for decades before sliding and overtaken by gold and rice.