The Guyana Sugar Corporation (GuySuCo) needs a Government bailout or it will not survive into next week, the Corporation’s chairman John Dow has told President David Granger.
“For the thousands of Guyanese who directly and indirectly who still depend on the sugar industry for their livelihoods, this is most disturbing news at this time,” the workers’ Union GAWU stated.
Faced with mounting debt, low production and the COVID-19 pandemic, GuySuCo wrote the President on May 15, but there has been no response.
Some 10,000 workers are employed by the country’s three sugar estates.
GAWU released the letter from Dow to the media.
“The GAWU has learnt that GuySuCo is facing the prospect of closure having exhausted its finances and was desperately requiring the support of the Government,” the Union stated.
GAWU noted that in the letter, GuySuCo’s chairman called on the President“…to use your good offices to arrange for funding to prevent the impending closure of the Industry”.
It noted that Dow told President Granger that “…GuySuCo needs funds now to be able to survive after the 2nd week June 2020”.
The GAWU, through its representative on the GuySuCo Board, said it has learnt that the President did not respond to the Corporation’s request.
“Our Finance Department estimates that the Corporation is expected to be out of cash by the 2nd week in June and until then we can only afford to meet labour, fuel and cane farmers’ payments and the bare essentials (labour transport, lubricants, etc.),” Dow said in the letter.
He said there is also a backlog of G$2.1 billion owing to creditors.
According to Dow, to date, GuySuCo has expanded $9.6 billion from a bond secured by the government’s asset holding arm NICIL and the Special Purpose Unit (SPU) it created to manage the divestment of the industry.
But Dow said GuySuCo understands that only $17 billion of the $30 billion bond has been raised thus far and from a recent interaction with NICIL/SPU, “little or no further funds are likely from this source in the near future.”
Further, he said NICIL/SPU has been selling off assets form the closed estates and GuySuCo has not received any accounting of the sale of these assets.
“NICIL/SPU merely states that there are now their assets and the funds from these sales are being sued to repay the Bond,” Dow stated.
He said the question has to be asked why GuySuCo has to fabricate new pants and buy new tractors when these items are being sold to others without GuySuCo being given the opportunity of the first refusal.
He said that the financial situation is so dire that the two accountants on the board felt obliged to resign.
