Georgetown: With the PetroCaribe agreement between Venezuela and Guyana slated to end sometime this year, Minister of State Joseph Harmon said Government is cautiously trying to push for an extension of the arrangement.
Harmon noted that the Government of Guyana is currently engaging the Bolivarian Republic of Venezuela on a bilateral basis to determine if it is possible to extend the agreement so that Venezuela can continue buying rice from and supplying oil to Guyana.
These discussions are being led by Foreign Affairs Minister Carl Greenidge, Harmon stated.
Under the current trade agreement, Guyana is expected to supply approximately 210,000 tonnes of paddy and polished rice annually to Venezuela. The value of this supply amounts to US$130 million.
Recently, Harmon declared that the PetroCaribe Fund is empty, alleging that the mismanagement of the former People’s Progressive Party Civic (PPP/C) Administration is to be blamed.
However, the PPP/C is arguing that the Fund was never meant to be a vault to keep money but rather, the money was used to pay rice farmers and millers.
Nonetheless, Harmon indicated that the PetroCaribe deal is extremely beneficial to Guyana and therefore, the Government is hoping that the agreement can be extended.
He also disclosed that there are other South American countries which are pushing to penetrate and possibly take over the rice market in Venezuela.
The likelihood of Venezuela dropping Guyana as a supplier of rice is uncertain, particularly considering the ongoing territorial dispute between the two nations regarding the Atlantic Ocean off of the Essequibo Coast where the US oil giant ExxonMobil has its operations.
ExxonMobil recently announced that it detected an indication of oil and an assessment is currently ongoing to determine if the lucrative resource is indeed in commercial quantities.
If so, in time, Guyana will no longer have to depend on other countries for oil.
But, in spite of these factors, Harmon said the government was optimistic that the rice deal will be extended.
“We believe that because of this length of time in which we have been shipping rice to Venezuela, that the Venezuelan market might have been accustomed to Guyana’s rice and therefore we stand a better chance of being able to negotiate a longer term arrangement,” he said.
In February, Guyana’s former Ambassador to Venezuela Dr Odeen Ishmael wrote an article suggesting that the countries signed onto the PetroCaribe agreement should no longer place much reliance on it.
The article asserted that Venezuela would be unable to sustain the programme of providing concessionary oil to countries signatory of the PetroCaribe agreement due to its current economic crisis and the recent drop in international oil prices.
The article also states that this position was adopted by the International Monetary Fund (IMF) which in November 2014 claimed that four Caribbean Community (Caricom) countries – Belize, Haiti, Jamaica and Guyana – had begun to take steps to reduce their dependency on PetroCaribe oil.
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