St. Vincent and the Grenadines owes EC$155.23 million under PetroCaribe, Venezuela’s oil initiative that allows countries to buy oil and keep part of the payment as a multi-decade loan.
“The amount owed is 155.23 million dollars. I repeat again, this talk of almost a billion dollars is just simply, absolutely rubbish,” Prime Minister Ralph Gonsalves told Parliament on Tuesday in response to a question tabled by Opposition Leader Arnhim Eustace.
“Under PetroCaribe, we only get the fuel for the power stations. When the prices were higher two years ago, we imported about 70 million dollars worth. Now the prices are somewhat moderated, is 55 million,” said Gonsalves, who is also Minister of Finance.
“So, if you are even taking half of it as part of the financing arrangement and you see the time from which we started PetroCaribe in earnest, you will see that it can’t reach anything near to that number, and you are looking more like six years, five years of real activity in that sense. And you can do the math. You don’t have to go and take something speculative from some Bank of Nova Scotia report by somebody whom I don’t know, you doesn’t have the facts and who is speculating,” Gonsalves said.
The Bank of Nova Scotia in Canada has said in a report that SVG’s debt under PetroCaribe is almost EC$1 billion.
Gonsalves said that while SVG owes Venezuela EC$155.23 million under PetroCaribe, his government has actually lent out EC$146.6 million of that sum “because for the other we have donation; we have some donations”.
He explained that EC$75 million was lent to the central government, EC$64 million to the International Airport Development Company, and various sums to state agencies: Port Authority, Housing and Land Development Corporation, the Farmers Support Company, the Roads Bridges and General Services Authority.
Monies were also lent to Jaden Inc., owners of Jaden Sun high-speed ferry, a private sector enterprise.
“We have displacement, like the Lowmans Bay housing, operating and administrative expenses, and cash resources in the bank is almost five million dollars in the bank balances,” Gonsalves said.
He noted that some persons have said that the government should un-sign PetroCaribe because it increases the national debt. Gonsalves, however, said money would have had to be borrowed for all the items he listed.
“And we would have had to borrow money at 6, 7, 8 per cent rates of interest, whereas from PetroCaribe we get the money 1 per cent, and rather than having seven years to pay it back, we have 20 years.
“So, it would be complete madness to have 1 per cent money which you can get effectively in loans and turn your eyes at it … or maybe not to do all of these things, like the Farmers Support Company, like the people’s housing programme, like, for instance, the Immigration System and the Electoral System, etc., etc., all the things which I have called out,” Gonsalves said.