The opposition PPP has poured scorn on the government’s $30b bond financing plan for the sugar industry and has called for a feasibility study and transparent plan to restore it to viability.
In a statement on Thursday, the PPP said that only a few months ago the public was told by government officials that the sugar industry was not viable and was a drain on the treasury.
As a result and without any feasibility study or impact assessment, the party pointed out that several estates were shuttered and thousands of workers were put out of jobs.
“Now again without any assessment, projection or feasibility study (at least none has been made public), we are told that the Special Purpose Unit has secured a $30 billion syndicated bond `to aid in the revitalization of the country’s sugar industry’. This approach seems to be predicated on caprice at worst and guesswork at best. We maintain most resolutely that any attempt to fix GuySuCo must cater for the long-term sustainability and viability of the industry”, the party declared.
Having been in government for 23 consecutive years, the PPP has been routinely criticised over its failure to secure the future of the industry and for decisions such as the Skeldon Sugar Modernisation Project which became a major drain on GuySuCo.
Adverting to the bond financing plan, the PPP said that $30b in subsidies from the government would have kept the industry going for four years without a single loss of jobs.
“We are aware from the Government’s own admissions that billions have been pumped into the industry as subsidies, under this Government, with nothing to show for it and we have called for an investigation into how and on what these monies were spent”, the PPP said.
During its last years in office, the PPP/C government had been accused of approving large subventions for the industry without there being any discernible improvements.
The PPP statement on Thursday said that some reports in the press state that the $30 billion came from “international markets” while others indicate that it came from several local banks, including, Republic Bank. “What is certain is that it is not a loan on concessionary terms. No study has been done to enquire into GuySuCo’s ability to repay such a loan. If we are to go on what the Government has said of GuySuCo, then clearly GuySuCo cannot repay this loan. This raises the other fundamental issue of what is the collateral for this loan. Did the Government guarantee the loan, or the assets of GuySuCo have been used as collateral? If the latter is the position and there is an inability to repay, then the banks will end up owning the massive asset base that GuySuCo has”, the party said.
The statement added that the APNU+AFC Government regularly blames the PPP for leaving GuySuCo in debt and uses the bloated figure of $84 billion dollars as this debt without disclosing that most of this debt consists of pension liabilities, taxes to the Guyana Revenue Authority and monies owed to the National Insurance Scheme. The PPP said that $30b is certainly larger than any single liability accumulated during the PPP/C Government.
“Most importantly, other than the broad generic terms used, there is no indication of a clearly defined plan on how this money will be spent and what rewards it will yield, specifically, or for the overall long-term welfare of the industry.
“We remain worried that the Government is operating blindly and up to now has not unfolded a plan for the future of GuySuCo. We feel that the $30 billion, given the track record of incompetence and corruption by this Government, will be wasted and stolen and future generations will be saddled with the repayment of this humungous debt”, the party declared.
The PPP reiterated its views that the industry has a viable long-term future.
“We are prepared to partner with the Government to make this a reality. However, we insist on a scientific and transparent approach. We demand a feasibility study and a transparent plan to restore viability to this industry. We say that the whimsical and fanciful approach of the Government, which is mired in secrecy, will only lead to corruption and greater disaster for the industry”, the PPP added.