Banks tardy in restructuring rice debt - Chandarpal
Crop to fall 20% below projection
By Andrew Richards
Stabroek News
May 15, 2002
Minister of Agriculture, Navin Chandarpal, has expressed disappointment at the delay by commercial banks in assisting rice farmers in restructuring their debts.
This is the situation even though government had reached an agreement with the banks to restructure the debts of some 1,200 rice farmers whose outstanding principal was no more than $10 million, and who together account for some 11% of the $12 billion rice debt.
At a press conference he hosted yesterday at the Ministry of Agriculture, Chandarpal said though the agreement was reached on January 31 this year, the banks only recently put it into effect. This would affect the farmers going into the next crop and the minister said that since all the arrangements with the banks were not in place, his ministry was looking at ways in which it could assist. He contended that the banking sector did not meet its obligations.
He recalled that when President Bharrat Jagdeo announced the assistance package, government had already met the commercial banks and had worked out the details of the arrangement.
He said the President had requested from the banks whether they would proceed with the arrangements or if further steps were required to be put in place. The minister said the banks gave the commitment that they would proceed with the arrangements with the rice farmers.
Noting that prior to that the banks had taken some of the rice farmers to court over their debt repayments, Chandarpal said the farmers became agitated when court dates drew near and their loans were yet to be rescheduled. Even though the banks had not requested further measures before undertaking the debt rescheduling, the Ministry of Finance had to issue some documentation at their request two months after the agreement before any action was taken, Chandarpal said.
He said the process was now in train with the issuing of a Ministry of Finance letter, which reiterated government's commitment in the arrangements.
Chandarpal noted that the farmers with debts over the $10 million mark were negotiating with the banks but this was going on at a slow pace and the ministry was also examining areas in which it could help.
The minister also used the opportunity to brief reporters on Guyana's strategic plan for the rice industry.
Outlining the 2001-2011 plan, Chandarpal said the first objective was to increase rice production and productivity to the point where Guyana became internationally competitive. For this to happen, production would have to be an estimated 38 bags per acre.
The minister said the plan would establish national policies, which support the systemic development of the rice industry.
It would create conditions for farmers to have access to appropriate and state-of-the-art technologies and methods for efficient rice production on a regular basis.
Systems would be established to operate and maintain drainage and irrigation infrastructure in a sustainable manner. Quality rice seeds of appropriate varieties would be provided to meet the national demand. The minister said systems would be created to provide the necessary support services to rice farmers in a sustainable manner.
The plan would also seek to improve the post handling system to the point where rice quality is maintained or improved and losses reduced to the minimum. Recovery would be improved during milling to produce a marketable product at a competitive price.
The aim is to increase whole grain yield of acceptable quality rice to 50% by the end of 2002.
An objective would be to increase profit margins in the industry by improving management of post harvest systems and adding value to rice and by-products where feasible.
Chandarpal said the plan would create a system, which regularly provides the industry's stakeholders with the decision-making information they required. An inter-disciplinary rice lobbying body, which effectively projects the competitive advantages of Guyana's rice, would be organised.
Chandarpal said production at the end of the first week of May stood at 137,000 tonnes with 83% of the sown area harvested. He said at the completion of harvesting, the crop should close at about 80% of the budgeted amount.
The minister stated that problems were encountered with drainage and irrigation due to the fickle weather. He said the state of the drainage and irrigation system only allowed it to cope with moderate changes in the weather; intense rainfall posed difficulties.
He disclosed that during this year government earmarked $410 million to be spent on capital works for the system and $411 million for works in the regions. The minister pointed out that the rehabilitation of the system was an ongoing process.
Noting that a lot of work was being done in Region Two (Pomeroon/Supenaam), he stated that all of the areas could not be addressed in one year's budget.