The Finance Ministry this evening announced that the national treasury is in no position at this time to offer a bailout to the Guyana Sugar corporation.
In a statement, the Finance Ministry pointed to the prevailing national circumstances and the challenges of COVID 19 which have reduced national income, as the main reasons behind its position.
The Guysuco Chairman back in May wrote to President David Granger seeking his urgent intervention. The Chairman said based on the company’s current financial situation, it may run out of cash from the middle of June.
But the Finance Ministry reminded that a $30 Billion bond backed by NICIL’s assets and guaranteed by the Government of Guyana was secured through NICIL to retrofit and revitalise the 3 remaining sugar estates.
“During the period July 2018 to February 2020, $9,720,759,568 was disbursed to Guysuco to fund its Capital and Operational Expenditure – much of which was outside the terms of the bond. Additionally, NICIL through the SPU, sold lands that were vested to it, and garnered deposits of $2.1 billion. The full sum was used to offset bond payments that became due in May, 2020. The balance of $1.5 billion for the lands will be paid over to NICIL when the vesting orders are signed and gazetted. It is expected that part of this sum will go towards a bond repayment which is due on July 4th, 2020, and the remainder to Guysuco. Guysuco also generates its own income”, the statement said.
The Finance Ministry said another disbursement is expected in the coming days, “so we urge that NICIL, Guysuco and the syndicated lenders work assiduously to resolve any bottlenecks”.
The Ministry said the Government remains committed to making Guysuco a viable partner.
In a May 15 letter to President David Granger, Guysuco Chairman John Dow described the corporation’s current financial situation as dire.
He said that despite improvements in the productivity of cane, sugar production for the last two crops have fallen short of expectations.
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