Mr. Speaker, as I rise to make my contribution to the debate on Budget 2017 under the theme “Building a Diversified Green Economy: Delivering the Good Life for all Guyanese.” We on this side of the House continue to inspire growth and reinstate confidence for the people of this dear land and for this I join with the rest of my colleagues in congratulating the Honorable Finance Minister for a budget well received.
Mr. Speaker, in 2017, agriculture will continue to contribute 16% to the economy. I must add that agriculture has received over $18 Billion in 2017, this remains one of the largest budgets for this sector, highlighting government’s commitment to agriculture and the persons involved therein.
Agriculture remains a priority area for addressing problems of unemployment, poverty alleviation and for fostering economic development. Significantly, the country is focusing primarily on sustainable food security, increasing productivity, expanding commercial agriculture, import substitution, income diversification and export orientation. In 2017, we will continue production transformation through agricultural diversification; improvement in drainage and irrigation systems; improvements in research, extension education and marketing; strengthening our regulatory framework governing fisheries, chemical and ground water management. Hinterland development with large-scale agriculture in both the Rupununi and Intermediate Savannahs will also be advanced.
We will be pursuing interventions that will ensure food security for all, specifically, access to safe food throughout the country, with a view to maintaining a healthy and productive population. With the passing of the Food Safety and Animal Welfare bills, the activation of such practices within Guyana will ensure that the country is a benefactor of many advantages especially as it relates to international trade. It is expected that these bills will boost the economy and ensure consumer confidence as well as giving Guyana a national reputation in terms of the food products exported.
Mr. Speaker, one of the most topical subjects this year and the object of much letter writing in the press, has been the Guyana Sugar Corporation and the Guyana Sugar industry.
Over the past years not much was done by way of securing the future of both the industry and the future wellbeing of its employees.
Opportunities existed in the past to reorganize and modernize the industry but these were not pursued. Reference is made here to better sugar prices, funding from the EU; accompanying measures following the reform of the EU sugar price regime; access to appropriate levels of skills and experience, etc..
The current Government, in May 2015, inherited a sugar corporation and sugar industry that were badly run down. Indeed, the first approach by the then management of Guysuco was for support from Government amounting to G$16.9 billion, excluding capital investment, to finance the operations for 2015. The magnitude of the request came as a great shock to the Government and it was only after the appointment of the new Board of Directors and Interim Management Team did this Government begin to appreciate the extent of the decline of our sugar industry.
While the onset of the El Nino weather phenomenon or drought would have had a very favourable impact on harvesting during the second crop of 2015 as a result of excellent ripening and harvesting conditions, it took its toll on the production this year. The combined effect of the poor state of the cultivation coupled with the impact of El Nino, resulted in a shortfall of 23,600 metric tonnes of sugar.
Additionally, 2016 has been plagued by poor labour turnout, lack of spares, equipment shortages in particular cane punts, and factory breakdowns. As indicated earlier, the shortage of skills and experience together with the serious underinvestment in the industry are taking their toll. While the 2016 second crop started late as a result of the wet conditions which succeeded the drought and canes yields are higher that forecasted, the Corporation would be unable to harvest all its canes before the end of the year and it is estimated that some 153,300 tonnes of cane would be carried over into 2017. This is equivalent to some 11,300 tonnes sugar.
No doubt, there are those who would like to twist what I just have said for narrow political mileage. Let us bear in mind that the El Nino or drought has resulted in a drop in world production of sugar over the previous season of over 13 million tonnes. Production declines were experienced by producers in Central America, the Caribbean, Cuba, China, India, Philippines, Thailand to name a few. Guyana was not unique in this regard.
Between July 2015 and December 2016 this Government would have provided Guysuco with G$23 billion in support. Guysuco has advised that should the industry remain as presently structured, it would require subsidies from the Government in the sum of G$ 18.6 billion and G$21.4 billion for the years 2017 and 2018, respectively. Where is this money to come from without causing serious dislocation to other sectors of the economy which are also in great need of investment?
What is even of greater concern to the Government is that this magnitude of subsidy would have no positive impact on the financial state of Guysuco. Because of the prevailing sugar prices and Guysuco’s cost structure, the Corporation would continue to lose billions of Dollars each year and would continue to require billions of Dollars in subsidy also each year, despite significant increases in production. The economy simply cannot afford this.
Government is deeply concerned about the future well being of the sugar workers and their families. Government is also deeply concerned about the state of the other sectors of the economy and the critical need for investment in these sectors. It would be irresponsible of this Government to not sensibly address these challenges in a sustainable manner.
Therefore, in relation to Guysuco and the sugar industry, the Government has appointed a Cabinet sub-committee to recommend the way forward for the industry after taking into consideration the recommendation of the Commission of Enquiry into GuySuCo, the report of the Cabinet appointed committee on diversification of the industry and recommendations emanating from the Corporation itself, inter alia. These recommendations will be presented to Cabinet for due consideration prior to the end of this year with a view to their implementation in 2017.
The successful implementation of these initiatives should return Guysuco to a state of self sufficiency and eliminate its reliance on the Government for subsidies.
Mr. Speaker, in 2016, rice production is projected to decline by 12.7% to 600,000 metric tonnes, this reduction is due to the El Nino weather conditions and some farmers exiting the industry due to the loss of the high priced Venezuela market. Due to the El Nino phenomenon, only 84% or 76,717 hectares were sown out of the targeted production for the first crop of 91,072 hectares. Of the 76,717 hectares sown, 3,311 hectares were lost. In 2017, rice production is expected to increase by 1.3%.
On the other hand, we export to 35 countries. This has led to an increase in exports by 1% over 2015 at the end of October 2016. However, due to the reduction in world market prices, the value of exports will decline. Prices at the end of October were US$370 per ton compared with US$394 in 2015. For 2017, we project exports to be around 531,000 tonnes (value US$ 180,984,100.)
I am also pleased to report that the Managing Director and a team from the Mexican Rice Council is planning to visit Guyana around mid-January 2017 with a view to initiating paddy sales to that country . I must also bring to the attention of this House that sales to the Venezulan market has recommenced and is steadily growing at prices in excess of US$500/per ton.
Mr. Speaker, the Research Station at Burma continues to work assiduously to improve rice lines being offered to farmers. However, improved rice lines necessitate improved management practices, seeding rates, sowing methods and disease management.
Government has been diligently employing various technologies in an effort to reduce the impact of severe weather. In 2017, diversification to specialty rice varieties, with increased emphasis on the development of value-added production such as rice/wheat flour blend, rice noodles, pasta and pre-cooked rice products will be pursued.
AGRICULTURAL DIVERSIFICATION – HINTERLAND AGRICULTURE
Mr. Speaker, in his address to the National Assembly in October, his Excellency, President Granger, observed that, “The 2017 National Budget will evince measures aimed at developing a more diversified and climate-resilient agricultural sector. We will:
– promote agricultural expansion further inland by introducing mega farms in the Intermediate and Rupununi savannahs;
– promote the expansion of non-traditional agricultural production such as coconuts, fruits and spices; and,
– promote the increase of aromatic rice production which will add to production in the rice sector at the higher end of the value chain..”
Mr. Speaker, because agricultural diversification is so fundamental to the wellbeing of the green economy transition, I’d like to spend my remaining time talking about what it will take to achieve these developmental advances and share their benefits.
Mr. Speaker, hinterland agricultural development will continue to be an important facet on our agriculture development agenda. In 2016, emphasis was placed on finalizing plans for expansion of the agriculture station at Ebini and the establishment of a new station at Pirara in Region #9. Work will continue in 2017 in pursuit of these stations becoming a reality. Emphasis will be placed on cassava, peanut and orchard crops and cattle at Ebini whilst at Pirara the focus would be on cattle, rice, orchard crops and cassava. These developments would be supported by an IDB programme which is coming on stream in 2017.
Orchard production was increased at Ebini in 2016. At Hosororo, a farm has been initiated to test and produce planting material for the cultivation of turmeric, black pepper, avocado and citrus. Mr Speaker, our intention is to ensure that we become self-sufficient in spices within the next three years. Our farmers, especially in Region 1, would be the beneficiaries of these interventions. We currently import over US$1 million in spices for the processing sector.
In 2016, a farm was also established at Kato to demonstrate commercial agricultural production. This will be fully operationalized in 2017. Similarly, a facility was constructed at Kamarang from which farmers would be able to access technical and advisory services. A similar facility will be established at Paramakatoi in 2017.
Mr. Speaker, we continue to place emphasis on the other crops sector, which is of vital importance to our economy from both a food and nutrition security standpoint as well as for exports. This sector recorded a 2.5% growth by mid-2016 and a 4.4% growth is anticipated for 2017.
The coconut subsector was given much prominence in 2016. This culminated with the coconut festival in October. As we are all aware, coconut ranks after rice and sugar, both in terms of acreage and exports. A coconut roadmap was finalized in 2016 to further catapult this important commodity. The roadmap was a collaborative effort between the public and private sectors and was adopted by my Ministry. Over the next ten years, the Guyana coconut industry will demonstrate consistent growth rates, rising from severe underdevelopment to a fully integrated economic partner at national, regional and global levels.
In 2017, coconut nurseries would be operationalized at Mon Repos, Wakenaam and the Pomeroon for the expansion of the industry. We would also be looking at importing elite planting material for distribution to farmers. A lot of emphasis will be placed on value-added, coconut products, especially coconut water and virgin coconut oil. We have seen expansion in acreages in the Pomeroon and the establishment of a coconut water bottling facility in the region.
Mr. Speaker, the Government has been very supportive of the coconut industry. The sum of G$49 million was allocated for the acquisition of chemicals to treat palms that were affected by the red palm mite. This is an on-going exercise and to date in excess of 1,400 farmers have been the beneficiaries of this exercise. We recognize that Integrated Pest Management (IPM) is the long term solution for managing the red palm mite. Consequently, the utilization of natural enemies and other green agricultural practices will be employed to combat this problem.
It is also significant to note, Mr Speaker, that we have made significant progress in managing the Black Sigatoka Disease affecting plantain/banana production. In 2016, we should be recording our highest plantain production ever – in excess of 70,000 tons. This will be further increased in 2017 to supply the plantain chip factories to be operationalized at Parika and Leguan.
Cassava is another commodity we have been talking about for years. I am pleased to say that we would be placing more emphasis on mechanized cassava planting and harvesting in the hinterland savannahs as well as on the coastland.
Mr. Speaker, crop diversification is an ongoing exercise. Under the auspices of NAREI, several new crop types were introduced in 2016. These include breadfruit, melons, sweet potatoes and sweet peppers. New introductions will continue in 2017; especially, those crops which can withstand the vagaries of climate change.
NAREI will continue to work with the private sector to further enhance agricultural development nationally. As an example, NAREI would be working collaboratively with AMCAR on the establishment of a 500 acre organic fruit farm at Herstelling in the Berbice River. An initial, 100 acres will be established in 2017. These fruits would be processed for the export market.
Mangrove management/restoratiom has also been an integral component of our work programme. In 2016 brushwood groynes were constructed at Walton Hall and Lusignan. 5000 mangrove seedlings were also planted at Better Hope.
Mr. Speaker, the Guyana Livestock Development Authority (GLDA) has been allotted G$45 million in the 2017 capital budget and growth in the Livestock sub-sector is projected at 2.5 in 2017.
Poultry – the Black giant poultry programme
Guyana is self sufficient in poultry production, in 2016 production increased by 5% over 2015 to 32Million KG. Positive growth will continue in 2017.
As an integral part of its hinterland development program, we have acquired Black Giant poultry with improved genetics from Brazil to be used to upgrade the local creole bird population. This initiative will improve the nutritive base of hinterland residents, through the increased production of both meat and eggs. These birds have the ability to thrive on resources from within the communities and will, therefore, eliminate the need to have feed material shipped from the coast.
A key developmental pillar of the local beef subsector is the introduction of animals of improved genetic material, through breeding bulls, semen and embryo transplants. Selected cattle farmers in several regions have benefited from GLDA’s bull rotation program. This is augmented with the provision of breeding animals from its genetic enhancement program, with most of the related activities being conducted at the Ebini and Mon Repos Agricultural Stations.
It must be noted that, milk was the top imported food in 2015, at a cost of US$ 27 Million. Over the last five years we have noticed a 55% increase in the volume of milk and milk products imported into this country. In 2015 imports were almost 10 million KG.
Mr. Speaker, at one time Guyana had one of the most flourishing dairy industries in the Caribbean. As Minister of Agriculture, I will try to ensure that this industry sees its glory days once more. The industry is stymied due to the absence of adequate milk processing facilities. My government will see the construction of a modern milk processing plant, capable of not only producing fresh milk but also butter, cheese and other dairy commodities. As such, we will coordinate milk collection by establishing cooling stations at strategic locations. It is anticipated that with these interventions along with the necessary technical support, the sector will grow by about 10% in 2017, while at the same time making a significant contribution to increased farm incomes.
Duck Hatchery programme
The Duck Hatchery program continues to make a significant contribution to the advancement of the local duck industry. Duckling production in 2016 is projected at 266,000, a 25% increase over 2015. This is expected to remain strong and positive in 2017 with a 50% growth.
With the current positive developmental trajectory of the industry, it is poised to break into the export market with the necessary administrative and technical support. This will have the knock on effects in creating more jobs, facilitating product diversification and contributing to foreign exchange earnings and will, therefore, make a tangible contribution to our GDP.
Mr. Speaker, regarding the Fisheries sub-sector, over the years, we have established some fundamental building blocks. In 2016 we reaped the benefit by recording a positive growth of 11%. However, an increase in aquaculture will become necessary as a substitute for seafood, as we realize that the marine resources are becoming challenged. As such, there were more detailed planning especially as it relates to aquaculture and small scale fisheries, we have seen over 20 new aquaculture farms come on stream.
Furthermore, deep sea fishing has been introduced to Guyana. It will be further encouraged as this is an area of our Exclusive Economic Zone that is not exploited. Additionally, thus far in 2016, the marine sub-sector has recorded exports of 17,930MT or G$12.7 billion.
In 2017 the promotion and development of a sustainable aquaculture and inland fisheries sector will be achieved through the maintenance of the indigenous stocks and the research and promotion of new marketable species at the Satyadeow Sawh Aquaculture Station. The formation of the National Aquaculture Association will serve as a catalyst for the promotion and development of the subsector. Furthermore, progress with hinterland fishing will be propelled with the assignment of staff to the North Rupununi area to assist with the Arapaima Management Plan and to encourage aquaculture activities.
MARKETING AND AGRO PROCESSING -TAKING VALUE ADDED TO ANOTHER LEVEL
The improved livelihood of our people remains a thrust of Government as we are advancing the cause of a new market approach to value-added production and productivity. The Guyana Marketing Corporation (GMC) will continue to create an enabling environment for the promotion, development, utilization and exportation of non- traditional agricultural commodities.
In 2017, the establishment and operationalization of the chips and flour processing facility at Parika will come into fruition. Cassava processing is rare with limited value addition done in Guyana. Cassava is cultivated in most regions, especially the hinterland, although, it is currently not exported. The result is depressed prices due to a glut in the market. The Ministry of Agriculture will undertake to establish and operationalize at least one processing facility to produce high quality cassava flour reducing our high import bill for wheat, currently US$21 Million. We will work in tandem with the bakeries to have the cassava flour incorporated with wheat flour. Mr. Speaker, this initiative is expected to reduce post-harvest losses, create market opportunities for fresh produce and create gainful employment with the associated foreign exchange savings through a reduction in wheat imports.
In promoting Agriculture Business Development through linkages with respective Agro-processors, the Guyana Marketing Corporation introduced approximately 40 new products in the Guyana Shop. In the area of fashion, beauty and enhancement there is currently a wide array of soaps including ginger and aloe, lemon grass, coffee, turmeric and honey fragrance. Facilitation in this area of product development will continue in 2017.
Non-Traditional agricultural commodities are exported in both the fresh and processed forms via air and sea. Guyana’s major regional export destinations include Trinidad, Suriname, Antigua and Barbados, while the main extra-regional destinations include the USA, Canada and the Dominican Republic. The main exported commodities are coconut, coconut water, pineapple, mangoes, eddoes, watermelon, pumpkin, papaw, heart of palm and sauces.
DRAINAGE AND IRRIGATION
Mr. Speaker, given the critical nature of our water resources to agriculture and other sectors, great importance must be placed on water planning, development and management that is done by NDIA and MMA. Taking due cognizance of the effects of global warming on rainfall patterns and sea level rise, we recognize that our systems must be improved. The objective of executing capital works in the medium term would, therefore, be to improve drainage and irrigation throughout Guyana, which would contribute to the long-term aim of achieving a high capacity D&I system that actively contributes to improved agricultural productivity and reduced incidents of flooding.
A holistic approach is necessary for proper management on both a technical and managerial level. In 2017 we will commence the process of detailed mapping of facilities, structures and drainage and irrigation channels in each region, these maps will show their location and other pertinent data. It would indicate which works are executed by Water Users Associations, Community Development Councils, Farmers’ groups, Neighbourhood Democratic Councils, etc. and would be a major asset in depicting the D&I systems throughout Guyana.
Mr. Speaker, for the first time, NDIA will be undertaking works in Region No. 9. The North and South Rupununi villages have traditionally suffered from inadequate water supply for their crops and livestock during dry months of the year. This has severely affected their livelihood. To this end, we will be improving or building rainwater harvesting facilities in these communities, commencing in the North. Works are planned for the villages of Woweta, Rupertee, Annai, Aranaputa, Massara, Toka, Parashara and Nappi.
The NDIA is expected to be more proactive in 2017 with the introduction of a Dredger for clearing outfall channels, thereby significantly decreasing the possibility of flooding along the coastland.
THE HYDROMETEOROLOGICAL SERVICE
Mr. Speaker, given the quest for alternative sources of energy, specifically, for Hydro Power Development, we will commence the construction of new climatological and hydrological stations in Kato, Chi Chi, Sand Landing and Amaila Falls. This will effectively ensure that the Guyana Energy Agency is equipped with data on the potential of these rivers for power production for the implementation of future projects.
Another important area of focus for Hydromet in 2017 will be the implementation of the ISO Quality Management System (QMS) at the National Weather Watch Centre (NWWC). The implementation of a QMS will ensure that the Cheddi Jagan International Airport maintains its standing as an international port of entry for aviation.
In terms of regional development, we plan to install Automatic Weather Stations in Regions 1 (Santa Rosa), 4 (Carifesta Avn), 8 (Amaila Falls) and 9 (Pirara), to expand our network. Water Level loggers will be installed in Regions 3 (Essequibo River), 6 (New Amsterdam and Corentyne River) and 8 (Amaila Falls) and in the Pomeroon River, Region 2. A tidal gauge will be placed in Region 6 to monitor oceanographic data to support the budding oil and gas and other industries.
EDUCATION IS THE BEST INVESTMENT
To produce globally recognized agriculturists and to promote and support agricultural development through education and training, the Guyana School of Agriculture will go forward in 2017 focusing on acquiring accreditation as a reputable agricultural education service deliverer. To this end, facilities will be upgraded to meet industry standards.
SOUND CHEMICALS MANAGEMENT
Mr. Speaker, the Pesticides and Toxic Chemicals Control Board (PTCCB) continued to execute its mandate through the holistic and comprehensive management of pesticides and toxic chemicals in Guyana. During 2016, this was realized through the monitoring of imports of chemicals, with the registration and issuance of 1,137 licenses for pesticides and toxic chemicals to date. There are now 165 licensed pesticide vendors in Guyana who are also involved in the management of restricted use of pesticides.
A total of 175 pesticide storage cabinets are being distributed with focus on sound storage practices. Training is provided to educate pesticide users on proper storage practices. This program has led to the establishment of a much needed private public partnership approach with industry. A Pest Control Operators Basic Proficiency Certification Program was completed with 43 PCO’s and millers being trained and certified.
Mr. Speaker, major projects are also in the pipeline for 2017 and onwards, these include:
US$ 12.4 Million- Rural Agricultural Infrastructure Development Project (2016-2020)
In 2017 works will commence to establish a Fruits and Vegetables and Dairy farm at President’s College, to promote and develop Climate Resilient Agriculture programme in Schools, clear approximately 2500 acres of land for cultivation in Buxton, Ithaca, Triumph and Mocha, complementing this with planting material, improved breeds of livestock and extension support for farmers.
US$ 11.89 Million-Flood Risk Management Project (2016-2019)
The estimated cost of this project is G$2.5 Billion in 2017. The benefits of this project include: reduced flooding and improved drainage and irrigation for over 300,000 residents on the East Coast of Demerara. In 2017, the majority of works will be carried out. These include, the construction of three Pump Stations at (i) Lusignan, (ii) Buxton/Vigilance and (iii) Hope Enmore; the reconstruction of the North Eastern Dam of the East Demerara Water Conservancy; specialized training for staff in Hydraulic and Hydrology Modelling; and an Emergency Preparedness Plan for the East Demerara Water Conservancy.
US$ 3 Million- Cunha Canal Rehabilitation Project (2016-2019)
US 8.5 Million – Hinterland Environmentally Sustainable Development Project (2017- 2021)
US$15M – Sustainable Agricultural Development Program Project (2017-2022)
Project activities will be concentrated in Region 5, 9 and 10. The Program will be organized in three components:
Component 1: Generating information for evidence – based policy making and natural resource management. This component will include the review and design of an appropriate Agricultural Information System (AIS), including the preparation and implementation of an Agricultural Census; a LIDAR survey of the North Rupununi (Region 9) and the Intermediate Savannahs in Region 10;
Component 2: Strengthening of the agricultural innovation and extension system.
Component 3: Will provide support for compliance with sanitary and phytosanitary standards.
In 2017, preliminary works for the agricultural census for the entire country will commence, we will contract firms to design and supervise the construction of the agriculture stations in Regions 9 (Pirara) and 10 (Ebini) and pilot meat processing Facilities in Regions 5 and 9.
In closing, Mr. Speaker, I commend this Budget to this house for its approval.