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Minister of Agriculture, Dr. Christopher Tufton, has advised that the Government hopes to reach an agreement with the Brazilian company, Infinity Bio-Energy, to take over ownership of the five state-owned sugar estates shortly.
A clause in the Heads of Agreement, that was signed in June, has had to be activated, which allows for a three-month extension if an agreement was not arrived at by the September 30 deadline.
Speaking at the 62nd Annual Conference, of the All-Island Jamaica Cane Farmers Association, held at the Jamaica Pegasus Hotel in Kingston on Tuesday (September 30), Dr. Tufton informed that it was felt that “it would have been impossible to complete all the discussions and the negotiations, in time for a signing today. And so we took the position to trigger that clause in the Heads of Agreement, to continue that dialogue until we reach a final position.”
“I know that there are a lot of questions being asked about this privatisation programme.the fact is the negotiations that have been taking place for some time now, ever since Infinity Bio-Energy was identified as the sole bidder in this privatisation exercise, has not reached the point, where based on consultation between both sides, the Government and the Brazilian company, we believe we can sign a final agreement. We are working towards that final point. We are confident that we will reach that agreement. In fact, the discussions continue as we speak,” he assured.
Dr. Tufton said that the Brazilian company was keen on reaching an agreement as “they believe that the plans that are in place to move the sector forward, are plans that can realise commercial viability and of course can preserve the sustainable development of the sugarcane industry.”
Noting that the Government was equally committed, the Agriculture Minister, said there was need for transformation to take place, but that “we are not convinced that as a Government, we alone can lead that transformation with the existing status quo with the existing stakeholders. And so, we carry on that negotiation in good faith, and we believe and we hope that an agreement will be reached sooner rather than later.”
Dr. Tufton noted that some issues surrounding the delay, regarded legislative changes that must be made. “Most of those issues are on the energy side. We have an E10 policy. We have to sort out issues with Coimex. Some of those issues require legislative changes and some other infrastructural issues. While we may have verbal agreements, we need to have signed agreements and therefore that has delayed the process somewhat,” he explained.
He pointed out further that the negotiations were not a simple matter and many organisations, agencies and Ministries are involved in the process. “These are not simple discussions. The importance of this industry, and the size of this industry and the length of time this industry has been part of our landscape here in Jamaica, makes the discussions even more complicated, even more complex,” he said.
“These discussions,” he further outlined, “involves the Ministries of Finance, Agriculture, Energy, and Health and Environment. It touches on a multiplicity of agencies.a number of agencies that are critical towards dealing with the overall framework to allow for the future viability of the industry. It involves legislative changes, which clearly have to go through a process involving the Attorney General’s Department, lawyers on both sides of the negotiating teams.”
He noted further that social services, and Non-Governmental Organisation’s (NGOs), such as Food for the Poor, and the European Union (EU), were also involved in the process.
“So the point is, this is a discussion that is delicate, that requires an approach that is sensitive to the nature of the industry and I don’t need to tell you that we have been down this road before and one of the things that we are extra cautious about, is that the mistakes that were made in the past are not repeated in this case,” Dr. Tufton said.
He appealed to all concerned to exercise patience, “to appreciate the challenges that we are confronting and support the process as best you can, because it is in the interest of all of us that this process works, and up to this point, I must commend those stakeholders. Yesterday I had a meeting with the trade union representatives, (and) with the representatives from the cane farmers group. We had discussions on all the estates, updating the workers as to what was happening and as I understand it, up to this point, things have been calm.”
The Agriculture Minister noted that this suggested a level of maturity that is being adopted towards this process. “That is commendable, from all perspectives and involving all concerned.it is good and it augers well for the future of the industry,” he said.
Dr. Tufton said that while a definitive date cannot be given as to when a final agreement will be reached, he is assuring workers that it is business as usual until then.
“We’re still preparing the factories. People are still there and from the farmers and workers perspective they can just assume that nothing is happening, because they are just going ahead with doing what they are required to do. When an agreement is struck, then the redundancy exercise will be triggered once the signing takes place and the Ministry of Finance is fully prepared to provide necessary compensation for all workers, and then the new company, Newco, would now trigger the rehiring process and they will be selected based on their business model.”
He informed that a facility will be established on each estate to help workers who are dislocated in the exercise.
When completed, the divestment will see the creation of a new company, 75 per cent of which will be owned by Infinity Bio-Energy Limited, and the other 25 per cent by the Government of Jamaica.