The Santander Sugar Group in the Valley of Peace area in the Cayo District is in serious trouble with the Ministry of Trade tonight after the export company started selling sugar domestically. The company has EPZ status meaning they get certain exemptions on the clear understanding that they can only export. But, they've been doing more than that.

This is a photo of Santander's Plantation White sugar being sold at a store in Orange Walk. It's presence on the local market has infuriated cane farmers - who are already going through a difficult year with historic lows in sugar prices. Now they say they are facing competition in a market from a company not licensed to sell locally. Here's what Fred Ortega of the Belize sugar Cane Farmers Association told CTV-3 in Orange Walk:..

Fred Ortega, BSCFA
"When it was presented to us that Santander is coming into the country, because when we got to know that Santander is coming, is because they were already building. But questions were asked to the past ministers of agriculture and questions were asked to the present minister of agriculture is Santander would be granted permission to sell sugar to the local market and the answer was no. Because the sugar that they will be producing will be sugar that will be sold out of the country - to Guatemala or to other countries Not into the local market and now that this is happening, it really concerns us, because then its something that is coming behind our backs - like backstab to the North. I will say to the North, because not only to the farmers. This creates a negative impact to us in the industry with the prices we presently are experiencing and with this happening sugar from other companies is flooding the market, then it reduces the amount of sugar that is being prepared by BSI for the local market."

Salvador Martin, Chairman - BSCFA
"I want to be clear, the only way they could sell that sugar, that means that they got permission and we really need to know from when, where and how that comes from."

Minister of State in the Ministry of Trade Tracy Panton today told us that Santander, quote, "does not have permission to sell plantation sugar locally". She says the company applied for a waiver to sell locally last week Friday - and that waiver has not been reviewed yet.

She warned that they could face a fine, or government could go as far as rescinding their EPZ status.

She says Government also has the option of confiscating the Santander sugar that is currently on the local market - which is already being looked at in tandem with the customs department.

She added that Santander has been advised of the violation, quote "in the strongest terms."

But, under what grounds are they applying for an EPZ waiver? Minister Panton explains that Santander would like the opportunity to sell to the local market and is requesting a waiver to supply 15 % of local sales.

A representative for Santander said, quote, "Santander is just adapting to different markets. It was always the plan to sell a small amount locally and under the EPZ regulations any company under this program can sell some part of its production locally paying the taxes that are required. Prices of sugar domestically is regulated by the government. So the price will be the same as the sugar sold by BSI." End quote.

The company says that at this time, there is no further delivery to the local market, pending sorting out the waiver with the ministry. They are applying to sell 1,500 metric tonnes of brown sugar and 3,500 metric tonnes of white sugar into the local market which represents 30% of local consumption. The company rep adds that Santander has been meeting with the ministries over the last week.

Channel 7

Sugar Confiscated, Fine Coming

News Five understands that the supplier of the Santander sugar is DV Distributors, which may be connected to the Vega Empire. Santander’s move to proceed with production and the retail of plantation white sugar appears to be deliberate, since government reiterated its position again, via a stronger letter sent to the company on May eighteenth.  Trade Minister Panton says punitive measures are being considered in light of what has happened.

Tracey Panton, Minister of State, Trade & Investment

“That process should not take longer than two weeks we’re hoping, if people are available.  But outside of that, Santander understands very clearly that they acted outside of their formal agreement with the Government of Belize.  They acted in contravention of their EPZ status, so we can fine them.  We’re in the process of confiscating the sugar that is on the market.  Worst case scenario, we can move to have their license, EPZ certification, revoked.  But we’re not there yet.  They understand they are not to do it.  Even after our first letter on the eleventh, there was still product on the market, so we wrote them again on the eighteenth [of May], a stronger letter to make it emphatically clear that they were in contravention of their formal agreement with the Government of Belize and that we would not, certainly could not support having their sugar on the local market.”

Trade Minister: Santander Jumped the Gun on Sugar Sales

Santander, the Spanish multinational operating in Valley of Peace, is again in hot water, this time for illegally producing and introducing plantation white sugar into the local retail market.  Tonight, the Comptroller of Customs, Colin Griffith, has instructed customs posts in Corozal, Cayo and Orange Walk to confiscate the Santander sugar on the premises where they are found. It means that Santander won’t be able to sell or move the sugar until further notice. Cane farmers in the north are up in arms, despite the decision taken by government to confiscate up to seven hundred and fifty metric tons of grain from shops across the three districts, which had been sold to one distributor.  That quantum represents roughly eight percent of the annual tonnage produced by A.S.R./B.S.I. for local consumption.  According to the terms of the Export Processing Zone certificate that Santander had been granted, the production of mill white sugar without the expressed permission of government is prohibited.  The Ministry of Trade and Investment caught wind of the matter almost two and a half weeks ago and, upon confirming that Santander sugar was indeed on the open market, instructed the company to cease and desist.  That order was ignored in the face of clear guidelines set out by which Santander should have sought consideration.  Following today’s lengthy Cabinet meeting, News Five spoke with Minister of State Tracey Panton who shared firsthand government’s stance on the issue.

Tracey Panton, Minister of State, Trade & Investment

“The position is that it was done illegally.  Santander got an EPZ certificate in 2014 and that certificate allowed them to produce molasses and raw sugar for export.  In May of this year, the first week of May, they submitted an application asking if they could amend their certificate of compliance to include plantation white sugar.  That matter has to go before the EPZ committee for consideration and then onto Cabinet for further ratification.  That has not been done as yet.  It was on the tenth of May, I believe, we were alerted that there was plantation white sugar produced by Santander on the market and so the ministry wrote them on the eleventh of May, after we had confirmed that yes there was sugar in the marketplace in the north, that they had to cease and desist.  There is a procedure, they can apply for consideration for a waiver to have their products on the local market to come into the customs territory, so to speak, but that request for a waiver had not been submitted by Santander.  They responded later that day to indicate that they would be sending a request for a waiver which was done, the letter is dated on the eighteenth of May, but we got that letter at the ministry at the beginning, on the twenty-fifth.  And so the ministry officials, our CEO and our Director of Investment have met with the representatives of Santander to acknowledge that we now have the waiver request, but there’s a process, right.  We have to consult with key stakeholders.  We have to consult with ASR/BSI, we have to consult with the farmers.  We have to consult with the relevant government agencies which includes the Ministry of Agriculture, the Customs Department to see if this request has any merit, if there is a need, there is a shortage of plantation white in the market; if there is a need for greater supply, if there is a greater demand.  But that is now going to be assessed.”

Company Not Even Empowered to Produce Plantation White Sugar

Minister Panton says that Santander has met with the Ministry of Trade, but is also requesting a meeting with the Ministry of Agriculture, even though it has already violated the EPZ in retailing plantation white sugar.

Isani Cayetano

“Have they approached to meet with you as the minister, or with your ministry to see how this can be resolved from their end, having introduced their product into our local market?”

Tracey Panton, Minister of State, Trade & Investment

“There has been a meeting, as I said, yesterday, with the C.E.O. in our ministry and our Director of Investment.  I understand as well that they have requested a meeting with the Ministry of Agriculture this afternoon.  But both ministers will have to meet and a formal assessment will have to be done in terms of the need for more sugar in the marketplace, that sort of thing.  Please bear in mind that they do not have permission by the Government of Belize, even to produce plantation white.  So even that is in contravention of their concession arrangement with the Government of Belize.  They have gone ahead and done it anyway.  It’s made, I guess, exacerbated because even though they’ve done that outside of what is legally doable, they have also put it on the local market without any waiver or permits by the Government of Belize.  I know that the [Belize Sugar Cane Farmers Association] in the north are very upset, we try to be very clear with them that there has been no agreement or any consideration for such a waiver or permit at this time.  We will issue a press release to make that absolutely clear and before any such consideration all relevant stakeholders will be consulted.”

Santander, since establishing itself as a going concern in Belize back in 2012, has remained controversial.  It ran afoul of environmental compliance in 2012 when a subsidiary, Green Tropics, razed a swath of land through the Labouring Creek Jaguar Corridor Wildlife Sanctuary.  It was fined one hundred thousand dollars by the Ministry of Environment.  In another unfortunate episode, the company destroyed a huge acreage of vegetables on farmlands use by growers in the Valley of Peace community.  Peppers, cabbages and other vegetables were all singed when a crop-duster flew overhead and sprayed chemicals on the plants below.

Channel 5

Santander Sugar apologizes but still wants waiver

Santander Sugar Limited has responded to the Government of Belize. In a press statement issued this evening, the sugar producing company apologizes and regrets the actions that led to the cease and desist letter issued by the Government. In the release, Santander explains an amendment to the EPZ was filed in February and whilst waiting for acceptance, Santander began to explore market opportunities within CARICOM. The company says it failed to realize that an additional waiver for the local markets was needed. Santander says that it will quote, “comply with all local authorities and recall all the sugar that has been distributed thus far.” End of quote. As for its waiver request, Santander is asking that its submission be reviewed and the waiver granted as soon as possible. The company says that the local sugar market should be shared by all Belize based sugar companies in a fair and equitable fashion especially since world sugar prices are falling.

Santander’s request for waiver being considered

Santander Sugar Limited has not been granted permission to sell white sugar on the local market. In fact, the Government of Belize issued a cease and desist letter to the company after receiving confirmation that plantation white sugar was being distributed. According to the Ministry of Investment, on May 10 the Ministry was alerted that Santander was distributing plantation white sugar on the local market. The following day, the Ministry wrote to the company, informing that it must first seek a waiver from the Export Processing Zone Committee in order to enter the local market. On May 18, Santander Sugar wrote the Ministry requesting for its EPZ Certification and Operations Contract to be amended in order to sell sugar on the local market. However, during this period Santander sugar was still being distributed in Orange Walk and Corozal by a company which Minister Tracey Taeger Panton described as a company from the “Vega Conglomerate”. According to a Government press release, this cease and desist letter indicated that the company was in clear violation of the EPZ Act and contrary to what they had been authorized under their Certificate of Compliance. On Monday, officials from Santander met the Ministry and it was confirmed that Santander Sugar sold 750 metric tons of sugar to the local distributor. The Ministry is working with the Customs and Excise Department to get rid of Santander’s sugar from the local market. The Ministry of Investment, Trade, and Commerce is conducting consultations with the Ministry of Agriculture and other relevant stakeholders in its effort to formulate recommendations to the Export Processing Zone Committee on the sale of sugar on the local market by Santander Sugar Ltd. We understand that the Ministry will determine Santander’s request for the waiver within thirty days of receipt. The three cane farmers association have expressed that allowing Santander to sell sugar on the local market will negatively impact cane farmers.

LOVEFM

Northern Cane Farmers Mobilize over Sugar Waiver

The release of white sugar in the local market by the Spanish company, Santander, has thrown the local sugar industry into a tailspin. On May eleventh, it was first detected that through DV Distributors, the white sugar was retailing in stores in the Corozal, Orange Walk and Cayo Districts in violation of Santander’s Export Processing Zone Certificate. Five thousand farmers represented through three associations in the north came out strongly against the move and are now stepping up their efforts seeking a rejection of Santander’s application for a waiver to allow the company to sell three thousand five hundred tons of white and five thousand five hundred tons of brown sugar domestically, as well as to market it in CARICOM. The associations argue that if granted, the waiver will affect their livelihoods because it will cause a reduction in the price of cane paid to farmers and therefore should be rejected. Furthermore, that Santander should be fined for violating the terms of its EPZ certificate. News Five’s Isani Cayetano looks at all the angles in the following report.

Isani Cayetano, Reporting

The untimely introduction of plantation white sugar onto the domestic trading floor by Santander presents an imminent threat to the local sugar industry.  In the days ahead, the Export Processing Zone Committee is likely to consider an application by the company for a waiver to sell milled sugar internally.  The concern, should that contract be granted, is the adverse effect of competition on existing price regimes elsewhere within the industry.

William Neal, Communications Director, A.S.R./B.S.I.

“While the local market is important, it’s important to us and to farmers because it is a part of the pricing formula for the price that is paid to cane farmers per ton of sugar cane that they produce.  So it’s important for us and we recognize that it also impacts heavily anyone who’s involved in the sugar industry in the northern part of the country.”

A.S.R./B.S.I. is only one of several key stakeholders in the large-scale production of sugar in Belize.  Others include a trio of associations representing the interests and welfare of cane farmers.  Together, they have written the EPZ Committee recommending that Santander’s application be rejected.  Salvador Martin is the Chairman of the Belize Sugar Cane Farmers Association.

On the Phone: Salvador Martin, Chairman, B.S.C.F.A.

“We sent them a letter showing the results and the impact that will damage Corozal and Orange Walk in the north, that we depend on directly for the cane farmers’ sugar, like how we say, the sugar industry, like I say, I’m not sure if you understand me, I am saying that we depend directly on sugar.  In other words, we can’t accept the unacceptable, a waiver or permission for them to get a concession for thirty percent of the direct consumption [sugar] in Belize.”

According to a letter written by the joint associations, granting Santander permission to sell three thousand, five hundred tons of white sugar and one thousand, five hundred tons of brown sugar in the local market will see a reduction in the cane prices paid to farmers.  The net loss, based on the calculation per ton of cane, is one dollar and sixty-five cents.  Those figures have been presented to the EPZ Committee.

On the Phone: Salvador Martin

“About the letter, we still sent it to the EPZ board telling them why we are so worried about that waiver and we still gave them a copy, and we gave them figures on how it will affect us directly.  If they produce that thirty percent in our country, the cane farmers we are facing to lose more than one dollar and sixty-five cents directly in our sales.”

Santander coming onboard with white and brown sugar not only threatens the livelihoods of the thousands of cane farmers operating in northern Belize, it also jeopardizes the status quo based on the existing Sugar Act.

William Neal

“We have a very good relationship with our farmers associations, some more than others, but we know that we are in the same boat.  What impacts the farmers impacts us.  We just want the competition to be fair and that the rules for any investor are adhered to, to make sure that it is in the best interest of the country and the general population that is impacted or makes their livelihood by producing that product. The sugar industry up north has a set of rules that is actually laid out very clearly in the Sugar Act.  We then have the commercial agreements with the cane farmers associations that, you know, dictates exactly what we do.  We don’t have the liberty of not paying attention to the Sugar Act, that’s what guides the entire industry up north.  It has many stakeholders, we have government as a stakeholder, we have farmers associations and of course you have B.S.I. as the miller, as a stakeholder in all of that.  So it’s a three-legged stool and we as a company devised our strategy using our strengths and our weaknesses… because you are only as strong as your weakest link.  We have to move our farmers in the direction that we need to go.”

That direction is a move toward direct consumption sugar.

William Neal

“With the changes in the EU regime in October 2017, we have been very strategic in our preparation for global competition.  Competition on a global scale because sugar is definitely, you know, with the prices that we are seeing on the world market, every little bit counts.  So as much as possible, we have to create a competitive edge.  We have been investing in a Direct Consumption Sugar Expansion Project with the idea that value-added sugar.  There is no place for raw sugar.  Value added products like direct consumption sugar is the way to go, so we have been preparing for competition globally.”

That preparation does not include the likelihood of competition on the local front. Reporting for News Five, I am Isani Cayetano.

Channel 5

Sugar association says NO to Santander Sugar

The Corozal Sugar Cane Producers Association says that Santander Sugar’s deliberate action to sell white sugar on the local market is quote, “only the preview to further their quest to possible access/approval to be able to participate in the local market which is clearly denoted in the most recent waiver application on the EPZ committee for the sale of sugar into the local market.” End of quote. The association’s Chairman, Vlademir Puck, says the cane farmers strongly oppose Santander being granted the waiver, stating that it will lead to a potential revenue loss to the 5, 400 cane farmers.

Vlademir Puck, Corozal Sugar Cane Producers Association: “The position of the association remains in that the livelihood of these farmers and their families. There are 30,000 families I think affected by the move without proper consolation. I can say and we are leaving that in the hand of the Government also yes with the input from our side but I think the proper procedures were not followed very well so we stand with this situation right now and maybe if things would have been taken at a different angle maybe we could have sit down and dialogue with the ——. We have been dialoguing with various other Ministries in charter with Ms. Thompson and we have been retaining information from them. I can say that they have been moving swiftly considering the time that it was brought up. I think it is moving from my point of view. I see the Government really working hard on it. It is something that cannot be done in a couple of days but looking at the way that we three associations join hands and I brought it up. I can say with the information the information that we have been gathering that they are moving swiftly.”

The Association says that it will keep a close eye on the Government and Santander as dialogue continues.

LOVEFM

No Simple Solution For Santander Situation

Earlier in the news, you saw the Albert Division’s Area Representative, Tracy Panton, out on Albert Street assuring business owners and residents living in the downtown area that the cops will be taking action to stop the recent spate of armed robberies. 

We also asked for an update as the Minister of State in the Ministry of Trade and Investment Promotion about the situation with Santander, who illegally sold sugar on the local market. 

The 3 cane farming associations from the north are calling for the Government to hand them the maximum fine under the law as a penalty for the violation.

These farmer associations have also insisted that the Government’s EPZ committee should reject Santander’s application for a waiver to sell white and brown sugar on the local market. 

In their lengthy release, the associations said, quote, “"approval of the waiver would mean destroying the financial livelihood of thousands of cane farmers…while supporting the…profits of the multinational, Santander," end quote.

We asked the Minister about that concern from the farmers, and here’s what she had to say:

Hon. Tracy Taegar-Panton - Minister of State, Trade
"The government has not sided at all with the multinational, I don't know where that sentiment comes from. There is a process that we need to take so that we can gather all the relevant information about what happened and how it happened so the appropriate action can be taken against the person who did wrong. Santander had no permission or permit or waver from the government to sell any of its products on the local market. It violated its EPZ status when it did that and so the EPZ committee will meet. The evidence is obviously glaring against Santander but we have to allow the process to take place. We have listened to the cane farmers associations; in fact my CEO is in the north currently having meetings. We will speak with all stakeholders. The sugar sector is a very important economic sector for the country of Belize and we can't ignore that. Santander contributes to the export earnings from sugar to Belize and so we're trying to be fair to all parties concerned in particular to our farmers."

Daniel Ortiz
"What effect are you able to say this violation of the EPZ, will that have or can play into the approval, the final approval of the application that's in front of the EPZ committee?"

Hon. Tracy Taegar-Panton
"You see I can't speak for the EPZ committee. I know that the ministry itself will provide its recommendations based on its findings and clearly there is a violation and a very serious violation and that I am sure will be taken into account by the committee."

Reporter
"Will they be fined?"

Hon. Tracy Taegar-Panton
"There are repercussions, they will be fined, there will be other sanctions against Santander but I need to give the committee its room and time to do its work. We have to be fair and Santander is fully aware as you read in their press release that they violated their conditions of doing business in Belize and that will be dealt with the strictest letter of the law."

Reporter
"Some think that the government is being light handed, very easy on Santander."

Hon. Tracy Taegar-Panton
"There is a process by law and the process involves the EPZ committee and if the government sets up these mechanisms for review and consideration, we need to use them.”

You’ll also remember that Opposition Leader John Briceño, in his press conference from yesterday, said that the Government ought to do more to help Santander to get a commercial foothold in the CARICOM Markets, so that they won’t need to sell sugar in Belize. Minister Panton told us that actually, the government has been diligently working to just that:

Hon. Tracy Taegar-Panton
"The leader of the opposition suggested that the government needs to do more to ensure that there is market access for Belize sugar in CARICOM. There is market access, there has always been market access at duty free rates and so what I think he was trying to get at was greater market penetration into the Caribbean. I want you to know that for the last 3 months or so, there has been a very active committee which includes ASR, BSI which has included Santander, it has included the ministry of agriculture, included the ministry of trade in trying to have greater market penetration in the CARICOM for Belizean sugar. There are standards that we need to meet, there is a quality that we need to meet. Of course there is also the issue of competitive pricing and so we have been in active discussions at COTED which is the trade committee of the CARICOM in which we're trying not only for Belize sugar but for Jamaica, for Barbados and other sugar producing countries in the region so that we can have higher tariffs for sugar that's coming outside of the region because sugar is such an important part of our national economy.”

The EPZ Committee has not made a final decision on what penalty Santander will face for their violation, and the application for their waiver to sell sugar in Belize.

Channel 7

Waiver Request Denied

Export Processing Zone Committee Decision on Santander Sugar Limited Violations and Waiver Request to Sell Locally

On Tuesday, 12th May 2018, the Export Processing Zone Committee (EPZC) convened a meeting in respect of (1) a request made by Santander Sugar Limited, a Belizean EPZ Company, for a waiver to be granted allowing the company to sell approximately 5,000 tons of direct consumption sugar and 2,000 tons of molasses in the domestic market; and (2) violations committed under the Export Processing Zone Act, Chapter 280, Substantive Laws of Belize, by Santander Sugar Ltd.

The methodology for the review of the waiver request was premised on three criteria:

i. Will the waiver aid the economic development of Belize?
ii. Will it relieve a shortage of sugar in the domestic market?
iii. Does it otherwise seem to be in the interest of Belize?

To determine these, an assessment was conducted which utilized information and data that was obtained from industry stakeholders, including the Ministry of Agriculture, Belize Sugar Industries Ltd., Santander Sugar Limited, Belize Cane Producers Association, Progressive Sugar Cane Producers Association, Corozal Sugar Cane Producers Association (CSCPA), and various national manufacturers that require sugar and/or molasses as a production input.

Based on the consultations and the information provided, the main conclusion from the assessment was that there is not any shortage of sugar in the domestic market. Based on this, and other findings of the assessment report, the EPZC decided that market conditions do not warrant the waiver at this time, and hence, the committee was unable to favourably consider Santander’s request to sell sugar and molasses in the local market at this time.

Additionally, the EPZC at its meeting reviewed several violations made by Santander Sugar Ltd. under its Certificate of Compliance and Operations Contract, and in consultation with the Attorney General’s Ministry, decided to impose the maximum fine applicable under the EPZ Act. Further to the fine, the Ministry of Investment, Trade, and Commerce has formally notified the company of the need to abide by all the Laws of Belize, and that any further infractions can result in the revocation of its EPZ status.

The EPZC and the Ministry will be working with Santander Sugar Limited to ensure that going forward, the company complies with all the Laws of Belize, and the EPZC.

The Directorate General for Foreign Trade and the Ministry will continue to assist the company in expanding export markets for its products.