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I would like to express my support for the views of former President Mr. Donald Ramoutar and Mr. Vishnu Panday that the government should rethink its approach to finding a solution to GuySuCo and by extension the sugar industry. I had decided to take the no comment stance on this debate, however, a few of my ex-colleagues requested that I express some views, also as citizens I think that we all have a vested interest in GuySuCo’s success.
Editor, I have travelled the world extensively over the past 17 years and worked with and associated with various international organisations and with all my experience in various organizations, the Guyana Sugar Corporation Inc. is one of the three most competent I have encountered. The other two are international organisations and the military.
Before going to work at GuySuCo, the predominant picture that was painted of the Corporation was negative but having gone to work at GuySuCo for almost five years, I can tell you that it is one of the most competent and fascinating places I have not only worked, but experienced. Both the management and the workers, as a part of the productive sector, are extremely competent in numerous ways, however, the Corporation is not without its challenges.
Let us examine some of those challenges and some possible solutions. The first challenge is that the PPP/C government needs to take responsibility for the mismanagement of the sugar industry over the 23 years, prior to 2015. They need to stop blaming the APNU+AFC government and be accountable for their mistakes. I like to keep it honest.
Secondly, the APNU+AFC needs to take responsibility for not seriously endeavouring to understand the sugar industry, and for not making timely decisions, resources available and generally for not approaching the restructuring of the industry in a more professional and respectful manner.
The PPP/C needs to take responsibility for the unsuccessful investment venture, the Skeldon Factory. The Skeldon Sugar Modernisation Project (SSMP) was an excellent idea, if it was managed and implemented well, it could have been the model factory for the Caribbean. However, the Skeldon factory is still the most technologically advanced mill in the Caribbean and with the right investment, it can be a profitable business venture.
The APNU+AFC, having done the Commission of Inquiry (COI) and commenced some degree of restructuring of the industry, which was necessary, failed to recruit professional expertise to manage the divestment and diversification programme. Another area in which the APNU+AFC failed was in budgeting for the strategic implementation of the programme to address the social and economic impact for those persons who were laid off.
For us to resolve our problems and find long-term solutions to development and growth challenges, our governments have to be honest and accountable. I find it to be disrespectful to the sugar workers and taxpayers, for the PPP/C to continue to blame the PNC or APNU+AFC for its bad decisions and for the APNU+AFC to continue to blame the PPP/C for everything that has gone wrong in the sugar industry.
Now for the solutions. Before we start talking about solutions, it is necessary to understand what the sugar industry means to the PPP/C and the PNC. Both the PPP/C and the APNU+ACF are not business entities, they are political parties, therefore while they would like GuySuCo to become a successful business, their priority is for it to serve their political interest.
There is a fundamental principle in economics which states that ‘a system is as strong as its most important part’, therefore for the PPP/C system, as a political organisation, its most important part is the sugar industry. For the APNU+AFC system, the sugar industry is one of its most important parts because it is the important part for its main political competitor.
So, I guess ever since nationalization of the sugar industry in 1976, politics, not business, has been the primary reason for its existence. One of the main reasons why the industry survived under this model, was largely due to the preferential prices which was offered to the African, Caribbean, and Pacific (ACP) states under the European Union Sugar Protocol.
However, that sugar protocol has ended, and that paradigm shift that Mr. Ramoutar is talking about, has to be to develop the GuySuCo into a competitive business entity, this is highly possible. The shift should also be towards a technologically sustainable sugar industry with more mechanization. The political interest for both the PPP/C and the APNU+AFC must be performance-based.
The previous management had developed a business plan and had commenced the development of a new approach to doing business with a ‘Sustainable Business Model’ with a focus on the Corporation being accountable for the economic (financial), social and environmental aspects which is a more modern approach to doing business. It should be noted that GuySuCo was already performing in all three of these areas, the difference is, to capture them under the ‘Sustainable Business Model’ approach in a measurable way.
From the economic perspective, GuySuCo could be successful with about four or five factories – Possibly Blairmont, Albion/Port Mourant/Rose Hall, Skeldon, Enmore and Uitvlugt Estates. Cane farming can be expanded, however, if cane farming will be expanded, farmers need more certainty, reliability, predictability which must Transend beyond politics in order for them to develop the confidence to make significant investment.
From a market perspective, even though the world market price for sugar is relatively low, there is a more than 200,000 tonnes White sugar market in the Caribbean region that could be tapped into. The previous management of GuySuCo did extensive lobbying and made much progress with the Ministry of Foreign Affairs, Department of Foreign Trade, CARICOM Secretariat, Trade Section and the Council for Trade and Economic Development (COTED) to have the 40% Common External Tariff (CET) applied to all sugars coming into the region, this includes White sugar, and will create market space for regional sugar producers to produce White sugar.
Lobbying was also done with the local breweries and the Guyana Manufacturing and Services Association (GMSA) to supply White sugar on the local market by 2022. However, what was required according to the previous Strategic Plan/Business Plan was for the investment to be made into the Albion Estate factory, to produce White sugar. The Skeldon factory could also produce white sugar, maybe this aspect is in the government’s plan.
One of the reasons why Corporations such as GuySuCo should be depoliticized is because when there is a change in government, there are certain long-term commitments which should be adhered to. The new government will always have scope to expand the vision but as a country we have to shift towards a more sustainable approach to growth and development.
Finally, the government has to decide if it will let GuySuCo run as a business, that is performance-based, or as a political entity. If it will be run as a business, then what is needed are people with the requisite experience and expertise,’ along with private sector involvement. I do not support Mr. Ramoutar’s proposal for Dr. Rajendra Singh to return as the Chief Executive. It is that unfortunate everything in our country is so politicized, as such many of the qualified people who can assist in finding a solution for GuySuCo, may be viewed from a political standpoint, whether that is accurate or not.