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Volume No. 1 Issue No. 71 - Thursday September 29, 2005 |
Petrocaribe Agreement Expected to Bring Benefits to Dominica Sean Douglas - Government Press Secretary
Dominica�s minister for energy Reginald Austrie, has been explaining the benefits of the Petrocaribe agreement for Dominica. The Minister addressed the local media at a Press Conference on Monday.
On September 6th 2005, Dominica signed a bilateral agreement with Venezuela to give effect to the Petrocaribe agreement signed by Prime Minister, Hon. Roosevelt Skerrit and twelve other Caribbean leaders at Puerto La Cruz, Venezuela on June 29th 2005.
The bilateral agreement allows for the Government of Dominica to set up its own National Petroleum Company. Trading will be done directly between the Government of Dominica and the Government of Venezuela thereby minimising the involvement of middlemen, thereby reducing costs.
Mr Austrie explained the credit mechanism built into the Petrocaribe agreement: �As the price of oil continues to rise, we will get a corresponding credit facility.
�If the price of oil is $40 a barrel, the credit facility is 30%. If the price of oil is $50 a barrel, the credit facility is 40%. If the price of oil gets to $100 per barrel, we will get a 50% credit. Those monies are loans to the state to be repaid over a 25 year period at 2 per cent interest which can then be used to finance social and economic development programmes in Dominica.�
The agreement makes provisions for countries to make payments in cash and in kind. The Minister further stated that this presented farmers and other players in Dominica with an opportunity to benefit from this arrangement.
Mr. Austrie also made a pledge that by Christmas 2005, Dominicans would begin to see the benefits of this agreement through lower electricity bills.
The Petrocaribe agreement also has an Alba Fund in which all countries who are signatories to the Petrocaribe project can have access to and receive grant funding. The objective of the Fund is to boost social and economic development programmes, foster training and employment, especially among women and youth, and increase productive activities and services such as air transport. In addition, it will seek to provide resources for improved public health care, including HIV/AIDS, and enhance education, culture, sport and youth exchange programmes.
That Fund will be replenished by some of the proceeds of the Petrocaribe agreement and Venezuela has already made US$50 million available to that Fund.
Meanwhile The Montego Bay Declaration, signed in Jamaica on September 6th 2005, outlines the purpose of the Petrocaribe project. Petrocaribe is intended to contribute, among other things, to energy security, socio-economic development and the integration and transformation of Caribbean and Latin American societies.
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