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GoB answers BSCFA’s call for Commission of Inquiry

HeadlineGoB answers BSCFA’s call for Commission of Inquiry

Photo: Alfredo Ortega – Chairman of BSCFA Committee of Management protest infront Independence Plaza near the National Assembly building in Belmopan.

After two years of failed negotiations between the Belize Sugar Cane Farmers Association (BSCFA) and the ASR/BSI, the BSCFA urged the government to convene a Commission of Inquiry into the mill’s financial records to finally determine the feasibility of a 60/40 split of gross revenue being proposed by the association. Today Cabinet announced its decision to convene the Commission!

by Marco Lopez 

BELMOPAN, Thurs. Mar. 9, 2023 

Over 260 members of the Belize Sugar Cane Farmers Association (BSCFA) assembled in Independence Plaza near the National Assembly building in Belmopan yesterday morning as a Cabinet meeting, which featured a presentation by Belize Sugar Industries (ASR/BSI), took place. The BSCFA and ASR/BSI have still not signed a Commercial Agreement after two years of negotiations, and the BSCFA was calling on the government to convene a Commission of Inquiry (COI) to review the financial records of the milling company.  This afternoon, Cabinet announced that a Commission of Inquiry to examine the sugar cane industry will be convened.

“This has arisen for the past two years since we have been in negotiations with BSI – have gone through many parts of it in which we have tried to negotiate between them and us, and it didn’t come to a fruitful end. We went to a mediator and nothing came out, so the only thing’s that left is the Commission of Inquiry,” the chairman of the BSCFA Committee of Management, Alfredo Ortega, had told AMANDALA yesterday. 

 The BSCFA believes that the company is shortchanging the cane farmers through the current formula for sharing of costs and revenue, which allows them to subtract overhead expenses from the gross revenue derived from sugar sales before arriving at a Net Strip Value—which is then distributed at a ratio of 65/35—with the 65% share being given to the farmers. This is the formula that is outlined in the same commercial agreement that the three other smaller cane farmer associations have signed.

The association is, however, distrustful of the financial records presented by the ASR/BSI and believes that they have manipulated the numbers to justify their rejection of the association’s requests for higher payments for the sugar they produce. The BSCFA wants a Commission of Inquiry to carry out a full, accurate, and up-to-date assessment of the finances of BSI/ASR. Their goal is to get a higher payout for those working in the fields, and they believe this government, under its Plan Belize mandate, must facilitate the achievement of that goal. 

While the BSCFA has been at odds with the mill for two years over the terms of a new commercial agreement, three smaller cane farmer associations have signed agreements with the mill. These are the Northern Sugar Cane Growers Association (NSCGA), Progressive Sugar Cane Producers Association (PSCPA), and the Corozal Sugar Cane Producers Association (CSCPA). Yesterday, a handful of members from the CSCPA along with their chairman, Vladimir Pook, were also present in Belmopan, as a gesture of approval of the Government of Belize and ASR/BSI’s meeting. They were joined by Florencio Marin, Sr., a former PUP Cabinet minister who recently served as an advisor to the Sugar Industry Control Board—a post he held until February. 

Marin, Sr. told local media that he is hopeful that a commercial agreement will be signed before the end of this year, and suggested that the BSCFA’s ordinary members, who collectively account for about 40 percent of the sugar delivered to the mill, are more demanding than the members in the other associations. Nonetheless, he believes that a signed commercial agreement will benefit those members in the long term and hopes the BSCFA leadership comes to terms with this soon. 

The BSCFA’s Ortega, when interviewed, however, made it clear that the Commission of Inquiry is the only feasible next step from the association’s point of view, and said that no commercial agreement will be signed with the present offer on the table. Late yesterday evening following the Cabinet meeting with ASR/BSI, the government released a statement on its position on the sugar cane industry and announced that a Ministerial Sub-Committee was formed to “guide discussions between both parties so that an enduring commercial agreement can be concluded.” 

The sub-committee will be chaired by Hon. Kareem Musa. But while he will be able to utilize his skills as an attorney and mediator, the BSCFA had said that they are weary of mediation between the parties and that they want the findings of a Commission of Inquiry before moving forward. 

“This is the next step,” Ortega said, regarding the call for such a commission. “We are here because this is the next step we are looking for, because going back to the same mediation again and we’ll end out with the same thing. It’s only time-consuming … and so what we want is something to move forward. We want something that the industry will benefit from,” Ortega said. 

A meeting between Cabinet and the BSCFA took place on January 10 of this year, and as mentioned, following the meeting with BSI this week, the government opted for more discussions on the matter but at that point had not yet given any indications that it would be yielding to the BSCFA’s demands for a commission of inquiry. 

As to the question of nationalization of the sugar industry, the government made it clear that it would take no such step. 

“Cabinet is resolute that it will not nationalize the sugar industry,” a statement released by the government asserts. 

Ortega told AMANDALA, however, that the government should nationalize the mill if “push comes to shove,” and he said that locals would benefit more from such a move. He shared that at one point the association had secured funds for BSCFA to purchase the mill when BSI had declared bankruptcy in 2010. 

“We found people in Mexico that they had already prepared to grant us the loan … we were not asking any money from the government; we wanted to buy over the factory, and the opportunity was not given to us. When we heard, ASR is the owner; but since ASR came into power, we have seen that rather than going forward we are going backward,” Ortega said. 

While this government is resolute that it will maintain its support of the current status quo within the industry as it relates to the mill’s ownership, Leader of the Opposition Barrow remarked, “While we appreciate foreigner investment, we have to be competitive, so if those foreign investors can’t come to terms to what the market is demanding as far as the caneros, then someone else could fill that void.”

While the Cabinet has formed a sub-committee to address the issues, the BSCFA had made it clear that they wanted the Commission of Inquiry before moving forward. 

We reached out to the ASR/BSI’s communications officer, William Neal, via email to get a comment on the company’s position following yesterday’s meeting – and to find out whether the mill would support the convening of a Commission of Inquiry, but have not received a reply up to this time. 

On Wednesday morning, we spoke to the CEO of the BSCFA, Oscar Alonzo, who pointed out that they were reviewing the press release issued by the government and would have a meeting within the association before taking a public stance on the matter. 

Cabinet, however, today said in its brief that after hearing presentations from the BSCFA and ASR/BSI they have decided to convene the Commission of Inquiry in order to “examine the modernization of the sugar cane industry and improve its viability.”

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