The idea was to finance 40% of the countries fuel purchases, said to total approximately $100 million per annum at the time, at 1% per annum. In other words the country would finance $40 million each year for 25 years for a consumable item.
Thank goodness the Cabinet did not sign on to this hair brain idea, or we would be getting Hugo's surprise of interest rate hikes like Jamaica and other countries are facing at a time they can least afford more expenses.
According to Dr. Andre Horton, economist at the University of the West Indies, this doubling of interest rates will force "Jamaica to rethink its debt solution".
This has all come about as Venezuela's economy is projected to contract further so they cannot afford to continue to subsidise oil purchases for other countries (pdf).
As the old saying goes, anything that sounds too good to be true, probably is. Too bad Jamaica and the other countries that signed on would think that PetroCaribe would somehow be sustainable.
The damage that is done to taxpayers by the action of politicians is unconscionable.
Chavez was so good at it he's haunting countries from the afterlife.
