Sugar woes significantly linked to EU price cuts –Agri Minister restates

Minister of Agriculture Robert Persaud yesterday labelled European Union Ambassador Geert Heikens’ “disquiet” over reports about the sugar industry as hypocritical since he said the envoy is fully aware that most of the problems stem from the “unilateral and abrupt price cut of thirty-six percent” by the European Commission (EC) for sugar from this country.

The minister noted that the full price cut, which would take effect from this year, will result in an annual loss of income for Guysuco of some $7B.

Persaud was responding to a report in yesterday’s Sunday Stabroek where Heikens said a regular and in-depth analysis of the sugar industry is needed as a necessary step forward, and also referred to reports in the local press about the state of the sector as disquieting.

Heikens underscored the importance of sugar to the local economy calling it a “pillar” while noting that the EU Delegation understands that continuous efforts to make the sector competitive and viable are essential. He said also that the European Union-funded Multi-annual Sugar Programme, which supports the government’s efforts to improve the competitiveness and viability of the local sugar industry, continues in 2010.

He stated that the programme has a total envelope of Euro 670 million for 18 ACP sugar producing countries, of which Euro 90 million (Guy$27 billion, US$130 million) has been allocated to Guyana. The decisions for the Euro 90 million are spread over 5years, he noted, with various disbursements annually.

According to the minister the loss of income for the corporation will become a reality even as the EC’s promise of support for the accompanying measures has been limited.

“The situation has been aggravated by the inflexible stand taken by the EC in terms of (Guyana) qualifying for their resources,” the minister said. He pointed out that if the Guyana Government had to await the flow of resources that the EC had promised to compensate for the price cut, which he said was very inadequate, it would not have been able to undertake the major restructuring and modernisation effort to better prepare the industry for the price cut.Minister Persaud stressed that the sugar industry has always encouraged constructive discussion with all of its stakeholders and as such neither the EC nor its representative could now conveniently “wash their hands” of the challenges facing the industry. The minister said that he was concerned about what he said was the dismissive attitude the ambassador evinced for the efforts being made to turn around the industry. He the turn-around process requires much time, hard work and commitment by all stakeholders and while he recognises that there are factors other than the price cut which are affecting the industry, these are being addressed in the industry’s turn-around plan.

Responding to questions on the industry posed by Stabroek News, Heikens had said it is important for an analysis to be done, in addition to comparisons being made with other sugar producing countries. This, he said, can be used to update the “Blue-Print for success and which sets realistic targets, initiatives and actions.”

source: stabroeknews