Posted on 05/03/2007 4:56:10 PM PDT by Jean S
Venezuelan President Hugo Chavez threatened Thursday to nationalize the country's largest steel company and private banks unless they make national interests a priority.
In a nationally televised speech, the leftist president said he would nationalize steel maker Sidor if it continued to sell its products abroad instead of selling them to domestic industries, particularly in the oil sector.
He also announced plans for a law to force the private banking sector to give top priority to the financing of domestic companies.
If the banks flout the law, he warned, "they should leave."
The outspoken champion of "21st century socialism" and leader of the world's fifth-largest oil exporter holds the power to rule by decree for 18 months, granted in January by parliament.
Chavez said that Sidor -- a multinational steel maker that makes 60,000 tons of tubes for the oil industry -- "had created a monopoly through its relationships with other companies and they only supply the raw material to these companies, leaving us to import these tubes from China."
"That is unacceptable. If Sidor, which was privatized, does not accept from now on to change this way of operating, then they will force me to nationalize it the same way we did with CANTV," the state telecommunications firm.
Sidor was privatized in 1997 and acquired by the Latin American consortium Orinoquia, which groups Siderar of Argentina, Mexican firms Tenaris Tamsa and Hylsamex, Usiminas of Brazil and Venezuelan firm Sivensa. The Venezuelan state owns 10 percent of its shares.
The leftist governments of Venezuela, Argentina and Brazil are driving an integration process in South America, guided by their shared principles.
"A number of time we have talked about the Sidor case; some urged me to nationalize it, I said that it was Latin American investments, let's talk. There is Argentine, Brazilian capital, let's see if they can behave differently from transnationals," Chavez said.
Chavez said he had instructed his industrial and mining minister, Jose Khan, to come back with a recommendation on the steel sector within 24 hours.
The president dismissed any potential counter-proposals from the companies: "It must be done immediately."
Sidor not only must assure steel supply to Venezuela, it also must do it at "a low price," not the international price, he said.
Chavez's latest nationalization threats came two days after the government finalized control of privately run installations in the Orinoco River basin, possibly the world's richest oil fields.
The key oil move was authorized by a law that obliges transnational companies operating in the vast region to hand over 60 percent of their assets to the Venezuelan state.
After his landslide re-election in December for another six-year term, Chavez, who has been in power since 1999, has stepped up state control of strategic sectors such as oil exploration, electricity and telecommunications.
On Monday Chavez announced he was withdrawing Venezuela from the International Monetary Fund and the World Bank, calling them "tools of imperialism" to exploit poor countries.
Chavez warned banks Thursday they were expected to support his program.
"I invite the private banking sector to join in this effort. In any case, we are preparing a law to oblige them to do it, in case they refuse," Chavez said.
"If private banks don't want to be involved, then they should leave."
My wife has a good friend who married into a wealthy Venezuelan family that made pharmaceuticals. I’ll bet they took their money out of the country as soon as it was clear that Chauvez would win. Within 5 years Venezuela will be in financial trouble because NOBODY is going to invest in a country where your property can be stolen by the government without notice.
P.S. And he will blame the US, of course.
I gather you left Spanaway. Did you move north or south?
South. I’m closer to the volcano now. =)
When Fox covered this today, why on Earth did they call it Socialist and not Communist? What are they afraid of?
To me, its more facist. Communists are into the complete ownership of property, where facists will let you own the property, but they control the functioning of the company. In most of this nationalization movement, Chavez doesn't seem to be taking the whole company, but just the majority ownership, and therefore control of the operation of the companies.
This country should have listened to Pat Robertsons’ diagnosis and prescription for Chavez.
“should have listened to Pat Robertsons’ diagnosis”
Yup. I think only the Israelis are willing to do that in the cause of freedom. We sit back and sell the rope to guys like chavez.
Where are the Contras when you need them?
This whacko is single-handedly destroying a nation. Mugabe would be proud.
Who is John Galt http://en.wikipedia.org/wiki/John_Galt_%28Atlas_Shrugged%29
In a way like a hurricane that comes through and destroys everything or like a flood...there is a renewal/restoration of faith in capitalism when the scum goes away.
Nice.
What about all the money they lend out to businesses, homeowners, credit cards, etc.?
For that matter, how do you collect payments from a company that just got Chavezed? I sincerly doubt he would make payments to a bank that held a mortgage on a business he just stole, especially if they had just fled the country.
And for homeowners, do they get kicked out of the house that Chavez now owns, does their car become a government vehicle? How would anyone provide proof of ownership if the titles are on a container ship?
So far Chavez has done a lot of taking, and no giving, unless you count discounts on heating fuel for poor Americans...that'll make a warm spot in the hearts of his victims, lol.
“So far Chavez has done a lot of taking, and no giving, unless you count discounts on heating fuel for poor Americans...that’ll make a warm spot in the hearts of his victims, lol.”
I think the US Congress needs to make the immediate move that any American investments in Venezuela will not be compensated for by the US Govt and losses there can not be written off against taxes. That way the US taxpayers won’t have to foot the bill for any American, or American company, that stupidly continues to invest there.
“That way the US taxpayers won’t have to foot the bill for any American, or American company, that stupidly continues to invest there.”
I could be wrong but I doubt hardly anyone is CONTINUING to invest there, but the issue is that there are long-term projects and investments that were bought/started before chavez came to power or early in his reign that some companies are just stuck with. The oils are a good example of this, at this point I think they are just trying to keep running as long as possible before he kicks them out totally to try to recover as much from their investment as possible.
"Thanks for getting my wood split, next week I'll call in about your garden", said the neighbor.
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus
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