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Opinion and Analysis: Economy | Environment

From Agribusiness to Agroecology? An Analysis of Venezuela’s Nationalization of AgroIsleña

On Sunday, October 3rd, Venezuelan President Hugo Chávez made public another remarkable opportunity for agroecology and food sovereignty advocates worldwide as he announced the effective nationalization of AgroIsleña, the transnational agribusiness firm that was – before Chavez signed Decree Number 7.700 – Venezuela’s main distributor of agrochemical inputs. Now under state control, the company has been re-named AgroPatria, meaning “AgroHomeland.”

From an agroecological perspective, the question to ask is: Will the newly born AgroPatria serve to advance an agroecological conversion of Venezuela’s agroecosystems, or will it make state policy the distribution of destructive Green Revolution inputs and technologies, with their pervasive social, economic and environmental consequences? The answer, in short, will depend largely on the social and political praxis of agroecology and food sovereignty advocates on the ground in Venezuela – people whose voices and perspectives are presented in this analysis.

AgroIsleña to AgroPatria

AgroIsleña’s Executive Board first responded to President Chávez’s announcement of the pending expropriation with dismay, affirming that the only explanation for such a decision would be Chávez being “inadequately informed… we ask that he [Chávez] please take the necessary time to fully understand the work of our company so as to reconsider the decision.”[1] Chávez replied in his typical executive fashion, declaring, “I decreed the expropriation of AgroIsleña. That’s it. They have the right to protest but they’ve been expropriated.”[2]

José Elías Varela, who worked nine years for AgroIsleña and not once benefited from worker benefits such as sick-leave, medical benefits, etc., celebrated the decision to nationalize, stating, “Now I am assured a steady income, on a monthly basis. Before we depended on whatever work was available, if there was no work, we had nothing to take home.”[3] His statement came after President Chávez’s assured AgroIsleña’s workforce that, “the Government takes full responsibility, as it has always, of your job security and stability, as you are to be guaranteed all the benefits stipulated by the laws of our country [as state employees]: we are counting on you to make sure the company grows and produces the best dividends as it serves the working class.”[4]

While many in Venezuela celebrated the decision, David Santana, grandson of the Canary Island-based family that first began AgroIsleña in 1958, asked the Spanish Foreign Minister to step in and defend the firm’s interests.[5] He pointed out that the Spanish government has helped other Spanish companies in recent years with similar issues, and expressed concerns that many of these firms, including his own, “will never receive” the actual value of their assets.

A Number of Reasons to Nationalize

While in the United States and Europe the only recent government interventions in the economy are what István Mészáros calls “the nationalization of capitalist bankruptcy” (in reference to government bailouts after financial capital’s recent collapse),[6] in Venezuela the state is playing an increasingly active role in the restructuring of the economy for the benefit of the Venezuelan people. And unlike the U.S. and Europe, Venezuela has no intention of returning these firms back to private interests – neither in the short or long term.

“AgroIsleña would have the products but they wouldn’t sell them to us,” said Toribia Sequera de Molina, a sugarcane producer in the state of Lara. “We would arrive at the warehouses with the resources to buy 20 sacks of fertilizers, but they wouldn’t sell them to us. Meanwhile, they would set aside one or two thousand sacks for their own re-distributors,”[7] de Molina affirmed as he described one of AgroIsleña’s many unjust business practices.   

In a written statement published October 10 entitled, “AgroPatria!”, Chávez laid out the social, economic, and environmental justification for his decision to nationalize the firm. Chávez stated:

“Nothing is above the sacred interests of the homeland. I am reminded of the words of [José] Martí who in 1873 declared, ‘The homeland is community of interests, unity of traditions, unity of ends, the sweet fusion of loves and hopes’. And we want, and we are determined, to live by those words... On a number of occasions we warned them [AgroIsleña] of the need to respect production plans organized by the national government, but these warnings went without reply. We have expropriated based on the national interest. The nationalization of AgroIsleña is going to contribute not only to reducing the price of food to consumers, and as a result reduce inflation, but it will also serve as an ecological shield for our soils.”[8] 

President Chávez went on to discuss comments made by Venezuelan agroecologist Miguel Ángel Nuñez, reaffirming the agroecologist’s position that, “AgroIsleña has numerous social, labor and environmental debts [with society]. In fact, in reality, by nationalizing the firm we are beginning to cancel a historic debt with the Venezuelan countryside.” Chávez insisted that the decision to act was made “to make sure, at all costs, that AgroIsleña would not keep using extortion against our campesinos – with their high prices and exaggerated interests on loans and credits, not to mention the imposition of an agrotoxic package and transnational ecocide that deteriorates our soils with products that provoke long-term damage to the environment.”

In the original piece cited by Chávez, agroecologist Nuñez laid out AgroIsleña’s debts to Venezuelan society in the following ways: 53 years as the main promoter, source and supplier of toxic agrochemicals; Monopolistic practices that tricked many small- and medium-sized producers into indebting themselves to the firm; Purchasing their own products abroad at preferential exchange rates, while speculating with prices paid by producers within Venezuela; Elevated costs of technical support and assistance, and ever-increasing farmer dependency as a result of the high chemical-input strategies the firm promoted.[9]

In addition, Nuñez detailed the way in which AgroIsleña would take advantage of state-owned Bank of Venezuela. Beginning with resources that Bank of Venezuela provided to the firm specifically to support smallholder farmers, at 8% interest rates, AgroIsleña would up the interest rate on these loans to 13%, thus pocketing 5% for having “distributed” public resources to resource-poor smallholder farmers.

According to Gonzalo Pastrán, professor of agroecology at the Bolivarian University of Venezuela (UBV), AgroIsleña was in permanent violation of environmental articles 127 and 305 of the National Constitution (1999) and for these reasons alone should have been expropriated years ago.[10] Article 127, for example, describes, “the right and responsibility of each generation to protect and conserve the environment for its benefit and for the benefit of future generations. Every person has the individual and collective right to enjoy a safe, healthy and ecologically balanced environment. The state will protect the environment, biological and genetic diversity as well as ecological processes. Article 305, meanwhile, asserts “the state will promote sustainable agriculture as the strategic basis for an integral rural development.”

A Contradiction of Sorts

Days after the creation of AgroPatria, the government announced 50% reductions in the price of agrochemical inputs such as glyphosate, the basis of Monsanto’s infamous RoundUp herbicide, arguing smallholder farmers would finally find fair prices for said inputs. To cite just a few examples, the government announced reductions in the following chemical input costs to be found at all of AgroPatria’s 60+ outlets: Granulated urea sold at a 59% reduction in market price; NPK10-20-20 sold at a 65% reduction in price; Ammonium Sulfate (also known as Super Sam) sold at an incredible 75% reduction in price; and so on and so forth.[11]

A few days later, the government also announced the takeover of two more firms: Fertinitro and Venoco. The former is a producer of agricultural fertilizers, while the latter a producer of lubricants and other petroleum-derived inputs that can be used for agricultural mechanization. During a visit to one of the Fertinitro plants, Venezuela’s Minister for Energy and Oil, Rafael Ramirez, affirmed, “This plant is very important for food sovereignty… Currently we [the state] are using 600,000 tons of urea while our production plans… require 1.3 million tons of this input. Now we have it guaranteed.”[12] 

According to Orlando Zambrano, spokesperson for the Simón Bolivar National Campesino Front and socialist candidate elected to Venezuela’s National Assembly, “AgroPatria should combat the negative effects of agrotoxins in the environment and on human health. This new company should make agroecology its banner so as to overcome capitalism in agriculture… We, campesino leaders, believe that as these two models confront one another, the capitalist and the socialist models, this decision [to nationalize] is a necessity for the advance and consolidation of food sovereignty. Now the company is to be controlled by campesino for campesino, so as to distribute agricultural inputs and seeds, which will contribute to the development of both human beings and the environment,”[13] Zambrano affirmed.

Franco Manrique, former member of the Venezuelan United Socialist Party’s (PSUV) Food Sovereignty Commission, spoke to the contradiction between the pursuit of national sovereignty through government-led interventions (which he agrees with) and the need for a food sovereignty model that respects the long-term needs of farming communities and average Venezuelans on the whole:

“We forget that pragmatism is not an efficient way of erasing the statistics that place our country on the list of food import-dependent countries. That blind pragmatism, which is applied so as to attend to financial and technological expectations of the business community, cannot continue to be allowed to compromise the objectives of our Revolution and natural resources, with special emphasis on our soils, waters and biodiversity… The creation of AgroPatria should not just be a change in owners, it should be the beginning of a great national agrarian mobilization to achieve the third step in food sovereignty – the conversion of the model, starting with what we’ve got and advancing firmly towards a socialist, agroecological model.”[14]

The Venezuelan Food Sovereignty Framework

Speaking to the issue of food production, distribution and consumption, campesino leader Benjamin Veliz was quoted as saying, “We can’t allow basic food products to continue to be converted into commodities. They are products essential to satisfy the requirements of our people.”[15] In a 2009 piece in Monthly Review, authors Schiavoni and Camacaro[16] detail Venezuela’s food sovereignty efforts within the context of the Bolivarian Revolution. Their detailed description of its components is worth considering in full:

Bolivarianism: The Bolivarian Revolution is named for Símon Bolívar, who led struggles for independence from colonial and imperialist forces throughout much of Latin America in the early 1800s. To this day, Bolívar represents a vision for a liberated and united Latin America. In Venezuela's struggle for food sovereignty, Bolivarianism points to a food system free of corporate control, neoliberal economic policies, and unfair trade rules. Internationally, Venezuela is forging alternative systems of trade and cooperation that promote the integration of Latin America and support each country's right to food sovereignty. 

Socialism of the Twenty-First Century: This involves building new social and economic systems based on equality, social inclusion, shared wealth and resources, and true participation of all members of society. In terms of food and agriculture, this means returning the means of production to the people through agrarian reform and cooperatively run farms and food-processing factories, as well as the treatment of food as a basic human right rather than a commodity for profit.

Endogenous Development: Meaning "development from within," this implies first looking inside, not outside, to meet the country's development needs, building upon Venezuela's own unique assets. This means valuing the agricultural knowledge and experience of women, indigenous, Afro-descendents, and other typically marginalized campesino (peasant farming) populations as fundamental to Venezuela's food sovereignty. This also means preserving Venezuela's native seeds, traditional farming methods, and culinary practices.

Participatory Democracy: This form of governance empowers citizens to play a direct role in politics, having a say in decisions that impact their lives. In Venezuela, it is facilitated by community councils, of which there are over 35,000 (and growing) throughout the country. Community councils and other forms of citizen organizing are enabling communities to monitor their food needs, shape food policies, and take control over their local food systems, much as local "food policy councils" in the United States strive to do.

The authors go on to the describe the participation of over 2,000 Cuban agronomists specializing in organic agriculture in the Campo Adentro (“Into the Countryside”) program, partnering with Venezuelan cooperatives to provide consultation and training in agroecological principles, strategies and practices. They point out that, “Venezuela is one of the few countries in the world to make credit available specifically for farmers engaged in agroecological projects” and mention the 24 laboratories for the development of biological pest control and fertilizers that the government has established with the support of Cuban advisors in an effort to replace “the toxic agrochemicals of Bayer, Cargill, Monsanto, and others,” according to former Agricultural Minister and now Venezuelan Vice-President Elias Jaua.

From Agribusiness to Agroecology?  

As AgroPatria takes on its new role in Venezuelan society – a role that has yet to be clearly defined – it is vital that Green Revolution technologies and ideologies of the past not limit the development of a truly just, sustainable rural economy in Venezuela. As has now been experienced for decades by rural people of the Global South, the so-called “Green Revolution” may increase crop productivity for some time (so long as costly chemical inputs are available), but its destructive effects on human health and the environment, the resulting loss of agrobiodiversity, rural traditions, cultures and knowledge associated with sustainable agroecosystem management, as well as the mass rural to urban migrations tied to these exclusionary technologies are all part of the ever-so-costly technological package sold, until recently, by AgroIsleña and its affiliates.

In order to correctly analyze the nationalization of the agribusiness firm AgroIsleña, one must first recognize that there are more than just ecological considerations to take into consideration. As agroecologist Stephen Gliessman points out, “There is no disputing the fact that for any agroecosystem to be fully sustainable, a broad series of interacting ecological, economic, and social factors and processes must be taken into account.”[17]

With the nationalization of AgroIsleña the Venezuelan state has taken an important step in the struggle to bring social and economic factors under greater control of the Venezuelan people and out of the hands of private, profit-driven firms. What is yet to be understood is what ecological factors will be considered as the AgroPatria project moves forward. While there are clear contradictions in the development of Venezuela’s socialist national food system, there are two important factors to consider.

First, as a result of the aforementioned nationalizations, the Venezuelan government now plays a decisive role in national food production, distribution and consumption. It can now influence strongly the nature of loans to farmers (both big and small, individual and cooperative). It can also design and implement national plans for the production, storage and distribution of seeds as well as transportation networks in general, storage of production, processing, distribution, commercialization, and yes, the use (or removal from the market) of a large array of synthetic chemical inputs. As an example, the Venezuelan government now controls 51% of the nation’s grain storage capacity, ensuring a more just relationship between producer and storage silo operators – because private operators will be forced to adapt to state-established prices. Venezuela currently has 279 silos, including both public and private. According to the Venezuelan News Agency (AVN), Venezuelan Minister of Food Carlos Osorio emphasized that private silos will continue under strict surveillance and if they commit irregularities, they too will be nationalized.

This now majority share in the country’s food system allows the Venezuelan people – through their government – to define their priorities as they relate to food production, distribution and consumption. This is a key element to the Food Sovereignty model spearheaded by the La Vía Campesina, international social movement that defends smallholder farmer production and agroecological production.[18]

Second, as La Vía Campesina has pointed out for years and as was ratified by agroecologist Miguel Altieri in his Monthly Review article of 2009,[19] smallholder farmers are actually more productive and resource conserving than their larger counterparts. In the struggle to establish a truly sovereign, socially just and environmentally balanced food system model that can meet the needs of the Venezuelan people (today, and for generations to come), the role of the small farmer must be recognized, respected, rescued (where it has faced attacks by the likes of AgroIsleña) and encouraged (through agrarian reform and government support for smallholder farmers). Altieri provides interesting figures as they relate to the productivity of the smallholder farmer who uses polyculture systems:

“Research shows that small farms are much more productive than large farms if total output is considered rather than yield from a single crop. Maize yields in traditional Mexican and Guatemalan cropping systems are about 2 tons per hectare or about 4,320,692 calories, sufficient to cover the annual food needs of a typical family of 5-7 people. In the 1950s the chinampas of Mexico (raised growing beds in shallow lakes or swamps) had maize yields of 3.5-6.3 tons per hectare. At that time, these were the highest long-term yields achieved anywhere in Mexico. In comparison, average maize yields in the United States in 1955 were 2.6 tons per hectare, and did not pass the 4 tons per hectare mark until 1965. Each hectare of remaining chinampa can still produce enough food for 15-20 persons per year at a modern subsistence level… Productivity in terms of harvestable products per unit area of polycultures developed by smallholders is higher than under a single crop with the same level of management. Yield advantages can range from 20 percent to 60 percent, because polycultures reduce losses due to weeds (by occupying space that weeds might otherwise occupy), insects, and diseases (because of the presence of multiple species), and make more efficient use of the available resources of water, light, and nutrients.

Welcome AgroPatria

The Bolivarian Revolution underway in Venezuela is a participatory form of democracy which – in order to flourish and break the chains of structurally enforced social inequality – requires the active participation, discussion and reflection of the Venezuelan people. The intervention in their own social reality – be it at work, at school, when farming, selling and distributing production, deciding which inputs to use (and not use), etc. – is the only possible source of an ever-maturing praxis within Venezuelan society which over time can overcome the challenges to food sovereignty and other matters of concern.

As a result, as a condition of Venezuela’s radical democratization, the contradictory statements coming from government representatives (celebrating chemical inputs while calling for environmental conservation) are to be rectified – if they are to be rectified at all – by the efforts of agroecology and food sovereignty advocates on the ground. This will depend on, in large part, the Venezuelan people being respected in their right to live out this democratic exercise in peace and self-determination.

Borrowing from István Mészáros, and adding agroecology to the framework, one can conclude that agroecology’s role in the direction of AgroPatria will, “depend on the ability and determination of committed socialist forces to formulate a comprehensive strategy and to organize themselves accordingly, extending their influence in a radically improved way among the great masses of the people, in the interest of the realization of that strategy.”  

Or, as Venezuelan agroecology professor Gonzalo Pastrán put it, “Welcome AgroPatria: Our commitment remains to a Bolivarian, revolutionary, environmentalist and agroecological homeland. We welcome the challenge, taking it on is a moral and ethical obligation.”

Author’s Note: The Venezuelan people’s right to self-determination is of paramount importance globally, as social justice, equality and human dignity are among the pillars of the Bolivarian Revolution. Readers are strongly encouraged to visit [http://venezuelanalysis.com/solidarity/groups] and become involved in any one of the many solidarity efforts in or near their communities. If readers are already actively participating in a political or social network, they are also strongly encouraged to link with others so as to discuss strategies for greater unity around the defense of the Venezuelan people and their revolution.


Notes

[1]Comunicado de la Junta Directiva de AgroIsleña. El Universal (October 4, 2010).

[2] Monsanto-like AgroIsleña expropriated in Venezuela for bad practices. Correo del Orinoco (October 8, 2010).

[3] AgroPatria salda pasivos sociales, laborales y ambientales. Ministerio del Poder Popular para la Comunicación y Información (October 15, 2010).

[4] ¡AgroPatria! Las líneas de Chávez (October 10, 2010).

[5] AgroIsleña asks Spanish government to defend its interests. El Universal (October 6, 2010).

[6] Istvan Meszaros. The structural crisis of capital. Monthly Review Press (2010).

[7] See: 6 (above)

[8] See: 4 (above)

[9] Miguel Angel Nuñez. AgroIsleña: Expropiacion ambiental. ALAI América Latina en Movimiento (October 10 2010).

[10] Gonzalo Pastrán. La expropiación de AgroIsleña y la necesidad de la formación agroecológica. Aporrea (October 11, 2010).

[11] Nacionalización de AgroIsleña permitira bajar precios. AVN (October 5, 2010)

[12] Con Fertinitro y AgroPatria ahora controlaremos la cadena completa. El Tiempo (12 October, 2010)

[13] MAT: Ejecutivo destina Bs. 565 millones para siembra y cosecha de arroz, girasol y hortalizas. Prensa MAT (October 11, 2010).

[14] Franco Manrique. A propósito de la creacion de AgroPatria. Aporrea.org (12 October, 2010)

[15] Frente de campesino de Cojedes apoya rescate de empresa AgroIsleña. VTV (October 4, 2010)

[16] Christina Schiavoni and William Camacaro. The Venezuelan effort to build a new food and agriculture system. Monthly Review (18 October, 2009)

[17] Stephen Gliessman. Agroecology and agroecosystems. Chapter 2 in: Agroecosystem analysis, American Society of Agronomy, Madison, WI.

[18] www.viacampesina.org

[19] Miguel Altieri. Agroecology, small farms and food sovereignty. Monthly Review (July-August 2009).