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Oct 16, 2019

Is CGA Heading for Bankruptcy?

We start the newscast tonight with developments in the citrus industry which continues to find itself on the brink of collapse. For some time, the once thriving industry has been on the decline and tonight some two hundred and sixty-nine citrus growers are in limbo and their employees face unemployment.  At the core of the problem is the inability of the Citrus Growers Association to provide even the basic services to its membership because it has essentially gone bust.  A lifeline that was predicated by a meeting with the Prime Minister did not come through and instead they were told to get their house in order. That means working its way up out of indebtedness, but it’s a steep climb because creditors are reportedly moving in to crowfoot C.G.A.’s assets.   Today, News Five’s Isani Cayetano headed down to the citrus belt where he found out that the industry is in a state of disarray. Here is the first of our three-part coverage.

 

 

Isani Cayetano, Reporting

Once a thriving industry that towered above all else as Belize’s second largest revenue generator, the citrus industry, as it stands, is but a shell of its former self.  Down five and a half million boxes from a record high of seven point eight, production continues to nosedive and its free fall is the result of poor management from grove to factory.

 

Kent Herrera

Kent Herrera, Chief Financial Officer, CPBL

“Probably about ten or fourteen years ago, the industry was at its peak.  I think we were producing seven point eight million boxes and that production has now dwindled in 2019, the 2018/2019 financial year, down now to two point three million boxes of citrus fruit.”

 

At the heart of its decline is the Citrus Growers Association, a representative body with a membership of two hundred and sixty-nine small farmers.  The CGA which provides essential technical services is in dire straits and while the citrus greening disease is being blamed for its financial woes, the problem goes well beyond what is taking place in the orchards.

 

Anthony Chanona

Anthony Chanona, Member, Citrus Growers Association

“To me, there are three core issues: one, the need for reality check.  Where is the CGA, as you say, in line with its financial status.  Our creditors, our bankers.  Where are the accounts of the CGA?  That has not come to the table, I would say, since 2014, so we don’t know.  The core business of the CGA as a grower service organization is failing its membership.  The core business of the association is defunct and therefore, if you have a grower organization that is not functioning as it is designed to do, you have creditors, members of staff that you owe and cannot pay, then the reality of what you are managing is in crisis.  And so, if you are unable to accept that reality of bankruptcy on all fronts then that denial is going to invite disgrace and prolong the agony that we have in the citrus industry.”

 

And that great pain which afflicts the industry is a sharp decline in production, ultimately translating to fewer jobs and significant loss of revenue at the processing plant.  Nikita Usher is the Chief Administration Manager at Citrus Products of Belize Limited.

 

Nikita Usher

Nikita Usher, Chief Administration Manager, CPBL

“Eight million boxes of fruit, in years gone by, we used to run three shifts.  So it meant that we were running an employment base of close to fifteen hundred people. Today at two point five million boxes of fruit, we are simply only running the factory at two shifts and we don’t run on weekends.  So you could imagine then, the employees that use to make substantial money working overtime work, their concerns.  Theoretically speaking, two point five million boxes of fruit, CPBL can process that if, all things being equal, can process that in three months.  It would mean that you would have a nine month period in which you would have absolutely nothing happening.”

 

While the management of CPBL has taken the decision to extend the production period, there are simply not enough oranges being planted in the citrus belt. To make matters worse, the CGA which is tasked with providing extension services to farmers is falling woefully short of its mandate and CPBL has had to take up the slack.

 

Kent Herrera

“Most of the services which the CGA would provide to growers, as a company we do have the capacity in-house because of course of the size and in terms of the technical expertise, the agronomists, the farm managers, the people who would work in the factories, the coordination part, the lab.  But the services which the CGA and BCM should be providing which the industry relies on a lot is in relation to assisting the small farmers.”

 

On September twenty-fourth, CGA Chairman Eccleston Irving wrote Prime Minister Dean Barrow requesting a meeting with him.  In that letter were several requests, including the establishment of a drought relief program, as well as an annual subvention of two hundred thousand dollars.  Anthony Chanona attended that meeting on October eleventh and had a different view from what the CGA presented.

 

Anthony Chanona

“The CGA presented several bullet points to the prime minister.  Those were dealt with over a two-hour session, but in my opinion that was business as usual.  We need money, we need subvention, we need this, we need that.  I think at that meeting I felt it was my responsibility as an elder of the industry to speak from my heart and I felt that what we were doing was ignoring the facts.  When you cannot pay your creditors and cannot pay your staff and you cannot account for what you are managing then it’s a bankruptcy of ideas, a bankruptcy of cash and a bankruptcy of our institution.  We‘ve lost our way.  And so, my intervention at that meeting was basically to bell the cat.  I called it out for the way I saw it and it wasn’t meant to be disrespectful or in any way combative.  We’ve passed that stage.  We have to find a way to sit down around a table, leave our baggage outside and put the best interest of the CGA on the table.”

 

Along with the requests was concessionary interest rates and for government to support a petition to the Social Security Board to reduce the interest rate on loan funds to growers from eleven to six percent.  News Five attempted to get a response from CGA’s Executive Director Dr. Eugene Cleland earlier today but we were told that they were in a committee meeting.  We will have more on this developing industry story in Thursday’s newscast. Reporting for News Five, I am Isani Cayetano.


Viewers please note: This Internet newscast is a verbatim transcript of our evening television newscast. Where speakers use Kriol, we attempt to faithfully reproduce the quotes using a standard spelling system.

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