Home' Trinidad and Tobago Guardian : February 11th 2015 Contents A17
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officials say they will allow a free-floating
exchange rate for the country's battered
currency while maintaining a subsidized
rate for key imports.
The socialist South American
government has been struggling to
maintain currency controls even as
inflation has soared with heavy public
spending. Now the falling price of
petroleum is slamming the oil-based
economy. The government sells dollars
for the most crucial imports at rates of
6.3 or 12 bolivars, demanding that
retailers hold down prices to reflect the
But many people have no access to
those rates and have had to turn to an
illegal black market, where the rate has
been about 185 to one.
The new system announced Tuesday
should allow greater access to dollars, but
at a far higher price than legally possible
Venezuela unveils new foreign exchange system
Trinidad Cement Limited (TCL), which
got approval late Monday to remove a 20
per cent restriction on shareholding, has
signed a subscription agreement with Sier-
ra Trading, an affiliate of Mexican cement
Under the agreement, Sierra will partic-
ipate in TCL s upcoming rights issue and
has committed to additional capital via an
agreement to underwrite the raising of capital
up to a maximum of US$45 million. This
will ensure that TCL meets a capitalisation
target of at least US$50 million.
TCL has agreed to grant an exclusive right
to Sierra to subscrbe and purchase any shares
in the rights issue which are not taken up
by shareholders. However, the amount
should not cause Sierra s shareholding in
TCL to exceed 40 per cent of the local
cement company s outstanding shares.
If after the rights issue Sierra has not
achieved at least 35 per cent shareholding
in TCL, a private placement of shares in
the company will be issued.
The agreement was signed on Monday.
Sierra currently holds 20 per cent of TCL s
TCL is embarking on a comprehensive
restructuring plan aimed at preserving its
ongoing operations of the company and
ensure its overall long-term viability. The
plan is being spearheaded by a new TCL
board installed late last year, headed by
businessman Wilfred Espinet and including
retired public servant Alison Lewis, Jamaican
business executive Chris Dehring, attorney
Glenn Hamel-Smith, UTC executive Nigel
Edwards and Cemex executives Carlos Palero
and Francisco Aguilera.
Late last year, the company put a hold
on all payments under a debt deal struck
with large creditors after being unable to
cope with $1.7 billion in short-term debt
on which it had defaulted.
In a related development, Opposition
Leader Dr Keith Rowley has appealed to
government to keep TCL in local hands. He
said a PNM government is committed to
reviewing development of a rapid rail system
for T&T and if it got the go ahead, TCL
will become a major player providing serious
amounts of cement over the five to seven
year period it would take for the project to
"It will be the tax payers who will have
eigner who will be in a position to determine
a monopoly price as against a locally indige-
nous company that is taking part in indige-
nous development," Rowley said.
TCL signs deal with Cemex affiliate
Members of the credit union movement protest outside Parliament over proposed
legislation they claim will hurt the sector. See story on Page A18.
UNITED IN PROTEST
After steady gains over four sessions, oil prices
fell sharply yesterday after the International
Energy Agency (IEA) warned that ample supplies
will raise global inventories before investment
cuts begin to significantly dent production.
Oil stockpiles in member countries of the Paris-
based Organization for Economic Co-operation
and Development (OECD) may approach a record
2.83 billion barrels by mid-2015, said the IEA,
advisor on energy policy to a group of Western
As a result, West Texas Intermediate (WTI) fell
US$2.84, or 5.37 per cent, to settle at US$50.02
a barrel, after dropping to US$49.86. Brent crude
fell US$1.91, or 3.3 per cent, to settle at US$56.43
a barrel, having fallen as low as US$56.11.
The IEA said The price of oil is poised for a
"relatively swift" recovery following the recent
collapse to under US$50 a barrel, but it will not
come close to returning to the highs of past years.
The Paris-based organisation of 29 major oil-
importing nations said the rebound in recent days
of the oil price "will be comparatively limited in
scope, with prices stabilizing at levels higher than
recent lows but substantially below the highs of
the last three years."
The US benchmark oil contract fell from nearly
US$110 a barrel last summer to under US$45 this
year before a recovery to around US$53 in recent
The IEA says the current price recovery is unlike
those of the past, because of the sharp increase
in production by non-Opec countries, especially
in the United States, as well as slowing demand
in China and slimmed down fuel intensiveness
in the developed world.
IEA report triggers
oil price drop
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