Venezuela Expropriates Abandoned Valve Factory

The Venezuelan government expropriated a valve factory that had been closed since 2003. The factory, Inveval, is the second ‘recuperated’ factory in a recent campaign to put abandoned and bankrupt factories back into production under worker-state co-management.

Caracas, Venezuela, April 28, 2005—Venezuela’s President Hugo Chávez announced the expropriation of the Constructora Nacional de Valvulas (CNV) in a ceremony at the Presidential Palace in the capital Caracas, yesterday. CNV makes valves used in the oil industry and was a long-time associate of the state oil company PDVSA until it closed in 2003.  Labor minister Maria Christina Iglesias and a group of former-CNV workers were also present at the announcement, where Chávez signed a decree expropriating CNV. The National Assembly had previously declared it to be of ‘public utility,’ a legal prerequisite to expropriation.

CNV is only the second company to be expropriated by the Venezuelan government and is to be run under a system of shared worker-state co-management.  Venezuela’s first expropriation, last January,—of the paper factory Venepal—was announced as part of a nation-wide endogenous development campaign called “made in Venezuela.”  The campaign seeks to promote national industrial and agricultural development in an attempt at diversifying Venezuela’s oil-dominated exports, and reducing dependency on imports.

In December 2002, the then main labor federation, the Confederation of Venezuelan Workers (CTV) and chamber of commerce federation Fedecamaras jointly declared a nation-wide “general strike” aimed at ousting President Chávez.  The most destructive aspect was the near-total shutdown of the oil industry, accompanied by sabotage resulting in billions of dollars in damage and losses.  In many cases, including both Venepal and CNV, employers locked workers out and shut down production for the entire 2 month strike.

As reported by Jorge Martin, writing for the Hands Off Venezuela campaign, the closure of CNV for the duration of the strike left over 100 workers without income.  With the end of the strike/lock-out CNV owner Andrés Sosa Pietri refused pay promised back-wages to workers, provoking a group of workers to begin agitating for radical change at the factory.  In May 2003 workers decided to occupy the entrance to the factory in an attempt to prevent Pietri from moving machinery out and closing down the factory.  The occupation was declared illegal by the Venezuelan courts, and workers were eventually convinced to abandon the occupation.

But the expropriation of Venepal—now the Endogenous Paper Industry of Venezuela (Invepal)—earlier this year inspired workers around the country to renew their efforts at their own factories in the hope that they would be the next Invepal.  On February 17, 2005, 63 former-CNV workers re-occupied CNV, this time taking over the entire factory, rather than just the entrance.

Back in January, at the signing of the decree to expropriate Venepal, Chávez sent a warning to the Venezuelan land-owning class: “Today’s expropriation of Venezuela is an exception, not a political measure.  We aren’t going to steal your land; if it’s yours, it’s yours.  But to the factories that are closed, and abandoned—we’re coming for you. For all of you. For the rescue of the industrial fabric.”

Speaking to workers at yesterday’s expropriation of CNV—now the Endogenous Valve Industry of Venezuela (Inveval)—Chávez reiterated this statement, warning that other companies that abandon their factories should be taken over and turned into “Inve-no-se-que-cosa” (Inve-whatever).

Pioneering Venezuelan Co-Management

The expropriation of Venepal and CNV, and the advancement of co-management in state run enterprises such as the electrical company Cadafe and the Aluminum factory Alcasa are not only a product of the government’s ‘Made in Venezuela’ strategy—they also represent hard-fought battles by workers all over the country.  But the business of worker-management is complex, and as a Venezuelan trailblazer, the pressure on Invepal to feed the hopes of workers at factories throughout the country is high.  While it remains unclear exactly what is going on at Invepal, recent developments suggest a deviation from workers’ earlier goals.

At a recent forum on co-management, a former member of the executive of Venepal’s now defunct union and current member of the directorate of Invepal, Alexix Ornevo, noted that since they no longer had any bosses, they longer needed a union, as workers were now grouped into a cooperative (Covimpa) to run the company.  And as a cooperative, Ornevo was quick to point out, they got several benefits including Constitutional relief from paying taxes.  Also thanks to the 1999 Bolivarian Constitution, Covimpa—currently owners of a 49 percent share in Invepal—were legally entitled to increase that share up to 95 percent.

Ornevo’s presentation caused serious concern among many in the audience, who worried that the model of co-management and worker agency in the country was setting the stage to become a model for capitalist cooperatives.  “As we saw in [the] presentation on Invepal,” said Federation of Electrical Workers (Fetraelec) president Angel Navas in an interview, “they are having some serious problems, they seem to be thinking as managers.”  “Eight-hundred workers will be sole owners of the company.  And if it becomes profitable, are these workers are going to get rich?  This is a company that is supposed to belong to the entire country; my company can’t only belong to the workers, if we make profits they belong to the entire population. This is a responsibility that we all have,” said Navas.