(Trinidad Guardian) The International Monetary Fund (IMF) in its 2014 Spillover Report released August 18 said it sees potential spillovers including “macroeconomic difficulties” into the economies PetroCaribe now helps. “Venezuela has provided financial support to countries in Latin America and the Caribbean through energy co-operation agreements, under which Venezuela sells oil at market prices, but gives generous financing conditions to beneficiary countries, including long-term loans at low interest rates, and sometimes the possibility to repay in kind,” the IMF said. “The volume of oil sold to the region under various agreements (San Jose, Caracas, Integral Cooperation, and PetroCaribe) has stabilised at around 250,000 barrels per day (bpd) after 2009, with values rising to about US$10 billion in 2012.”
These arrangements, the IMF said, represent a relatively small share of the Venezuelan oil sector, but nonetheless the authorities could decide to reduce this support “if the country’s external liquidity constraints become binding.” The financing element of these agreements accounts for only about five per cent of Venezuela’s export revenue (US$4.9 billion) and its accumulated claims on beneficiary countries stood at only about 2.7 per cent of Venezuelan gross domestic product (GDP) (US$10 billion) as at end-2012.
