Nicholas Richards, Gleaner Writer
RICKARDS
CABINET IS expected to finalise the privatisation of the island's six sugar estates when it gets the name of the entity that has been recommended to take possession of the Sugar Company of Jamaica (SCJ) assets come July.
Megan Deane, Director of Operations at the National Investment Bank of Jamaica (NIBJ), said the divestment mechanism which will be submitted to Cabinet next month, will see the Government deciding whether the privatisation should be done via lease, lease with call option or outright sale.
"Other issues such as strategies for dealing with litigation, employee displacement and social implications," she added, "will also be discussed by Cabinet."
The Sugar Cane Enterprise Team (SET), appointed by the Government in 2005 to oversee the divestment of the industry, has received ten bids from international entities from the United State, Canada and India to acquire the properties.
Head of the All-Island Cane Farmers Association, Allan Rickards, has also expressed interest in acquiring the assets. He said he has partnered with the Aracatu group from Brazil to submit a bid.
Deane refused to disclose the names of the bidders, "as it is against policy to provide details on entities that express interest in privatisation," she told the Financial Gleaner yesterday.
The properties up for divestment are, the Frome Estate in Westmoreland, with 98 per cent of its 4,800 hectares of land under production. Frome also has a factory, the largest on the island, which will also be privatised.
Monymusk sugar estate in Clarendon, which also falls under the control of the SCJ, has over 4,400 hectares of land under production. Currently, private farmers provide 40 per cent of the raw cane, with estates cultivating the remaining 60 per cent.
In Trelawny the Long Pond and Hampden estates will also be privatised. The smallest of the two, Hampden has 1, 619 hectares available for cultivation, almost four times less than Long Pond which has 6, 315 hectares in use.
Farming at Long Pond is also relatively diversified, with subsistence farming and forestry being among these alternatives.
Owned also by the SCJ, the Bernard Lodge sugar estate in St. Catherine "operates a raw sugar factory and an ethanol fermentary and distillery," it has over 4, 300 hectares under cultivation.
The Duckenfield estate in St. Thomas is an active sugar cane plantation and sugar processing factory. It is not clear how much land it has under cultivation.
The divestment of the six factories by the Jamaican government coincides with the phased reduction in the price that the European Union (EU) will be paying African Caribbean and Pacific (ACP) countries for the commodity.
The reduction which will take place over a five year period, will see the EU cutting the subsidies paid to ACP sugar by up to 36 per cent. This is in line with the World Trade Organisations (WTO) mandate to reduce agricultural subsidies.
