Op-Ed Commentary
VenEconomy:
Agreement
with Cuba lays waste Venezuelans’ welfare
The Chávez administration’s “banner”
oil agreement with Cuba has wiped out most of the possibilities
of providing the Venezuelan population, in particular the lower
income segments, with health and welfare services.
On October 30, 2000, President Chávez signed an agreement
with Cuba to supply 53,00 b/d of oil, and this was amended on
October 15, 2004, to raise the volume to be supplied to 92,000
b/d. This Monday, Humberto Calderón Berti, former Minister
of Energy and Mines and director of PDVSA (but not at the same
time) and José Toro Hardy, also a former PDVSA director,
made a public announcement denouncing that, with this oil agreement,
a fraud of gigantic proportions had been committed against the
country.
The list of denouncements made by Calderón and Toro Hardy
contains a collection of atrocities and outrages that makes the
illegality on which this agreement is apparently based the least
relevant of all, besides reducing the fact that this agreement
was never approve either by the defunct National Congress or by
the present National Assembly as specified in the Constitution
to a mere technicality of scant importance.
The denouncements reveal, among other things, that oil sales to
Cuba this year will amount to $2.2 billion, based on dispatches
to Fidel’s island of 103,000 b/d and not the 92,000 b/d
specified in the agreement. Besides, they point out that 25% of
those $2.2 billion is payable in non-negotiable bills of the Banco
Nacional de Cuba, with maturity at 15 years and interest at 2%,
which means that the current value of these bills is practically
zero. The remaining 75% is supposed to be paid by Cuba with goods
and services, a kind of barter arrangement. Among the services
being supplied by Cuba are “doctors,” “trainers”
and innumerable “advisers,” including the feared Cuban
G2, as well as operations under the Misión Milagro program,
medicines from Cuba, and light bulbs that come from China via
Cuba. Who could possibly think that the true value of these goods
and services comes to $400 million a quarter? Apparently the Cubans
and the Bolivarians.
Not only that, the Cubans allege that the value of the goods and
services supplied in the first quarter of 2006 exceeds $1 billion
and have requested that they be paid $212 million in cash, ignoring
the fact that this is not established in the agreement.
With documentation in hand, Calderón and Toro Hardy informed
the public that
President Chávez himself had ordered this payment and that
it was made by bank transfer to “European banks without
the Government of Cuba appearing as the beneficiary” and
charged to the social spending of Corporación Venezolana
de Petróleo (CVP). And as though that were not enough,
in October 2006, the Cubans demanded another $127 million on the
same grounds, the payment of which was also approved by the Executive.
The loss to the nation’s wealth is twice the $2 million
plus a year that Venezuela has forfeited in revenues, particularly
if one takes into account the benefits that the 15 million Venezuelans
living in poverty might have enjoyed had that same money been
invested in building and improving health services, not to mention
the jobs that would have been generated for Venezuelan doctors,
anesthetists, nurses, orderlies and countless others in the areas
of health, construction and maintenance.
VenEconomy
is a Venezuela's leading specialized publisher in the economic
and financial area. VenEconomy's Points of View on the issues
of the day, as seen by VenEconomy during the last week. Petroleumworld
not necessarily share these views.
Editor's
Note: This commentary was originally published by VenEconomy,
on 11/21/2006. Petroleumworld reprint this article in the interest
of our readers.
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Petroleumworld
11/23/06
Copyright ©2006 Veneconomy. All Rights Reserved.
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