Venezuela News Summary #67

Venezuela News Summary #67 (Dec. 23- Jan. 1st)

I. Chavez Proposes February 15 for Venezuelan Constitutional Amendment Vote
Two weekends ago, Venezuela’s President Hugo Chavez proposed February 15, 2009, as a possible date for the upcoming referendum to allow his reelection. Chavez’s proposed referendum date “coincides with the date of Simon Bolivar’s 1819 speech given at the newly inaugurated congress at Angostura. Chávez’s opponents have recently cited the speech in reference to Bolivar’s warning against long-time rule by one person. The opposition has named its campaign against the amendment, the “Angostura” campaign. Chávez and his supporters argue that the opposition is taking Bolivar out of context because when he made the comments there were no national popular elections of the president. The proposed constitutional amendment would still guarantee presidential elections once every six years, along with the possibility of a recall referendum halfway through the term. In mid December, Chavez’s supporters delivered more than four and a half million signatures to the National Assembly in support of the elimination of presidential term limits.

Meanwhile, the Venezuelan president warned recently elected opposition politicians aim to mimic government policies in an effort to gain popular support. Chavez advised governors and mayors of his United Socialist Party, PSUV, to beware of the opposition strategy of “pretending, rather than governing.” He said they intend to quote, “infiltrate and sabotage,” the popular social missions implemented by Chavez’s government, and added that they are attempting to quote, “create a platform to threaten Chavez, they aren’t really concerned about the poor.” 

During his first “alo presidente” program since the regional elections, Chavez also made headlines by announcing the expropriation of the “Sambil” mall under construction in central Caracas. He instructed Jorge Rodriguez, mayor of Caracas’s largest municipality, Libertador, to quote, “Expropriate that area and use it to form a school or university.”

II. Venezuelan National Assembly to Investigate Siemens’ Bribery Scandal
In mid December, the Venezuelan National Assembly announced it would investigate bribes that the company Siemens had admittedly delivered to Venezuelan officials. The German-based Siemens is the largest electronics company in the world. On December 15 it agreed to pay over a billion and a half dollars in fines to American and German authorities as a settlement to charges that it routinely used bribes to secure public works contracts in numerous countries. With the settlement, the company avoided a bribery conviction, enabling it to maintain “responsible contractor” status, and to continue to procure public contracts. According to Linda Chatman Thomsen, head of the US Securities and Exchange Commission, Siemens had paid $1.4 billion dollars in bribes to government officials. Siemens Venezuela says that between late 2001 and mid 2007 it paid bribes worth nearly $20 million dollars to Venezuelan officials in exchange for favorable treatment in the assigning of two projects. The projects are presumably the construction of subway lines in Maracaibo and Valencia. The National Assembly has been in discussion about the possible involvement in the bribes of the opposition mayor of Maracaibo, Manuel Rosales. Members of the opposition say it was Venezuelan central government that accepted the bribes.

III. Telecom Sector Grows 24% in Venezuela
Venezuela’s Minister of Telecommunications and Information Technology, Socorro Hernandez, announced a week and a half ago that Venezuela’s telecommunications sector has recently grown by 25 percent. According to Hernandez, the growth of the sector is one of the most commendable accomplishments of the Bolivarian Revolution, and came as a result of the nationalization policies carried out by the Chavez administration. Venezuela’s largest telecommunications company, CANTV, was re-nationalized last year, after it was privatized in 1991 by then-president Carlos Andres Perez. CANTV Vice-president, Franco Silva says that over a million phone land-lines have been installed in the last year and a half, and 150,000 low-income homes now benefit from the new “Solidarity” pricing. Over the same period, CANTV has also added two million cell phones nationwide, making it the national leader in cell phones. Hernandez said “the goal for 2009 is quote “to reach every corner of the country, regardless of social class or location.”

IV. Venezuela’s Economy Grew 4.9 Percent in 2008
Venezuela’s Central Bank announced this Monday that Venezuela’s economy continued to grow for a fifth consecutive year, posting just under 5 percent economic growth in 2008. This month concludes Venezuela’s twentieth consecutive quarter of economic growth, after a severe economic downturn in 2003 caused by an oil industry shutdown in opposition to President Hugo Chavez. According to Economist Mark Weisbrot, of the Washington DC-based, Center for Economic and Policy Research, Venezuela’s growth is unprecidented and the fastest in the region. He also noted that contrary to popular belief, Venezuela’s private sector has grown faster than the public sector, and that the vast majority of growth has been in the non-oil sector of the economy. Venezuela’s Central Bank reported this week that in 2008 the GDP of the oil sector rose 3 percent, while the non-oil sector grew by over 5 percent. Nevertheless, the global economic crisis appears to have also made its mark. Estimates indicate a recent economic deceleration in Venezuela whose GDP grew more than 8 percent in 2007, and dropped this year by more than 35%.

V. Poverty and Inequality Decline in Venezuela
According to the latest stats from Venezuela’s National Institute of Statistics,
Over the last decade, Venezuela’s poverty rate has dropped by half, decreasing from more than half of Venezuela’s population to less than quarter. Extreme poverty is also down from 25% in 2002 to 7% this year. President of the Statistics Insitute, Elias Eljuri, attributed the decrease in poverty to the social programs implemented by the national government. Inequality is also way down. Venezuela registered a social inequality index this year of 0.42, which along with Chile and Costa Rica, is the lowest in Latin America- except for Cuba, who’s inequality index is not measured by the United Nations. According to the United Nations, Venezuela’s human development index is also up. The development index measures quality of life, including life expectancy, education and purchasing power. Venezuela’s index is 61st, higher than 120 countries.

VI. Venezuela’s PDVSA Doubles Natural Gas Production
Venezuela’s state energy company PDVSA announced late last week that its daily output of natural gas has doubled over the past decade from 750 million cubic feet to more than a billion and a half cubic feet per day. The increase is part of a plan by the Chavez administration to increase natural gas consumption to quote, “support petrochemical development and improve people’s quality of life.” Venezuela has the world’s eighth-largest natural gas reserves, estimated at 180 trillion cubic feet.

VII. Venezuela Condemns “Criminal” Israeli Attack
Over the weekend, Venezuela’s Foreign Ministry condemned the Israeli bombing of Gaza, expressing its “profound indignation” over the quote, “criminal attack,” The ministry urged the Israeli government to adhere to the United Nations Charter. The Venezuelan government affirmed its “solidarity with the Palestinian people,” and called for the governments of the world who, quote, “desire peace and justice to raise their voices against this aggression.” A number of world leaders and governments have since criticized the Israeli attacks, including the European Union, Russia, China, and UN Secretary General Ban Ki-Moon. The Israeli bombing caused the death of over 320 Palestinians, including over 50 civilians. In Caracas on Sunday, dozens of protesters rallied outside the Israeli embassy in opposition to what one speaker referred to as “genocide” by the Israeli “occupation forces.” 

VIII. Venezuela Unlikely to Participate in FARC Hostage Mediation
Venezuela will most likely not be participating in the latest FARC hostage exchange. After an announcement by the Colombian guerrilla that it would be willing to free six hostages in exchange for prisoners, Venezuela expressed its readiness to assist logistically and in the mediation, but the Colombian government has ruled out international participation in the issue. Representatives of the FARC contacted Colombian senator Piedad Cordoba via email on December 21, where they announced the release of six hostages and designated Cordoba to receive them. The Colombian senator said she is hoping to establish contact with the FARC through the internet in order to solidify the new exchange. Among the group of six is the ex-governor of Colombia’s Meta state, Alan Jara, ex legislator Sigifredo Lopez, and four members of the security forces whose identities have not yet been revealed. Cordoba had proposed a committee to facilitate the interchange, in which Venezuela, Argentina, and Ecuador could send delegates. She said she hoped Venezuelan president Hugo Chavez could assist, but the Colombian government said that no foreign mediation would be permitted, aside from the Red Cross. Nevertheless, Colombian ex-president, Ernesto Samper, and the Latin American Association for Human rights have urged Colombian President Alvaro Uribe to allow Venezuela, and other South American countries to help contribute to the quick and smooth liberation of the six hostages. Venezuelan foreign minister, Nicolas Maduro said the role that Venezuela would play “would depend on the Colombian government.” He emphasized that Venezuelan participation “in the liberation of FARC hostages in the past has always had the endorsement of the Colombian government.” Cordoba is hoping to meet with Uribe in the first week in January to discuss the hostage exchange.