Six years after a rice deal between Guyana and Panama collapsed, $1.5 Billion was paid out to Guyanese millers today for rice shipped to Panama back in 2018 – clearing a long overdue debt.
In 2014, Guyana signed a contract to supply Panama with rice. However, the agreement collapsed after the Panamanian authorities refused to pay for rice shipped to the country in 2018.
A total of 19 millers were affected, with six of them being forced to shut down their operations due to the money that was owed.
The Government intervened and has been engaging the authorities in Panama on the issue.
Today, before handing over the money to the millers, Minister of Agriculture, Zulfikar Mustapha said determined to recoup the funds on behalf of the millers, the Government of Guyana initiated legal proceedings against Panama, after bilateral talks failed to yield any success.
He said the matter went to arbitration, but during a meeting with President Irfaan Ali, the Panamanian President offered his assurance that the debt, excluding interest, would be paid in full but Guyana must first withdraw from arbitration.
“We give them an undertaken that as long as the principal is paid, and the millers are paid, then we will ensure that we withdraw that arbitration. And I believe an agreement was signed after that, and the money was paid into the account of the GRDB, the full principal,” Minister Mustapha explained.
He said it was unfortunate that some millers were put out of business due to the large debt.
Wazeer Hossein, the proprietor of Wazeer Hossein Rice Milling Company in Essequibo, was among the millers, who received their payments today.
He told reporters that his operations were hit hard when the agreement collapsed. He said he has no plans to put his mill back into operation.
“I feel so happy about receiving this payment because I wait so long for it. It was so much overdue, and it even affect us in the industry because we were closed for a while because of the payments, and now we receive the payments and we feel so happy about it,” Hossein told reporters.
Another miller, Mahendra Persaud of Nand Persaud and Company thanked the Government for making good on its promise to resolve the issue with the Panamanian authorities.
“This morning, we are here to conclude a very long and probably for some, very stressful [issue]… I guess all of us are happy that this financial issue has been settled, and this bring the Panama sales to a closure, and we say thanks to the Government and the Ministry of Agriculture, Minister Zulfikar Mustapha. We thank him for getting this matter concluded,” Persaud said.
Other millers indicated that they will be using their money to activate their mills.
The Agriculture Minister used the opportunity today to encourage the millers to settle their outstanding debts with the Guyana Rice Development Board (GRDB) and small farmers.
“Some of y’all have some accounts to settle with GRDB, I hope y’all settle those accounts, and the farmers. If anybody owes any farmer, I told GRDB to deduct the money after consulting with the farmers and the millers, and we will pay the farmers,” Minister Mustapha said.
He said while the rice industry has experienced its fair share of challenges over the years, it is making tremendous progress, and is now on track to achieve its 2024 target of 710,000 tons of rice.
Minister Mustapha said the Government will continue to invest in the industry, and act in the best of rice farmers and millers.
Since 2020, approximately $3.6B was injected int the rice industry by the Government.
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