Wed | Aug 23, 2017

Editorial | Dealing with Caracas

Published:Wednesday | May 25, 2016 | 5:00 AM

We don't know if former Prime Minister Portia Simpson Miller had used the opportunity six months ago, when Nicolas Maduro visited for the 200th anniversary of Bolivar's Jamaica Letter, to have, as we suggested, a frank talk with the Venezuelan president about the economic and political situation in his country.

If she did, either she didn't frame the argument along the lines we suggested or Mr Maduro didn't heed the advice. The Venezuelan economy is in a deeper mess than last September and the political environment even more unstable and volatile despite last December's assembly election that was won overwhelmingly by the Opposition. Indeed, there is good cause to fear Venezuela

descending into deep fratricidal turmoil.

It is against this background that we hope the current Jamaican prime minister, Andrew Holness, exercised the prerogative of friendship to seriously engage and tell Mr Maduro a few home truths last Sunday during the Venezuelan's whistle-stop visit to the island in a search of political support. At the same time, we hope Jamaica recognises in Venezuela's current circumstances economic opportunities, without being exploitative, which we are in no position to be.

 

LONG-STANDING FRIENDSHIP

 

Jamaica's relationship with Venezuela, we remind, is deep and long-standing. Two centuries ago, that country's national hero and

liberator of South America found refuge in Jamaica when he escaped those who opposed his anti-colonial revolution. It was in Kingston that he clarified and set out his ideas for a post-colonial South America. Independent Jamaica has had diplomatic relations with Venezuela for more than 50 years, and for three decades Venezuelan oil largesse has helped to shore up the Jamaica economy.

The truth, though, is that Venezuelan economic solidarity with Jamaica and other countries in the Caribbean and Latin America, allied with socialist-inspired, flawed economic policies, under Mr Maduro and his predecessor, and exacerbated by the collapse in oil prices, has brought Venezuela to the verge of bankruptcy. A bad economic situation has been worsened by polarising ideology, for which Mr Maduro's socialists blame anyone but themselves and have, up to now, shown a marked inability to engage in serious dialogue with their opponents.

We believe that Jamaica, in its own right, and as the political leader of the Caribbean Community (CARICOM), with which Venezuela also has good relations, is in a position to have frankly told Mr Maduro of his missteps and to offer Kingston's good office, either on its own or in partnership with CARICOM, to begin a dialogue with the Venezuelan government and opposition.

Jamaica, over the last four years, has developed a fair bit of expertise in fiscal management and broader economic reforms, which we hope Mr Holness offered to Venezuela.

In the meantime, Venezuela is short of goods, which it either can't afford to import because of a shortage of foreign exchange or its factories can't produce because they lack raw materials or energy. It is possible that Jamaican firms could find a niche in this supply chain, utilising an existing facility, the PetroCaribe arrangement.

Despite having wiped out a substantial portion of the debt, Kingston still owes Caracas hundreds of millions of dollars for oil, some of which it might be able to offset with the export goods, as the Caribbean Cement Company has done in the past with the sale of cement and clinker.