US embassy cable - 05PORTAUPRINCE2596

UNCLAS PORT AU PRINCE 002596 
 
SIPDIS 
 
STATE FOR WHA/CAR 
WHA/EPSCA 
EB/ESC/IEC 
INR/IAA/MAC 
S/CRS 
TREASURY FOR MAUREEN WAFER 
USDOC FOR 4322/ITA/MAN/WH/OLAC (SMITH< S.) 
 
E.O. 12958: N/A 
TAGS: ENRG, EFIN, ECON, PGOV, PREL, HA 
SUBJECT: HAITI NOT INTERESTED IN PETROCARIBE DEAL --FOR NOW 
 
1.  SUMMARY:   According to some press reports, the 
government of Venezuela planned to send a negotiating team to 
Haiti to negotiate a deal to sell oil at a preferential rate 
via PetroCaribe.  However, follow-up conversations with 
Interim Government of Haiti (IGOH) officials reveal that 
Haiti is still a long way from such a deal.  It is more 
likely that Venezuela,s recent efforts are designed to get 
the issue on the agenda, and that Chavez,s strongest efforts 
will come after the elections, when a new Haitian government 
is inaugurated in February 2006.  END SUMMARY. 
 
Reports of Haiti-Venezuela Oil Deal 
 
2.  According to scattered press reports in early October, 
the government of Venezuela planned to send a negotiating 
team to Haiti (exact time undetermined) to negotiate a deal 
to sell oil at a preferential rate via PetroCaribe.  Upon 
returning from a recent trip to Venezuela, Minister of 
Culture and Communication, Magali Comeau Denis told the 
Charge she was &bringing Venezuelan oil back to Haiti8 with 
her. 
 
But IGOH Says No 
 
3.  When engaged by the Charge on the subject it was clear 
that there was no deal and that Minister Comeau Denis was not 
familiar with details of how such a sale would work.  Prior 
to the Comeau Denis visit to Venezuela, Charge and Econ 
Counselor had spoken to acting Prime Minister Henri Bazin who 
said that the Interim Government of Haiti was looking for 
concessional terms for oil purchases from Mexico and Nigeria 
--but not Venezuela, he was quick to emphasize.  In a 
follow-up conversation, Charge reiterated the negatives of 
such a deal with Venezuela.  Bazin listened and understood 
the message. 
 
4.  Econ Counselor met with a contact at the Finance Ministry 
October 13 who confirmed that the IGOH has no plans to 
participate in any PetroCaribe deal.  He added that our 
message to Bazin had an impact:  Bazin had seen a draft of 
comments to be made by Haiti,s representative to the IMF 
that included a vague reference to someday purchasing oil at 
concessional prices from Venezuela and Bazin had the sentence 
deleted, the only change he made on the text. 
 
5.  COMMENT:  Like many press reports in Haiti, there is less 
here than meets the eye.  First, given Chavez,s past support 
of ex-President Aristide, the IGOH has little enthusiasm for 
dealing with Chavez.  Second, a commercial deal with 
Venezuela would likely involve setting up a Haitian state-run 
oil company, something the IGOH would find difficult to 
accomplish given the variety of political, economic and 
security challenges it faces at the moment.  However, the 
high global price of oil is having a strongly felt negative 
impact on the economy, with political ramifications.  The 
pressures on the government to strike a deal will increase as 
long as the price of oil remains high.  We suspect that the 
recent efforts by Venezuela here are designed more to get the 
issue on the agenda, and that Chavez,s strongest efforts 
will come after the elections, when a new Haitian government 
is inaugurated in February 2006.  We will watch closely for 
that possibility.  END COMMENT. 
CARNEY