Guyana is protesting Trinidad and Tobago’s issuance of licences to manufacturers allowing them to import refined sugar duty- free from outside the region.

The Minister of Foreign Trade and International Co-operation, Clement Rohee has written his counterpart, Minister of Trade Ken Valley, and also corresponded with the Caricom Secretariat, seeking bilateral talks on the issue. Rohee also said he was not aware of any request via the Caricom Secretariat for a certificate under the Safeguard Mechanism that would allow the manufactured products, using the imported refined sugar, to qualify for community-origin treatment. A statement from the ministry on Wednesday said that Trinidad’s move does not augur well for intra-regional trade or the realisation of the regional single market and economy.

It comes at a time when Guyana has the ability to supply the Trinidad and Tobago refiner with its required supplies of raw sugar.

At the heart of the problem is the wish of Trinidad’s manufacturers to buy refined sugar at a cheaper price than through the Sugar Manufacturing Company Ltd. (SMCL), formerly Caroni (1975) Limited. In the last few months they have been enjoying waivers because the Caroni mill was closed down. But this period is coming to an end and some of them, including SM Jaleel and Co. Ltd., makers of Busta, are resisting any return to the previous arrangement. SM Jaleel is importing sugar from Colombia. If this situation continues, demand for Guyana’s raw sugar for use in the mill would be jeopardised.

Guysuco and SMCL have already initiated discussions about the supply of sugar for the period August 2003 to February 2004.

However, in an article in Thursday’s Trinidad Business Guardian headlined `Scouting for sugar: Big users want to by-pass Caroni, buy from world market’, it was reported that the T&T government had no intention of reducing the cost of imported sugar sold to local manufacturers, as the T&T government sought to ensure the viability of its newly-formed Sugar Manufacturing Company Ltd.

The statement from Guyana’s Ministry of Foreign Trade and International Co-operation noted that in keeping with the Caricom Treaty obligations, T&T is required to apply for a certificate to allow products produced from extra- regional refined sugar to be granted community-origin status so that the products can be traded regionally, duty free.

T&T’s action, the statement said, would not enable the final processed sugar-based products from the imported refined sugar, to be traded duty-free, regionally. The statement noted that such products would attract the Common External Tariff (CET) when traded in the Caricom region.

The statement also noted that reports also indicated that raw brown sugar sourced from Colombia and bagged for retail sale were available in stores and supermarkets in T&T at costs which did not reflect the application of the CET and other charges associated with the imports from extra-regional sources.

It was noted that T&T’s actions put into question the sustainability of regional agricultural industries. The statement added that for last year alone, Guyana imported about $US4.2M just in beverages, in addition to significant quantities of other sugar-based products such as biscuits and confectioneries from Trini dad.

Stabroek News understands that no response from Valley had been forthcoming to Rohee’s request as of Thursday.

Assistant Caricom Secret-ary-General Byron Blake on Thursday confirmed that T&T had not requested a certificate under the safeguard mechanism.

He explained, however, that if Trinidad and Tobago did not accede to bilateral talks with Guyana the Guyana government could forward its concerns to the Caricom Secretariat or refer the matter to the Council for Trade and Economic Development (COTED).

Blake told Stabroek News that at the 14th Meeting of COTED, Guyana, Belize and T&T “agreed to deal with requests from Trinidad and Tobago for a certificate under the Safeguard Mechanism for refined sugar products, on a case-by-case basis within three working days.” In a background to the agreements made at the 14th COTED Meeting, the statement said that Guyana and Belize, the two major sugar producers and suppliers of sugar in the CARICOM region had objected to a request from T&T for a certificate under the safeguard mechanism to import 14,000 metric tonnes of refined sugar from extra-regional sources for the period February 2003 to December 2003. The objection was made on the grounds that these two countries could meet T&T requirements for raw sugar.

At the 14th COTED meeting, Guyana, Belize and T&T along with the CARICOM Secretariat and the Sugar Association of the Caribbean held discussions which resulted in the following decision: “Trinidad and Tobago, in noting the undertaking by Caroni (1975) Limited to import raw sugar from Belize and Guyana for refining in 2003, stated its need to provide for circumstances in which Caroni (1975) Limited Refinery was shut down at short notice by industrial action.

“Belize and Guyana were sympathetic and, based on this understanding agreed to deal with requests from Trinidad and Tobago for a certificate under the safeguard mechanism for refined sugar products, on a case-by- case basis within three working days.”

And in relation to pricing of imported sugar in T&T, the Business Guardian quoted the newly-appointed Chairman of the SMCL, Prem Nandlall as saying that the company might even decide to sell its imported sugar to local manufacturers at a cost higher than its existing mark-up which was 15% above the world price.

However, he said that the new SMCL board was willing to get the input of the local manufacturers, who would be the company’s customers, before making a decision.

The likelihood of the continuation of the 15% mark-up and its possible increase is the main reason why some manufacturers want to import sugar in bulk on a duty-free basis, without government approval, instead of having to solely depend on the SMCL.

The Business Guardian says SM Jaleel, which has opposed the mark-up from the start, has noted that foreign competitors are buying their sugar at a much cheaper price. (Miranda La Rose)