500 re-hired to re-open Rose Hall Estate

Feb 09, 2022 News

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…as GuySuCo gets another $4B

Kaieteur News – The Guyana Sugar Corporation (GuySuCo) is “too big to fail” and government will continue to plug tax dollars into the cash-strapped institution.
This is according to Minister of Agriculture, Zulfikar Mustapha who justified the $B allocation to the corporation this year.
The subsidy to GuySuCo has over the years been a bone of contention for different administrations which has had to plug several billion dollars into the Industry—$30B from 2020 to last year and another $4B for this year. With reference to the People’s Progressive Party Civic (PPP/C) elections promise to re-open closed sugar estates, Minister Mustapha informed the House that at the shuttered Rose Hall Estate, the administration has already rehired 500 persons that had been sacked at the previous administration.

With this in mind, he informed the House that the factory is some 41 percent rehabilitated but was unable to say when the Estate would be reopened since there is still a significant amount of work to be had.
He identified as example the re-cultivation, the rehabilitation of the mill dock, purchase of equipment and other ancillary activities required and adumbrated this is “work in progress that we are doing” and was adamant his administration PPP will reopen Rose Hall and will produce sugar.”
The information was disclosed when the 65 Members of Parliament (MP) met yesterday for a second day of the consideration of the Estimates for the Ministry of Agriculture.
PROFITABILITY
Grilling the Minister on the monies identified for the ailing sugar industry, Shadow Minister with responsibility for that sector, Alliance For Change (AFC) MP, Khemraj Ramjattan, requested a performance report in light of the money that has been plugged into the industry in recent years.
Additionally, the Minister had told the Economic Services Committee of the Parliament that based on the industry’s strategic plan, it would by 2026 return to a stage of profitability and he was optimistic of a return to a state of profitability.
Asked to provide an update to the House in the $30B bond that had been secured under the coalition administration through the National Industrial and Commercial Investments Limited (NICIL), the Agriculture Minister reported that in 2020 when the PPP/C took office, there was only $3.8B of the $30B remaining.
To this end, additional money had to be injected into the industry—an industry, the House learnt is headed by a ‘turn around Chief Executive Officer’ who is paid some $1.4M monthly in addition to other benefits.
Coalition MP, Tabitha Sarabo-Haley had insisted that this was inaccurate, since at the time, the A Partnership for National Unity, AFC (APNU+AFC) left office, there was still $15B remaining.
He was adamant however that as Minister, he was only aware of $3.8B from the bond available for spending when the PPP/C took Office in August 2020.
SWEETEST DEBT
Public Accounts Committee Chairman, Jermaine Figueira, in his line of questioning for the Minister while acknowledging the importance of GuySuCo with regard its contribution to the nation, insisted that the industry remains the “sweetest debt” that the country has consistently incurred with billions being poured into the industry annually.
To this end, the Agriculture Minister was adamant that GuySuCo was on a path to diversifying its portfolio moving towards a greater emphasis on value added products in addition to the production of ethanol and high quality molasses.
Figueira in posing his questions to the Minister had suggested that as part of the industry’s diversification, it considers moving into the production of soursops and peppers as is the case in Jamaica.

“The industry is changing; we cannot compete in the international market” the PAC Chairman intimated and suggested even if the industry were to break even in 2026, “why not reinvest in sugar workers” and hinted also at providing the workers with land so they can give it to their family, rather than an inheritance of a cutlass.
With the Minister unable to given a definitive timeline on when the industry would in fact return to profitability, Figueira suggested, “this is a frightening situation” questioning further, “how will GuySuCo become profitable, with all this billions being invested?”
According to Figueira, taxpayers’ dollars ought to be spent prudently and the sugar industry cannot be allowed to plunder the Treasury.
He further questioned how many more billions will be needed to return the industry to profitably at which point in time, the Minister intimated that as much as is required, will be injected.
To this end, the Minister in response observed firstly that GuySuCo has to be seen beyond sugar and that MPs also have to take into account other social services that had been provided.
He cited as example, the fact that the National Draining and Irrigation Authority is now resorting to spending in excess of $1B to provide services previously provided by GuySuCo.
DEFECTIVE PUMPS
Insisting on the importance of sugar to Guyana and its people being the single largest employer with other indirect support, the village economies Minister Mustapha told the House, when it comes to the monies needed to fund the administration’s plan for the industry, “whatever it takes to bring back GuySuCo, the PPP/C government will make sure that we make the resources available.”
According to the Minister, GuySuCo is a very important industry that not only encompasses sugar, “it is too big to fail and we will ensure GuySuCo breakeven and eventually make a profit; we have had a set back with the floods (last year) but like I said, we have a strategic plan that will move GuySuCo forward.”
Another bone of contention related to the provision of pumps for the NDIA. During the consideration of the capital expenditure, Ramjattan sought clarity on whether the Ministry had allocated money to pay for the same pumps for which he had rallied against as being defective.
To this end, the Minister confirmed that the money has indeed been set aside for payments to be made for the very same pumps that had been purchased under the Coalition Administration but were found to be defective.
He defended the allocation of the amount in this year’s budget, since it was a roll over project. The Minister was adamant however that the matter is currently engaging the office of the Attorney General’s Office with a view to either recouping the monies already spent or be compensated with functioning pumps.
ASK ASHNI
He confirmed that pumps in question were supplied using an Indian Line of Credit and purchased from the company Apollo, “yes Apollo supplied these pumps; these are the defective pumps that are presently giving serious problems around the country.”
According to Minister Mustapha, the ousted APNU+AFC administration had already paid over 73 percent of the total contract price and that there is a US$730,000 allocation in this year budget for that very roll over project.
Shadow Minister with responsibility for the sector Ramjattan, in scrutinizing the Estimates for capital projects sought to ascertain the source of funding for works identified to be funded by Central Government and asked if any of the projects were being funded using money from the Natural Resources Fund—oil earnings.
This, given the tradition of outlining the source of funding in the budget document over the years and cited as example the Indian line of credit that was definitely illustrated.
According to Minister Mustapha however, it is “unfair to ask me that question.” The Minister continued that the funds were allocated by Ministry of Finance and as such, Dr. Ashni Singh “will be able to ask that question.”
At the end of the considerations, the more than $14.4B in Capital Works in addition to another almost $14B for recurrent expenditure identified for spending this year by the Ministry of Agriculture for the year.

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