At $5B GuySuCo’s debt is manageable

Dear Editor,

This PNC led APNU+AFC regime continues to mislead the public in relation to the real situation in the sugar industry. They have relied on half-truths, distortions and downright lies to perpetuate the disinformation. This is a real tragedy and immoral approach on the part of this regime.

Recently, through the acting CEO of GuySuCo, it was stated that the corporation has a debt of some $77 billion dollars. That is not the whole truth. As I have mentioned before, GuySuCo has some serious problems, but they are not insurmountable. No estate needs to be closed. No one should lose his/her job. Indeed, with the development of new products new jobs can be created.

This regime is determined to shut it down and is not prepared to look at any other solution. Thus, the distortions intended to mislead the public and to justify the attack on the industry.

Most of the debts that GuySuCo has are not immediate. They are long-term debts. Once the decision is taken to fix the industry, these debts would be paid by the industry.

The composition of the debt is as follows:

The amount owed for Skeldon Factory is $32 billion. This debt was being paid by the PPP/C government. It is a debt on the government books and not GuySuCo. True, it is expected that the industry would repay government. It would easily do so if the regime works toward getting it back on its feet by using soft credit available to it from the Indian government. President Granger is going to India soon. He should pursue the Indian offer which he himself acknowledged is available.

In fact, in that ‘debt’ is the co-generation plant. The administration knows that that plant, according to Dr Clive Thomas, is supplying 80,000 persons with electricity.  GuySuCo is not benefiting from this revenue split which favours GPL. This should be corrected. So that $32 billion is not a burden on the industry.

The second component of that debt is what they claimed was GuySuCo’s pension funds.  They claimed that amounts to $33 billion dollars. This is not the true picture. This amount is payable to persons when they reach the age of sixty. Everyone knows that all the persons would not arrive at sixty at the same time. Therefore, this is a major distortion. This is not an immediate demand. Indeed, this is a good reason to adopt the PPP/C plans to turn the industry around and keep it going. Doing so will postpone that ‘debt’ way into the future.

It is also said that the industry owes $7 billion to the Guyana Revenue Authority. The regime can either write this off, as it has done for some others, or wait for GuySuCo to recover and pay this.

Why then can’t they help as important an industry as sugar?

That accounts for $72 billion dollars. This means that GuySuCo’s obligation to its creditors and suppliers amounts to $5 billion dollars. This is manageable.

It is clear that the industry can be saved. Estates that are closed can be re-opened and prosper. All that is needed is the investment to operate efficiently and to develop new products. Another factor that has to be looked at is good management.

The regime can get these things. As was mentioned above, the Indian government is willing to assist with re-capitalisation and technical assistance. I have no doubt that they would be willing to provide managerial services if requested to do so.

The regime’s handling of the sugar industry is really questionable. While Jamaica is working to recapitalize and fix their industry the APNU regime is destroying ours. Why are no efforts being made to put it on a sustainable basis?

Yours faithfully,

Donald Ramotar

Former President

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