CEO of company that tried to sabotaged Petrocaribe deal between Haiti and Venezuela, chosen as US Secretary of State

Posted by on Friday, December 16, 2016 Under: Diplomacy
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If you were afraid of the diplomatic tussles between Haiti and the United States under former US Secretary of State Hillary Clinton, and dismayed by her alleged overlapping business interests in the Caribbean nation, be prepared for even bigger diplomatic clashes between Haiti, the United States and to a certain extent, Venezuela under a Trump presidency, and even larger business interests; it will all be about oil.

The next person selected by American President Elect Donald Trump to carry out American foreign policy around the world is Rex Tillerson, the CEO of Exxon mobile; a company which tried to sabotage the PetroCaribe deal between Haiti and Venezuela during Rene Garcia Preval's presidency, beginning in 2006.


Wikileaked cables that were published in 2011 showed how in collaboration with the US State Department, the US Embassy in Port-au-Prince and the top three oil companies in Haiti: Exxon Mobile, doing business in Haiti as Esso; Chevron, which operates under the name of Texaco; and the french oil company Total, tried to derailed a deal which aimed to save Haiti $100 million annually and increased its daily electricity distribution.

The United States frustration with Haiti in 2006 begun when Haitian President Rene Garcia Preval, on his day of inauguration for a second term on March 14, signed the historic PetroCaribe deal with José Vicente Rangel, Vice President of Venezuela, long time Haiti's ally, but brazen Washington's foe. Under the terms of PetroCaribe Haiti would buy oil from Venezuela but only paying for 60% of the amount up front and the remainder carried over for a period of twenty five years with a low 1% interest rate. And to symbolize the signing of the deal, the Venezuelan Vice President brought along a 100.000 barrels of PetroCaribe oil tanker, which was sitting in the bay of Port-au-Prince as the signing ceremony took place at the national palace, in the presence of the press who had been invited last minutes.

Washington became concerns not only because it obviously had economic interests in the oil industry in Haiti, the dramatization of the event made it even more suspicious of the incoming president's relations going forward with the Latin American country under the leadership of Hugo Chávez, a man infamous for spewing outlandish rhetorics regarding the United States. US ambassador assigned in the Haitian capital Janet Sanderson was quickly instructed by the State Department to undermine the deal despite all the great benefits it would provide Haiti.

Benefits which the American embassy, during its aggressive maneuvers to sabotaged it, acknowledged in one cable would be great for Haiti as it “ would save USD 100 million per year from the delayed payments,” Savings which President Preval said was going to fund hospitals, schools, disaster reliefs and other emergency needs.

 “Post [the Embassy] will continue to pressure Preval against joining PetroCaribe,” Ambassador Sanderson wrote in one April 19, 2006, cable. “Ambassador will see Preval’s senior advisor Bob Manuel today. In previous meetings, he has acknowledged our concerns and is aware that a deal with Chavez would cause problems with us.”

In order to fully implement the PetroCaribe deal, Haiti had to meet certain terms and completely overhaul its internal oil market. It took two years for the necessary mechanism to be put in place . The Haitian government had neither the experience nor the required structures to transport, store and sell oil. Throughout Haiti's History, the oil industry had been dominated by private foreign companies. The US companies were responsible for 45% of Haiti's petroleum imports, of which Exxon had 30% share.

The ordinance of the PetroCaribe stripped the oil companies' control of the market. They now were compelled to buy oil directly from the Haitian Government, then redistribute it locally. And since the Haitian government didn't own any oil ship tanks, President Preval also expected these companies to transport the oil from Venezuela to Haiti.   

In Sanderson words, Preval was making the oil industry "prisoner to two incompetent governments,

The head of Haiti Chevron and the other companies involved were furious, and shocked at the same time that Preval would actually think that american oil companies would transport Venezuelan PetroCaribe petroleum products to Haiti.

Christian Porter, Exxon Mobile country manager “speaking for both ExxonMobil and Chevron, stressed that they would not be willing” to buy oil from the Haitian government “because they would lose their off-shore margins and because of PetroCaribe’s unreliable reputation” for timely deliveries, Sanderson wrote. She concluded that it was a “dubious proposal that neither the U.S. oil companies in Haiti—responsible for about 45 percent of Haiti’s petroleum imports—nor Venezuela, for that matter, is likely to agree to.”

The oil companies took deliberate actions to stale the deal; for example they didn't show up at governmental meetings to present  their records on transportation and distribution, and they ignored official letters that were later sent requesting the infos.

The stand off dragged on for months, the US charge d'affaires Thomas C Tighe in a January 28, 2007 cable said that  “ExxonMobil has made it clear that it will not cooperate with the current GoH (Government of Haiti) proposal either.

The companies wanted to continue to import their own petroleum products and they were not going to cooperate with the Haitian government. In that same cable Thomas C Tighe said how Haiti's president Preval was  “enraged that an oil company which controls only 30% of Haiti’s petroleum products’ would have the audacity to try and elude an agreement that would benefit the Haitian population.”  The Haitian government stressed that they “would not be held hostage to ‘capitalist attitudes’ toward Petrocaribe and that if the GoH could not find a compromise with certain oil companies, the companies may have to leave Haiti,” reported Tighe.

On May 4, 2007, Ambassador Sanderson, in a second cable sent for the day explained that “the head of Haiti’s Petrocaribe office, Michael Lecorps, gave the four oil companies operating in Haiti until July 1 to sign the GoH contract on Petrocaribe,” hoping that “the four companies will sign the agreement voluntarily, instead of passing legislation obliging oil companies operating in Haiti to participate in the Petrocaribe agreement.

The entire ear of 2007 went by without the administration of president Preval to fully implement the Petrocaribe accord, as the rogue oil companies, mainly Exxon mobile and Chevron, were still plotting against the deal.

Finally after obtaining their desired terms with the Haitian government, the companies finally agreed that the state oil company Petróleos de Venezuela, S.A., or PDVSA, “will sell to the GoH, which will then sell to private oil traders, who finally will sell to the oil companies in Haiti for distribution…. Chevron also agreed to ship the refined petrol on one of its tankers. The GoH expects to receive a PetroCaribe shipment in late February or early March.” reported Janet Sanderson to the State Department on February 15, 2008

Status of PetroCaribe

Since 2008, PetroCaribe has proven to be the most important economic or trade deal between Haiti and any other country in its history in terms of direct impact. The savings from the unrestricted Petrocaribe funds cover more than half of the government's annual budget and by the year 2012, under US-backed president Michel Martelly, was responsible for 4.7% of Haiti's GDP and over 15% by 2015.

-After a devastating earthquake that had destroyed the Haitian capital and killed hundred of thousands, Caracas forgave some $400 million in PetroCaribe debt

- Michel Martelly told the Associated Press in 2011 during an intervention following his attendance of the summit by the Community of Latin American and Caribbean States, CELAC, in Caracas, Venezuela, that a 30-megawatt power plant and two other 15-megawatt plants installed by Venezuela now "represent a good 20 percent of our total consumption."

Despite the recent political turmoil and economic recession that have gripped Venezuela, and the constant prediction that the alliance will fail as the latin american country increasingly becomes unstable; petrocaribe have so far proven to be very reliable.

Will Rex Tillerson, who was the CEO of Exxon Mobile when the company tried everything in its power to make sure the PetroCaribe deal between Haiti and Venezuela didn't go through, will as secretary of state undertake a similar agressive approach in foreign policy towards Haiti? It all remains to be seen. But it is certain that future Haitian administration will not put up the petrocaribe for a debate in any negotiation with the United States. 

President-Elect Donald Trump as a candidate during his visit to the Little Haiti Cultural Center in Miami, seeking the support of the large Haitian-american community in Florida, which didn't like his opponent Hillary Clinton; promised that as President of the United States he would be Haitians' greatest champion; and would even appoint a Haitian-american as ambassador to Haiti. 

As the cabinet of the future President of the United States takes shape, Haitians are watching very closely whom he will pick as ambassador to Haiti, a country which then candidate Trump had used extensively throughout his campaign as the prime example of failure and corruption of his opponent Hillary Clinton and her husband former US president Bill Clinton.

Due to Rex Tillerson close ties with Russia, he is certain to come under tough scrutinies during his confirmation hearings in the american congress for the job of US Secretary of State. The businessman's lack of governmental experience has also been raised as an issue, but as the Wikileaks Haiti PetroCaribe files have shown, Rex Tillerson is truly a diplomat who have dealt with some of the most complex relations around the world.

In : Diplomacy 

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