Published On: Tue, Nov 25th, 2014

IMF wants to know what PetroCaribe money was used for in St Vincent

IMFWASHINGTON, USA -- The International Monetary Fund (IMF) says it is monitoring the potential impact of Venezuela's current economic stress on PetroCaribe, the country’s oil alliance with several Caribbean islands, and it also wants to know what PetroCaribe money was used for in St Vincent and the Grenadines (SVG), Merco Press reported.

According to SVG Prime Minister Dr Ralph Gonsalves, Caracas has invited PetroCaribe member countries to a meeting about “reaffirming” their commitment to the initiative, the brainchild of the former Venezuelan president, the late Hugo Chavez.

IMF Western Hemisphere advisor, Elie Canetti, told reporters that the IMF’s main concern “is that we know Venezuela is going through increasing financial stress, and oil prices have dropped from around US$120 a barrel to mid 70s a barrel and Venezuela is hugely dependent on selling oils.”

“So, we are mindful and concerned about the feasibility of PetroCaribe continuing, certainly at the level it has been, and we are looking into what will be the impact on Caribbean countries,” Cantelli said.

“So if PetroCaribe is, in the extreme, wound down, or if PetroCaribe financing benefits become less generous, it is something that will have to be taken in account in the fiscal strategy,” he said, adding that the Washington-based financial institution is trying to understand what exactly PetroCaribe money was used to pay for in SVG.

According to analysts, the initiative, which allows countries to pay for part of their oil imports from Venezuela over a 20-year period at low interest rates, will have to be modified or discontinued amidst the country’s worsening economic situation.

In addition to SVG, several other Caribbean Community (CARICOM) countries, including Antigua and Barbuda, The Bahamas, Jamaica, Belize, Haiti, St Kitts and Nevis, Saint Lucia, Grenada, Guyana, and Suriname are members of PetroCaribe.

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