Rising production costs after nationalization, along with falling world sugar prices since the late 1970s, placed Guyana in an increasingly uncompetitive position.

Prices were expected to continue decreasing as China, Thailand, and India boosted sugar supplies to record high levels.

[2] In the face of such keen international competition, Guyana grew increasingly dependent on its access to the subsidized markets of Europe and the United States.

The bulk of sugar exports (about 160,000 tons per year in the late 1980s) went to the European Economic Community (EEC) under the Lomé Convention, a special quota arrangement.

As part of a strategic plan to reduce costs and improve productivity, the GuySuCo and the China National Technology Import and Export Corporation signed contracts on June 22, 2004 in Beijing.

The agreement was also made in compliance with the World Bank targets and obligations to contribute to an overall reduction of global greenhouse gases and to introduce modern technologies to the sugar industry which would improve efficiency.