Saturday, January 03, 2009

Nationalization in Venezuela

Some time ago, I wrote a series of blog posts about Hugo Chávez's threats about nationalizing, wondering whether the threats would become reality. In fact, they did, as in 2007 and 2008 he announced a range of different state takeovers.

For a time I followed the cement industry (see the last post here) which he claimed was essential to the national interest. However, it is an extremely hard issue to follow, because inevitably there is a lot of media attention when the announcement is made about a particular company, and then it disappears afterward. Even the Venezuelan state news agency stops bothering.

Therefore, I was interested to see this story in El Universal, reporting that the Venezuelan government has not paid for anything it has nationalized, including cement, but also a number of other different companies. This runs into billions of dollars. This is particularly important because Hugo Chávez has consistently noted that his government pays fair compensation (e.g. here about cement). Given that he has already acknowledged the negative impact of the global financial crisis and the drop in oil prices, I have to figure these companies are not going to see payment anytime soon, if ever.


Anonymous,  2:56 PM  

I am in Maracaibo, and grew up among the rich. I also knew of severe abuse at the cement companies since LONG before Chavez was president. The compaany here, for example, threw all their toxic trash in our lake thus giving us one of the world's highest brain cancer rates for children who swim there- few swim there now. And I got that info from a snob pediatrician! Now, I own the first site of the local phone company, but its my mother who controls it and shed rather sell it to some idiot than let me sell it to CANTV so I can develop my projects in there. Squalids... from a Quaker born in Chile and who met the USA's truths in Alabama after thinking it was all a NYC where those who now hate Chavez would go shopping.

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