China Controls Barbados Cement Costs

Arawak Cement Barbados.jpg

Updated: June 7, 2006 11am – Scroll Down 

So I guess Barbados had better make nice – if we know what is good for us.

Ten years ago, the Arawak Cement Plant in Barbados struck a deal with Venezuela to supply fuel for the cement plant at $200 per tonne. Now, the deal is finishing and the plant will have to revert to Bunker C fuel at $600 per tonne.

Everybody is crying the blues – but the contract was for 10 years at a certain price, and the ten years is over.

Now Venezeula wants to please China so much that Barbados will be cut off – as all sales of this fuel will go to China.

Of Course, Arawak Cement Wants To Feed At The Public Trough – Again

How did this happen, anyway? Who made the decision to put all our cement eggs in one basket?

From today's Barbados Advocate

The Government of Barbados has voiced its concerns about the sourcing of Orimulsion (fuel) by the Arawak Cement Plant to the People's Republic of China.

According to Minister of State, Ministry of Foreign Affairs and Foreign Trade, Kerrie Symmonds, while it is a commercial issue, there are potential consequential fallouts that could occur in Barbados if there is an inability to continue to access that fuel.

His comments came against the backdrop of reports that Venezuela had plans to sell the entire output of Orimulsion to China, preventing Barbados from getting its usual supply. …

Symmonds explained that a financial arrangement between the BITOR (Bitumenes Orinoco SA), which produces Orimulsion in Venezuela and China Oil Company is expected to bring about a new joint venture, which could be detrimental to Barbados' cement industry. ….

…General Manager (ag) Arawak Cement Plant, Phillip Yeung, said that he was pleased that the Government had presented their position to the Chinese minister …

…unless we get the Orimulsion, it could have a significant impact on one of the major industries in Barbados,' Yeung said.

Noting that the St. Lucy plant changed from Bunker C fuel to Orimulsion in 1997,to go back in this direction, he said, was not a viable option because there are currently no cement plants that use Bunker C and are profitable. …

"While you can say that your costs go up, the market may not allow you to increase prices because consumers do have alternatives and so we really are driven by the market," he maintained.

Update: 11am June 7, 2006

China Generously Allows Arawak To Breathe For One More Year 

From the CBC website here

Government has assured Barbadians that the cost of cement will not increase anytime in the near future.

This assurance from Minister of State in the Ministry of Foreign Affairs Kerrie Symmonds, at a signing ceremony this morning with the visiting Vice Minister of Foreign Affairs of the People's Republic of China Yang Jiechi.

Mr. Symmonds said the contract between the Arawak Cement Plant and Venezuela, the sole provider of the cheaper orimulsion fuel, will expire at the end of 2007.

The minister explained that China has now signed a deal with Venezuela, and they will be purchasing eighty per cent of Venezuela's orimulsion.

And China in turn is expected to transfer the benefits to Barbados.

The Chinese Vice Minister said his country was glad to strengthen its ties with Barbados, a partnership which spanned over three decades.

Through the agreement, Barbados will also stand to gain financial assistance of 10 million Yuan, through two grants from China.

Past Barbados Free Press posts on China…

Barbados Media Forgets Anniversary – China's Tiananmen Square Massacre (But Remembers to Accept The Money)

Trinidad Tobago Natural Gas Reserves "Exhausted In 20 Years" (China's Role In Caribbean Economy & Background On Cement)

Beware of Communists Bearing Chinese Gifts (China Gives A Stadium To Dominica)

Caribbean Oil, Drugs & Fausta's Blog (China's Role In Rescuing Cuban Economy)

BFP photo by Shona

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