Opposition Spokesman on Finance, Audley Shaw. - Andrew Smith/Photography Editor

Shadow finance Minister, Audley Shaw, on Wednesday called for the Portia Simpson Miller-led administration to set up an "emergency enterprise divestment team" to advance the divestment of former state-owned sugar factories, which he said had been bogged down by bureaucracy.

Last year, then Prime Minister P.J. Patterson announced the closure of several sugar factories operating under the Sugar Company of Jamaica (SCJ), ending years of operating losses. Patterson disclosed then that his administration was willing to sell the sugar assets to private investors, prompting an initial flurry of interests from foreign and local bidders. These include the All-Island Cane Farmers Association, as well as sugar manufacturing outfits from Brazil and India.

But, on Wednesday, Shaw told Gleaner editors that the divestment process, being overseen by the Development Bank of Jamaica, was apparently at a standstill.

Frustration

"At least one investor has expressed frustration to me. They have a feeling that somehow there are all kinds of permutations (and) special interests ... all kinds of internal policy issues," said Shaw. "That particular investor doesn't get a feeling that (he is) getting a straight answer."

In order to jump start the sugar divestment process, the Shadow Finance Minister also said Government should follow through now on Patterson's promise to divest some of the sugar lands to existing local sugar producers, such as Appleton Estates and Worthy Park Estates, which have demonstrated efficiency. Shaw noted that these privately run estates were producing sugar at 50 per cent less than the unit cost achieved in state run sugar factories.

Pointing to further troubles in the sugar sector, Mr. Shaw disclosed that three months after bringing a $2.5 billion overdraft at the SCJ to the attention of Finance Minister Dr. Omar Davies in Parliament, the figure now stands at almost $3.5 billion spurred on by a "horrendous" interest rate of 43 per cent. This, he noted, is in addition to hundreds of acres of former cane lands being idle - an "absolute disgrace".

Things unattended

"There are a lot of things that are going unattended (and) the sugar divestment is (just) one of them," remarked Shaw.

Minister of Agriculture, Roger Clarke, has, however, denied that the overdraft at the Sugar Company of Jamaica now stands at $3.5 billion.

The Minister told the Gleaner/Power 106 that the Government had paid off $1.7 billion of that overdraft and the remaining $1.8 billion had been converted into a loan.

Speaking glowingly of potential Indian investors, Mr. Shaw disclosed that they were involved in an integrated sugar cane manufacturing process that produces rum, sugar, bagasse and energy. He noted that the Indian company was involved with thousands of satellite small farmers.