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The Senate last Friday (Dec. 9) approved a motion calling on Finance and Planning Minister, Dr. Omar Davies, to urgently conclude the ongoing investigations into the operations of the sugar industry and arrange for assistance to the sector to prevent the further loss of foreign exchange to the economy.
The private members’ motion, which was laid by Leader of Opposition Business Senator Anthony Johnson, was also modified by a unanimous decision, to include that a request be made to the relevant European Union agencies to provide a sum of not less than 160 million Euros for the restructuring and modernization of the ailing sector.
This comes against the EU’s recent proposal of a 37 per cent cut in the price of sugar imports from Africa, Caribbean and Pacific (ACP) countries over the next three years, with compensation of 40 million Euros for all 18 member states in the first year.
Jamaica and other ACP countries have expressed opposition to this move and have instead suggested a 19 per cent price reduction to be phased in over an eight-year period and have called for an increase in the compensation package. It has been noted that Jamaica alone would require some 160 million Euros to undertake a programme of readjustment, modernization and diversification.
In the meantime, Senator Johnson also requested that additional information be provided on the closure of the state-run Long Pond and Bernard Lodge factories as announced by Prime Minister Patterson in October, while expressing discontent that prior consultations had not included all stakeholders.
He said that these matters must be addressed to save the industry, which earned annual revenue of US$130 million and was “the largest single employer of labour in Jamaica and the single largest agricultural industry”.
Noting that sugarcane had not provided an acceptable lifestyle for persons involved in its production, Senator Johnson said it rested with policy planners to develop systems and mechanisms to enable the benefits from the crop to be felt by all. “We have to do something about sugar.keeping sugar alive and vibrant is a form of social insurance; the resorts cannot afford another influx of the unemployed,” Senator Johnson stated, adding that the calls to abandon sugar production were not to be heeded.
Noting the recent surge in sugar importation by China and the interest in the industry by Brazil and India, Senator Johnson said the possibility existed that the prices for sugar could be kept competitive.
Furthermore, he said, “the priority must be to ensure that the 2005/2006 sugar crop was as large as possible,” and that the factories and the road networks in the areas affected by hurricanes, specifically sections of Clarendon, Trelawny, St. Thomas and St. Catherine, were up to standard. “Work is needed now, not tomorrow,” Senator Johnson stated.
Government Senator Trevor Munroe, in his comments, said that there was consensus on the need for the industry to be restructured, modernized and made competitive in order to provide a decent and adequate standard of living for persons working in the sector.
He said it was also accepted that all stakeholders and the government were to be involved in charting the way forward and informed that already, a meeting involving the Planning Institute of Jamaica, Government agencies and all stakeholders had been held to develop a country strategy for the adaptation of the sector.
Senator Munroe said that the modernization and restructuring must be accompanied by a plan of action to move the sector forward and monitoring committees should be established at the central level and on each estate, to see that the plans agreed on were implemented in a timely manner.
He further called for the strengthening of the country’s lobbying voice in the international arena, complemented by the intensification of internal efforts to redesign and improve the competitiveness of the industry.
Leader of Government Business in the Senate, Senator Burchell Whiteman, while noting the calls for a plan of action, informed that a policy position had been stated in a previous presentation by Prime Minister Patterson. Furthermore, he said the operational side of the process was moving, backed by a principle of strategic alliance.
Speaking in the House of Representatives in October, Prime Minister Patterson said the policy options so far accepted would see the industry centered around the production of raw sugar for the export and domestic markets; molasses for rum manufacture and ethanol as a substitute for MTBE for the local transportation sector in the first instance.
Mr. Patterson said it was also proposed to produce some 200,000 tonnes of raw sugar per annum, which would enable the country to meet the 126,000 tonnes per annum quota in the EU market. Prime Minister Patterson said three of the state-owned sugar companies and two privately owned plants would undertake the production and informed that this would necessitate the eventual closure of Long Pond and Bernard Lodge factories.
He however emphasized, that while it was not intended to immediately close any factories, the government would be forced to do so in light of the agreed phasing out period and the introduction of suitable alternatives.