So we will simply try to survive it and I will attempt to monitor it. All eyes are on Venezuela right now, and Venezuela's effect on the Caribbean nations from energy to trade and other things are really worrying, specifically Eastern Caribbean countries. So, I guess the question that I have is, all 6 nations of the Organization of Eastern Caribbean States are members of the Bolivarian Alliance referred to as ALBA, that includes efforts to promote local cooperation and reduce poverty; so to what extent have ALBA and Petrocaribe increased Venezuela's influence in the Caribbean? I think I can respond to that concern significantly.
Mr. Farnsworth. Mr. Chairman, thank you. And I agree it is the pregnant problem if you will of the area. Venezuela is a nation that remains in collapse. Financially, some are saying it is no longer a democracy. It is a nation that has severe and long lasting internal issues which it is going to take years to get beyond. Therefore, the relationship that Venezuela has developed with a number of countries of the Caribbean in great times has become stretched, due to the fact that the largesse that Venezuela has actually been able to honestly distribute or to supply a concessionary on concessionary terms has actually been much constrained in the present environment.
I think what I would say remains in the existing environment, since of the problems that Venezuela is having and frankly due to the fact that of the opportunities that we have in the United States through the whole revolution of energy that we have actually seen in our own nation over the last several years, we have an opportunity to come into the Caribbean as a partner and state, look, you understand the programs and the activities that you may have been making with Venezuela are no longer relevant and we can provide the exact same things that you need without the political or without the ideological overhang that you might have had formerly - What does ear stand for in finance.
Duncan. Let me ask you something about that. Exists enough trust of the United States for us to step into that space with those countries? I do not understand the response to that. Mr. Farnsworth. Well, I think in the current environment we require to do some foundation. We need to do some spade work. I indicate, look, Petrocaribe was a really effective program and we understand why. I imply, it was prompt, it provided something that the leaders needed when they required it. It was symbolic. It was very, really easy to describe to people. I mean, we are getting oil from Venezuela.
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It was on one issue. And I believe sometimes, when the United States engages with the countries of the Caribbean, we have a lot of well implying programs and terrific ideas, however they are watered down, right? Not misguided, but watered down in terms of the effort and the focus. Under Petrocaribe, it was one item quickly described, extremely symbolic, and individuals said Venezuela's our friend - How to finance a franchise with no money. And I believe what we require to do better from the United States' point of view is to construct that level of trust through a continuous sustained engagement with the area so that individuals can state, look, we do trust you. What happened to yahoo finance portfolios.
Mr. Duncan. I personally believe energy is a great chance for us, no doubt about that. Let me delve into cash laundering and terrorism funding a little bit. There is a big push by the U.S. to have U.S. banks sever relationship with Caribbean-based banking organizations. Does that policy work to minimize cash laundering and opportunities for terrorist companies to access the financial system? And that is most likely to Sally. Ms. Yearwood. In a great deal of ways it does the opposite, due to the fact that once U.S. banks move out of the area what you have created in reality is a space and that ends up being filled by other institutions.
So, what is being created is a situation where there is more chance for terrorist financing or something to fail and somebody to make use of that space. So I would say that the U.S. banks definitely require to be an essential and vital player wesley company in the regional cash system. Mr. Duncan. I am probably less concerned, and maybe I shouldn't be, but less concerned about terrorism financing through the Caribbean monetary institutions as I am about cash laundering. What is internal rate of return in finance. We simply saw in Panama, a substantial $800 million money laundering scheme, property participation, big number of staff members associated with a legitimate organization-- still a money laundering scheme.
Ms. Yearwood. Part of the concern is the perception of risk versus the truth of the risk. Banks are not leaving the Caribbean since there is cash laundering. Banks are leaving the Caribbean due to the fact that the expenses of compliance are extremely stacked versus the banking system. You have small jurisdictions and for every account that you are handling you have to put a huge amount of money into making sure that the expense of-- that business is clean. But what we need to perform in impact is produce a system where the regulators, the banks, everybody is collaborating, details is being shared, and when info is passed between the regulators and the Treasury or the regulators and the banks, individuals understand where deep spaces are.
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And the issue in the Caribbean is that the economies are small, putting these systems in location costs a lot, however all the Caribbean will tell you that they meet the compliance regulations. And so there is a disconnect in between what is really taking place and what individuals are saying is taking place. I believe among the Click here for more info typical problems is the breakdown between what is going on in offshore financial services and what is going on in banking. And the Panama Documents were extremely mostly linked to the offshore monetary services industry versus the correspondent banking and de-risking issue that is currently being dealt with.
Mr. Duncan. I am presuming that the Federal Government is monitoring-- in Panama Papers a person is never linked because and begin moving funds around, in possibly, the Caribbean nation. I am presuming our Treasury and FBI are monitoring that, I would presume. So I am going to go ahead and yield to the ranking member. Mr. Sires. One of the factors that I supported, or I still support the export of energy from this nation is to offset the influence of Venezuela because essentially they were using it for political function. You know, if you take a look at the votes they took at the U.N.
So now Venezuela is in difficulty. I think their production is something like 40, half less, and there is a space there that we can assist fill and, you understand, we can truly assist in terms of simply having a little bit more affect on people. The other thing that stresses me is that on the eastern part of the http://rylanecwx436.tearosediner.net/top-guidelines-of-how-to-finance-a-kitchen-remodel Caribbean. Generally, we have an Embassy in Barbados and it serves all those islands there. Meanwhile, you have Venezuela, Cuba, Brazil, they all have a presence there. So I was simply wondering how much of a competitive disadvantage this puts us when we do not have, really, a presence in the Eastern Caribbean.