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While there may be distinct negatives for the oil industry in T&T from Venezuela's Petro Caribe agreement, it could be even more dangerous for Caricom states looking for oil on soft terms, Prime Minister Patrick Manning has reiterated, the Stabroek News reported yesterday.

Speaking in Georgetown, Guyana, at the Caricom Secretariat in Liliendaal, Manning said discussions on the issue at the level of Caricom, on the positives and negatives for T&T and member states, have begun and they would continue at the Inter-Sessional Meeting of the Heads of Government to be held in T&T from February 9-10.

Asked about the effect the accession by Caricom member states to the agreement would have on the economy of T&T, and whether he was still upset with the manner in which regional leaders signed on to the agreement with Venezuela in June last year, Manning said, "First of all, there isn't much room for emotions in the conduct of regional affairs. Whether one is upset is of absolutely no significance.

"What was important is how countries relate to each other, and on the Petro Caribe arrangement there were some distinct negatives for the oil industry in T&T."

Manning, currently the chairman of Caricom based on the six-month rotation of the chairmanship, addressed the Guyanese media on the Caricom Single Market and then took questions.

Also present were Guyana President Bharrat Jagdeo and Caricom secretary general Edwin Carrington.

Manning pointed out that while the oil and refining industries in particular would suffer a setback as a result of the Petro Caribe arrangement, if it goes through as it is now structured, it would not be fatal for the T&T industries.

"And even if the Government of T&T, or the oil industry or the refining industry of T&T has to take a hit, we can take the hit and enter into new arrangements," he said.

If the Petro Caribe arrangement goes forward, T&T would have to eliminate its emphasis on the Caribbean as a market for the export of its refined products, but Manning warned that "there are dangers for the Caribbean in that."

While Manning did not spell out what the dangers were, he said one element of the arrangement was that the domestic storage facility must be owned by a state entity, either on its own, or in collaboration with the state-owned oil company of Venezuela, Petroleos de Venezuela (PDVSA).

"If they do that you would find yourselves in the hands of only one supplier, by which time T&T, a traditional supplier, would have made alternative arrangements," he said.

"If ever countries may wish to come back they may very well find themselves in a position where T&T has no products to supply," he said.

T&T is now the major supplier to Guyana.

He added that the issue was not straightforward and it was not just T&T that would be affected.

"It is a question of cutting your own throats if you are not careful," he said.

Asked whether he was not worried about Venezuelan oil diplomacy undercutting the T&T industry and taking away its Caribbean market, Manning said "there was no room for worries."

He said his Government would look at the Petro Caribe deal as it develops and if the country's interests would be jeopardised, appropriate action would be taken.

Noting the fluctuations in the price for oil, Manning said countries of the region, which essentially are oil importing countries, were faced with extremely high oil import bills.

As such, "the Petro Caribe arrangement has to be attractive to countries that find themselves in this position."

He said it was not a one-sided issue by any means, as there were real benefits to the region that would arise from the deal. This, he said, was one of the reasons the discussions were necessary.

While the discussions have been ongoing among member states since the signing of the agreement, Manning said they were not complete.

T&T and Barbados were the only Caribbean countries which did not sign the agreement.

Under the agreement, provisions are in place for financing mechanisms and compensation, which include long-term and short-term financing, deferred payment, and energy efficiency.

According to the agreement, Venezuela is also offering technical co-operation to support the creation of state agencies in countries not possessing qualified state institutions for this purpose.

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