Venezuela Accelerates Public Housing Projects in Wake of Floods

Mérida, December 21^st 2010 (Venezuelanalysis.com) – Over the weekend, the Venezuelan government approved new funds and announced the nationalization of two companies that produce construction materials in order to accelerate a surge of public housing projects for people displaced by recent floods.

The National Assembly voted to allocate 1.18 billion bolivars (US$ 274 million) towards a special housing plan to build 9,387 homes for flood victims in Caracas. It approved an additional 63.9 million bolivars (US$ 14.8 million) for the Commerce Ministry to buy basic items for the thousands of families currently living in shelters as a result of the floods.

Meanwhile, President Hugo Chavez has been on a flurry of visits to emergency housing construction sites and shelters to assure flood victims that the government will fulfill its promise to build them new homes.

The flooding began in November and ended last week after killing 35 people, displacing as many as 130,000, and causing damage to hundreds of roadways and bridges as well as 46,000 hectares (113,620 acres) of agricultural land in 11 states.

The president visited a 19 hectare (47 acre) plot that was previously slotted to be used for a new landing strip near the international airport outside of Caracas. The site will now be used to build 1,900 apartments with a public investment of 500 million bolivars (US$ 116.3 million), Chavez said. He added that the homes are expected to be ready in 18 months and that the complex will house more than half of the 10,000 people displaced by the flooding in the area. The president also mentioned plans to build a total of 800 apartments in Vargas state.

Later, Chavez visited 155 families displaced by the rains in Petare, one of Caracas’s largest low-income communities, and announced the nationalization of a 2.1 hectare (5.2 acre) plot of privately owned urban land that will be used to build 400 apartments.

Perhaps the largest public housing project spurred by the recent torrential weather is a plan to build 10,000 houses on a 40.8 hectare (100 acre) section of a large military fort in Caracas called Fuerte Tiuna. The government contracted Citic International Contracting, Inc., a section of the Chinese state-owned construction firm Citic Group, to carry out the massive project, which is to include several 20-story apartment towers.

Chavez met with Citic President Hong Bo in Caracas and announced an initial installment of US$400 million for the project, drawn from a $20 billion credit line that China extended to Venezuela earlier this year. Venezuela will pay back the loan partially through increased oil exports to China at reduced prices.

During his presidential talk show on Sunday, the president announced the “forced acquisition” of Sanitarios Maracay, a toilet manufacturer, and Venezuelan Aluminum (ALVEN). Both companies produce supplies for home construction and are deemed to be strategic sectors of the economy in the context of the current surge in public housing construction.

President Chavez referred to the firms as “two companies that are going to allow us to strengthen our capacity to produce inputs for construction.”

So far, the government has given approximately 2,800 housing units to families affected by rains, including 550 homes that were handed over on Sunday, according to Housing and Habitat Minister Ricardo Molina.

Minister Molina said the government, in accordance with Article 299 of the constitution – which establishes the need for joint public-private sector economic projects – has been in contact with private construction contractors who are willing to participate in the government’s public housing plans.

“We have a large capacity, from small and medium-sized contractors to large construction companies in the private sector, so now a space is being opened for them to exploit their productive potential jointly with the revolutionary government and the organized communities,” Molina said on Sunday.

In the meantime, public officials continue to visit public shelters to help organize medical care and encourage refugees to organize themselves into work, housing, and education committees while in shelters, many of which were set up using government buildings. The shelters are preparing to house flood victims for as long as a year and a half.   

Donations of aid to the flood victims continue to arrive from Venezuela’s international allies. According to the Venezuelan Foreign Ministry, the Latin America division of the China National Petroleum Corporation along with the Chinese Embassy in Venezuela donated US$ 300,000. Belarus sent a ship filled with pre-fabricated, 55-square meter apartments that are made of fiber-cement cladding and metal and can be assembled in three months.

CITGO, the US subsidiary of Venezuela’s state-owned oil company, PDVSA, has made eight air cargo deliveries with more than 450 tons of supplies, according to CITGO President Alejandro Granado. Air transport services were provided by Bolivia’s state-owned Transportes Aereos Bolivianos. In total, CITGO has donated 7,000 tents, 20,000 cots, 10,000 bunk beds equipped with mattresses, sheets, blankets, and pillows, radios, flashlights, boats, rubber boots, and power generators, Granado said.

President Chavez, who was recently granted the authority to legislate by decree, is expected to nationalize a swath of rural and urban landholdings that are idle or unused in order to build more public housing. In accordance with Article 115 of the Venezuelan constitution, the government is to compensate private owners for these forced acquisitions.

Many of the idle urban plots have already been occupied for several months by local “urban land committees” which are linked to communal councils and have the legal right to occupy private lands and gain title to them for the purpose of building homes, according to a law that was passed earlier this year.