Tufton slams Clark’s over criticism of Eridania deal

As squabbles continue over the Government's deal with Italian company Eridania Suisse to pre-finance the 2009-2010 sugar crop in exchange for 79,000 tonnes of raw sugar, the Agriculture Minister is defending the move.

Last week, Roger Clark, Spokesman on Agriculture, in a statement, questioned the wisdom of the deal between the Jamaican Government and Eridania, especially given the warning that Jamaica Sugar Holdings Company would not be able to satisfy the commitment made.

According to Mr. Clark, the Government and the country are incurring significant losses on this deal as the price being paid by Eridania is about US$300 less per tonne of sugar than what it is sold for on the local market.

Loss making deal – Clark

The Opposition Spokesman also asserted that as a result of the deal, with Eridania, Jamaica was unable to supply another 400 tonnes of sugar to the US market that could have been sold at premium prices. 

However, in a sharp response, Dr. Chris Tufton asked Mr. Clark to come up with an alternative.

According to Dr. Tufton, the Opposition Spokesman is fully aware that the alternative was to shut down the Government-owned sugar estates as the State did not have the resources to continue the billions in subsidies.

Drought affected supply

He also stated that there were issues which led to Jamaica being unable to provide the 79,000 tonnes.

“When we were negotiating with Eridania, the context was if we did not secure a refinancing arrangement, then we would not be able to do a crop which means the Government’s part of the industry would shut down. Secondly, we negotiated a pricing arrangement which did allow for adjustments … there was fixed price and then a component that allowed for anything beyond that fixed price to be shared between Eridania and our entity,” the Agriculture Minister said.

 “As it turned out, we benefited from that but the drought in Jamaica affected the volume on all the estates, private and public, and so we were not able to provide the 79,000 tonnes on our own,” Dr. Tufton further explained.

Best deal – Tufton

According to the Agriculture Minister, Mr. Clark is being disingenuous in his criticism.  

“When all of those things are factored in, it’s really unfair to suggest that it was poor judgment (as) under the circumstances, it was the best deal that we could have struck and I think the industry has been better off for it because we’ve been able to continue operations, continue the upgrading, packaging the industry for the divestment which we achieved recently,” Dr. Tafton said.

He added that the Agriculture Ministry has resorted to arrangements with private estates to make up the difference.