PETROCARIBE #34: EC LEADERS FLOCK TO PETROCARIBE

1. (U) Summary: Eastern Caribbean Heads of State departed for
the Fourth Petrocaribe Summit on Friday, December 21st in
Cienfuegos, Cuba. The summit comes among praises from
leaders in St. Kitts and Nevis and St. Vincent and the
Grenadines, who have benefited from the Petrocaribe program.
The participation levels may reflect an understandable
byproduct of rising energy costs that disproporionately
impact these small economies, but do not necessarily reflect
growing political sympathies with either Cuba or Venezuela.
End summary.



2. (U) Various government ministers from Antigua and Barbuda,
Barbados, Dominica, St. Kitts and Nevis, St. Lucia and St.
Vincent and the Grenadines are traveling to Cienfuegos, Cuba
for the Fourth Petrocaribe Summit to be held on December
21st. St. Vincent and the Grenadines and Antigua and Barbuda
are reportedly being represented by their Heads of State,
Prime Minister Ralph Gonsalves and Prime Minister Baldwin
Spencer, respectively.

Petrocaribe Making News in St. Kitts and St. Vincent


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3. (U) St. Kitts and Nevis will be represented by Energy
Minister Dr. Asim Martin and Permanent Secretary Oaklyn
Peets, who only a week earlier announced the successful
delivery of the first batch of Petrocaribe fuel. On December
6th, St. Kitts received a shipment of 6,876 barrels of diesel
fuel, or 294,000 gallons. The GOSKN marked the event with a
highly-publicized ceremony hosted by Prime Minister Denzil
Douglas. Several days later, news reports stated that
Venezuela plans to begin building a fuel terminal on St.
Kitts in the first quarter of 2008. St. Kitts currently has
two fuel storage facilities, one owned by Texaco and the
other by Shell. According to reports, PDVSA claims the
facility will have a capacity of 34,300 barrels. The recent
PetroCaribe developments come just months after St. Kitts and
Nevis purchased a second generator to support the increased
energy demands of its growing tourism industry.



4. (SBU) St. Vincent and the Grenadines (SVG) is sending a
nine-man delegation to the summit, led by Prime Minister
Ralph Gonsalves. In late November, he hailed Petrocaribe as
a "huge success" for his country, exclaiming to the media,
"if somebody gives you 40 percent credit at one percent
interest over 25 years it is extraordinarily generous."
According to Gonsalves, SVG has accessed $1.8 million USD
from ALBA CARIBE, as part of its development fund under the
Petrocaribe agreement. Gonsalves is expected to meet
separately with Cuban officials to discuss plans for St.
Vincent's proposed Argyle International Airport.

A Revisitation by St. Lucia


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5. (C) At the last minute, the GOSL ordered Trade Minister
Guy Mayers to attend the summit. Titus Preville, Permanent
Secretary for Trade, admitted to PolOff that St. Lucia's

SIPDIS
objective is to "just hear what is being said." Given the
ruling party's strong stance against Petrocaribe shortly
after the December 2006 elections, Preville was clearly
surprised that the government chose to send a representative.
Recently, however, government spokesperson Jeff Feddee
announced "the GOSL will soon no longer be able to subsidize
fuel prices given the global rising price of fuel, which may
influence St. Lucia to revisit the Petrocaribe offer."

Comment


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6. (C) High-level participation by EC leaders in this Fourth
Summit shows that Petrocaribe is alive and well in the

region. While the actual benefits of Petrocaribe to the
Eastern Caribbean are minimal in some countries and
questionable in others, Petrocaribe still gets strong
political mileage in the region. And combined with
Venezuela's promises of more benefits to come, Eastern
Caribbean leaders are more than happy to oblige. In private,
one energy official from Barbados told Econoff that "the
Caribbean is not stupid; these countries have no intention of
paying off under a payment plan that will expire long after
everyone (of the signatories) is dead." End Comment.
OURISMAN