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Jamaica seeking alternative means to pay for oil from Venezuela

KINGSTON, Jamaica Nov. 29, 2014 - The Government of Jamaica is pursuing a number of alternative methods of repaying the country's oil debt under the Petrocaribe Deal with Venezuela.

Jamaica’s Energy Minister Phillip Paulwell says while the country  is currently paying a portion of the debt with clinker from Caribbean Cement, there's the need to come up with additional products which can be traded with Venezuela.

A Radio Jamaica news report quotes Minister Paulwell as saying that this determination arose from last week's meeting of PetroCaribe beneficiaries in Caracas, during which the Venezuelan Government gave the assurance that the oil deal remains intact, "and that Jamaica, along with the other beneficiaries, will not see any reduction in the benefits."

Instead, he said, Venezuela is seeking "deeper integration into the economies of PetroCaribe."

In keeping with that commitment, he said the Jamaican Government  will be seeking to "access other products and services and service, as tradeable items to enable us to pay for our imports of petroleum products, rather than pay hard currency, as we've been doing to Carib Cement, in the sale of clinker."

Under the PetroCaribe agreement, Jamaica benefits from a deferred financing mechanism on petroleum products purchased from Venezuela.

The agreement includes a trade compensation mechanism that allows Jamaica to pay a portion of  the loan with locally produced goods and services, valued at preferential rates. 

Mr. Paulwell also disclosed that Jamaica will to host the 10th anniversary meeting of  PetroCaribe members next year.

The PetroCaribe Agreement, the brainchild of President Hugo Chavez of Venezuela, was signed in Montego Bay in 2005.

With the current drastic reduction in global oil prices, there had been growing concerns that Venezuela would be unable to sustain the preferences given to regional countries, under the Agreement.