More than one year after the historic PetroCaribe rice-for-oil Guyana-Venezuela deal collapsed, a motion will be moved in the National Assembly urging Government to reopen negotiations with the Bolivarian Republic of Venezuela on the rice and paddy trade.
People’s Progressive Party/Civic (PPP/C) parliamentarian Irfaan Ali is scheduled to move the motion when Parliament resumes on Thursday.
Last year, Venezuela abruptly halted the importation of rice from Guyana under the PetroCaribe arrangement.
At that time, the PetroCaribe deal was to remain functional until it expired in November of that year, but owing to certain circumstances, Venezuela terminated the rice deal before the official end date.
Since the collapse of the arrangement, Guyana has not clinched similar rice deals with other countries.
However, Government had announced in March that the Spanish-speaking nation may still be purchasing Guyana’s rice, albeit through neighbouring Suriname.
Workers loading paddy destined for Venezuela onto a vessel in 2015
The PetroCaribe deal was sealed by then President Bharrat Jagdeo with then Venezuelan President Hugo Chávez several years ago, which saw Guyana receiving oil in exchange for rice at premium rates.
Under the PetroCaribe deal, Guyana was required to pay up front a percentage of the cost of fuel acquired from Venezuela, with the balance, which was placed in the PetroCaribe Fund at the Bank of Guyana, being treated as a loan repayable over 23 years, with a two-year grace period and two per cent interest. Each deposit into the Fund was treated as a loan to the country with the same concessionary terms. This resulted in Guyana being able to defer its payments, which were at concessionary rates, over a longer period of time.
Venezuela had been by far the major market for Guyana’s rice and paddy, accounting for around 60 per cent of total exports in 2010. In 2014, exports to Venezuela accounted for approximately 38 per cent of total exports although the overall tonnage exported (150,000 tonnes of rice and 50,000 tonnes of paddy) far exceeded the 2013 export levels. Therefore, the loss of the Venezuelan rice market was indeed a significant blow to the rice farmers, the entire industry and, by extension, the entire economy.
Meanwhile, with regard to the state of the local rice industry, the PPP/C Member of Parliament (MP) also intends to push for a number of items, including the elimination of all forms of taxes and duties on fuel for the industry as well as for machinery, equipment and spares.
Ali’s motion is also calling on the Government to commence discussions with all the commercial banks that lend to the industry to review terms and conditions of loans taking into account the low prices farmers are getting in order to ‘soften’ repayment conditions, to suspend payments of land leases and drainage and irrigation charges, among others.
Following the collapse of the PetroCaribe deal and the hardships that were thrust upon rice farmers across the country, Opposition Leader Bharrat Jagdeo had proposed a plan to the Government to aid in reviving the industry; however, the Administration never paid it any heed.
Government has staunchly maintained the rice industry falls within the realm of the Private Sector and, therefore, those affected by the prevailing problems should not depend on Government for solutions. (Reprinted from today’s Guyana Times)
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