Op-Ed
Commentary
VenEconomy:
What’s the President afraid of ?
Paradoxically, when, on January 8, President Hugo Chávez
made his announcements that will take Venezuela to a communist-style
totalitarianism where all the power is concentrated in his hands,
rather than strength and confidence, the Head of State demonstrated
considerable weakness and a lack of faith in his own leadership.
On January 8, on the occasion of the swearing-in of his new cabinet,
President Chávez announced the nationalization (i.e. passing
over to the hands of the State) of all companies privatized to
date, starting off this run of absolute control with CANTV.
But the President didn’t stop there, he went even further
in his eagerness for control and, on the pretext of “sovereignty,
national security” and strategic reasons, to which only
he is privy, he will sweep up in the nationalizing boom all the
telephone companies, the companies in the electricity sector (including
La Electricidad de Caracas, an emblem of Venezuelan private enterprise
since its beginnings in 1895), and the Orinoco Belt crude upgraders,
which came into being as mixed enterprises with the participation
of foreign partners. And perhaps the most disconcerting aspect
of these announcements is that they are apparently going to nationalize
the national gas companies founded under the Gaseous Hydrocarbons
Law promoted by President Chávez and approved by Parliament
in 1999. That same year, the Head of State also passed an Investment
Promotion and Protection Law, which stipulates that no legislation
or regulation passed subsequently would be able to alter the basic
terms under which investments were made in Venezuela. The intention
of this law was, precisely, to generate confidence and attract
new investment to the country.
Now, suddenly and in one fell swoop, he is going to change all
the rules of legal certainty on domestic and foreign investors
who have built up productive companies that provide optimum services
and jobs in the interests of taking over more and more power.
Contrary to what it is intended to show, in VenEconomy’s
opinion, this reveals a singular lack of confidence in his leadership.
There is no logical reason whatsoever for undertaking this nationalizing
race, bearing in mind that: a) the Constitution and the laws of
the Republic fully define and demarcate the field of action of
private companies; b) the agencies for correcting and sanctioning
any departure from these laws are under his command; and c) any
unregulated aspect can be corrected immediately in a National
Assembly made up totally of members who support the regime. The
only possible justification would be a total lack of confidence
in his powers of conviction at some future date and his wanting
to grab all the power now so as to avoid the danger of any type
of opposition, from any source.
VenEconomy
is a Venezuela's leading specialized publisher in the economic
and financial area. VenEconomy's Points of View on the issues
of the day, as seen by VenEconomy during the last week. Petroleumworld
does not necessarily share these views.
Editor's
Note: This commentary was originally published by VenEconomy,
on 01/11/2007. Petroleumworld reprint this article in the interest
of our readers.
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News 01/12/07
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