Much comment has been made, following the recent death of President Hugo Chávez, emphasizing forebodings about the fate of the PetroCaribe initiative and other forms of assistance, including the creation of the Alba; and the effects of any disappearance of these initiatives on the economic welfare of the Caricom countries, among other countries of the hemisphere. A significant part of the comment has given the impression that these initiatives have been a complete novelty, and that their sudden disappearance will be a major catastrophe for the economic circumstances of the countries involved.
Yet it tends to be forgotten that the significant attention which Chávez paid to Caricom and other hemispheric countries were by no means new in Caricom’s post-independence relations with Latin American states, and in effect, really reflected a major change in Latin American countries’ attitudes to the Caribbean particularly in the mid-1970s.
Hitherto, there was much doubt in the Latin American sphere as to whether the independence and sovereignty that the English-speaking states had attained from Britain was real, or whether their governments would turn out to be playthings of the West, as was the perspective of US-Central American and Latin-Caribbean states before Fidel Castro’s ascendancy in Cuba.
Little comment, indeed, has focused on the extent to which initiatives taken by Michael Manley and Forbes Burnham towards Latin American and Cuba in the 1970s raised fears similar to those relating to the Chávez-Caricom initiatives. Similarly, little attention has been paid to the fact that a central figure in the change in Caricom-Latin American relations in those years was the then President of Venezuela, Carlos Andrés Pérez. And it is a little remembered fact that the Latin American initiatives included a similar outreach by Mexico, then under Luis Echeverría.
Much current comment on the PetroCaribe initiative often omits to remind the Caricom public that in the mid-1970s, that initiative’s precedent, the San José Accord, evolved at a time when Jamaica and Guyana also were playing significant roles in the context of the Venezuelan-Mexico push for the establishment of SELA (the Economic System of Latin America) of which our countries were founding members. And much of this was seen as a Third World (a concept that had become increasingly popular and accepted) initiative to find ways of organizing international production, trade and aid more to the benefit of the recently independent, as well as older independent states in the non-Western world
The domestic context, in Latin America, of these initiatives was the nationalization of the petroleum industry in Venezuela by Carlos Andrés Pérez, complementing the longtime state ownership of the industry in Mexico, and the 1971 nationalization of the copper industry in Chile. And fears arose in the Caribbean as a similar assault was made on the Guyana bauxite industry, and in a more limited way in Jamaica, relatively small as these states were deemed to be. And added to this was the threat of the initiative for a New International Economic Order (NIEO) that could change the terms of trade and, in part, release the stranglehold which Western institutions like the World Bank and the IMF seemed to have over Third World countries – an initiative in which both Guyana and Jamaica were particularly vocal, as indicated in their advocacy of the International Bauxite Association.
But another context was certainly the dramatic change in the oil prices initiated in the Middle East (1973) which indicated that anti-Western antagonism was not only limited to our part of the world, but to countries long felt to be tied to the West and too traditional to undertake such an hostile initiative.
This rise in oil prices, followed by similar rises in other commodities, is in fact the link between then and now, and in particular in the present circumstances, Chávez’s decision to take advantage of the rise in oil prices when he assumed office and to raise again the major issue of the resumption, in more dramatic fashion, of the principles and objectives of the San José Accord, in the face of difficulties caused for other developing states of sudden and precipitate changes in the international economic environment.
That there has been much fear, since Chávez’ initiatives, about the substantial sums of money which Venezuela was now allocating in terms of the recipients’ ability to repay, is also reflective of the earlier period. It is recorded, but probably now forgotten in the wider world, that in 1974-75 – now nearly forty years ago − the Venezuelan Investment Fund made loans of US$700M to the Central American Bank for Economic Integration and to the Caribbean Development Bank; and $60M to the Andean Development Corporation; while Venezuela made an agreement to purchase 400,000 tons of bauxite from Jamaica, in what were then difficult economic times for that country.
Then, as now, criticism in some circles was harsh. As one author wrote at the time, these initiatives “sprang not from a careful study of the circumstances but from an expensive and disorderly interpretation of international economic cooperation.” President Pérez was perceived in as harsh a light as Chávez is today. But Jamaicans today know that one of their now rapidly developing cities on the borders of Kingston, Portmore, is a result of one of those Venezuelan loans.
The international environment has again changed, with some developing countries (in Latin America, Asia and Africa) making rapid strides while others, among them Caricom states, finding themselves in the economic doldrums. Yet, in Latin America, and in particular Brazil in our geographical area, it is acknowledged that an approach of pursuing development requires closer regional relationships, described as the pursuit of infrastructural integration with the support of international aid tied to private sector development, and that this is a valid use of their own resources vis-à-vis neighbouring countries. Even if the opposition should prevail in the forthcoming presidential elections in Venezuela, will a President Capriles be easily able to tear his country away from regional economic cooperation in a time of global economic difficulty?
And should our own Caribbean Development Bank, in close cooperation with the Inter-American Development Bank, not now begin to analyse likely policy trends in regional and international economic cooperation in consequence of Venezuela’s role as a regional neighbour, regardless of who wins?
In the context of what evolves in Venezuela, it is the nature of our relationship with our Latin American neighbours as a whole that will be crucial. Forty years ago, to say that one or other Caricom country should have close development policy relations with one or other neighbouring Latin American country would not have been perceived as unusual. Trends point to a similar disposition at present.
