Government demands that Panama pays $1.9B owed to rice millers

Dec 01, 2020 News

– Panama indicates unable to pay until the end of pandemic

Minister of Agriculture, Zulfikar Mustapha.

Kaieteur News – Last Friday, the Ministry of Foreign Affairs wrote to the Panamanian authorities, demanding that they pay the $1.9B owed to Guyanese rice millers for rice exports.
This publication learnt that that Spanish-speaking country acknowledged their outstanding dues to Guyana.
However, Panama wants to wait until the COVID-19 pandemic ends to make the payments.
The Minister of Agriculture, Zulfikar Mustapha, stated that the government is taking continual steps to ensure the money is received and as a result of this, he will soon be contacting Panama’s Minister of Agriculture, where they will make a decision regarding what date the money will be paid. As he pledged his commitment to Guyana’s rice industry, Minister Mustapha said that this matter could have been resolved a long time ago, but the previous administration had not shown much interest in doing so.
Since taking office in August, he has been persistent in getting the matter resolved.
This publication reported a few months ago, that the Panamanian Government had committed to clearing their debt and said Guyana would be repaid with interest.
They had also indicated that they would like to revive their rice deal with Guyana.
Kaieteur News understands that Panama’s debt comes from contracts signed in 2018 and 2019 for rice shipments from Guyana to Panama. The rice was shipped by the Guyana Rice Development Board (GRDB) but only a partial payment of US$550,000 was made for the 2018 contracts and absolutely no payments were made for the 2019 contract.
The partial payment was used to pay rice millers in 2018 and the GRDB had to use their own money to pay rice millers afterwards resulting in them having a liability of $4.7 million.
They had lamented that Panama’s delay was a hanging threat to their revenue.
It was also previously highlighted by this newspaper that the Panamanian government’s market offers a higher price than other markets; however, payments are sometimes delayed due to government processes.
The GRDB had contended that their commitment to reviving their rice deal with Guyana is good for the industry, which includes farmers, millers, and other stakeholders.
Along with that, Minister Mustapha said that his administration would be examining the Caribbean markets for rice export opportunities, mainly with countries that have indicated their willingness to explore these options too.
Large-scale farmers had acknowledged that Mexico is interested in purchasing rice and it was stated that that too would be explored.