BASSETERRE, St. Kitts - PRIME MINISTER Dr. the Hon. Denzil Douglas announced Wednesday (May 27) that St. Kitts-Nevis is currently weighing the ramifications of signing onto a trade agreement that is a source of political contention between Venezuela and the United States.
Speaking of the Bolivarian Alternative for the Americas (ALBA) trade agreement initiated by Venezuela in 2004, Douglas said that his government planned to enter discussions regarding the issue soon.
“I believe the ALBA will come up for discussion during the [6th PetroCaribe] Summit. Remember that the ALBA is an initiative started by Venezuela to enhance trading and other relationships between the member countries of PetroCaribe.”
The Prime Minister stated that the ALBA is “something that is very interesting to us”, and described it as an alternative to the Free Trade Area of the Americas (FTAA) proposed by the United States in 2003, which the Federation had initially expressed interest in.
“ALBA came into being at the time when the United States, as you know, was pushing for the Free Trade of the Americas, and Venezuela, Brazil and Mexico felt that wasn’t going to work…that it was something that smacked of colonialism. It was the exploitation of the different sectors, companies and peoples in the region, and so they came up with their own initiative, which is the ALBA,” he stated.
While the Prime Minister was correct in stating that the ALBA and the FTAA are an ongoing dispute between Venezuela and the US, the ALBA is not intended to counteract “colonialism”, but rather the trade liberalisation proposed within the FTAA.
Additionally, the ALBA was originally signed onto with Venezuela by Cuba and Nicaragua, not Brazil and Mexico, the latter of which has close trade agreements with the US and has signed the FTAA.
For St. Kitts-Nevis, signing onto the ALBA after discussions at the June 12th PetroCaribe Summit, which will be held in St. Kitts, would place the nation somewhere between the hemispheric tug-of-war between the US and Venezuela.
While the US has historically been the dominant trading partner in the Americas, the ALBA has been gaining favour for Venezuela and a total of seven countries have signed on, including Dominica and St. Vincent & the Grenadines.
Much like the PetroCaribe agreement, the ALBA operates largely on socialist tenants of bartering oil in exchange for social programmes and aid.
Some experts, however, have expressed concern that the agreement is a way for Venezuelan President Hugo Chavez to spread the socialist ideology and gain votes within the Organisation of American States by dividing the powerful Caricom voting bloc.
The Henry Jackson Society, a Cambridge-based, neoconservative think tank, particularly warned small Caribbean nations about moving too quickly into becoming a part of the ALBA trading bloc.
“This sounds like an attractive deal to many small states in the region struggling to balance their books, but on closer examination it becomes apparent that the aims of ALBA are based on Chavez’s ideological vision for the region, making it very much a political movement which those signing up to should be wary of,” member Danielle de Bruin stated in a 2008 report.
The analyst further warned that the political ramifications of signing the ALBA may not be initially apparent to smaller nations like St. Kitts-Nevis.
“Governments of small nations who see their involvement in ALBA as a way of standing up to the regional hegemony of the United States, should be aware of the dire consequences of turning their back on their powerful northern neighbour and aligning with Chavez.
“These countries depend on foreign direct investment and tourism as a major propellant of development, and this association with the infamous Venezuelan President will do them no favours,” she stated.
In April, a virtual currency called the SUCRE was approved for the ALBA members, with the aim of it eventually becoming a unified hard currency like the euro is for the European Union.
It remains unknown at this time what challenges the Eastern Caribbean ALBA members would face in incorporating the SUCRE, as they already use a similar regional currency system with the Eastern Caribbean dollar.
It also remains unknown if St. Kitts-Nevis will face similar concerns in the near future.
“The St. Kitts-Nevis government has been invited to become a member of ALBA. We continue to study the basic conditions, and at the right time we shall make the decision,” Douglas stated at the press conference.
