Together with a number of other business groups from across the country, the Private Sector Commission has issued a call on the government to put a hold to its plans to scale down the operations of the state-owned sugar company, Guysuco.
“The private sector calls on Government to hold its hand on the current approach towards closure of estates. The private sector stands ready to place its considerable experience at the disposal of and to work with Government to explore all possible options to avert closure”, the PSC said in a statement.
While recognising that the sugar corporation has delivered financial losses and has become dependent on Government/taxpayers subvention to enable its continued operation, the PSC said the government should also take into account the impact the scaling down of operations could have on the country.
According to the private sector body, a review of Guysuco’s audited financial statements for the year 2015 reveals that more than G$10 Billion would be removed from private employment income should Government proceed with the closure of estates.
“This, in turn, would have a direct negative effect on consumer spending in the communities which, directly or indirectly, depend upon income, from sugar. Such a decline in consumer spending would also have a diminishing impact upon all commerce with concomitant negative spin-off effects on the economy as a whole”, the PSC said.
It has also expressed some worry about the impact the closure of estates could have on foreign currency holding. According to the PSC, Guysuco is a major earner of foreign exchange and closure of any estates would severely impact the availability of foreign exchange and increase the price at which it is sold.
The PSC is reminding that many factors have contributed to the declining performance of the industry, including the loss of the preferential pricing of the lucrative European Union market. Although not givint the source, the PSC said “there is the view that these could be addressed to turn around the industry”.
The Guyana Sugar Corporation (Guysuco) came into being as a state owned entity in 1976, when it was nationalized.
Since the EU cut the price for sugar several years ago and other Caribbean countries opted out of the industry, Guyana has found itself supporting the industry to the tune on billions of tax dollars annually.
The Government has announced a plan to scale down operations. Two estates are to be closed by the end of this year, with their workers being offered land and financial packages or new jobs at other estates.
Outside of the government itself, the sugar industry in Guyana, remains the largest single employer in the country.