President David Granger said his Government could look at reopening the rice deal with its Spanish-speaking South American neighbour, Venezuela, if negotiations go well by his Ambassador, Foreign Affairs and Finance Ministers, contradicting earlier statements by his
Agriculture Minister Noel Holder. “I did meet with the Ambassador before she left for her post and I did say that we are interested in that market. It came to an end. The agreement came to an end and we need a new agreement. Both the Foreign Minister and Finance Minister are working at that, but we are also examining new markets in Latin America including Panama and Costa Rica and Mexico. That is a clear objective and mandate given to ambassadors”, President Granger said in his weekly televised “Public Interest” Programme”
But while the President acknowledged the importance of the Venezuela Market, Agriculture Minister Noel Holder, a senior member of the Cabinet, has a different story to tell. Holder said last Thursday in Parliament that based on the serious economic problems facing the Bolivarian Republic, a return of such a deal seems improbable. “It is inconceivable that deals that are comparable in volume and price often past are achievable again”. Holder told legislators in response to a call from the opposition for government to re-engage their Venezuelan counterparts.
Opposition Shadow Finance Minister Irfaan Ali, proposed a motion titled “The state of the rice industry in Guyana” which highlighted the plight under which rice farmers have found themselves. The motion called on the President Granger Administration to resume ties with Venezuela, so that some amount of relief could be had among rice farmers here. Interestingly, the President has acknowledged the need to recapture the Venezuelan rice market and even indicated that his Finance and Foreign ministers were working on securing that market once again, however, his Parliamentarians, including these two ministers, voted against Ali’s motion which sought to reaffirm the need for that market.
Meanwhile, economic commentator and former Minister of Foreign Trade under the PPP/C Dr Henry Jeffery in an invited comment said he sees no reason why government could not reopen the rice deal. “I think it is a good idea. Whether or not Venezuela is in economic crises, the Venezuelans will have to decide whether or not they want to restart the deal. They still have to eat, therefore no doubt they still have to get rice and therefore I see no reason wrong with Guyana attempting to restart the deal”, he told Guyana Times. According to him, while it all depends on the Venezuelan Government, it might be that the conditions might be different now,” but if you have rice to sell, you must sell it to persons who need it”. The PetroCaribe deal is an oil alliance of many Caribbean states with Venezuela to purchase oil on conditions of preferential payment. The alliance was launched in June 2005 in Puerto La Cruz, Venezuela.
In 2013, PetroCaribe agreed links with the Bolivarian Alliance for the Americas (ALBA), to go beyond oil and promote economic cooperation. The agreement was initiated with the aim of having solidarity with other countries in accordance with ALBA. The payment system allows for purchase of oil at market value for five 50 per cent up front with a grace period of one to two years; the remainder can be paid through a 17-25-year financing agreement with one per cent interest if oil prices are above US$40 per barrel. Out of the 15-member Caribbean Community, 12 countries have signed on to the agreement, including Antigua and Barbuda, The Bahamas, Belize, Cuba, Dominica, The Dominican Republic, Grenada, Jamaica, St Lucia, St Kitts and Nevis, Saint Vincent and the Grenadines, Suriname. While Guyana had also signed on to that agreement and was enjoying a fruitful relationship, recent tensions between the two countries saw Venezuela pulling out of the rice for oil contract it had with Guyana.
PetroCaribe, a signature initiative of late President Hugo Chávez, has sold about US$28 billion to participating nations across the Caribbean and Central America since its creation in 2005. Member countries finance as much as half the price of the shipments at one per cent to two per cent interest over 25 years. Guyana received about half its fuel supply via PetroCaribe, but the agreement was affected by the diplomatic row with Venezuela over a longstanding border controversy.
Relations between Guyana and Venezuela have soured following ExxonMobil Corporation’s announcement of a “significant” oil discovery off Guyana’s coast in waters that Venezuela claims as its own. The country has contended that borders drawn in 1899 are invalid, and claims nearly two-thirds of Guyana’s territory, mainly the County of Essequibo. The Guyana Government had said it remains committed to judicial settlement of the border controversy, and is seeking legal opinion of the International Court of Justice (ICJ) on the 1899 arbitral award.