How Petrocaribe is providing hope during the devastating food crisis

By Karla Jacobs

On August 11 and 12 the Executive Technical Committee of the Council of Agricultural Ministers of Petrocaribe met for the first time in La Habana, Cuba, to discuss progress on the regional energy initiative's proposed Food Security Treaty. To put the Nicaraguan government's successful food policy into its regional context, Tortilla con Sal reports on how the powers behind Petrocaribe are providing the region with an alternative to the dismal perspective of continued implementation of the type of food policy prescribed by imperialist powers.

Petrocaribe is a regional energy integration initiative by which Venezuela supplies country members with up to 100% of their fuel consumption under very preferential payment conditions. The initiative was founded by Venezuela and Cuba in 2005. Today the multilateral initiative has 19 member countries: Antigua and Barbuda, Bahamas, Belize, Cuba, Dominica, Granada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Nicaragua,  Dominican Republic, Nevis and St.Kitts, Santa Lucía, Saint Vincent and the Grenadines, Surinam and Venezuela. Costa Rica applied to join and is expected to sign the agreement in September.  

The idea that Petrocaribe should include a Food Security Treaty arose during the V Petrocaribe Governmental Summit in Maracaibo, Venezuela, last month (July 12 and 13). During this meeting a number of member country representatives voiced the opinion that immediate action was necessary to contain the devastating impact of the global food crisis on the region.

Venezuelan President Hugo Chavez responded by proposing the creation of a "petro-food" fund with US$0.50 of every barrel of oil exported by Venezuela outside cooperation agreements like Petrocaribe. Money would continue to be deposited in the fund as long as the price of a barrel of oil remained higher than US$100. The proposal was approved and adopted in the summit's declaration which states "this fund will be used to finance food and agricultural initiatives in member countries with a view to achieving food security." It is thought the fund will have an initial capital of US$450 million, although this will depend on the international price of oil.

The idea, according to Chavez, is that as part of a Food Security Treaty, this fund will be used to help member countries reactivate their agricultural sectors, overcome shortages of basic grains and compensate for the high price of basic foods as a result of the global food crisis. During the Maracaibo summit the Council of Agricultural Ministers of Petrocaribe was created to oversee the proposed food security initiatives.

As decided in Maracaibo, this ministerial council met in Tegucigalpa on July 30 to discuss the ideas further. In Tegucigalpa a range of issues and ideas were discussed including the need for localized agricultural research programs, how to make effective use of irrigation systems in deforested areas and concrete examples of innovative integral agricultural development programs.

The reasons behind the global food crisis were also discussed. Member country Agricultural Ministers or their substitutes agreed that the current crisis would not be resolved unless the US, Japan and Europe agree to abolish their exorbitant agricultural subsidies. The other main factors contributing to the situation were defined as global population growth, climate change, continued oil price increases and the use of food to generate fuel.

Also during the Tegucigalpa meeting the Executive Technical Committee of the Council of Agricultural Ministers was formed and the most recent meeting in Habana was planned. The Executive Technical Committee is made up of experts and government representatives from Cuba, Venezuela, Nicaragua, Honduras, Surinam, the Dominican Republic, Jamaica and Saint Vincent and the Grenadines. These experts (among them Nicaraguan Agricultural Minister Ariel Bucardo) are responsible for drafting Petrocaribe's Food Security Treaty and establishing mechanisms to administer the petro-food fund.

Among the measures and actions to come out of the Habana meeting last week was the immediate disbursement of US$2 million to each member country for the "most urgent" food production and distribution projects, said Venezuelan Agricultural Minister Elías Jaua. On top of this a set of regulations to encourage prudent use of petro-food funding was established and the proposal that participating countries purchase fertilizer and other agricultural necessities jointly so as to reduce costs for farmers adopted.

Minister Jaua also announced the decision to create a grand-national - as opposed to multinational - company, ALBA Foods, owned jointly by several countries. ALBA Foods would be responsible for carrying out the policies to be agreed in Petrocaribe's Food Security Treaty. Jaua explained that the Executive Technical Committee timetabled the tasks to be completed between now and December, when the VI Petrocaribe Summit is scheduled to take place. This timetable includes the founding of ALBA Foods and the evaluation and approval of proposed projects for petro-food funding.

During the Habana meeting the Cuban Minister for Foreign Investment and Economic Collaboration Marta Lomas Morales noted the speed with which the Petrocaribe food security initiative has advanced. The progress made over the last month demonstrates that "our countries are deeply engaged in the search for alternatives with which to confront the food crisis," she said.

Cuban Vice President Carlos Lage reminded those present that "the future is unlikely to be any better [given that] oil is expected to run out in 40 years which will provoke a lot of pressure to produce more biofuels from sugar and corn. ... The rate of consumption in rich nations is exacerbating the crisis in poor countries which have great difficulty feeding their populations and paying their fuel bill," he went on.

In the light of such a difficult global context Lage emphasized the potential for the petro-food fund "to go beyond a technical or trade mechanism and to become a force for integration and solidarity" which will help to "strengthen our governments' ability to respond to increasing food prices." 

Petrocaribe's solid discourse and concrete actions are a breath of fresh air after all the bad faith rhetoric and empty promises spouted by representatives of what the opposition here in Nicaragua refer to as the "international community" during the UN's Food and Agriculture Organization Summit in Rome two months ago.