Early in 2012, shortly after being elected to a second term, the Government of Prime Minister Dean Barrow set out to re-organize the petroleum industry in Belize to take full advantage of the generous concessionary terms being offered by the Bolivarian Republic of Venezuela through Petrocaribe.
Petrocaribe is an oil alliance of many Caribbean states with Venezuela to purchase oil on conditions of preferential payment. The alliance was launched on 29 June 2005 in Puerto La Cruz, Venezuela.
Barrow’s plan was to consolidate all of Belize’s petroleum purchases to come from a single source – Venezuela. In that way Belize would only have to pay for 75 percent of its petroleum imports up-front. The remaining 25 percent Belize could use for development purposes, and pay in easy instalments over a 20 year period.
To accomplish this, the Barrow Government approved the establishment of a private corporation which it called Alba Petroleum Caribe Belize Energy Limited (APCBL), a consortium of Venezuelan and Belizean investments, to manage all petroleum purchases for Belize and to create a Petro Caribe Fund. The residue of money which Belize does not immediately spend on petroleum imports is deposited into this fund.
APCBL was able to buy out Esso Standard Oil S.A., the American company which used to import all of Belize’s fuels, and its distribution network of service stations. The transition was effected so smoothly and efficiently that few people took note of the change. But they began to see the benefits almost immediately.
The idea from the very beginning was that Belize could dip into this fund from time to get infrastructure money for roads, bridges and schools. More recently the fund was identified as the source of money to bridge the 2014/15 budget gap and to acquire one or more utility helicopters for the BDF.
The money in the Petro Caribe Fund does not belong to APCBL. Actually it belongs to Venezuela. But Venezuela has given permission for the money to be used to benefit Belize development and help lift the country out of poverty. Last year Petrocaribe agreed to link with the Bolivarian Alliance for the Americas (ALBA), to go beyond oil and promote economic cooperation as well.
The Barrow Government’s efforts at re-organizing the petroleum industry in Belize has been a sensational success. It has not resulted in cheaper gasoline prices for Belizeans, but it has provided a fund of development money which has proved to be extraordinarily helpful in providing infrastructure for Belize to build on.
It has moreover given the Barrow Government the economic freedom to act in emergencies – hurricane and flood relief, poverty alleviation, threats from Guatemalan marauders, funds to complete the forward naval base at Hunting Caye and patrol helicopters for the BDF – none of which would have been possible if the country had to depend on its regular budget resources. .
In its motion before the Supreme Court last week the People’s United Party seems to be suggesting that there is waste and corruption in the administration of the Petro Caribe Fund.
It also argues that the APCBL company administering the Fund is not authorized to issue loans to the government of Belize from that Fund.
These are matters we know nothing about. If indeed there is waste and corruption, these should be corrected. All we can say at this time is that the Petro Caribe Fund is vital to the economic well-being of Belizeans, and that the government of the day, whether UDP or PUP, must have easy access to these funds at all times. .