General Manager of Jamaica Cane Products Sales (JCPS), Karl James, is raising questions about whether Jamaica could have received greater value from the 2010 divestment of sugar estates to the Chinese firm Complant.

According to James, the country could have seen greater rewards from the sale if the divestment team had sought the advice of local experts.

But the man who led the divestment team, Aubyn Hill, has scoffed at the claim even as he charged that every major player in the sugar industry had a chance to air their views.

Hill is getting support from Donovan Stanberry, permanent secretary in the Ministry of Agriculture.

“It depends on what consultation means because we had knowledgeable persons involved in the process, so I am not sure it would be fair criticism,” said Stanberry.

The two were responding to James, who told The Sunday Gleaner that experienced players in the more than 300-year-old industry should have been consulted when the Government started discussions on the sale of the Bernard Lodge, Monymusk and Frome sugar estates.

“You have a serious investor, you negotiated, agreed and have a price … . Get back to the people who are the old-time players in the industry and get their opinion on the kind of riders for this deal,” argued James, who is respected in the sugar industry regionally and globally.

“Mr Hill will tell you that he was hired to dispose of the factories, to get them off the books of the state, and can proudly say, ‘Mission accomplished’,” quipped James.


He made it clear he believes Complant came out on top in the negotiations.

“I congratulate the Chinese for getting it for the price they got it. They did an excellent job of negotiating and got what they wanted.”

But Hill argued that companies were not lining up to purchase sugar estates which taxpayers could no longer find the millions of dollars to operate each year.

“Mr James is either purposely ignorant of the consultations or has forgotten. To remind all, the chairman of the SIA (Sugar Industry Authority) was a member of the divestment team,” Hill told The Sunday Gleaner.

“The other manufacturers were informed monthly, the unions were informed regularly. Union leaders met each of the possible prospective buyers and engaged in long discussions with these buyers, so did the sugar cane growers.

“Indeed, the cane growers have a representative on the board of JCPS and, like Mr James, had access to me and other senior executives of Sugar Company of Jamaica Holdings, the chairman of the SIA, and other members of the divestment team.”

Hill also scoffed at James’ claim that additional caveats should have been added to the agreement with Complant.

“Considering that these people were not very versed in the production of cane, we should have put a few caveats in the agreement,” argued James.

“If there had been a caveat that says some time must be spent understanding the peculiarities of the industry and the challenges, a lot would have been avoided, because you could bring in all the machines you want -as the Chinese are doing – without the right people, you won’t get anywhere. So training is a vital component,” added James.

But Hill said with the limited number of persons interested in purchasing the sugar estates, the divestment team was not in a strong position to negotiate.


“Mr James needs to remind himself that Complant is committed by contract to invest US$156 million over a four-year period, and those in authority must hold Complant’s nose to the wheel to that contractual commitment,” said Hill.

He argued that all the entities which purchased the Government’s stake in the sugar industry – the Seprod Group, Everglades Farms and Complant – have the corporate responsibility to manage, “and may mismanage, the sugar assets that have been divested to them”.

That is a view echoed by Stanberry.

“A lot of time was spent with the Chinese explaining the culture of the industry, but it is always going to be difficult when there is one bidder. You just can’t anticipate how investors will operate.”

According to Hill: “Mr James seems to have forgotten that there were not scores of companies waiting to buy our decrepit sugar assets. His long tenure in the sugar industry should have sharpened his memory to this fact”.

Complant was sold the Bernard Lodge, Monymusk and Frome sugar estates for US$9 million, along with the surrounding 25-50 acres of land around each facility.

source: stabroeknews

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