BASSETERRE, St. Kitts - THE 6th PetroCaribe Summit will take place in St. Kitts on Friday (June 12), and one local Queen’s Counsel has expressed serious concern as to how the funds paid from St. Kitts are being managed.
The Summit will be co-chaired by St. Kitts-Nevis Prime Minister Dr. Hon. Denzil Douglas and the President of the Bolivarian Republic of Venezuela, His Excellency Hugo Chavez, and is expected to focus largely on discussions of how the members of PetroCaribe can help offset the effects of the global economic crisis.
One of the main objectives of the PetroCaribe agreement is to alleviate unnecessary debt to small-island nations in light of globally sky-rocketing oil prices, as well as provide financial aid to countries throughout CARICOM and Central America that continue to face development challenges.
Despite the seemingly altruistic aims of the agreement, Charles L. Wilkin, Q.C. published a letter on June 4 that questioned how the funds accumulated by the PetroCaribe are actually dispersed for development projects in member states.
“I am informed that such financial support is provided to those countries which participate in the Petro Caribe arrangement through a series of companies and trusts,” Wilkin stated, “[and] the trust is a quintessential capitalist tool.”
He explained that money put into trust funds is generally handled by an appointed board of directors.
“The trust involves the placing of assets…by the owner of those assets into the hands of trustees who are given powers (which vary from trust to trust) to deal with, manage and invest the assets for the benefit of a stated person or group of persons who may or may not include the original owner.”
The problem that trusts encounter, Wilkin opined, is the fact that they are considered private funds and are not necessarily required by law to publish their financial records in the name of transparency.
“It must raise eyebrows… if the quintessential socialist country of Venezuela is using this device…to receive our money and then distribute it back to us,” he stated.
SKNVibes carried out an exclusive interview with Alexander Nikolic, the General Manager of the joint venture company established by St. Kitts-Nevis and Venezuela to handle the funds the Federation contributes to PetroCaribe.
Nikolic confirmed that a trust fund is currently being established through the National Bank of St. Kitts, and that the board of directors appointed to manage the assets would be named in the near future.
“Once the trust is established, projects would be submitted and would go through a two stage review process. First, a technical committee would look at the feasibility and sustainability of each project, and then a joint government committee between Venezuela and St. Kitts would review the project to see if it is in the best interest of the nation,” he stated.
When asked whether or not the financial statements of the trust would be made public, Nikolic said that he was not in a position to decide such matters, but believed that “if the conventions and the laws of the country required it to be so, the board of directors would certainly approve it”.
He added that St. Kitts-Nevis, as a member of PetroCaribe, would also have access to the funds handled by the executive body of the PetroCaribe.
One such fund was established last year when market prices for oil reached over $100 per barrel. During that period, 50 cents of every dollar spent on oil through PetroCaribe was put into a fund that would be used to improve agricultural infrastructure in member countries.
According to some estimates, the fund was accumulating over $1 million per day when oil prices were at their highest.
It is through these types of funds that Venezuela aims to “benefit the social development of the region and improve the relationships of PetroCaribe members”, Nikolic stated.
Following the PetroCaribe Summit on Friday, Wilkin said that the general public should expect “a full disclosure…of the operation of the PetroCaribe agreement, as well as the details of the ALBA trade agreement”.
“I can’t [help] but remember the saying, ‘Beware of Greeks Bearing Gifts!’” Wilkin’s letter read.
EDITOR-IN-CHIEF'S NOTE: SKNVibes humbly apologises to Mr. Charles L. Wilkin, Q.C and also the President and members of the St. Kitts-Nevis Chamber of Industry & Commerce for the error made in this article, previously published under the headline "CIC demands "full disclosure" of PetroCaribe Agreement".
