Gov't may seek deferring payment to Venezuela
Published:Friday | December 2, 2011 | 12:00 AM
Correction & Clarification
The Ministry of Finance and Planning denied a claim concerning deferment of interest oayments to Venezuela under the PetroCaribe arrangement.
It said: "The Government of Jamaica has sought, and is not seeking to defer any form of debt payments to Venezuela. Jamaica remains current on all external debt payments.
In December 2011, the Government paid the current amounts of US$2.6 million due under the PetroCaribe Agreement, bringing the total amount paid for the calendar year to US$42.2 million."
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The Jamaican Government could seek a deferment of interest payments to Venezuela, totalling US$44 million for the current financial year, under the PetroCaribe Development Fund, and is expected to be among the major issues to be discussed at a summit in Caracas tomorrow.
Prime Minister Andrew Holness is leading the delegation to the PetroCaribe summit, following the Latin American and Caribbean summit on integration and development, which will address themes around security, food sovereignty, human rights, democracy, sustaining the natural environment and energy issues.
Neither the Prime Minister's office, the Ministry of Finance nor the Ministry of Energy and Mining could confirm whether the Government would seek to defer the payment, and Sharon Weber, manager for the PetroCaribe Fund to whom queries were directed, was not reached for comment.
However, usually reliable sources said that would be among the major issues likely to be discussed with the Hugo Chávez administration.
Weber is among the delegation attending the PetroCaribe summit, the Ministry of Foreign Affairs and Foreign Trade has confirmed.
The PetroCaribe Fund is financed by a portion of the oil bill, which the PetroCaribe pact, signed in 2005, allows Jamaica to convert to a long-term loan for use as project financing.
This year's debt payment to Venezuela is US$44 million, compared to US$28 million last fiscal year. Jamaica currently pays interest of one per cent on the debt.
Jamaica's total liabilities to Venezuela under the fund is expected to reach J$164 million by the end of the current fiscal year.
Other members of the delegation to Venezuela are permanent secretary in the Ministry of Energy and Mining, Hillary Alexander, and managing director of Petrojam, Winston Watson.
The PetroCaribe fund was established to provide loan financing for approved projects and oil imports.
For the current fiscal year to date, the fund has disbursed approximately J$12.7 billion to Clarendon Alumina Production as working capital support for the Jamalco refinery, the Urban Development Corporation for the upgrade of Falmouth, and Petrojam to finance oil imports. Other projects are pending board approval.