- Jamaica will, over the next four months, supply Venezuela with some 100,000 tonnes of clinker.
- The provision is being facilitated under the Trade Compensation Mechanism of the PetroCaribe Agreement between both countries.
- Clinker is used in the intermediate stage of cement production.
Jamaica will, over the next four months, supply Venezuela with some 100,000 tonnes of clinker, valued at approximately US$8.5 million, for the latter’s utilization in the production of cement.
The provision, which is being facilitated under the Trade Compensation Mechanism of the PetroCaribe Agreement between both countries, will commence this month and last until April 2014.
Under the arrangement, Carib Cement Company Limited will supply approximately 20 tonnes of clinker per month to cement manufacturing facilities in Pertigalete, Venezuela.
This arrangement facilitates the government’s repayment of a portion of its oil debt to Venezuela, which currently stands at about approximately US$2.5 billion, with locally produced goods and services in lieu of cash, under the PetroCaribe Agreement.
Clinker is used in the intermediate stage of cement production, and accounts for approximately 95 per cent of the material used to manufacture Portland cement, one of the more common types of this construction input.
Loading of the first shipment, scheduled to be delivered shortly, is being undertaken at the Jamaica Gypsum and Quarries Pier in Kingston.
Prime Minister, the Most Hon. Portia Simpson Miller, headed the officials on hand to witness the proceedings during a ceremony to launch the venture on Thursday, December 19.
In a brief address, Mrs. Simpson Miller advised that Jamaica has, to date, honoured all its debt service obligations to Venezuela, adding that the current agreement is expected to be a successful venture, to this end.
“This shipment of clinker will be the first of many to come; Carib Cement will continue to play its role as one of our premier manufacturing enterprises,” she said.
The Prime Minister also urged more local manufacturers to support the initiative through the provision of other goods and services.
“I would like to urge other Jamaican manufacturers to access this Trade Compensation Mechanism so that more Jamaican goods and services will enter the Venezuelan market,” she said.
Mrs. Simpson Miller also lauded the efforts of the Ministers of Science, Technology, Energy and Mining, Hon. Phillip Paulwell; Finance and Planning, Dr. the Hon. Peter Phillips; Foreign Affairs and Foreign Trade, Senator the Hon. A.J. Nicholson ; and Industry, Investment and Commerce, Hon. Anthony Hylton, in piloting and concluding the arrangements for the clinker shipments.
Chief Executive Officer (CEO) of the PetroCaribe Fund, Dr. Wesley Hughes, explained that the agreement will offset approximately eight per cent of Jamaica’s annual debt payment.
“Our annual debt payment currently is about US$100 million per annum; so US$8.5 million is over eight per cent for the annual payment. But we expect that this is just the first of many (goods and service provisions in lieu of cash payments),” he said, adding that talks are underway with other companies desirous of being part of the undertaking.
In her remarks, Venezuelan Ambassador to Jamaica, Her Excellency, Maria Jacqueline Mendoza Ortega, informed that the historic agreement will continue to strengthen ties between Jamaica and Venezuela.
“This is the spirit of the South-South cooperation. This is the spirit of the PetroCaribe agreement,” she said.
The arrangement for Jamaica’s provision of clinker marks the first time the country is utilizing the Trade Compensation Mechanism of the PetroCaribe Agreement, and signals a new dimension in the relationship with Venezuela.
The agreement is the outcome of over three years of negotiations between the Carib Cement and the governments of Jamaica and Venezuela.