Venezuela and IADB clash over $200 billion biofuels plan

Quicknote geopolitics
During the 48th annual meeting of the Inter-American Development Bank (IADB) in Guatemala City, the IADB launched a proposal to invest a massive US$200/€150 billion by 2020 for the mass production of biofuels in the hemisphere and to reduce the continent's oil dependence.

Meeting participants took a strategic look at the risks and opportunities in a future of diminishing fossil fuels and greater global warming, at a seminar sponsored by the German government.

However, the proposed injection of US$200 billion prompted a negative reaction by Venezuela, the continent's major oil exporter. "Suggesting an investment of US$200 billion is incredible when, even at this moment, two out of five Latin Americans do not have access to power supply," Venezuelan Finance Minister Rodrigo Cabeza minister told reporters.

IADB President Luis Alberto Moreno countered by saying that "biofuels are a chance for the region to tap into its natural resources, as part of an activity that involves development of technological innovation sites, investment in infrastructure, streamlining of rural sectors and jobs creation".

Biofuels as such aren't the real issue, because Venezuela itself is creating bilateral cooperation agreements with, among others, Brazil and especially Cuba, for the production of the climate-neutral fuels. With Cuba, it recently agreed to cooperate on the construction of 11 ethanol plants (earlier post), while at home, President Hugo Chavez has initiated a plan to build 17 such biofuel production facilities (earlier post). He even invited South-East Asian producers to establish plantations in the country (previous post).

What is at stake is Venezuela's attempt to control the energy politics of South-America. Interference by a multilateral organisation like the IADB - perceived to be loyal to U.S. interests, not surprisingly since U.S. Treasury Secretary Henry Paulson was present at the meeting and vowed strong support for the biofuels plan - is seen by Venezuela's left-wing government as 'neo-imperialism'. It forms a threat to the country's attempts to forge a broad left-wing alliance in Latin America, in which energy is used as a geopolitical weapon.

A similar reaction came from the country when U.S. President Bush signed a biofuel cooperation agreement with Brazil earlier this month. Brazil, the genuine regional superpower, has recently distanced itself from President Hugo Chavez's increasingly agressive attempts to control the debate over biofuels and energy security in Latin America [entry ends here].
biomass :: bioenergy :: biofuels :: energy :: sustainability :: ethanol :: biodiesel :: Inter-American Development Bank :: Venezuela :: geopolitics ::