Jamaican Government moves to compulsorily acquire Petrojam

The Jamaican Government has said that it will introduce legislation to take back into state control the PDVSA-owned Petrojam refinery in Kingston. Jamaica’s Attorney General, Marlene Malahoo Forte, said that a bill will be introduced shortly to compulsorily acquire the 49% of the shares held by PDV Caribe, a subsidiary of the Venezuelan state-owned firm Petroleos de Venezuela (PdVSA).

The announcement came shortly after Jamaica voted with 18 other members of the Organisation of American States (OAS) not to recognise Nicolas Maduro’s second term in office as Venezuela’s President.

At the OAS Jamaica joined with five other Caribbean nations, The Bahamas, the Dominican Republic, Guyana, Haiti, and St Lucia, plus Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, Guatemala, Honduras, Panama, Paraguay, Peru, the United States and Canada to vote in favour of the resolution. Dominica, St Vincent and Suriname voted against, while Antigua, St Kitts, Barbados, Belize and Trinidad abstained. Grenada was absent.

Speaking in Kingston on the BBC World Service programme ‘World Questions’, Jamaica’s Foreign Affairs and Foreign Trade Minister, Senator Kamina Johnson Smith, said that Government’s decision to vote in this way did not represent a break in its foreign policy. “We always vote on the side of human rights, democracy and the rule of law, which is what we did at the OAS”, she said. In answer to a question the minister noted that Jamaica had not taken any position regarding the Venezuelan Opposition. “We have heard that there have been discussions about recognising an alternate government, but the Jamaican Government has not been exploring that as an option. We are however monitoring the situation closely,” she said.

In a statement issued earlier, the Ministry of Foreign Affairs said that it remained hopeful that dialogue will take place among the parties in Venezuela “consistent with our position that the people of Venezuela should have the opportunity to resolve their various issues through dialogue at the national level”.

Both the OAS vote and the Petrojam decision have been the subject of extensive criticism by the Jamaica’s opposition People’s National Party (PNP).

The Opposition Leader, Dr Peter Phillips, who is expected to speak further about both issues, asserted that both the decision regarding President Maduro and to acquire Petrojam were premature and “bring disgrace to Jamaica’s reputation”. “The fact is, we have never expropriated the property of any investor in Jamaica before. It is a dangerous precedent for us to set. If we don’t behave honourably to our friends, we soon won’t have any friends,” Phillips told the island’s parliament.

Julian Robinson, the PNP’s General Secretary and the opposition spokesman on science and technology, said: “The actions of the Government will most likely lead to legal action being pursued by the Government of Venezuela. Those actions can cost the taxpayers of this country billions of dollars that we may have to pay in restitution if a court rules against us.”

Last December, Jamaica’s Prime Minister, Andrew Holness, said the Petrojam oil refinery was in danger of becoming obsolete. He also said that he had ordered a forensic audit into the US$390m (J$5.2bn) unaccountable oil losses it had recorded over the five-year period between 2013 – 2018 to discover whether this reflected wastage or oil being stolen. There remains media speculation in Jamaica that the ultimate beneficiary of the takeover of Petrojam may be a Chinese state-owned company. The price tag for repair has been put at US$10m.

Meanwhile a consortium of Latin American media organisations and independent journalists have published a well-researched extensive report on the operation of Venezuela’s PetroCaribe programme and the way individuals in several named countries, including the Dominican Republic, Nicaragua, Guyana and El Salvador, have benefited from the programme allegedly through fraudulent invoicing and the non-supply of goods under barter arrangements. The report can be read in English at:

https://www.connectas.org/especiales/petrofraude/en.html.

 

This is a lead article from Caribbean Insight, The Caribbean Council’s flagship fortnightly publication. From The Bahamas to French Guiana, each edition consists of country-by-country analysis of the leading news stories of consequence, distilling business and political developments across the Caribbean into a single must-read publication. Please follow the links on the right-hand side of this page to subscribe, or access a free trial.

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