Re: Re: Chavez?

[Louis Proyect <lnp3@xxxxxxxxx>]

On Sun, 14 Apr 2002 09:17:16 -0700, michael pugliese wrote:
>
>Hugo Chávez, who has won a new mandate at the
>July elections, has engaged in a series of
>sweeping reforms since his triumphant election
>as president of Venezuela in 1998: Congress has
>been dissolved and a new constitution approved.
>But despite a spectacular increase in oil
>revenue, he has failed to remedy serious
>economic and social problems, and observers
>wonder if his current populism may not
>degenerate into despotism.
>
>by GABRIEL GARCIA MARQUEZ


Actually, the conflict with the oil union arose over Chavez's
determination to clean house at the state-owned company. He accused
executives of owning luxurious chalets in the Venezuelan Andes and
other excesses and has said the company's costs must be cut and its
benefits spread to the 80 percent of Venezuelans who live in poverty.

On April 7th the Washington Post reported that Chavez had installed a
board of directors loyal to him and named a leftist economist, Gaston
Parra, as president. Parra had criticized company policies for two
decades. Company executives were outraged by the moves. Hundreds of
managers demanded that the appointments be rescinded, arguing that
Chavez's changes were based on politics rather than merit.

Of course they were based on politics. He is a left-populist friendly
to Marxism, while the oil union and teachers union spearheading the
CIA-backed coup are rightwing social democrats.

Here's how an energy trade publication sized things up. Much more
reliable an assessment than that coming from magical realism
quarters:

Energy Day, February 14, 2002
Venezuela oil fears as Chavez ousts Lameda

By Amy McLellan

Fears that Venezuelan oil policy could make a further swing to the
political left grew at the weekend with news that state-run Petroleos
de Venezuela has a new boss - the fourth in just over three years.

President Hugo Chavez ousted General Guaicaipuro Lameda - regarded as
a capable manager by many in the industry and a critic of the new and
unpopular hydrocarbons law - and replaced him with central bank
economist Gaston Parra.

"Mr Parra has no oil industry experience," said Alejandro Bertuol, a
New York-based analyst with ratings agency Fitch. "He helped draft
the nationalisation law in the 1970s and he has followed the industry
from an academic point of view but he has no operational experience."
The move came amid deepening political uncertainty in the country,
forcing Mr Chavez to deny any risk of a military coup after Colonel
Pedro Soto last week called on the army to defy the president and his
"tyrannical government".

"This generates additional uncertainty for the oil industry," said Mr
Bertuol. "PdVSA needs continuity to reinforce confidence in its
operations and long-term strategies, given the overall uncertainty in
the wider Venezuelan environment. This high rotation at the top does
not help."

Foreign oil companies have made multi-billion dollar investments in
Venezuela in partnership with PdVSA, with the likes of Conoco
investing Dollars 2.5bn in the Petrozuato heavy oil project.

TotalFinaElf, Statoil, ExxonMobil and ChevronTexaco are also big
dollar investors in the country.

Declan Ryan, regional analyst with oil and gas consultancy Wood
Mackenzie, said: "Stability at the top of PdVSA is a key issue, given
that there is already a lot of political instability in Venezuela at
the moment.

"A stable political environment is critical for these guys (the
foreign oil companies) because they have invested billions of dollars
for the long term."

--
Louis Proyect, lnp3@xxxxxxxxx on 04/14/2002

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