MercoPress. South Atlantic News Agency

Energy, trade and cooperation in Mujica/Chavez agenda

Uruguayan president Mujica is a long time friend of Chavez

Energy, trade and bilateral cooperation are the main issues of the agenda that Uruguayan president Jose Mujica will address with his Venezuelan peer Hugo Chavez on Wednesday in Caracas.

Mujica left for Venezuela late Tuesday and begins a round of contacts with Chavez Wednesday morning in the Miraflores Palace, seat of the Venezuelan Executive. Several bilateral agreements are scheduled to be signed at the ceremony and in the afternoon both presidents will hold a joint press conference.

This is Mujica’s first visit to Venezuela as president, although as a member of parliament and political leader he has travelled on many occasions given the “good chemistry” between the two leaders and former rebels.

The visit was programmed for last week but on request of Chavez, and a full agenda, the event was postponed for a week.

“The issues to address are mainly energy and trade although there are others such as the situation of the Venezuelan development bank, Bandes, and its financial challenges”, said Uruguay’s Foreign Affairs minister Luis Almagro, before leaving for Caracas.

“Our objective is to deepen and continue advancing links between Ancap and PDVSA”, (the two countries government owned oil and gas companies), added Almagro.

Since 2005 Uruguay has access to Venezuelan oil, 25% of which is paid long term with soft interest rates. In 2008 Ancap and PDVSA signed an agreement by which the Uruguayan company will search for oil in the famous Orinoco basin.

Venezuela has also granted soft loans to Uruguay for the development of a sugar and alcohol industry and to help with hospital infrastructure.

Regarding trade “we want to strengthen current business and open other options”, although Almagro said it was too soon to give details.

Uruguay is very much interested in having its own logistics hub in Puerto Cabello from where to distribute basically food imports to the rest of Venezuela.

Uruguay has had difficulties dispatching and distributing its imports because of the myriad of bureaucratic layers in Venezuela.

Apparently a former Venezuelan navy barracks in Puerto Cabello will be handed to Uruguayan companies to operate their own hub and overcome these difficulties.

As to Bandes, and in spite of its financial shortcomings, “Uruguay is interested in having the bank operational; obviously some reforms will have to be introduced to cut its costs, but we are optimistic that a way out will be found”, said Almagro.