by Shirley Thomas
Guyana Chronicle
June 5, 2001

A PRECONDITION set by the American Alcoa firm for taking over the Berbice Mining Enterprise (Bermine) to be merged with the Aroaima Bauxite Company (ABC), is for the Guyana Government to make funds available for the development of the Kwakwani community, Prime Minister Sam Hinds has told workers.

On a weekend visit to the Berbice bauxite mining operations to try to sell the proposed takeover of Bermine by Alcoa, he said the firm wants the government to make an investment of US$1.8M in the development of the community at Kwakwani.

This would cater for making it more habitable, and providing the basic amenities and facilities for the people, he explained.

But while the deal is not "done", and the two sides are still negotiating, the Prime Minister said though it is not yet known where that money would come from, provided that that kind of development takes place, there is hope that employment could be created for many of the persons who are likely to be on the breadline following the imminent merger of Aroaima and ABC.

Addressing workers at Aroaima on Sunday, about the future of the bauxite company, he said that with the merger of the two companies, ALCOA which was forced to sell out some of its alumina plants, no longer has need for as much bauxite as it did previously.

The Linden Mining Enterprise (Linmine) will therefore remain the only bauxite operations in which the government will be investing, he said.

The proposal by ALCOA for the government to address the matter of making money available for upgrading living conditions at Kwakwani has found favour with workers both at the Aroaima mining site and at Kwakwani.

Workers who have been enjoying superior working conditions and a healthy environment created for them at ABC appear to be averse to surviving under any other conditions.

Meanwhile, those at Kwakwani who suffer great hardships such as poor roads, lack of telephone and recreational facilities, improper garbage disposal and social amenities for their children, hope that gainful occupation can be created out of the new developmental works.

The residents of the two areas are, however, suggesting that in order to ensure the efficient utilisation of funds, and a new community of which they can be proud, the US$1.8M to be provided by the government should be turned over to ALCOA and an agreement entered for the social amenities and services to be provided for the people.

"Bearing in mind that they have the required technology and will know exactly what it is that they want to see the community develop into, we think it should be left for them to work that out," one resident suggested.

Commenting on the plight of the workers at Everton, another bauxite community, Prime Minister Hinds said: "We do have to be concerned about Everton and the workers who will be out of jobs there immediately."

He said that immediately some 70 to 80 workers from Kwakwani will also become redundant.

And according to projections, in about three to four years when there is consolidation of the mining, there may be a further reduction of about 200 out of the total work force at that time.

Based on projections for the future of Kwakwani, Mr. Hinds said that when there is a better standard of living, jobs would be created in other sectors such as education, health services and other areas being developed by way of infrastructure, so that people could find new employment.

Meanwhile, as the government moves to map out strategies aimed at negating the suffering of bauxite workers likely to be displaced with the closure of the Everton operations, and downsizing of the Kwakwani work force, following the merger between ABC and Bermine, the Prime Minister assured that the administration is committed to the payment of benefits to the affected workers.

"We have a law in place that commits to retrenchment benefits being paid by any company in Guyana, or that such benefits be recognised as one of the claims on a company that may have to go into liquidation etc. It is one of the claims on any remaining assets of a company, and in the case of Bermine, Government will guarantee that retrenchment benefits be paid."

He also stated that the possibility of venturing into the production of cement and developing calcined products at Everton was being considered.

The Prime Minister was optimistic that the Upper Berbice area will have a number of activities which, if they come together can support each other, and lead to fairly steady rapid development of that part of the region.

He referred to two Amerindian villages in those parts, which he said must grow and develop and noted several operations going.

These include the Intermediate Savannah Project (INSAP) which is beginning to get rolling with the establishment of at least two groups attempting to grow cashew nuts; Amerally's Modeen operations now developing some good export market for lumber products; Case UNAMCO lumber and the granting of 28,000 acres of land to be worked for timber extraction by residents of Kwakwani.

"Within all of this, we think that there is an opportunity for growth in this area, with diverse types of activities that could support each other...I am very hopeful of development that could take place in this part of Guyana," Prime Minister Hinds affirmed.

Meanwhile, at a meeting Saturday evening with the Kwakwani workers at the Bermine Bauxite Union Hall, the leader of the Youth Choice Initiative of Kwakwani expressed the view that a serious and sustained approach to the development of eco-tourism in those parts can fill the niche, and can turn out to be a major foreign exchange earner for Region Ten which has long been in the doldrums.

Prime Minister Hinds was accompanied on the weekend tour by Minister of Labour Dr. Dale Bisnauth; Head of Go-Invest, Mr. Geoff Da Silva and Mr. Lionel Kandasammy of the Office of the Prime Minister.

The team which left Georgetown Saturday morning held its first meeting at the Bermine Bauxite Union Hall in New Amsterdam.

The second meeting was at the Bermine Hall in Kwakwani Saturday evening, and the final meeting was held with workers and management officials Sunday at the Aroaima recreation club.

In the main, workers were interested in hearing what the Prime Minister and party had to say.

Even though there was picketing at New Amsterdam Saturday morning, and at Kwakwani on Saturday night, there was a definite change of mood and lively interaction followed after Prime Minister Hinds briefed workers on the real situation in the bauxite industry, and what the changes will mean for them.

Mr. Hinds noted that bauxite operations which were nationalised in the 1970s, instead of making a cash contribution to the economy, had actually been receiving support from the national treasury to the tune of some US$300M-US$400M.

He cited the following financial requirements in the bauxite industry, the burden of which, fall on the national treasury:

** The guarantee of a bank loan to Bermine in the sum of US$1M to sustain operational costs.

** Linmine requiring about US$8M for the operations, and another US$4M towards services such as water, electricity, and more recently

** a request from Bermine for US$5.62M to save the operations from collapse.

"So, altogether in the bauxite industry, we are looking at nearly US$18 million...", he noted.

Mr. Hinds explained that this would mean:

** Imposing additional taxes on workers.

** Cutting back on spending for roads, drainage and irrigation, water and health, for example.

** Having the budget go into a bigger deficit - which means spending more money than is collected in taxes, ultimately courting high inflation for which a big price is usually paid.

Against this background, Prime Minister Hinds said: "The merger of ABC and Bermine makes good sense since it will mean that there will now be a smaller, new and more productive organisation which has a good chance over the next ten or so years to pave its way fully into the future."

In addition, with the companies at Kwakwani and Everton not even being able to "break even", if the situation is not addressed, it will mean a serious drain on the national coffers, leading to heavy inflation.

And painting a picture of the ALCOA situation, he outlined that that company had not fully recovered from loan money it deposited to get the company going since taking over from Reynolds.

Having been forced to sell some of its alumina plants, ALCOA now has more bauxite than it can use internally. It would definitely not be interested in Everton, hence the need for that operation to be closed, Mr. Hinds noted.

Mines Manager of Aroaima Mining Company, Mr. Andrew Goode said that since the current ore body at Aroaima is likely to be exhausted in about three years' time, mining at that location will cease, and the operations transferred to Kwakwani where there are greater deposits.

The Prime Ministerial party also visited the mines site at Aroaima and viewed excavation work in progress, a worked out mines pond at Aroaima slated for future development as an acqua-culture venture and boating for recreation.

The team also toured the Case UNAMCO sawmilling operations and a residential Amerindian community known as "The Crack" aback Aroaima.