WE ARE happy, for its own sake, about the cautiously optimistic news that has emerged from Caracas in recent days about President Hugo Chávez's health.
But even if Mr Chávez can take the oath of office on January 10 for another six-year term, it is obvious that he remains gravely, and perhaps terminally, ill. He has now had four operations in a year-and-a-half, as well as many rounds of radiation and chemotherapy treatment for cancer in the pelvic, whose precise nature has not been disclosed, but which many doctors speculate to be a sarcoma. Indeed, Mr Chávez has not been seen in public or heard from directly since his latest operation in Cuba in December.
Several countries in Latin America and the Caribbean, including Jamaica, have an interest in Mr Chávez's health and the implications for policy should he not be able to continue in office. The interest turns primarily on Mr Chávez's PetroCaribe oil initiative.
In Jamaica's case, Venezuela supplies the island with around 7.5 million barrels of oil per year, for which, if the price of petroleum is above US$40 per barrel, 70 per cent of the payment is converted to a 25-year loan at one per cent interest. When the price of oil falls below US$40, between five and 25 per cent of the payment is financed by Venezuela, at two per cent interest.
That Mr Chávez allies won 20 of the 23 state governorships in elections this month, suggests that the socialist policies he has promoted over the past 14 years have an institutional hold domestically. Chavismo, in that respect, is likely to survive.
PetroCaribe may not survive
We are not optimistic, however, that PetroCaribe, at least not as presently structured, would survive Mr Chávez - a point we have made before. There are many, even in Mr Chávez's party and government, who believe the resources that go abroad could be better used at home.
In the absence of PetroCaribe, Jamaica, with its severe imbalance on visible trade and its current accounts problems, would require an additional, upfront US$500 million per year to cover its petroleum bill. That, on the face of it, would cause great stress to the economy.
This matter should, if it didn't before, be concentrating the minds of Jamaica's policymakers on the urgency of a settled energy policy and programme that would lead to the utilisation of a cheaper mix of fuels and a lower cost of energy to the economy. Even with PetroCaribe, Jamaicans pay around US$0.41 per kilowatt hour for electricity - among the highest in the region. That rate is a heavy burden to the competitiveness of firms.
The Jamaican Government has for decades muddled around the energy issue. More recently it appeared that liquefied natural gas (LNG) would be the fuel on which Jamaica would plot its future. Then the current administration abruptly pulled out of its promotion of an LNG project, saying that the supply cost of bidders would not lower the price of electricity to desired levels. The Government ostensibly turned over the project to the Jamaica Public Service, the light and power company. Since then, little that is definitive has been heard of the proposal.
The energy minister, Phillip Paulwell, is seized of all the issues and the urgency of the situation. It is time that he brings clarity to the matter. Energy is the economy's potential game-changer.
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