Sugar says no to EU price cuts
factories would be jeopardised Boast
Stabroek News
July 20, 2004
United against sugar price cuts: From left Guysuco Industrial Relations Director, Jairam Petam; Kenneth Joseph, President of the National Association of Agricultural, Commercial and Industrial Employees (NAACIE); Komal Chand President of the Guyana Agricu
The sugar industry yesterday banded together to send a message to the European Union (EU) that it strongly opposed planned cuts in the price of sugar and warned that factories would have to be closed if the proposals went through.
Almost 125,000 Guyanese are directly and indirectly dependent on the sugar industry and the proposals could put thousands of them out of jobs.
Workers backed by their unions and executives of the Guyana Sugar Corporation marched and waved placards in front of the European Delegation to Guyana's office on Brickdam for over an hour before dispersing.
`Without sugar all Guyana will suffer' and `European Union reform has destroyed banana, rice and rum and if it succeeds sugar will be the next victim' were some of the slogans chanted.
The protest which was originally scheduled for 1 pm got underway around 11.30 am in slightly overcast conditions with around 50 picketers.
The EU proposals, which were discussed at a council meeting yesterday in Brussels, Belgium would see sugar prices dropping by 20% next year and down by 33% in 2007. (See other story on page 4)
This could cost Guysuco US$200 per tonne of sugar, which on an export base of 167,000 tonnes would be equivalent to US$33M a year.
Chief Executive of Guysuco, Michael Boast, who was also on the picket line told reporters that the current proposals would have very negative consequences for countries like Guyana.
Contending that the reforms are a breach of trust between the EU and the African, Caribbean and Pacific States (ACP), Boast noted that Guyana only recently signed a large contract for the Skeldon Modernisation Project and the pricecut proposals would severely affect progress in the venture which also relies on selfgenerated funds.
If the price cuts were implemented Boast warned that Guysuco would have no other choice but to close some of its factories resulting in the retrenchment of thousands of persons.
"So it's a situation which demands that all Guyanese stand firm in unity and let our objection be known," Boast said.
Boast added that it is going to take a lot of work to persuade the EU to change its mind.
He noted that the company was aware of the EU's proposals for reform for some time now but they were assured that the changes would be implemented over a period and not as radically and as deep as is now being argued for.
"We were under the impression that the price cuts would range between 3% and 4% over a phased period and by that time we would have been ready to accept it, but Guysuco neither the other ACP countries could handle it right now," Boast said.
He said they were aware that in order to be more competitive they had to significantly reduce their cost of production. At present, the Chief Executive said Guysuco is producing sugar at US18 cents per pound. He said this had to be reduced to about 12 cents which could be attained in another four years but not with the current proposals.
Boast observed that the present proposals would see sugar prices on the European market dropping from 26 cents per pound to 16 cents and also a massive reduction in Guyana's quota.
"But there is going to be a lot of political intervention and I hope that at the end of it all we in Guyana and the other ACP countries will have a good deal."
Shortly before the picketing exercise kicked off EU Resident Representative to Guyana Per Eklund was seen leaving his office. He returned later to see the picketers standing in front of his office gate and when approached for a comment by reporters the Ambassador declined.
However when contacted later he told reporters that the EU was aware of the negative effects such proposals will have on ACP countries, but asserted that the present system could not remain unchanged. He said the system had been the way it is for over 30 years.
Eklund added that the present arrangements were not viable for the EU and as much as the proposals will affect ACP countries, beet producers in Europe will also feel the effects.
Eklund said they would have to find ways to cushion the effect the reforms would have on countries like Guyana, but asserted that the proposals are not sealed and the final document could be changed after consultations.
Komal Chand, President of the Guyana Agricultural and General Workers Union said whenever Guysuco is in the out-of-crop season thousands of cane cutters and other workers are without jobs and had to eke out a living sometimes doing demeaning work. He said with such a situation combined with the EU's proposals many families would lose hope.
Chand observed that apart from the loss of jobs which would result if the proposals are implemented, other vital services provided by Guysuco would also be in jeopardy. He said it was hoped that the picketing exercise, along with consultations and lobbying would force the EU to reconsider.
Foreign Trade Minister, Clement Rohee also turned up to lend support to the exercise. The minister remarked that it was a good sign to see that management and the unions were united in the cause. He assured that the Caricom Heads of Government along with ACP representatives will continue to put forward their case.
When asked if he was optimistic about a less radical proposal, Rohee said it calls for intense lobbying and consultations.
Kenneth Joseph, President of the National Association of Agricultural, Commercial and Industrial Employees (NAACIE) said the proposals are nothing less than a betrayal of reassurances given, that any changes would be designed to avoid severe disruption to the economy.
"This abrupt and unexpected price cut calls into question the seriousness of the EU's commitment to the recently launched negotiations for economic partnership agreements.
"These proposals are totally unacceptable and must be challenged immediately and strongly," the NAACIE president declared.
The organisers say they will monitor the talks and would take whatever action they deem necessary. (Nigel Williams)