U.S. Official Urges Use of Biofuels

Washington DC March 20, 2007; The AIADA newsleter reports that U.S. Treasury Secretary Henry Paulson yesterday applauded the Inter-American Development Bank's backing of alternative fuels and expressed support for China's request to join the financial institution.

Business Week reported that bank will give credits to countries that reduce their carbon emissions and promote the use and production of renewable energy, such as biofuels.

"This initiative will help countries reduce their dependence on imported oil, create jobs and improve economic growth," Paulson said. U.S. and other foreign investors have expressed interest in using Guatemala as a base for exporting ethanol to North America, Guatemalan Finance Minister Hugo Eduardo Beteta said.

While Brazil is the No. 1 ethanol exporter, the country's exports to the U.S. are restricted by a 54-cent-per-gallon U.S. tariff on its sugar-based ethanol.

As a result, many are exploring Central American and Caribbean countries, which are large sugarcane producers and enjoy preferential trade quotas and a certain amount of tariff-free trade in ethanol with the U.S.