KINGSTON, Jamaica (JIS) – A model of efficiency and effectiveness is how Chief Executive Officer of the PetroCaribe Development Fund (PDF), Dr. Wesley Hughes, describes the operation and management of the $320 billion Fund, in it’s nearly 10 years of existence.

Speaking at a JIS ‘Think Tank’ on August 4,  Dr. Hughes said the Fund, which was established in December 2006, almost a year after the PetroCaribe Energy Cooperation Agreement was struck with Venezuela in 2005, is being seen by many, including the Venezuelans, as a model for others in the region.

Under the terms of the agreement, the Government of Venezuela agreed to convert a portion of each payment due for petroleum products supplied to PetroJam Ltd, the state owned refinery, into a long term concessionary loan.

“It is a huge fund. At the end of March it was $320 billion. We’re in constant touch with other members and we’ve offered them the benefit of our expertise to help others who are not as developed in their infrastructure, in terms of managing their resources as we are. We have a fairly good piece of legislation that protects the Fund in the way we operate relative to what we’ve heard happening in other countries,” Dr Hughes told JIS News.

He said that the Fund is a very well scrutinized operation and is visited on a quarterly basis by the International Monetary Fund (IMF) and the Inter-American Development Bank (IDB) and operates at the highest global accounting standards.

“We’re well audited by the Auditor General, by our external auditors and we constantly liaise with the Venezuelans to give assurance that the Fund is well run and well organized,” he added.

Dr Hughes pointed to four primary functions of the Fund, which continue to play a significant role in Jamaica’s development.

 “The primary one is to ensure that when the time comes around for the repayment of the PetroCaribe debt, we will have the resources to repay. The other being to help finance the importation of oil through the refinery and help them meet their obligations. We’ve been doing that successfully and they and the country have benefitted,” he said.

The third primary function, Dr. Hughes pointed out, is for the PDF to help the Ministry of Finance to fund its overall domestic debt operation by using some of the resources to reduce ‘high cost’ debt. This gives the Government breathing space in its fiscal operations.

The fourth element is to invest the remaining resources and to make loans through public bodies for major projects. These have been in infrastructure [Norman Manley expansion]; a cruise ship port in Falmouth, Trelawny; Highway 2000, and the funding of other public bodies, including Clarendon Alumina Production Ltd, Wallenford Coffee and the Jamaica Urban Transit Company (JUTC).

Dr Hughes pointed out that the PDF is not a panacea for Jamaica’s development, as it represents limited resources that have to be managed prudently and carefully. However, the Fund is making an important contribution to Jamaica’s development, he noted.

“It is a debt and there are terms related to this debt. We are meeting those terms on time and in full. We do what we have to do to receive the long term financing – invest it and utilize it in a manner that ensures that we remain able to repay the debt on time,” Dr Hughes said.