Stabroek News
April 30, 2001

Last week's ACP ministerial conference on sugar illuminated clearly some of the major challenges facing the sugar industries of the ACP countries and more importantly ours.

It was an important lesson for Guyana and its politicians. While we continue to bicker fiercely here over the spoils of political power, the gargantuan wheels of globalisation roll inexorably forward threatening preferential trade agreements and thereby further endangering vulnerable economies like ours. Important trade decisions are being made for us in important places while our voice of protest is muted and jammed by internal political differences and an inability to bridge the divide.

The two rounds of dialogue to date between President Jagdeo and Mr Hoyte offer great hope of significant agreements towards lessening the periodic eruptions of turmoil that have gripped the country. It will not be a moment too soon but in the meanwhile the two leaders should lay the basis for an immediate all-party group on the rice and sugar industries. The bauxite industry has already been identified as an area for joint action.

The problems of the sugar and rice industries are well known. Guysuco faces the important challenge of lowering its cost of production, gathering the financial backing for its US$200M expansion plan, venturing out into value-added activities, finding new markets and protecting its prized European Union (EU) sugar protocol and special preferential sugar quotas from diminution and price erosion.

The EU Everything But Arms (EBA) proposal represents a danger to our valued European quotas. The manner in which it crept up and caught the ACP members by surprise is not reassuring of the clout wielded in Brussels by their diplomats. It is a reminder that Guyana and the rest of the ACP have to seek more effective representation in Brussels and other important capitals and the government here must recognise this.

In the rice sector, severe farmer and miller indebtedness to the banks, reduced markets and lower prices, unattractive yields, uneven quality and insufficient investment in new rice strains are significant problems. There are also problems on the international front. The choking off of the Other Countries and Territories route was the rice equivalent of what the EBA threatens together with the new EU method of assigning quotas which create problems as they sometimes do not coincide with our crop periods.

Last week, there was another potentially troublesome development. The two largest rice exporters in the world, Thailand and Vietnam agreed to revisit attempts to establish a cartel-like arrangement to govern the rice trade. As of now, our rice sector cannot compete with Thai and Vietnamese exports because of the scale of their production. Their renewed interest in managing the rice trade bears careful watching as it could close off other markets to us. The EBA is also a threat to rice in Europe.

Sugar and rice are two of our pivotal exports and in the light of the problems that they face here and the international dimensions, there should be all-party consensus and a commitment to ensure that these industries are not affected by political instability. There can be no reason for reaping political capital out of the woes faced by these industries. Both the government and the opposition must therefore commit to working together on the rice, sugar and bauxite industries and cooperate on external challenges such as what tariff free trade in the Americas by 2005 will mean for the domestic economy.