CANE farmers in Barbados are to receive the Government subsidy they have been requesting once an arrangement is finalised by the Barbados Agricultural Management Company (BAMC) and the bank providing the funds.
That much has come from the Minister of Finance and Economic Affairs, Christopher Sinckler as he reported to the media on talks between his Ministry and the private sector, on the 2017/2018 Budget and budgetary proposals he presented late last month.
The farmers have been requesting the subsidy saying they have to prepare their operations for both the forthcoming 2018 sugar crop and the 2019 one.
Sinckler said that the matter is presently being dealt with by the BAMC and the bank with his Ministry also in there. “When that matter is resolved the sugar people will be paid,” Sinckler assured while also noting that it is part of the financing which Government has to find to run the country.
The Minister pointed out that Government is paying the BAMC’s debt incurred over the last 15 years to 20 years, to the tune of mover $50 million. He said that they have had to repay a bond repayment of $60 million on behalf of the BAMC and will have to pay a similar month when it falls due. Furthermore, it is costing the present Government an additional $20 million to $25 million on top of the debt payment, to finance the BAMC’s operations.
Sinckler said that since there is a gap between what the industry earns from the sale of sugar and the cost of producing the commodity, the idea of the subsidy has arisen. “What happens therefore is that the government comes in and subsidises the difference to keep the over 3 000 people employed in the industry,” he told the media.
It was further noted that the industry is unable to finance the sugar crop because it is not earning enough from sugar sales. The Minister pointed out that the sugar sector has declined to such an extent that its foreign exchange earnings have dwindled and its contribution to gross domestic product is minuscule. “So we have to borrow that money, for the payment of last year’s crop and for this year,” the Government official explained.
Last year the crop produced a paltry 7 000 tons of sugar. Output from this year’s sugar harvest was expected to double the amount produced last year. Government has said that its long-term goal is to have the industry producing 25 000 tons of sugar.
Since earlier this week Sinckler has been meeting with private sector leaders to clarify some aspects of the May 30 budget and Budgetary proposals which are to take effect from July 1, this year. On Wednesday he said that the measures will remain although he has been clarifying the proposals. However, he has promised consumers some relief noting that over 300 items some of them including food, will be exempted from the controversial National Social Responsibility Levy, one of the key revenue raising measures in the Budget. (JB)