Support Village Voice News With a Donation of Your Choice.
Anyone in the field of economics, even if limited by half a brain, knows that the continued financing of a failed industry through subventions, would represent a venture that isn’t economically sustainable. And the rationale, has its underpinning in Charles Darwin’s theory on Survival of the fittest, also known as Natural selection.
For this theory, which transcends biology, postulates that in challenging circumstances, survival would be for those that can most compete in their environment. Such that, through this process of natural selection, the weakest amongst us are weeded out to extinction, rather than existing parasitically, even as those competitive would experience a better outlook.
Thus, guided by the aforestated argument, from an economic perspective, an industry that is unprofitable, should be allowed to face an inevitable economic death. And the rationale is, any attempt at resuscitating the failed industry, against established economic norms, will negatively impact the wider economy. That is, the dying industry failures, will metastasise like an economic cancer, to other industries, and in the process bringing the wider economy down.
In fact, recollect we can, during the 2007 financial crisis, where many industries, unable to compete in the difficult financial environment, faced an inevitably lonely economic death. For this epitomises the harsh realities of survival of the fittest, where failed industries, invariably the weakest amongst us, aren’t repeatedly rescued through financing, at the expense of the wider economy.
And it’s in this context we examine our Sugar Industry, which is in a painfully unique position, having failed for two decades and counting. Thus, as a failed industry in a survival of the fittest construct, the irrefutable argument could be made, that it should be allowed an economic death, rather than prolonging the inevitable.
Therefore, recognising this fact of economics, APNU+AFC in attempting to rationalise the dying industry, while protecting the wider economy, undertook the process of rightsizing. Where it was through this rational process, that three of the most failed Estates were closed, with a view to minimising the Sugar Industry financial losses, whilst protecting the wider economy.
However, with PPP having been installed in 2020, the rightsizing process established by APNU+AFC, was rejected and ultimately discontinued. And it was with a political underpinning, PPP through propaganda, proffered that they will successfully reopen the three closed estates, even as they senselessly promised to placed billions in financing, into the failed industry. Then having placed over $40B financing in 4yrs, it wasn’t the least surprising, that the Sugar Industry continue haemorrhaging billions of dollars.
In fact, as extracted from the installed Agriculture Minister, the Sugar Industry predictably recorded consecutive losses of $7.8B and $10.2B, in 2021 and 2022 respectively. Moreover, even as the Sugar Industry’s audit for 2023 is still to be undertaken, for the 2yrs audited, the Sugar Industry has recorded significant losses, of approximately $20B. Yet despite these continued financial losses, counting over two decades, with the outlook for this year extremely poor, the installed government continues their senseless rescuing endeavours of the failed industry, with a most recent $4B in supplementary financing.
Therefore, with such economic irrationality from this installed government, Charles Darwin’s survival of the fittest, we revisit. For in Charles Darwin’s construct, when a species is unable to compete, then through a process of natural selection, that species is rendered extinct. Likewise, through the process of natural selection, when an industry is rendered uncompetitive, as the Sugar Industry is, then it should face an inevitable economic death, rather than existing parasitically off the Oil & Gas Industry.
And it’s this reality, which confronts PPP and the Sugar Industry, where rather than doing what’s right for the country, PPP would selfishly do what’s best for them as a political entity. As a result, in the context of these senseless economic and political decisions, PPP burdening our burgeoning Oil and Gas Industry, is placing it at irreversible economic risk.
