Opinion: Populist dealPOSTED: 03/31/14 11:37 PM
Separating facts from fiction in an election year is an interesting exercise. How many of the promises politicians suddenly unleash by the truckloads are real, and how many are just wishful thinking?
The most recent example is obviously the Memorandum of Understanding independent MP Romain Laville presented on Wednesday. An interesting component in that memorandum seemed to be the possibility to import extremely cheap cooking gas from Dominica. That would bring relief to the people. And those people, Laville, said, have trouble putting a warm meal on the table.
The MP noted that a small bottle of cooking gas costs around $11 in Dominica while it costs an astonishing $30 in St. Maarten. Piggybacking on Dominica’s deal under the PetroCaribe agreement with Venezuela, St. Maarten could get is hands on the cheap gas as well, Laville said. Our brothers and sisters in Dominica only have to order more of the stuff and then send 20 percent – or so – on to St. Maarten.
Laville did of course not say that Dominica obtains its gas under certain conditions from Venezuela. They may be South-Americans, but they are not crazy. Dominica pays part of the gas price within 90 days, and Venezuela pre-finances the rest against a preferential interest rate – to be paid back in a period of between 17 and 25 years.
It is the wet dream of every politician: give the people what they are dying for and let the next generation of politicians – and citizens – deal with the consequences.
As our front page article by Sir Ronald Sanders shows, Venezuela itself is now in dire financial straits – a completely different and more disastrous situation than back in 2005, when the late Hugo Chavez came up with the PetroCaribe Agreement. Jamaica is one of the countries that “benefits from the agreement, but according to Sanders the country has built up a debt with Venezuela of $2.5 billion. The day Venezuela pulls the plug on the program, Jamaica will have to do some serious financial bleeding.
Jamaica built up this debt in 8 years – meaning that it has added $312.5 million to this account every year. Surely, if St. Maarten obtains “cheap cooking gas” from Dominica, our “brothers and sisters” over there will not be so daft to take on a debt for cooking gas it sends to St. Maarten. Those costs will in the long run become a burden for the same people Laville says he wants to help. Before the Council of Ministers signs off on this wonderful Memorandum of Understanding, it ought to take a good hard look at the possible financial consequences of such a populist deal.