News from the OPM

Tour of Monymusk Sugar Factory

Address

By

The Most Hon. Andrew Holness, ON, MP

at the

Tour of Monymusk Sugar Factory, Clarendon

March 31, 2017

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I want to first of all thank Minister Samuda for the invitation to come here. He didn’t persuade me; actually that was Minister Spencer who persuaded me because he said after this I’m going to be feted in his constituency where I will have fish and lobster and all kinds of things but I decided to come because Minister Samuda has been a faithful advocate for the sugar industry.

 

Indeed one of the very first crisis that we faced as a new government was the prospect of the closure of Monymusk. I recalled distinctly, vividly, the panic in the voice of Minister Samuda when he called me on the phone that Sunday morning and he said “there is a problem Prime Minister”. He said “I’m about to meet with the workers and the mangers and the operators. What am I going to tell them because if we don’t act, if we don’t do something…” – and you know Minister Samuda, has in his DNA what you call a proclivity for being hyperbolic.

 

I wouldn’t really say to exaggerate but he has the ability to make the gravity of the situation come home clearly to you and he said that,          “Thousands of workers would lose their jobs; the entire south east and south west Clarendon would descend into chaos.” And he went on and on about all the terrible things that could happen and he was not far off. The truth is that this area depends heavily on sugar so the difficulties that would happen materialize if the factory were not to open was understood by the government but there was a complicating factor.

 

The complicating factor is that the government, not just this administration, but the government of Jamaica took a decision to divest itself out of sugar and therefore us coming back into sugar would effectively be a breach of our policy that we took on some years ago, but you see governments have to make things work.

 

Politics is not the art of not doing anything. Politics is the art of the possibility; how to get things done. At the end of the day politics is about people and us as the government we are about you the people. We want you to be employed, we want you to be able to go home and you might not be comfortable or you might not say you have the prosperity yet, but we don’t want you to suffer.

 

We want to build with you, we want to give you the opportunity for progress and prosperity and that comes in a job. It comes when we are able to preserve and to protect your job and so we had a big debate in the cabinet about how we’re going to approach this and we decided that we would give critical support and I want to point out two things.

 

This plant which I had the privilege of touring, and I’m told by my friend Allan who knows everything about sugar that in spite of me not having sugar in my DNA, I am in his recollection – and if he says so then it is a fact – the first prime minister in his living memory to have toured a sugar factory and it was an education touring the factory.

 

It’s hard to believe that this factory was built in 1943; you’re looking at a seventy- four year old factory. Of course, improved several times over to make it functional but the government could not allow this factory to deteriorate into scrap metal. That is what it would become if it did not reopen and you know what happens to any metal that is left lying around loosely in Jamaica so by the time a year or two passes there would be no factory but we decided to help in two strategic ways.

 

The first is to invest in the capital improvements that were necessary to ensure that you could actually bring home the crop and that’s where the government resources went, but we also made a strategic decision to place management in the factory. And of all the things that we’ve done and people will say we have spent money on sugar and all kinds of criticisms will come down the road, but I want the public to know that the government gave a strategic intervention by placing management here.

 

I want to focus on that point and I see the permanent secretary looking a bit puzzled. Money is one thing but management is everything and it is not just the ability to manage money. You have to be able to manage people, you have to be able to manage the culture of the people, you have to be able to manage technology and one of the things I’m very pleased with and I want to congratulate the sugar company holdings, both the chairman and the CEO is the foresight, our Chinese partners in Pan Caribbean Holdings. They made an investment in a power plant.

 

I am not an expert, sugar is not in my DNA but it makes obvious economic sense that if you can bring down the energy cost you can become more competitive and you can become more resilient when the commodity price fluctuates and so the first investment was in plant but the foresight to ensure that we have Jamaicans side by side understanding how the plant works, it’s important, that is good management practice.

 

It is also good strategic management to engage the stakeholders to say listen we’re going to put in the funds for the capital development but first sign our suppliers, you come on board. There is an economic opportunity here to bridge the financing of the fertilizer to bring in expert farmers to help with the management and production of the cane itself.

 

All of these are good management decisions and I stress management because as I said when we took over the government this presented our first crisis. How did it happen, why did it happen, when we divested five or six years ago, what happened why the factory reach this point?

 

It wasn’t only that the price of sugar fell; the price of sugar fell for all factories in Jamaica but not all factories in Jamaica were on the brink of not reopening. It’s a management issue and I want to focus on that a little more.

 

Minister Samuda believes that he has kind of brought me here and sweet me up. Obviously we are at a sugar plant but I’m still very much aware of the institutional difficulties that the industry face and they are not going to go away overnight because the government has intervened in this plant.

 

Inefficiencies still exist. The cultural practices still pose a threat to the viability of the plant and I hear Allan say “lock them up, tougher measures”. How are we losing forty thousand tons of sugarcane because someone decides for whatever reason that they should burn the cane?  That is just as devastating to the industry as a falling price of sugar.

 

That has to be managed and Allan it’s not just a policing issue; it’s a cultural issue and we have to get down to the root of it to have a reasoning and education so that people understand as you’ve said it “when you burn it, you can’t earn from it”. In the next phase of our management intervention which I see John is shaking his head and nodding that the government will make the intervention through management.

 

We will continue as best as possible to support the capital development here and I am tasking that to the sugar holding, the SCJ, but the long term is not for government to operate this plant. The long term is for the government to help to build the capacity of the people who took me around and showed me the place because it’s clear that we have the skill set here to manage this plant.

 

It is clear that you can bring in the younger workers who are coming in and the workers who have been here long enough and sit down and have a reasoning so that every single person understand that they have  a stake in protecting this industry. Government can’t look at sugar as a welfare operation. I want that to be clearly understood. Government has to look about developing the capacity of the industry to manage itself efficiently and effectively and so that is how I contextualize the intervention of the government in this regard.

 

Over time we would love to see the sugar industry being managed in a cooperative way but being privately run and administered. I know we have the capacity to do it and this – I’m going to use the term minister – this experiment shows that it can be done. Government must look to leave the long lasting institutions that will permanently recover this industry and bring it to the heights that we know that it can be.

 

So minister I’m tasking you to ensure that this is done and I leave you with the management. You can have as much money, but if you don’t have management then you don’t have anything and it’s not just about the management of money but the management of people and culture and technology. I sense that there is a rebirth happening here, a resetting of the industry here. Let us grasp this opportunity with both hands. Let us work together as the chairman said “to build out our sugarcane and sugar product industry”.

 

God bless you and thank you for listening.