A viable agro processing industry in Guyana is likely to remain elusive unless there is a cheaper more reliable energy source, Agriculture Minister Robert Persaud has said.
“We will never be able to develop an agro-industrial base unless and until we have cheap and reliable energy,” Persaud told Stabroek Business.
Persaud said while the country’s agricultural sector has long demonstrated a capacity to produce the raw material necessary for the creation of a viable agro processing industry, the growth of the sector continues to be stymied by prohibitive energy costs. “At this point in time it makes more sense to produce that raw material and export it – to Trinidad for example – for processing and return to Guyana. That would be cheaper than processing here. That is the economic reality of that situation,” he said.
Large scale local and foreign investments in agro processing ventures in Guyana have long been stymied by prohibitive energy costs and up until now initiatives in the sector have been limited mostly to modest ventures. Accordingly, the minister told Stabroek Business, “expectations of Guyana’s agro processing sector have to be tempered to take account of that reality.”
Despite what Persaud said is the need to close the gap between potential and actualization in the agro processing sector, it is “the one in which we have, perhaps the greatest potential.” Accordingly, the minister told Stabroek Business potential investors might consider beginning to position themselves to access the sector.
“Once we can fix the issues of the cost of energy, the supply of energy and the availability of energy, we can see a massive takeoff in the agro processing sector. In fact we can perhaps become so competitive that we might even threaten the volume of raw material that we have,” he said.
“We have to look ahead. It might be nice to dream of processing plants in all of our farming communities. But that will only happen and will only make economic sense when we have cheap and reliable energy. That is where hydropower is the missing link. For us, having access to hydropower as an alternative to fossil fuel is the only solution to the problem. At the same time there is that gap between what is happening and what can actually happen.” Meanwhile, the Agriculture Minister told Stabroek Business that changing global circumstances dictate that Guyana review its approach to the agriculture sector to embrace “climate smart” policies. “The challenge of climate change dictates that whatever agriculture we do, in terms of the technology, the techniques and the planning; what it is that we plant, what varieties we use, what it is that we decide to do and not to do, so that we can be smart given the constraints that we face.” Noting that Guyana cannot “fix the climate” the minister said that we can at least be smart in terms of how we operate within the climate constraints that confront the agricultural sector and which, from all predictions, will grow worse.
The manifestations of climate change are requiring changes in both practical and psychological approaches to agricultural pursuits and Persaud said local farmers are adapting well to the challenges. “Fortunate-ly, we have farmers who are very aware of what the realities are. They are also very aware of what the potential threats are. What we are trying to do is to work with our farmers in order to move them from the stage of understanding the problem to the stage of doing something about it. It requires culture change; it requires a new orientation,” the minister said.
