Chief executive officer (CEO) of Seprod Limited, Richard Pandohie says the company has paid out $55 million in redundancy packages to workers at Golden Grove Sugar Factory in Duckenfield, St Thomas.

The disclosure was made in an interview with the Jamaica Observer North & East following an announcement by Seprod to shut down operations there.

Pandohie said while the country’s sugar industry is in trouble, the decision to close the factory stems from the loss of the preferential trade agreement with the European Union.

“That’s the fact. Everything else is noise. The sugar industry is basically downsizing to the domestic requirements. In our case at Golden Grove, it has been one of continuous losses. We tried our best, we created a brand; we were the biggest exporter of sugar out of the country, in terms of retail,” Pandohie explained.

He said there were several other issues which contributed to the decision to close the factory, some self-inflicted.

“Not all the decisions were the best decisions but the environment was one, [with] this factory being the smallest factory in the sugar industry in Jamaica, and one that had inherent inefficiencies. We were the only factory that was on the JPS (Jamaica Public Service) grid, for example, instead of supplying our own energy. All this combined to make it untenable and we were just sustaining heavy losses,” the CEO noted.

“I think it’s over $4 billion in losses. It’s just unsustainable. What it was doing was hampering our ability to invest in other businesses and new businesses. So this is just a way to remove what has been a very expensive weight off our foot to allow us to cut the bleeding, to cut the cash loss, and to basically create better value for shareholders and hopefully help us with new acquisition opportunities,” Pandohie added.

He said Seprod is always looking for opportunities for agro-processing and that the company has been on record to say it is looking to get into gluten flour, using cassava and sweet potato to target international markets.

“A number of farmers have gone into cassava and we’re looking to put down a factory to process cassava flour. The largest cane farmer in Jamaica has already started converting and growing cassava. So it’s a real project and one that we’re to pursue,” he said, adding that that is the direction Seprod is heading in to have a factory in St Thomas.

“Even before the factory, the Government has announced a series of projects in St Thomas. You have the Factories Corporation [of Jamaica] putting down the new project where Goodyear [Factory] was. You have significant road construction projects about to start. We’ve heard a lot of talk around residential housing going to St Thomas, so there is going to be a series of economic activities in St Thomas where we’re hopeful, as Jamaicans, that a lot of people will be absorbed into that. If and when the factory comes on board of course, as long as the talent and resource are there, the first priority will be to use people from in the area. But I believe St Thomas is going to actually need more people to come into the communities to fulfil all of the economic activities that have been announced,” he added.