by DR. ODEEN ISHMAEL
Ever since the inception of PetroCaribe in 2005, Guyana has remained firmly committed to the oil agreement. This staunch assertion flies in the face of urgings from some analysts in the Caribbean region who opine that Venezuela would be unable to sustain the program of providing concessionary oil to countries signatory of the PetroCaribe agreement but due to its current economic crisis and the recent drop in international oil prices the status of the agreement remainded in doubt. They, therefore, suggest that now Caribbean countries, including Guyana, should no longer place much reliance on it.
This position was also adopted by the International Monetary Fund (IMF) which in November 2014 claimed that four Caricom countries (Belize, Haiti, Jamaica and Guyana) had begun to take steps to reduce their dependency on PetroCaribe oil.
But it was unclear how the IMF had reached this viewpoint with respect to Guyana. An opposite position was taken by the country’s finance minister, Dr. Ashni Singh, who stated in his March 2014 budget presentation that the country had concluded three rice-for-oil agreements with Venezuela, specifically within the ambit of the PetroCaribe agreement and aimed at debt compensation. He also assured that Guyana would continue to meet its obligations under the PetroCaribe arrangement.
From the beginning of the agreement, Guyana never placed its total dependency on PetroCaribe oil; it actually obtains only half of its fuel energy requirements from that source. Guyana has not responded to the IMF statement, but nevertheless the government is concerned over the economic downturn in Venezuela, one of the largest purchasers of Guyana’s rice. It is probably for this reason that the national rice marketing agency has been seeking to expand its international rice sales to new markets just in case future Venezuelan purchases are reduced.
Significantly, Venezuela’s President Nicolás Maduro has dispelled fears about any cutback in PetroCaribe support to Caribbean countries and has reassured them of the “long term” viability of the agreement despite the recent price drop. He reaffirmed his government’s commitment to the initiative which would remain as an integral part of Venezuela’s strategy for regional security and support.
As of now, Guyana remains firmly in support of PetroCaribe. At a joint meeting of PetroCaribe and the Bolivarian Alliance for the Peoples of Our America (ALBA) in Caracas on December 17, 2014, President Donald Ramotar said PetroCaribe was an agreement of foresight and of special importance to the Caribbean region. He pointed out that the arrangement was exemplary and important for Guyana, and has helped to increase trade relations with Venezuela.
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