Worker Self-Management Introduced in Primary Industry Companies in Guayana, Venezuela

Merida, May 16th, 2010 (Venezuelanalysis.com) – Yesterday president Hugo Chavez swore in a range of directors of state owned companies that comprise the Venezuelan Corporation of Guayana (CVG). The directors were chosen by workers’ working groups and ratified by the president. Chavez also announced a range of measures to further implement the Plan Socialist Guayana, including some nationalisations and eliminating outsourcing.

A range of workers and ministers told the press that it was the first time in CVG history that directors had been nominated by workers, and were workers themselves. CVG includes 15 state-owned primary industry companies in Guayana.

CVG Workers and the government have confronted a range of problems, including corruption, deteriorating machinery, drops in the prices of aluminum and steel, and power shortages. Last year Chavez lent his support to a worker proposed plan for the industries to be directly controlled by workers, called Plan Socialist Guayana, but it has been met by a range of bureaucratic maneuvers to prevent its implementation.

Yesterday, in a ceremony in Alcasa, Chavez was finally able to swear in new directors of some of the companies that make up CVG. They were, Jose China as director of Bauxilum, Jose Mendez for Carbonorca, Elio Sayago for Alcasa, Rada Gamluch for Venalum, Rafael Guerra for Alucasa, Carlos Zzari for Cabelum, Otto Delgado for Alunasa-Costa Rica, and Caros de Oliveira for Sidor.

The new directors swore to completely dedicate themselves against corruption and inefficiency and to productivity and sustainability of each of the companies that form the corporation as well as loyalty to the national government.

A range of ministers and around 600 workers of CVG attended the act.

Workers chose the new directors in working groups that they formed with some of the ministers and sent this list to Chavez, which he approved in its entirety on Thursday.

The executive will take a new approach to the industry, which includes a range of decisions that Chavez announced at the swearing in ceremony.

CVG will reduce the high levels of exportation of primary materials like steel and aluminum, and divert them instead towards local and national projects. Chavez said there needs to be a plan to create companies to process such material in the country.

“The primary material companies in Venezuela were designed just to produce the primary material and hand it over to the international and national private sector so that they could process it and add value, at each stage of the productive chain they were exploiting the workers and speculating with prices,” Chavez explained.

He also ordered that the transport system of the primary material be nationalised. He said that according to studies done during working groups with the workers, the transport system was “one of the main causes of high costs and losses, and a big business for the private companies.”

Chavez motivated a new system of buying and selling in CVG, where, “everything is transparent and not a single cent is lost, because such wealth belongs to the people.”

Another decision is to reduce the levels of dependence on imports such as lime and caustic soda, as well as to talk with state oil company, PDVSA about it buying and nationalising the Venezuelan company Norpro, to then be able to have a direct supply of the chemical propanol.

Chavez also ordered the nationalisation of Matesi, an iron and steel company, and Comsigua, another iron and steel company. The Argentinean owners of Matesi offered the company to the government at a price five times its worth, according to Chavez, and after spending nearly a year negotiating with the two companies, among others, over prices, the government has decided it has no “other alternative but to nationalise them”.

And, as some managers and administrators have been reluctant to provide information required to take some of these decisions, Chavez said, “If some manager or administrator hides information, this is suspicious and should be cause for immediate removal from their position. It’s necessary to defeat such resistance to change.” He warned that some positions are occupied by “enemies of the revolutionary process”.

Chavez also denounced the levels of outsourcing within CVG, where companies like Sidor, paid BsF 423 million ($US 98 million) in 2009 to outsourcing companies, and only 41.34% of this went to the workers’ wages. He said such activity was a way of delivering profits to the bourgeoisie and “leaving us with the losses” and demanded “an end to such a perverse mechanism”.

He called for the creation of a plan that will allow, in the medium term, for the eradication of outsourcing in the area.

Finally, Chavez announced an investment of BsF 432.4 million as well as $125.9 million into modernising a lot of the sector’s machinery. He said this would include renovating and extension of a hospital in the area and improving technology related to electricity supply. He also said the government would pay off BsF 25 million ($US 5.8 million) owed to workers of Ferrominera Orinoco, using a fund created from dividends of the state owned communication company CANTV.

A worker at Alcasa, Alberto Parra, told ABN, “A lot of the managers …associated with corrupt practices, refused to accept our presence because they know that we bring transparency to the finances, but thanks to President Chavez and the organised working class, our participation in decision making will be stronger and stronger every day.”

“We’re going to construct a great socialist zone here,” Chavez said.

In July last year workers proposed a new model of production based on workers control, which president Chavez supported. He then presented a new plan, “Plan Socialist Guayana 2009-2019” which involved transforming the state owned CVG and its companies into socialist companies. The plan was a result of weeks of discussion among CVG workers and included direct worker control over production, improved working conditions, and public auditing.