Dear Editor,
I find it rather strange that the weather is being used as the scapegoat for the poor performance in the sugar industry in 2009, but simultaneously is the main reason being used by the Minister of Finance for the credible performance in the rice industry. The Minister said inclement weather made harvesting difficult for the sugar industry and contributed to lower sugar cane yields, but in the very next breath on page 6 of the 2010 National Budget said that the rice industry took advantage of the conducive weather conditions to expand acreage under cultivation.
Historically, these two crops existed side by side in Guyana, in the same climatic zone, and the year 1999 clearly points to the fact that both of these industries can do very well in the same year. Therefore I am at a loss in understanding this contradiction in the 2010 Budget. It just reinforces my conclusion that the weather is nothing but a cop-out for the political directorate with respect to the man-made troubles in the sugar industry. There is more to the sugar industry than the weather, and I remain convinced about that fact.
Having said that, the focus of this letter is the rice industry and to highlight how the 2010 Budget is weak with insufficient measures to support the small rice farmers. My finding further cements my position that that this budget was anti-working class. Fundamental issues in the rice industry remain unresolved. These are not new issues but have been around since the PNC days, and thus it baffles me why solutions are not more forthcoming from a government that was supposed to be working-class biased.
The Cheddi Jagan administration did significant work to repair the rice industry and this reconciles with his working-class ideology. During his tenure, production moved from 207k tonnes in 1993 to 340k tonnes in 1997, and the growth trend continued after his death to 1999 when production reached 365k tonnes. It was an excellent foundation to jump start the industry into the future. The best years after 1999 were 2003 and 2009, when production was 355k and 359k tonnes. Thus no one should dispute the fact that Guyana is very capable of consistently producing more than 350k tonnes. But the pertinent question remains: is there a national plan that is actively being pursued for the rice industry? It would have been quite refreshing if an updated National Rice Strategy had been announced in the 2010 Budget, especially with the background that production will be declining in 2010.
If anyone is to review this industry, they will quickly determine that our reputation as a reliable supplier of good quality rice remains questionable year after year. I acknowledge that the industry has generally been privatised and it is up to the private sector to build this reputation. However, we have enough evidence to concede that the private sector does not have enough competent and reliable businessmen to be the sole custodian of the rice export trade. The government must re-enter the rice export trade, even as the custodian of the national buffer stock. This challenge went over the heads of the preparers of the 2010 National Budget and that is a shame.
I am a strong advocate for the GRDB to have a small mill of its own and significant storage facilities outside of the private sector. These GRDB storage facilities will be the national buffer stocks that are available to all millers if they have a shortfall in their international shipments. However, firm conditionalities can be used, such as the miller must pay cash up front for the purchases from GRDB to prevent a repeat of the PNC-style Rice Board days. That cash can then be used to pay the small farmers up front who supplies paddy to the GRDB mill. It is much easier for a large rice miller to access funding from the banks than for small rice farmers to do so, and this demand for cash by the government can add necessary lubricant to the production chain in this industry. Thus, this buffer stock can be used to contain any oligopolistic tendencies on the part of the millers for the betterment of the small farmers.
It can work!
Another developmental predicament in the industry is the methodology of providing funding. Any trained strategist will tell you that a presidential quid pro quo that sporadically releases extra budgetary funds in a knee-jerk fashion, only contributes to the sub-optimalisation of the performance of the industry. Why couldn’t the Jagdeo regime set up a Rice Commission (call it what you may) that would meet regularly and include all the relevant stakeholders (government agencies, RPA, research agencies, the commercial banks, the millers, a small farmer representative). That body would have executive power to identify all the relevant challenges in the industry and address them accordingly in a timely manner by providing the Ministry of Finance with relevant and reliable information to properly structure the funding for the industry. Supersession of the budgetary process with these ad hoc supplemental budgets should not become the norm as is the case today. I can assure you that if any private sector firm ran their company in this fashion they would be sure to be bankrupt before long.
I must congratulate the Minister of Finance for highlighting that the Rice Factories Act will be amended so that more timely payments can be made to the rice farmers. What really was a botheration for me was why it took so long for a so-called working-class government to finally arrive at this decision to further empower the small rice farmers to secure what is justly theirs. Timely access to their moneys is the sine qua non for small rice farmers.
Finally the 2010 Budget failed to adequately support small rice farmers in the area of developing sufficient numbers of new varieties and training more rice scientists. In the past 10 years, rice growers in Australia have increased productivity per hectare by 60% while at the same time decreasing water use per hectare by 30%. It was in their national interest to scientifically understand their climatic and pest issues, and there is no reason why Guyana should not have access to this knowledge. Why can’t the government fund a few scholarships to Australia to transfer this knowledge to Guyana? Why can’t the Australian rice seedlings be tested in Guyana, since the feedback so far is that they are more suitable to today’s climatic conditions? Do not tell me that we are a poor country and we cannot afford this knowledge since this is a more beneficial venture to the nation than the ill-conceived and unnecessary presidential escapades of 2009 which were funded to the tune of more than G$200 million.
On this training issue, I was fortunate to find one area of the 2010 budget that will directly benefit the small rice farmers, and I must recognise this fact. The government has funded 51 Farmer Field Schools programmes in 2009, and it is heartening that this programme will continue in 2010. The feedback I have received to date on this programme is that it is a valuable experience for the working-class rice farmers.
I trust Dr Randy Persaud will now go back to the policy-makers in the Jagdeo regime and challenge them on why the 2011 Budget next year, cannot better address the challenges of the working-class rice farmers in a more focused and coordinated manner, since this 2010 Budget certainly falls far short of the mark.
Yours faithfully,
Sasenarine Singh
