Jamaica: PetroCaribe Development Fund ceases to exist at month end

Jamaica: PetroCaribe Development Fund ceases to exist at month end
Dr. Wesley Hughes
Dr. Wesley Hughes

KINGSTON, Jamaica, Mar 19, CMC – The PetroCaribe Development Fund (PCDF), established following an agreement between Venezuela and a group of countries in the Caribbean and Central America, is to be integrated into the Ministry of Finance and the Public Service as of March 31, 2019.

The chief executive officer, Dr. Wesley Hughes, says the PCDF has accomplished its mission.

The PCDF was established in 2006 as a Public Body, and was dedicated to lending to self-financing public bodies for human capital development, offering assistance to the Ministry of Finance for domestic debt refinancing as well as lending to reduce Jamaica’s dependence on fossil fuel.

Hughes told a Jamaica Information Service (JIS) “Think Tank’ that all the assets and a small amount of liabilities will be transferred to the Ministry, and the Fund, as a separate entity, will cease to exist.

“We are extremely proud of our accomplishments and the contribution that the Fund has been able to make to Jamaica’s overall development in all areas.

“We are most proud of our contribution to the debt buy-back arrangement in 2015, and the significant reduction of the debt-to-GDP (gross domestic product) ratio as a result of that operation, which contributed greatly to the macroeconomic stabilisation of the country,” Hughes said.

He said Jamaica had a debt to Venezuela of approximately US$3.2 billion, and through the Ministry, Kingston was able to negotiate with Caracas to repay US$1.5 billion, a near 50 per cent discount.

PCDF Investment and Treasury Manager, Bob Russell, said that during the life of the loan, the PCDF had been 100 per cent successful in repaying the Petroleos de Venezuela South America (PDVSA) debt, having never missed a single loan payment.

He said further, that PDVSA even sent officials to look at Jamaica’s debt management model, as it was one of the most successful models within the PetroCaribe agreement.

Hughes said that another mandate of the Fund was the provision of grants for housing, school sanitation, assistance to children in the inner-city communities and investment in infrastructure, such as the Port in Falmouth; renovation of the Norman Manley International Airport and the downtown markets, and Highway 2000.

The Fund’s establishment resulted from an agreement between Venezuela and a group of countries in the Caribbean and Central America due to the significant increase in oil and the attempt to find a way to ameliorate the impact of this increase on these countries.

Last month, Parliament gave the Andrew Holness government the green light to compulsory re-take the 49 per cent shares in the state-owned oil company, Petrojam that had been held by the Venezuelan state-owned oil and natural gas company, Petróleos de Venezuela (PDV) Caribe.

Prime Minister Holness, who tabled the Compulsory Acquisition (Shares in Petrojam Limited) Act, 2019, said the decision to move in the current direction was not taken lightly.


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