GuySuCo land sales proceeds to help cash-strapped entity - Finance Ministry

GuySuCo land sales proceeds to help cash-strapped entity – Finance Ministry

Jun 11, 2020 News

Cash-strapped Guyana Sugar Corporation (GuySuCo) which says it is running out of money and may have to close its three remaining estates unless it receives a cash injection quickly, is likely to get some help.
Yesterday, the Ministry of Finance said it has noted GuySuCo’s request to the Government for a bailout.
The Ministry said it wishes to assure that it is actively seeking to assist GuySuCo to access funds that are available to it, to mitigate its present challenges.
“Notwithstanding, however, the prevailing national circumstances, coupled with the challenges of COVID-19 and a reduced national income, render the Treasury incapable of providing a bailout to GuySuCo.”
The Ministry said that it wants to remind that a $30B bond backed by NICIL’s assets and guaranteed by the Government of Guyana was secured through NICIL to retrofit and revitalise the three remaining sugar estates-Albion, Blairmont and Uitvlugt.
The Ministry said that during the period, July 2018 to February 2020, $9,720,759,568 was disbursed to GuySuCo to fund its Capital and Operational Expenditure – much of which was outside the terms of the bond.
“Additionally, NICIL through the SPU, sold lands that were vested to it, and garnered deposits of $2.1 billion. The full sum was used to offset bond payments that became due in May 2020. The balance of $1.5 billion for the lands will be paid over to NICIL when the vesting orders are signed and gazetted.”
The Finance Ministry said it is expected that part of this sum will go towards a bond repayment, which is due on July 4, 2020, and the remainder to GuySuCo.
“GuySuCo also generates its own income. Another disbursement is expected in the coming days; so we urge that NICIL, GuySuCo and the syndicated lenders work assiduously to resolve any bottlenecks.”
The Ministry said that the Government remains committed to making GuySuCo a viable partner.
GuySuCo on Tuesday said that it has no money to pay creditors and conduct maintenance in the second crop with over $2.1B owed to creditors.
GuySuCo has fallen from grace; it was once the biggest foreign currency earner to now being behind gold and rice.
More than 7,000 workers lost their jobs in the sugar industry in the last four years as the Coalition closed four factories, which they say were dragging the industry down.
Aging factories, poor agriculture and poor world prices alongside the loss of preferential markets have decimated an industry, which once sweetened the treasury, even propping up the other under-performing sectors.

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