By KRISTEN MACKLINGAM

As a result of Venezuela’s decision to sever ties with Guyana in relation to the PetroCaribe deal which was on-going for many years and now inking the same deal with Suriname, Guyana’s former Agriculture Minister, Dr Leslie Ramsammy has posited that the APNU/AFC coalition is responsible for this major loss.

Further, he stated that it is his firm position that this new Government is “killing the rice industry” in Guyana since the pathway the APNU/AFC Administration has chosen has placed rice on the road to destruction.

Dr Ramsammy told Guyana Times on Sunday that should the rice industry die then Guyana would encounter ‘serious’ economic and social troubles.

He made reference to the Venezuelan President Nicholas Maduro’s address on Friday last, notifying the Spanish-speaking nation, that his country has officially ended the rice agreement deal with Guyana and now pursues a rice deal with Suriname instead.

“This seems to end any hope that we might have been able to restart the rice deal with our neighbour. Problems with the Venezuelan market started soon after the APNU/AFC Government assumed office. One of APNU/AFC’s first acts with international implications was the grounding of Conviasa, the Venezuelan airline that operates between Guyana and Caracas,” Dr Ramsammy stated. He reminded that the Venezuelan airline had failed to deposit a refundable fee of about $US200,000 as a condition for operating the Guyana-Venezuela air route. According to Dr Ramsammy the previous Government now Opposition Party, the People’s Progressive Party/Civic (PPP/C) approached the solution with patience and through intense and firm negotiation:

“We did not believe that grounding Conviasa was in Guyana’s best interest because in the first place, the route between Guyana and Venezuela was a useful one and served both ours and the Venezuelan needs. But the most important reason for not grounding the airline was to ensure that Venezuela did not retaliate by curtailing the rice deal.

The Venezuela rice deal involved the export of 200,000 tonnes of rice and paddy for 2015, with a value of $23B (US4115M) and the PPP/C thought that the pathway of dialogue, negotiation and encouragement with Conviasa was the more prudent option and would not risk the rice deal and risk the livelihood of rice farmers.”

Sadly, the APNU/AFC Government sought to approach the said issue with a different perspective — they were determined to play “big and bad” and grounded the Conviasa, demanding immediate payment as a condition to operate again, Guyana Times was also told. “How do you risk $US115M to protect US$200,000? The consequence is that paddy and rice already at the wharf for shipment had to be returned to the millers, as Venezuela stopped shipment and this matter, I am informed, will be a legal tussle between the Guyana Rice Development Board (GRDB) and the millers. Millers have not paid some of the farmers, claiming it is the fault of the GRDB that the rice was not sold,” the former Minister emphasised.

This newspaper was also told that the PPP/C had hoped that the Conviasa issue would have been resolved amicably and that the rice agreement for 2015 would resume.

However, those hopes were dashed by tensions on the border with Venezuela and although this had nothing to do with the PetroCaribe deal, the rice trade with Venezuela has become the most important victim of the border tensions, Dr Ramsammy  pointed out. “Like the PPP/C, I stand firm with our Government that our borders are sacred and non-negotiable. While rice might have in any case become a victim of the border tensions, its trouble started not with the border issues but with the grounding of Conviasa. It was an example of poor management of a problem with international significance and I support the position of the Leader of the Opposition that we should still try to delink the border tensions from the rice trade agreement through a one-on-one dialogue between the Presidents of the two countries,” he stated. As such, the announcement by President Maduro that the rice deal is formally over increases the uncertainty in the rice industry which is presently plagued by low prices for paddies and a shift from high priced markets to low priced markets.

It must be reminded that with the loss of both the Venezuelan and Panamanian markets, export is not likely to reach the 503,000-tonne mark of 2014, resulting in a large “carry-over stock”. “Inevitably this will result in millers encountering difficulties in proper storage for the supply will exceed demands. The situation is untenable and will sink many families into poverty; and farmers have financial commitments, including restarting the next crop — and many of these farmers have bank loans to service.

Yet farmers are not the only ones affected because the downturn in rice has a domino effect on the economy, as can be seen with retail businesses in rice areas and around the country coming to a virtual halt. These are serious problems and yet they are not the only problems low prices for paddy are causing,” Dr Ramsammy said.

According him, a positive Government response is necessary and opines that it is blatantly foolish to chastise the farmers and millers with such nonsense as “this is their business”, because rice is a private sector activity.

“APNU/AFC’s position that because rice is private sector the Government cannot intervene is a callous, insensitive, stupid and discriminatory response to the crisis in the rice industry. Mining is also private sector and mining deserves the subsidies and other benefits being offered to them by APNU/AFC in response to the low gold prices in the markets today.

In spite of mining being exclusively a private sector activity, the Government did see it as necessary for a Government intervention, even if they have not gone far enough,” he reminded. Guyana Times was further told that such a position by the Government displays “double standards” since rice  is “at least equally important” to the economic and social development of Guyana.   “I will argue that from a GDP perspective, rice is even bigger than mining, although it is a mistake to rank these important economic planks as more important than each other.

The Government must immediately negotiate with bankers to provide relief for farmers from loan payments due at this time and rescheduling with friendlier terms, including interest rebates. Subsidies for fuel, fertilizers, seed paddies, vehicles and other inputs that would reduce the production cost are important initiatives that the Government must embark on now,” he added. “They have shown a willingness to intervene in the private sector, for the good of Guyana.

The subsidies already given to the mining industry is a good example. Although I am opposed to the intimidation of the Berbice River Bridge Authority, this is more evidence that when APNU/AFC wants to intervene in the private sector, they have no hesitation. Therefore, the position that they cannot intervene in the rice industry is sheer hogwash,” Dr Ramsammy declared.

He also noted that incidentally, the cost of the “super salaries pay increases” could cover some of the subsidies noted above to buffer the crisis in the rice industry.

Guyana Times was also told that the $22M spent to procure a vehicle for Prime Minister Moses Nagamootoo could have been utilised to pay for seed paddy for rice farmers. (kristenm@guyanatimesgy.com)