Venezuela Opposition Plan Promises Return to Free Market and Elimination of Referenda

Opposition government plan proposes privatization of electric sector, multinational-friendly laws and the dismantling of social programs. Chavez called plan "Bush's consensus" due to U.S. financing for the project.

Caracas, July 13 ( The organized opposition to Venezuelan President Hugo Chavez unveiled its government plan for a post-Chavez administration last Friday, a month before Venezuelans are to decide if the President will remain in office via a constitutionally-allowed recall referendum to be held Aug 15.

Diego Bautista Urbaneja, Venezuela opposition leader
An opposition government would privatize part of the state-owned electric companies, acording to opposition leader Diego Bautista Urbaneja
Credit: Venezolana de Television

Multinational-friendly constitutional amendments

The opposition plan titled “Consensus Country”, promises a return to free market economic policies, a change that would be welcomed by international financial leaders and institutions, including the International Monetary Fund. The IMF had offered support for the dictatorial government of business leader Pedro Carmona, who made the same promise after briefly ousting Chavez thought a coup d’ etat in April of 2002. Diego Bautista Urbaneja a leader of the opposition coalition Coordinadora Democratica denied that the opposition would seek IMF support.

The plan also contemplates reforms to the Constitution and several laws approved during the Chavez administration. The Hydrocarbons Law will be reformed in order to allow greater opening of Venezuela‘s economy to foreign investment in the oil and gas sectors. The current Hydrocarbons Law allows foreign involvement in the oil and gas sectors mostly through partnerships with local private and state enterprises. The current new law also significantly increased the royalties paid by foreign multinationals for oil and gas extraction, a measure that has negatively affected foreign investment in that sector, according to opposition experts. Those royalties will be “flexibilized”. Part of the profits generated by the increased royalties and from the state oil company PDVSA, are being used to finance social programs fro the poor.

An increase in oil production will also be enacted through “a redirection of OPEC policies according to the modern oil market.” An increase in oil production would help the opposition’s plan of “restoring good relations” with the United States, as the Bush administration has been pressuring OPEC for an increase in output in order to bring down prices. Chavez is credited with helping rebuild OPEC and restoring oil prices after he took office, a move that was not well welcomed by Washington.

Under the economic flexibility policies to be implemented, currency exchange controls will also be lifted. The currency controls were enacted after capital flight reached unprecedented levels during the opposition-sponsored oil industry sabotage, lock-out and strike of 2002-2003, aimed at ousting Chavez, and which caused a historical quarterly GDP drop of 28%.

The plan calls for private sector investment in state electric companies. “Privatizations may be necessary due to the large investments needed,” admitted opposition leader Diego Bautista Urbaneja, who coordinated the program. The plan proposes combining privatization with subsidies for the poor, which already exist.

The Land Law, Chavez’s mild version of land reform, will also be derogated during a post-Chavez administration. Although the Law has only been applied to transfer state-owned land to farmers organized in cooperatives, it is one of the most controversial measures enacted by the Chavez administration. The Land Law has been used as an example of Chavez’s alleged threats to private property of the means of production. Some NED grants have been specifically directed to opposition groups such as Accion Campesina, which has offered to monitor possible conflicts generated by the implementation of the Law. Unlike previous land reforms implemented in the past by parties which are now part of the opposition, the current Land Law forces the government to pay market prices for land that remains unused for years instead of expropriating without pay. It also gives owners a two-year grace period to initiate production in order to avoid being forced to sell their land. However, rancher and agri-business associations see it as a threat to property rights.

Continuity of social programs “not guaranteed”

The opposition proposal vaguely hints at maintaining some of Chavez’s social programs or “missions”. However, Diego Bautista Urbaneja admitted during an interview with Venezuela’s state TV station late Monday that the continuity of the missions will not be guaranteed. Polls show widespread support for the social programs of literacy, access to secondary and higher education, health care, and endogenous development, enacted by Chavez in favor of the poor.

A program of micro-credits and of promotion of small businesses will also be implemented. The proposal avoids mentioning Chavez’s current micro-financing programs currently implemented through several government-financed banks.

The opposition programs calls for a campaign to confiscate illegally owned firearms. The Chavez government currently has a program for the exchange of firearms for scholarships through the Ministries of Defense and of Education.

Recall Referenda to be eliminated

The plan calls for a Constitutional amendment which would eliminate the recall referenda of elected officials, a tool currently used by the opposition to try to oust Chavez, after other methods such as a coup d’etat, lock-outs, strikes and oil industry shutdowns had failed. “Recall referenda must be eliminated because it brings too much instability,” opposition leader Henry Ramos Allup was quoted as saying in a AFP news wire. Ramos Allup is the Secretary General of Accion Democratica (AD), the opposition’s biggest party.

Elimination of voting rights for military

The right of members of the military to vote, granted by the new Constitution approved by referendum during Chavez’s first years in office, will also be eliminated. The number of years that a president can serve in office will be changed from six to four years.

Articles 333 and 350 of Venezuela’s Constitution, which justify rebelling against an autocratic or dictatorial government, would also be eliminated if the opposition comes to power. Those articles have been used by the opposition to justify anti-Chavez militant actions such as the “legitimate disobedience” camp that rebel military officers set up in 2002 at the Altamira square in eastern Caracas to demand Chavez’s resignation. The opposition also invoked those articles to justify the “Plan Guarimba” activated earlier this year, which consisted of setting up roadblocks and the destruction of property. Opposition leader Elias Santana invoked article 350 when calling for “tax law disobedience” during the oil industry shutdown and business lock-out at the end of 2002.

With regard to foreign policy, the opposition proposal contemplates “defining a clear and active opposition to narcotrafficking and terrorism. Although more illegal drugs have been intercepted by the Chavez government than any previous government, the opposition and Colombian right wing politicians claim that Chavez cooperates with drug traffickers to finance Colombian guerrillas. Under Chavez, Venezuela has signed and ratified all the international legal instruments against terrorism.

“Bush’s consensus”

On Sunday, during his weekly live television show, Venezuelan President Hugo Chavez described the opposition’s new plan as “Bush’s consensus”. Chavez cited documents obtained through the U.S. Freedom of Information Act (FOIA), which describe financing of the U.S. National Endowment for Democracy (NED) for the development of the opposition government plan.

According to FOIA documents published at, the U.S. government-financed NED awarded a grant of approximately $300,000 in early 2003 to the Center for International Private Enterprise (CIPE), a U.S. based entity and one of four core NED grantees, together with the Center for Dissemination of Economic Information (CEDICE), a Venezuelan organization, for a project titled “Project Consensus to Build a National Agenda”.

Chavez accused those who drafted the plan of being “coup plotters”. CEDICE’s president Rocio Guijarro was one of the initial signors of the a decree enacted during the brief April 2002 opposition dictatorship which dissolved all of Venezuela’s democratic institutions, including the National Assembly, the Supreme Court, the Constitution, the General Attorney and the Public Defender’s office. Several of the individuals and institutions mentioned in the grant as supporters of the project, also supported the brief dictatorial government of April 2002.

The CEDICE project describes the Chavez government as “a dictatorship”, and compares Chavez to Hitler by stating that “The one thing separating the country from full revolutionary control is the fact that the Chavez government was the result of free elections (as was the Nazi regime in its inception)…”

Coordinadora Democratica representative Diego Bautista Urbaneja dismissed Chavez’s comments on the opposition plan saying that “he wasted his time” by dedicating part of his show to it. “Nothing of what he showed has to do with the Consensus Country [plan],” said Urbaneja to a local radio station.

An NED grant was provided for the development of the oppositions government plan. See grant documents at

Urbaneja’s arguments seem to be disputed by the NED grant documents which reveal CEDICE’s links to the Coordinadora Democratica coalition and its close collaboration with the mainstream media: “CEDICE’S Consensus project is being monitored by the committee in the Coordinadora Democratica (Democratic Coordinator) ‘Consensus Country’ responsible for preparing a ‘transition program’ that will be offered to the electorate, and this is scheduled to be ready and approved by all elements of the Coordinadora by mid June.”

The opposition plan presented last Friday is dated Sep 3rd, 2003.

Media and poll company president involved in project

The CEDICE project’s advisory committee included leaders from many of the same groups –banks, media, Catholic Church- that supported the coup efforts in April 2002 and the illegal strike in December 2003-February 2004. Among them are William Echeverria from TV network Radio Caracas Television (RCTV), Mikel De Viana, SJ a Catholic Church representative, Hugo Fonseca Viso, of the Chamber of Commerce FEDECAMARAS, and Jesus Urbieta from the Confederation of Venezuelan Workers (CTV) union federation.

The mainstream media is mentioned as collaborators in the promotion of the opposition’s initiative. See full page at

Among scholars who would participate in forums to promote the plan is Prof. Luis Vicente Leon, the president of the polling company Datanalisis. Datanalisis’ current polls show Chavez losing the upcoming recall referendum by a margin of 15%, in contrast with four other polls that show Chavez winning with a lead as big as 16% over the opposition. Datanalisis has consistently given Chavez unfavorable numbers in its polls, even before he was elected.

Datanalisis president Luis Vicente Leon, was mentioned as a featured speaker at forums to develop and obtain support for the project. See full page at

The impact of the presentation of the opposition’s plan will likely be reflected in new polls to be released in upcoming weeks. The lack of a government plan has been cited by experts as the opposition’s biggest weakness when confronting Chavez.

The plan presented would not necessarily reflect what the particular party that comes to power in an eventual post-Chavez period may want to implement. The Coordinadora Democratica opposition coalition is made up an heterogeneous mix of parties, business organizations, NGOs and political personalities. “The Consensus Country plan was developed within the course of two and a half years, and it went as far as consensus could reach,” said Urbaneja at a press conference when presenting the plan.

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