GEORGETOWN, Guyana– Less than six months after the government successfully provided more than six billion dollars (One Guyana dollar=US$0.004 cents) in the national budget for the Guyana Sugar Corporation) (GuySuCo) On Monday, it got legislators to approve a further GUY$3.4 billion for the cash-strapped sugar company.
Agriculture Minister, Zulficar Mustapha, said he is confident that the fortunes of the sugar industry could be improved as he defended the supplementary funding to GuySuCo.
He told the National Assembly that the additional capital could ultimately bring production costs down and that the Irfaan Ali government would continue its recapitalization push at GuySuCo with the extra money.
The government said of the additional GUY$3.4 billion, an estimated GUY$1.4 billion has been approved for other resources to support the sugar industry, with the remaining two billion being used to cover operational expenses.
The funds will also be used to reopen the Rose Hall estate, which Mustapha described as a priority for the government.
“Rose Hall estate will be reopened, and that’s a commitment of this …government. Today, we have reemployed 692 out of 1,038 persons, and several works have already been carried out,” Mustapha told Parliament.
He said in preparation for the reopening of the sugar factory; lands have already been prepared for planting, while roads and bridges in the area have also been repaired. Drainage channels have been cleaned and excavated, and other technical works are ongoing.
“We are on track to reopen this estate; as a matter of fact, many persons in this country would have realized and known that that area was made a ghost town, with the entire village economy in east Cannie – many persons had to leave the area and we are seeing once again a lot of economic activity in the area.”
The new funding for GuySuCo comes even as President Ali said he would be holding discussions this week with officials of the financially strapped sugar company to quell internal problems that have already led to the resignation of one director.
“My focus is on ensuring that we work to revive GuySuCo, making it viable, making it economically and financially feasible, and that is why I say it is not only about financial feasibility, it is about economic feasibility, how it is integrated into the entire community, so that is the focus,” Ali told reporters.
“There seems to be a strained relationship between some board members and the management. The management has a position; the directors have a position. I intend to bring the parties together in the week and to have a conversation,” he added.
GuySuCo’s vice chairman, Anthony Vieira, recently resigned from the corporation amidst internal issues between management and the board.
Meanwhile, the government has also been able to get the green light in the National Assembly to provide an additional four billion dollars to the Guyana Power and Light Company (GPL) to address cash flow issues.
Finance Minister Dr. Ashni Singh said that several governments and state agencies currently owe GPL millions of dollars and that additional funding is necessary.
“Amongst the entities that owe GPL was, in turn, several other agencies in similar states of financial distress. GWI, Guyana Water Incorporated, had owed GPL over $9 Billion and was incapable of discharging that liability.
“The Guyana Forestry Commission is another example of an entity that accumulated tremendous indebtedness and did not have the liquidity to discharge that indebtedness, and so Sir, we have been faced with the task of addressing this chronic problem, and we have set about doing so diligently,” Singh said.
The Finance Minister said that despite the increasing cost of fuel locally and internationally, the government’s support for GPL has resulted in the expenses not being passed on to consumers.
“The challenges at GPL have been further compounded by the fact that the fuel price on the global market had increased tremendously, moving from US$40 per barrel when we assumed office to now about US$100, and we have, as a matter of policy given a commitment that we will absorb this fuel price increase and not pass it on to the consumer…, and this, of course, has itself imposed a grave cash flow pressure on GPL,” he told the National Assembly.
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