Benefactor's death worries many nations

MEXICO CITY – Like planets gone slightly wobbly in orbit, a string of Western Hemisphere nations fretted openly Wednesday about the death of Venezuela's Hugo Chávez, whose skein of relationships went far beyond mere rhetorical support to include major financial benefits.

Recognizing how much they owed Chávez – often quite literally – nations across the region declared at least a day of mourning for the fiery Venezuelan leader. Cuba declared two days. Argentina, Brazil and the Dominican Republic declared three.

Some 17 countries gained benefits under Chávez's Petrocaribe program, under which Venezuela sent about 10 percent of its crude oil production to member states under generous terms. It permitted them to partially repay in goods or services – sugar, beans, rice – rather than in cash. Many now wonder about the program's future.

A handful of Latin leaders thrived under Chávez's large ideological umbrella – in Bolivia, Ecuador and Nicaragua – but even larger nations such as Argentina and Brazil felt his gravitational pull on their economies. Flowery tributes flowed in.

"Wherever you are, dear Hugo, our promise now more than ever is to take no step backward to fulfill your dreams," said President Rafael Correa of Ecuador.

"Long live Chavez!" Daniel Ortega, Nicaragua's president, shouted at a rally in Managua, a big portrait of Chávez behind him. Chávez gave an estimated $2.6 billion to Nicaragua over the past six years.

At least some of that went directly to Ortega and his ruling party and made Ortega, who began his political career as a die-hard socialist, into one of his country's wealthiest men.

Presidents José Mujica of Uruguay and Cristina Fernández of Argentina arrived in Caracas overnight on Fernandez's presidential plane. Among the first to arrive Wednesday was Bolivian President Evo Morales.

An aide described Fernández as "very anguished" over Chávez's death.

Smaller nations not openly associated with Venezuela – Jamaica and the Dominican Republic, in particular – worry about the future of Petrocaribe and count on Chávez's anointed successor, interim President Nicolás Maduro, remaining in power.

"There's going to be a lot of hope that Mr. Maduro wins the election," said Mark Kirton, a specialist in Latin America at the University of the West Indies.

Venezuela sent more than 240,000 barrels a day of crude last year to Petrocaribe member states.

Crude oil production is controlled by the state oil company, Petroleos de Venezuela, S.A.

"PDVSA has been nothing more than Santa Claus for a number of countries," said Anthony Bryan, a Caribbean specialist who's a senior associate at the Center for Strategic and International Studies, a research center in Washington.

Under the largesse of the Petrocaribe program, member nations pay only 5 percent to 50 percent upfront for the oil. After a grace period of one to two years, they pay the balance over terms of 17 to 25 years, at a 1 percent interest rate.

"It has really saved some Caribbean countries from collapse," Bryan said.

Foremost is Cuba. Havana gets about two-thirds of its oil from Venezuela – nearly 100,000 barrels a day – and repays part of the cost by deploying about 35,000 Cuban doctors, nurses and teachers to work in Venezuela.

"It will be nothing short of disastrous for Cuba if that program came to an end," Bryan said.

Risa Grais-Targow, an analyst for the Eurasia Group, a consultancy, noted that "all of the partners (in Petrocaribe) are probably very nervous" but "it's not like you're going to wake up tomorrow and not have free oil."

Dominican Republic President Danilo Medina tweeted that Chávez was "a warm and supportive friend of our country." Indeed he was. The nation gets at least 30,000 barrels of crude a day under the Petrocaribe program, and it has run up a $3 billion debt to Venezuela. The soft terms have helped keep its currency stable.

While Chávez failed to attain a dream of a united Latin America with an anti-U.S. hue, he made sure Venezuela's oil wealth was felt through the 10-member bloc he spearheaded, the Bolivarian Alliance for the Peoples of Our Americas, and with targeted trade to such countries as Argentina and Brazil.

"PDVSA (Petroleos de Venezuela, S.A.) has been nothing more than Santa Claus for a number of countries. It has really saved some Caribbean countries from collapse."

ANTHONY BRYAN, a senior associate at the Center for Strategic and International Studies

Order Reprint