Guatemala Will Not Join Petrocaribe

The government wanted convenient terms in time frames, repayment schedules and interest rates, but no agreement was reached.

Tuesday, November 5, 2013

Guatemalan Vice President Roxana Baldetti, reported that the country has ruled out joining the initiative "which allows countries in the zone to buy oil from Venezuela on favorable terms," noted an article in Laprensagrafica.com.

"None of the agreements we wanted were reached, so we are not interested" he added.

A Venezuelan mission visited the country last May to hear Guatemala's position, which was to get a fee of less than 2% interest in the oil bill.

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Venezuela Raises Interest Rate in Petrocaribe

July 2013

During the VIII Petrocaribe Summit it was reported that the rate of interest on oil bills will be changed, increasing from between 2% to 4%.

The Guatemalan Vice President Roxana Baldetti, explained that Venezuela has modified the interest payment according to oil and oil supplies for more than a dozen Latin American countries.

After Chavez: Changes in Petrocaribe

May 2013

The conditions in Petrocaribe will never be the same: the new government of Venezuela will change preferential credit terms for the purchase of oil.  

This was explained by the Vice President of Guatemala Roxana Baldetti, who has already met with representatives of Petrocaribe.

Petrocaribe: Good or Bad Deal?

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The Guatemalan government's intention to join Petrocaribe is generating a heated argument that reveals the political background of the subject, beyond its apparent financial advantages.

Humberto Preti, in his column in Prensalibre.com, reports that "What is being done with Petrocaribe is to set up a state run or semi-state run company which does "the business" and receives the oil with 50% long-term financing with interest rates of 1% per year and with a grace period of two years before starting repayments. The oil is received at current international prices, so there is no advantage in price, but in funding. The oil is to be delivered to a refinery that can process Venezuelan heavy type oil, which is highly sulfurous-, which are those that are outside of Venezuela, in Trinidad and Curacao. Venezuela does the same and imports its own oil derivatives. The only refinery that they had burned down. This refinement has normal costs, so therefore the price of derivatives remains the same and Guatemalans would have no economic advantage. "

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The Chamber of Agriculture of Guatemala believes that integration to Petrocaribe will not bring advantages and will bring disadvantages.

Jose Molina, president of the Chamber of Agriculture, said that since 2008, when Guatemala joined the program, they have been expressing their total opposition because the project represents an increase in public debt.

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