Petro Caribe Fund under Fire! PUP says it’s operating illegally

In a sharp rebuke to the PUP for filing a court action calculated to disrupt Government use of Petrocaribe funds for development, an official statement from the Government Press Office called the PUP a party “on the wrong side of history working against the upliftment” of Belize.
It charged the PUP with trying “to derail or throw mud on the record-breaking progress that the UDP Administratio’s handling of the Petrocaribe funds has achieved.

It called the PUP ‘s recourse to the court an “unpatriotic attempt to play politics with a breakthrough program that is of vital national financial and development importance” which has nothing to do with the law.

But out of “an abundance of caution” the Government announced that it has introduced a motion in the National Assembly to treat the drawdowns it has been making as loans, and to authorize borrowings in that regard. The motion has already been approved by the Public Accounts Committee and will go to the full House of Representatives for approval at its meeting this month.

The outburst from the Barrow Government came after it learned that the PUP was taking it to court.

In its brief before the Supreme Court the PUP argued that the Barrow Government has been illegally drawing Petro Caribe funds provided by Alba Petroleum Caribe Belize Energy Limited (APBEL), the private company set up to administer the Petro Caribe funds.
The PUP is urging the court to use its power of mandemus to require the Barrow government to give a full accounting of how the money, estimated at $115 million, has been used.
The Petro Caribe Fund has been in existence since the days of former Prime Minister Said Musa in 2005, but Belizeans never heard much about it until the Barrow Government took power.

In 2012 the Barrow Government set up a private company (APCBL) to make all petroleum purchases from Venezuela and to administer the accumulated savings resulting from Belize’s special arrangement with Venezuela.
The savings come about because the government is allowed to pay for only part of each shipment. The Government of Venezuela allows the government of Belize to keep the other part and use the money for development projects.
The private company (APCBL) works as the agent of the government in buying petroleum supplies from Venezuela, keeping track of the money, and responding to government’s requests from time to time in making drawdowns from the Fund.

The PUP and its bevy of lawyers are saying that APCBL has no legal authority to be dispensing this money to GOB because APCBL is not a lending institution. It has not been registered as a lending institution and it has no authority to make loans.

The Barrow government’s reply to this objection is that the purpose of the Petro Caribe Fund is precisely to assist the government with development money, and the purpose of APCBL is precisely to dispense those funds from time to time at the behest of the government.
The Government, which has withdrawn some $115 million from those funds. It says it does not regard these withdrawals as loans.

“It isa special commercial and diplomatic arrangements under which our sister Bolivarian Republic of Venezuela sells Belize petroleum on terms that oblige us only to pay a part of the purchase price up-front, and keep the rest as credit to be paid instead on instalments over 20 years.
The GOB statement points out that “when the program first began under the PUP in 2005 it was never taken to Parliament, and there was never any accounting of how the financed portion of the petroleu purchases was spent… or even how much it amounted to”.

It goes on to say that Petrocaribe spending has been included in both national budgets since the program’s start and budget speeches include copious references to the particular programs funded by PetroCaribe.
This year’s budget (2014/2015) includes a drawndown from the Petro Caribe Fund to cover the fiscal year’s financial gap. The budget also identified by name and amounts the payments it authorized for the servicing of the Petro Caribe credit facility.

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