Introduction Historically the sugar industry developed in Guyana because of its favourable agro-climatic coastal features.
Introduction Before considering options for the way forward in the sugar industry, I shall first examine challenges posed by its underperformance as revealed in the behaviour of the standard performance measures since the 1990s as well as last week’s analysis of Guysuco’s predicament.
Introduction The serious weaknesses and massive underperformance of Guyana’s sugar industry during the past two to three decades were revealed in previous columns, through an evaluation of six standard performance measures that are routinely applied to the assessment of sugar industries.
This week I begin with a wrap-up discussion of factory performance measures as revealed at the level of the eight individual estates.
This week’s column concludes consideration of the sugar industry’s land productivity measure; that is tonnes cane (TC) per hectare (HA) of harvested land.
Culture of losses GuySuCo is a state-owned corporation. Readers already have in their possession firm details of how deeply mired it is in what I have termed “a sea of losses and indebtedness” (annual losses of about $6 billion and outstanding debt of $90 billion in 2013).
Introduction When evaluating Guysuco’s profitability and/or losses as a performance indicator the conclusion reached was that the corporation has been “mired in a sea of losses and indebtedness since the 2000s.” The proposition was therefore advanced that its survival as a sustainable commercial venture rests squarely on its ability to earn regular accounting profits.
From a dynamic perspective, over the medium to long-term the profitability of the sugar industry as a whole, and GuySuCo in particular, is more than any other variable, the best representative indicator of its sustainability as a commercial venture.
In this week’s column I intended to conclude the evaluation of costs as a performance indicator.
I had reported a few weeks ago in this series data comparing the unit cost of sugar production for Caricom producers in 2005.
Last week’s column introduced six performance indicators for the sugar industry, which I will examine in coming weeks: production, costs, profitability, land productivity, factory productivity, and combined (land and factory) productivity, in that order.
Indicators Despite the unavailability of detailed audited GuySuCo accounts after 2009, in the coming weeks I shall focus on six performance indicators (production, costs, profitability, land productivity, factory productivity, and combined (land and factory) productivity) in assessing the sugar industry since 1990.
Before starting an assessment of the key performance indicators for the Guyana sugar industry, two issues need to be addressed.
I had earlier cautioned readers to be sceptical of the widely held view that the European Community’s (EC) denunciation of the Sugar Protocol (SP) in 2009 was “the final nail in the coffin of Guyana and the rest of Caricom’s sugar industry.” I have put forward the alternative interpretation that this event was the proximate occurrence leading to the effective collapse of the region’s traditional sugar industry, and in no way either the sole or principal cause for that collapse.
King Sugar As indicated previously, several analysts view the EC’s legal denunciation of the Sugar Protocol (SP) in 2009 as the “final nail in the coffin of Guyana and the rest of Caricom’s sugar industry.” That event has been held mainly, if not solely responsible for today’s crisis in the region’s sugar industry.
Introduction The world sugar prices for the period 1960 to 2013, which I presented last week, were formed in the ‘free market,’ where the sugar bought and sold is not subject to governmental regulation and control.
This week’s column wraps up my presentation on the long-term situation of the global sugar industry, which as I have argued stands in stark contrast to that of Guyana’s.
Examining the last century or so of the industrial life cycle of Guyana’s sugar industry, it is observed that the period up to the late 1960s and early 1970s marked the phase of its maturity.
Introduction As testimony to the present dire state of Guyana’s sugar industry and its continued importance to the socioeconomic, political, and cultural life of the country, last week I began a third series of columns on this topic in the space of only three years.
Tipping point Alarmed at the crisis state of the sugar industry in 2011, I devoted more than a score of Sunday columns in that year (May 29 to October 16) to its discussion and drew attention to the crying need for radical reform and restructuring.
Introduction Last week I drew readers’ attention to the far more potent threat facing tax evaders and money launderers operating in and through Guyana, than the activities of the Financial Action Task Force (FATF) and its regional counterpart, the Caribbean Financial Task Force (CFATF).
Introduction If perchance any reader might have had doubts about the serious intent of the United States as it opens a new front against tax evasion and money laundering, under its Foreign Account Tax Compli-ance Act, 2010 (FATCA), he or she should ponder the pointed remarks made by a Senior United States Treasury official (Robert Stark) on September 2013: “Offshore tax evasion is a significant contributor to the tax gap.” As a result of this, FATCA is designed: “To establish a process for foreign financial institutions (FFIs) to report information about their US account holders to the Internal Revenue Service (IRS).” The IRS has further stated its objective very clearly: “It is to catch tax evaders.” When considered carefully, the implications of this development for Guyana are stunning in the extreme.
Introduction In my current series of Sunday columns on countering money laundering and the risks of terrorist financing and proliferation I have consistently advanced what I consider to be the fundamental view that the financial crime of tax evasion is the primary driver of money laundering.
Introduction As indicated last week that column was prompted by the seemingly orchestrated public statements by private organizations, steps being taken by the US Treasury against tax evasion in the region as well as diplomatic and other pressures brought to bear on the parliamentary “opposition.” All this supposedly in the expectation that it would accede to the legislative amendments before the Special Select Committee and therefore not pursue “the goal of effective money laundering reform” designed to reduce the economic burden this deep-seated problem heaps on the country.
Well-orchestrated As stated last Sunday it was my intention to bring the series of columns on money laundering to an end.
Conclusion This week’s column indicates the remaining markers that go along with the strategic guideposts provided earlier for a way forward in dealing with Guyana’s situation in regard to money laundering, the financing of terrorism and proliferation.
The Schedule below summarizes the key features of the strategic guideposts for a way forward presented in the two previous columns.
This week I shall address the two remaining strategic guideposts in designing a road map for the way forward in dealing with money laundering and related challenges in Guyana.
Introduction For the remaining columns in this series on money laundering in Guyana, I shall concentrate on portraying a strategic road map for the way ahead, in light of the current impasse in Guyana’s relations with the Caribbean Financial Action Force (CFATF).
Last week’s column carried a brief description of the current situation of Guyana in regard to the Caribbean Financial Action Task Force (CFATF).
Introduction In the previous two columns the prevailing architecture of global anti money-laundering regulation under the Financial Action Task Force (FATF) was introduced by way of the seven major groupings of the targeted areas within which this structure is organized.
Introduction Last week’s column provided a brief synopsis of the Financial Action Task Force’s (FATF) international standard.
International standards As indicated in last week’s column, the original publication of the Financial Action Task Force’s (FATF) Forty Recommen-dations took place in 1990.
Introduction As I continue the series on money laundering and looking back on last week’s column, perhaps the main original contribution so far has been putting forward the thesis that there have been three principal drivers pushing money laundering and related concerns to the level of the massive global threat these now represent.
OFCs and tax havens The origins of money-laundering as a global phenomenon are closely tied to the international spread of offshore financial centres (OFCs) and the opportunities these provide for the spread of tax avoidance and evasion; the latter being of course a criminal offence.
Introduction At this point of the ongoing discussion of the money-laundering situation in Guyana, readers would have come to realize that they cannot expect to form an intelligent appreciation of this issue, and as a result the several serious challenges which the country presently faces, without, at the very least, a rudimentary appreciation of the basic contextual issues surrounding this phenomenon.
Introduction This week’s column provides a highly condensed, yet hopefully accurate portrayal of the origins of money laundering, which as we shall observe is a uniquely modern phenomenon.
Introduction In my recent Sunday Stabroek columns I have sought thus far to provide a background for assessing the money laundering situation in Guyana, with specific regard to examining its local, regional, and international regulatory regimes.
Last week the question was tackled: what is money laundering? This week we look at the techniques and circumstances, which give it traction in Guyana and the wider Caricom region.
Introduction The two topics that have dominated national as well as parliamentary debates on Guyana’s political economy in recent months are, namely, the future of the Amaila Falls Hydropower Project and Guyana’s money-laundering legislation in light of its regional and global regulatory obligations.
Conclusion The last topic left to be considered in this rather extended appraisal of the management of Guyana’s public investment programme is its third and fourth phases, namely, project management and implementation and the conduct of ex-post evaluation audits of projects.
Conclusion Today’s column concludes the discussion of the Amaila Falls Hydro Project (AFHP).
Judging by the numerous requests which I have received from readers to comment on the Hydropower Purchase Agreement (PPA) between GPL and Amaila Falls Hydropower Inc (AFH Inc) this seems to be, by far, the public’s most troubling concern about the Amaila Falls Hydropower Project (AFHP).
Part 6 Last week’s column indicated that the financing arrangements for the Amaila Falls Hydropower Project (AFHP), envisaged GPL playing a pivotal two-pronged role.
Part 5 In this week’s column and the next I shall wrap up my discussion of the financing arrangements through which the Amaila Falls Hydropower Project (AFHP) is being executed.
Project finance Last week I had indicated that this week’s column would be devoted to the further elaboration of the financing structure of the Amaila Falls Hydro Project (AFHP).
Last week’s column summarized the geo-technical features of the troubled Amaila Hydropower Project (AHP).
Introduction There has been, surprisingly, very little consistent and sustained official information flows to the public aimed at improving their awareness and understanding of the Amaila Falls Hydropower Project (AFHP).
Part 1 Introduction Last week’s column completed the discussion of Phase 2 of the management of Guyana’s public investment programme (that is, project selection and sequencing).
Scope This week I shall conclude the discussion on the selection of public projects in Guyana and their sequencing.