Sugar cane farmers awaiting millions of dollars owed to them by Government, by way of incentives, will have to wait even longer due to the severe financial situation facing the Freundel Stuart administration.
Government, through the Barbados Agricultural Management Company Limited (BAMC), has been able to meet just over half the promised amount owed for the 2017 crop season.
Minister of Finance Chris Sinckler told journalists on Wednesday, Government was in a bind and therefore was finding it difficult to meet its payments for this year, as well as outstanding sums for last year.
Further painting the picture of the administration’s dire financial position, Sinckler said Government has had to borrow to help prop up the organization.
He explained that the Stuart administration was already saddled with making debt payments for the BAMC to the tune of approximately $50 million a year, which he said had been “incurred by successive Governments over the last 15 or 20 years”.
“It costs Government an additional $20 to $25 million on top of the debt payments, which is about $50 million, to finance BAMC’s operations. That is what the sugar people are talking about, the subsidy that comes from Government,” said Sinckler, who added that the administration “can do as much as it can do in the circumstances”.
“We have made arrangements to borrow again for the crop this year and for last year’s payments. Those are caught up in an issue that is going on between the BAMC and the bank, with the Ministry of Finance in the middle. Until that matter is resolved, when that matter is resolved the sugar people will be paid
“But I am just showing you the extent of the financial challenges that Government has to face, and these are not challenges that were created last week or last month or two years ago or three or five years ago. These are things dating back to many years ago to the last time we had a sugar restructuring programme when late Prime Minister David Thompson was Minister of Finance under the Prime Minister [Lloyd] Sandiford administration. So this is how long this issue has been going on,” Sinckler explained.
Farmers were promised incentives of up to $160 per tonne, half of which was to be paid initially and the remainder at the end of the crop. However, up to April this year farmers had received only about $45 per tonne.
Last month, Director of Barbados Farms Limited Edward Clarke complained that without the necessary funds the sector would find it difficult to reinvest.
“It is not good having increased production then you can’t get funding to fertilize your crops to increase the next year’s production. So the plan in the industry, not just Barbados Farms, but generally in the private farmers industry, was to try to increase the level of production utilizing the resources that Government had agreed to provide as in incentive for increasing growth of new cane planters, and the problem is that the payments have not materialized in a timely fashion once again and we continue to wait for these,” Clarke had said.
Acknowledging that it was critical that funding continued for the industry, which employs approximately 3,000 part-time and full-time workers, Sinckler said Government was committed to keeping the industry afloat despite its miniscule contribution to the island’s gross domestic product.