* Venezuela provides $50 million cash boost to Antigua
* Caribbean state still reeling from Stanford scandal
* Antigua has joined Chavez's ALBA trade alliance
By Pascal Fletcher
MIAMI, Aug 13 The tiny Caribbean state of
Antigua and Barbuda, still reeling from the fraud scandal
surrounding Texas billionaire Allen Stanford, on Thursday found
a new foreign benefactor in Venezuelan President Hugo Chavez.
Prime Minister Baldwin Spencer told the nation in a
broadcast that the leftist Venezuelan leader was providing $50
million in urgent financial assistance to the twin-island
state, which was at the heart of Stanford's far-reaching
business empire that collapsed in February.
"Today, I am pleased to advise the nation that at one
o'clock this morning President Hugo Chavez signed the necessary
paperwork to approve the immediate transfer of the full amount
of $50 million to the government's call account at the Eastern
Caribbean Central Bank," Spencer said in his address.
Spencer, who led his Caribbean country to join Chavez's
ALBA alliance of leftist Latin American states just two months
ago, said the funds would be used to help Antigua and Barbuda
confront the effects of the global financial crisis.
He said the Venezuelan emergency help came "completely
without precondition", but gave no details of the terms.
Antigua and Barbuda Finance Minister Harold Lovell said in
a statement the Venezuelan assistance would involve "some grant
element and a loan on very concessionary terms", although he
added the terms were being finalized.
Stanford, a flamboyant sports entrepreneur who was granted
a knighthood by Antigua and Barbuda and was once its biggest
investor, faces U.S. civil and criminal charges related to an
alleged $7 billion fraud that prosecutors say was centered on
certificates of deposit issued by his Stanford International
Bank in Antigua. Venezuelan investors were among those who
U.S. prosecutors have accused Antigua's former chief
financial regulator, Leroy King, with abetting the fraud.
Investors from the United States, Mexico, Colombia and Peru are
suing the tiny Caribbean state for up to $24 billion in
damages, alleging it was a "partner in crime" with Stanford.
Antigua and Barbuda's government denies this. It says the
Stanford scandal badly hurt the economy of the small state of
around 85,000 people, causing losses and layoffs and damaging
the nation's image as an offshore finance destination.
Antigua and Barbuda is the third member of the 15-nation
mostly English-speaking Caribbean Community (Caricom) to join
Chavez's ALBA, an alliance which critics say the outspoken
Venezuelan president uses to try to counter U.S. influence in
Some Caricom leaders have expressed concern about its
members joining the Venezuelan-led alliance, saying this
threatens Caribbean unity at a time when the region faces huge
challenges posed by the global economic crisis.
But others say it is precisely these pressures, such as
falling revenues from tourism and remittances, which are
forcing small Caribbean states to seek beneficial alliances.
Acknowledging Antigua's financial woes, Finance Minister
Lovell said $35 million of the "generous and timely" Venezuelan
support would be used for "budgetary support", $7 million would
be employed for "economic stimulus', while $6.5 million would
go toward improving administration of revenues and spending.
The remaining $1.5 million would be used to fund activities
and programs that provide social protection for the poor and
unemployed, Lovell said.
Antigua and Barbuda is also a member of PetroCaribe, a
regional group set up by Chavez that allows poor, oil importing
countries in the region to buy Venezuelan oil on credit.
Analysts say the Venezuelan president, an ally of
communist-ruled Cuba and fierce critic of U.S. policies, uses
this "petrodiplomacy" as a tool to extend his political
influence and woo allies and votes in world forums.
(Editing by Tom Brown and Philip Barbara)