KINGSTON, Jamaica – Minister of Finance and Planning Dr Peter Phillips is expected to answer questions regarding the financial status of the PetroCaribe Development Fund (PDF) at today’s sitting of the House of Representatives.

Following the Government’s announcement in July that it had raised $2 billion in Eurobonds on the international capital market to buy back its PetroCaribe debt from Venezuela, Opposition spokesman on finance Audley Shaw had demanded that the minister disclose how the approximately $1 billion of liquid assets at the PetroCaribe Fund would be used.

“Will any of this be used towards servicing this new debt, and should some of these funds not be dedicated to purchasing goods from manufacturers for barter to Venezuela? Will it be used to facilitate industrial development and export and grow the economy?” Shaw asked at a press conference.

Minister Phillips has said that three-quarters of the US$2 billion or US$1.5 billion was used to purchase US$3.25 billion of debt owed by the PetroCaribe Development Fund to Venezuela’s State-run Petróleos de Venezuela SA (PDVSA).

Shaw had also raised concerns that the cost of the funds raised to pay down the debt was too much and would lead to more economic pressure for Jamaicans.

The move came in the face of the South American country’s own mounting debt problems, which has pushed Venezuela to make arrangements with its partners in the region to address what experts say are growing PetroCaribe debts.

The International Monetary Fund (IMF) in a report last year warned that some countries benefitting from PetroCaribe could be exposed to economic shocks if Venezuela reduces or cuts special pricing and payback arrangements as a result of that country’s own liquidity problems. Under PetroCaribe the Jamaican Government buys oil from Venezuela under preferential payment conditions.

Alphea Saunders