Venezuela rice deal gets one-year extension

-PetroCaribe retooling may bring changes, Foreign Minister warns

Following weeks of anxiety in the local rice industry, Guyana and Venezuela yesterday extended an export agreement for another year that will see 210,000 tonnes of rice being shipped to the Spanish-speaking country in a deal worth US$130 million.

“Farmers have been looking forward to this trip for a long time…this rice agreement is a concrete way of cementing the cooperation and friendship between our countries. We look forward to more extensive collaboration in agriculture (in the future),” said Minister of Agriculture Dr. Leslie Ramsammy following the inking of the letter of commitment to trade Venezuelan oil for Guyanese rice at the International Con-ference Centre at Liliendaal yesterday. Venezuela’s Minis-ter of Food, Felix Osorio signed on behalf of Caracas.

The deal was extended for another year though Guyana has expressed its desire for a multi-year year agreement. Local farmers have benefitted from higher prices under the deal and uncertainty about whether there was going to be one this year sparked protests by farmers, who were being paid low prices by millers recently. Under the extended deal, they will be able to start exporting immediately.

The arrangement falls under the wider PetroCaribe Agreement and Venezuela’s Minister of Foreign Affairs, Elias Jaua Milano yesterday warned that the parameters of the various agreements under PetroCaribe would be more closely looked and changes to the rice agreement may be made for next year.

In remarks via a translator, the minister recommitted Caracas’ desire to continue the PetroCaribe Agreement and the various deals that falls under it. He assured that the rice agreement will continue as it was the desire of the late President Hugo Chavez to guarantee food security through various partnerships.

 Dr. Leslie Ramsammy
Dr. Leslie Ramsammy
Elias Jaua Milano
Elias Jaua Milano

Milano stated that the deal will see over 210,000 metric tonnes of rice being delivered annually to Venezuela’s ports. He said that for 2013, the Venezuelan government would be looking at how to effectively implement the various agreements which visualising the expectations for the year. He stressed that the rice agreement is not a donation nor are any of the other agreements, donations to the various Caribbean countries. He said that importation of Guyanese rice was an innovative way to pay for Venezuelan fuel.

Ramsammy, meantime, stated that he would once again be meeting with Venezuelan government representatives on May 15 to further discuss the rice deal. He said that while a multiyear deal is on the table “it’s an agreement [with Venezuela] and Venezuela wants an annual agreement.” The minister said that the current situation will mills overflowing with paddy was reason enough to continue dialogue to enhance aspects of the deal. He added that Guyana is committed to the fight against poverty and hunger and agreements like the PetroCaribe sought to ensure food security balance across the region through the partnerships.

For his part, Osorio pointed out that the annual rice commitment has grown from 20,000 metric tonnes to 210,000 metric tonnes since the deal was first inked in 2005.

Farmers, who were present for the signing of the letter of commitment, were relieved that the exporting of rice to Venezuela could begin immediately. Prior to the signing ceremony, some expressed frustration that the deal only runs for a year and they said that it needs to be made into a five or ten years deal. “If you have to go to the bank you get a loan for three, five years. It would make sense for us to have this rice agreement for the same amount of time,” one farmer said. “The time that the agreement is signed is when harvest has already begun. I think Ramsammy needs to question that with Venezuela and we can maybe start shipping rice and not wait until the mills are overflowing,” he added.

Millers also advocated a multi-year agreement. “The pressure falls on the famers and us and it is a bit worrying every year. Venezuela might be committed, but they are in charge and can pull the plug I suppose,” a millers’ representative said.

The extending of the deal comes at a time when farmers have been protesting the price of paddy and asking for reassurances from the agriculture ministry that their livelihoods are not in jeopardy. Essequibo farmers yesterday continued protesting paddy prices while petitioning for farmers’ rights, in Anna Regina.

Farmers have pointed out that the first crop harvest, while at a historical high, has been filling mills but with nowhere to move. Venezuela imports approximately 66 percent of Guyana’s rice. The PetroCaribe agreement means that the exporting of Guyanese rice needs to wait until the annual agreement is signed. For the past few weeks, millers have used their bank overdrafts to pay out farmers and many farmers still have rice to offload. The massive influx of paddy to mills has meant that paddy prices have dropped.

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