Local producers seeking fairer deals for feeds, oil, sugar

By Patrick Denny
Stabroek News
January 26, 2000

Some local private sector representatives want to see talks with Trinidad due to begin today focus on innovative ways of narrowing the $7 billion trade deficit between the two countries.

They feel that edible oil and the animal feed sector could be used to help narrow the deficit.

A delegation headed by Ralph Maraj, Trinidad and Tobago's foreign minister, will be holding talks aimed at increasing trade between the two countries and ironing out the difficulties faced by Guyanese products accessing the Trinidad and Tobago market.

His visit is a follow up to one by Maraj's Guyana counterpart, Clement Rohee, who led a public and private delegation to Port-of-Spain last year.

Robert Badal who heads Guyana Stockfeeds Limited contends that because of the importance of the animal feed sector to the rice industry, it should qualify for special treatment. He contends too that because of the advantages enjoyed by Trinidadian manufacturers such as extensive credits, subsidies paid to manufacturers, low electricity costs, among others, there should be some transitional period before trade between the two countries is fully liberalised.

In supporting his case for special treatment for the animal feed sector, Badal told Stabroek News that imports between July and December last year were around an estimated $78 million which entered Guyana without attracting the Common External Tariff (CET) even though none of the inputs for manufacturing stockfeed is available there.

He explained that while the Customs and Excise Department accepted Trinidad and Tobago's assertion that its stockfeed was eligible for exemption, it was not qualified to make such a judgement since it was not aware of the production process.

Badal further explained that while the value added by Trinidadian manufacturers to the inputs was minimal, Guyana's value added component was an estimated 71 percent.

He argued too that inputs for the production of feeds were secured through the US PL 480 programme and that the proceeds of the sale of these inputs go to financing social projects such as education, health services and other ventures aimed at supporting community development.

Any decrease in sales, he said, would thus affect this programme. The edible oil sector also suffers from Trinidad's re-export of the commodity in which the local input is minimal.

Steve Hemraj of Pomeroon Oil Mills complains that crude soya oil is imported into Trinidad, refined and then re-exported to other CARICOM territories including Guyana. Hemraj told Stabroek News that in Jamaica and Antigua, this oil attracts a 40 percent impost.

He pointed out that Trinidad imports copra from Guyana through local buyers but the export of this commodity is not properly reflected in the export figures produced by the Ministries of Trade and Agriculture.

"In any bilateral trade agreement with Trinidad and Tobago, the export of copra should be banned," Hemraj argues, noting that if the situation was reversed the export of copra would not be allowed.

Hemraj claims too, though he has yet to obtain confirmation, that the copra producers in Trinidad are being subsidised. He said that his experience suggests that the price being paid would involve some subsidy.

He explains too that if the export of copra was banned the producers here would in about a year be able to expand their production to meet the demands of the local market. The plants here, he said, were at present operating at less than 60 percent of their capacity.

Hemraj says too that the quality and price of the local edible oil is competitive as it sits on the shelves equally with other products from around the world and in the supermarkets in the other CARICOM states, including Trinidad and Antigua.

Another product which is experiencing difficulty is Guyana's sugar which has been subject to quality complaints. Guyana's sugar, Stabroek News understands, is produced to US and European standards but Trinidad refiners claim that it is below the quality required for their operations.

As a result, they argued that their production using the Guyana product is not of the desired quality and as a consequence do not attract the best prices.

Market access difficulties has been occupying the attention of President Bharrat Jagdeo since he assumed the presidency in August. He has raised the issues with Trinidad Prime Minister, Basdeo Panday, and there have been discussions at the ministerial level of the two governments as well as at the level of their private sector organisations.

Recently the issue of access of Guyana's parboiled rice to the Trinidad market was discussed during the visit of Lindsay Gilette, Minister in the Office of the Trinidad Prime Minister. Local rice producers have long complained that they have been given a hard time in penetrating the Trinidad rice market although their parboiled rice is of impeccable quality. After talks with industry officials here, Gilette gave a commitment that once certain problems were ironed out between the two sides, local producers would be able to hike their exports to the twin-island republic.

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Guyana: Land of Six Peoples