GOG and EU sign financing agreement for disbursement of 2007 funds for Sugar Action Plan

Georgetown, GINA, April 03, 2008.

The financing agreement for the Guyana National Action Plan for Accompanying Measures 2007 was signed today at the Ministry of Finance paving the way for the sugar industry to access approximately US$40M during this year.
             This is part of the Euros 89M (US$140M) grant from the European Union (EU) for the period 2006 to 2010 to help Guyana deal with the difficulties being faced as a result of the adjustments to EU Sugar Protocol for African, Caribbean and Pacific (ACP) States.         The first financing agreement for the       Action Plan was signed in February 2007 while the disbursement of the first tranche of funds under that agreement was released late last year.
            Among those present at the signing of the agreement today were Minister of Finance Dr. Ashni Singh, Minister of Agriculture Robert Persaud, Chief Executive of the Guyana Sugar Corporation (GuySuCo) Nick Jackson and Head of the European Commission (EC) Delegation in Guyana Ambassador Geert Heikens.
Minister Singh noted that the funds for the Action Plan will be disbursed through the budget support mechanism; a mode of delivery that is only effected in countries that have achieved a certain level of progress with regard to their institutional environment    
“The fact that the European Union has in recent years chosen to deliver its poverty reduction projects in Guyana using this mode of delivery, in my mind is tangible demonstration of the European Union and Commission’s acknowledgement of progress that has been made with respect to the institutional environment in Guyana,” the Minister stated.

Signing of the financing agreement at the Ministry of Finance

He further highlighted the sugar industry’s importance to Guyana and the Action Plan, which sets the strategies for the industry to overcome its challenges and further develop through which Government is investing in various initiatives including the Skeldon Sugar Modernisation Project (SSMP).
Minister Persaud pointed out that the event today confirms that the sugar industry will survive and continue to be sustainable and viable and that both the EU delegation office in Georgetown and the Commission's staff in Brussels, are supportive and consider the objectives of the Action Plan achievable. The plan focuses on expansion, development and diversification of the sugar industry, growth and expansion of specific non-traditional agricultural sub-sectors as well as infrastructural and human resource development. 
It was noted that since the resources allocated by the EU are inadequate to fund the entire Plan, Government through sound economic management and unwavering determination, has made much progress in the Plan's implementation.
The Minister reported that in the February 2008 update of the EU Commission on disbursement for the 2006 and 2007 allocations to sugar protocol countries received from the European Commission, Guyana was well ahead on the 2007 programme, with a contracted amount of Euros 13.2M.
The indicators for the variable tranche that been finalised between the EU and Guyana Government include submitting the GuySuCo business plan from which further indicators will be developed, preparing a sectoral expenditure framework document and submitting the 2008 budget for Guysuco as well as laying the audited accounts before Parliament. Preparing social mitigation programmes is another indicator.
            Ambassador Heikens pointed out that the Guyana Action Plan is a nationally owned document that sets the policy objectives and provides the roadmap for the necessary restructuring of the sugar industry.
 “I believe that the Guyana National Action Plan has seen a good start; funds have been disbursed, a Sugar Steering Committee is established and empowered to discuss critical issues and make decisions for the implementation of the plan.”
In the 2008 National Budget, approximately $7B was allocated under the Action Plan to commence modernisation of the Enmore Estate and construction of the packaging facility at the same location.
            Strategies outlined in the plan for diversification and transformation include value-added activities such as refining sugar and brand packaging, diversification in the energy sector and sustaining supplies of raw materials to the rum industry.

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