Venezuelans Protest Big Business for their Role in the Economic War

Amidst the ongoing “economic war” in Venezuela, 200 people from various political collectives marched to Fedecamaras headquarters to place a spotlight on how the largest business confederation may be contributing to scarcity, inflation and speculation in Venezuela. 

By Cory Fischer-Hoffman- venezuelanalysis.com
Topics
Short URL

The March

It was cooler in the shade, so members of the Revolutionary Popular Block (BPR), “Movimiento Lucha” and the Merú-Unefa movement, gathered under a tree to unroll their banners, make their signs and distribute leaflets; all of which identified Fedecamaras, the largest association of private industry, as an enemy of the Venezuelan people

“I am here against the economic sabotage that Fedecamaras is carrying out, and the high prices” said Maria Fernanda of Avanzada Popular, “the business class, in combination with the international right wing is creating a lot of economic pressure through systematic sabotage.”

As the lunch hour approached, more people arrived to participate in the first march which has specifically targeted Fedecamatas since the down-spin in the Venezuelan economy which began in 2013. 

Ofelia Vendano, was leaning over the hood of a car, carefully tracing over faint pencil lines with a large permanent marker so that her sign could be read from afar. With her daughter at her side, she said “all they do is resell things, speculate, and move contraband, we know that they are behind this.”

The sign that she and her daughter made together read “Fedecamaras is a big buhonero.” A word that is often associated with street vendors that are part of the informal economy but, in this context, Vendano is pointing to the ways in which the private sector evades taxes and other forms of government controls. Unlike the common street vendor, however, members of Fedecamaras control the most important industries in Venezuela.

Vendano and her daughter marched alongside others who were carrying banners and chanting, “if people don't get angry, the right-wing will screw us over!” The peaceful march wove through the streets of Caracas and arrived at the Fedecamaras headquarters during the lunch hour. The employees that had been gathered outside of the building, behind locked gates, promptly went inside, and the marchers continued chanting, “Pay attention, these are the ones who are screwing over the nation.”

Fedecamaras in Context

Prior to neoliberal restructuring in the late 1980's, Venezuela had a “price for sale to the public” (PVP) on all basic goods. This set price was intended to protect people from sudden hikes in the prices of basic goods and to keep the most essential food items affordable. The loan package that Venezuela signed with the International Monetary Fund during the administration of Carlos Andres Perez, eliminated these prices controls, which led to an immediate increase in the costs of basic goods.

With no controls of prices, the private sector began to speculate about what the prices might be, and distributors intentionally kept consumer goods from the market in anticipation of rising prices. This created false shortages with real consequences. When poor and working class Venezuelans could no longer take the rising prices, speculation, lack of access to food and other consumer goods, they rose up in a popular rebellion against neoliberal reforms.

Today, the Venezuelan government has re-instituted a form of price controls as a means to keep basic food items affordable in the face of inflation (which reached 60% last year) and similar dynamics of the hoarding of goods (fueled by speculation) at distribution points throughout the country. This time; however, the smuggling of goods to Colombia, as well as possible political motivations are also at the heart of what Luis Hernandez, a march participant, refereed to as “the hunger making system of Fedecamaras.”

Fedecamaras has taken a staunch position against the Law for control of Fair Costs, Prices, and Profits which went into effect in the beginning of 2013. This past April Fedecamaras introduced a case against the Organic Law of Fair Prices to the Supreme Court but a ruling has yet to be made. 

Lenin Marcano, a member of the March 8 collective and a philosophy student at the Central University of Venezuela, stated that Fedecamaras is holding goods back from the market as a “form of protest” against the Fair Prices Law.

“Why would they want to go along with fixed prices? They are capitalists” noted Sergio Fromelta, without the least bit of surprise in his voice. “If they invest 10 bolivares, they want to get 40 out of it. They are capitalists.”

The Problem 

Many of the complaints surrounding food shortages are targeted at the points of distribution, and a number of protestors mentioned that in this oil-producing nation where food imports are extremely high; Fedecamaras represents the private sector's control of distribution, including both imports and the production of goods. 

For example, Lorenzo Medoza, the owner of the company POLAR controls roughly 40% of the food market in Venezuela. While POLAR does own facilities where food and beer are produced in Venezuela, they also control the distribution of imported goods produced in other countries, such as corn flour, a main staple of the Venezuelan diet.

“Almost half of the food that we eat comes from POLAR,” said Maria Fernandez, “their strategy has been to monopolize the food market, to dominate the food culture in Venezuela so that they can manipulate us.” She continued, “this is why we need to promote food sovereignty and a sustainable self-sufficiency.” 

“The difficulty is with the distribution of foods” said Zoraida Perez, as big raindrops started to fall on the freshly spray-painted sidewalk in front of Fedecamaras headquarters. “Even though we are producing, the problem is with the distribution because sometimes the food does not arrive where it needs to go.”

 Possible Solutions

As an oil-exporting nation Venezuela faces some severe obstacles in increasing production, due to Dutch Disease, or perhaps what is more aptly referred to as “neo-colonial disease,” which makes imports far cheaper than domestically produced goods. Like Maria, many pointed towards self-sufficiency and food sovereignty as a means of undermining Fedecamara's control of the sources of food in the country. This is a long term goal that many people and institutions are working towards, but the challenges to get there are many.

Luis Hernandez, of the popular councils of cacao producers Guillermo Ribas of Barlovento, also noted a need to increase production in the face of “a savage capitalist market that comes with the cost of hunger for the Venezuelan people”. Additionally he focused on the need to create new mechanisms for the distribution of goods.

“As producers, we want to advance by increasing production and bringing our products directly to the consumer. We need help from the government with transportation, to take our goods directly to the people," said Hernandez. 

He noted that in the past month he had participated in “Socialist Markets” in which producers brought goods directly to consumers, and by cutting out the middle people, consumers were able to get access to affordable food and producers were compensated justly for their goods. Hernandez concluded that “we need to break the supply chain that is, today, controlled by the private sector.”