The Economist reports on how PetroCaribe, the Venezuelan energy-assistance program for the Caribbean and Central America places the Dominican Republic in a vulnerable position. The Economist says that the deferred payments established by the program for Venezuelan oil exports represented an average of US$2.3 billion a year for Venezuela.
“So far, the desire for influence in the Caribbean has outweighed economic pressures in Venezuela. But there are already signs that PetroCaribe’s terms are becoming more stringent: Guatemala withdrew from the group last year after the terms became less favorable. The possibility that the program may eventually be wound up prompted a recent report from Scotiabank, a Canadian lender, to call PetroCaribe “more noose than lifeline”.
Each PetroCaribe member has a separate energy-co-operation agreement, but the terms are broadly similar. The agreements can be cancelled or modified with just 30 days’ notice, cutting off the flow of new financing and forcing countries to pay market rates.
http://www.economist.com/news/americas/21621845-venezuelas-financing-programme-leaves-many-caribbean-countries-vulnerable-single-point