Venezuela seizes cement plants in socialist drive

[jetsetter]

Venezuela seizes cement plants in socialist drive
Tue Aug 19, 2008 6:49pm EDT
By Enrique Andres Pretel

GUANTA, Venezuela (Reuters) - Venezuelan soldiers and workers seized foreign-owned cement plants on Tuesday, a show of strength as President Hugo Chavez advances a plan to make South America's top oil exporter a socialist state.

Workers and soldiers poured into the plants alongside government officials as Venezuela took control of installations belonging to Mexican giant Cemex on the stroke of midnight after failing to reach a deal in cement nationalization talks.

Chavez, who has said he intends to build a state-planned socialist economy, has taken oil and telephone companies from private owners and is buying a large Spanish-owned bank and a steel company.

"Their time is up and they move into the hands of the state," Chavez said at a political rally late on Monday. "These are all steps towards socialism."

Despite losing a referendum last year that would have given him wider scope to remake the economy, the former paratrooper used decree powers to pass a package of laws in July granting the state greater powers to intervene in sectors such as food.

At Cemex's main Venezuelan plant in Pertigalete on the Caribbean coast, government supporters sang the national anthem and waved the country's yellow, blue and red flag. The plant was still operating.

Some wore shirts bearing the slogan "Now the cement is everyone's." State television showed supporters at another plant holding up the flag of Venezuela's communist party.

"Now the cement we produce will not make millionaires of some far-away men, it will be used for our houses, our infrastructure, our national development plan," said Energy Minister Rafael Ramirez, charged with overseeing the takeover, before dancing workers clad in red shirts.

The move against Cemex will further chill the investment environment in Venezuela, where companies enjoy fast growth from a consumer boom but face heavy regulations on prices and frequent government takeover threats.

KEY ELECTIONS

As part of the cement nationalization, Venezuela struck deals to buy majority shares in the local operations of European cement makers Holcim and Lafarge, following a pattern of usually compensating takeover targets well. But the government said Cemex was asking for too much.

Shares of Cemex on the Mexico stock exchange fell 2.83 percent on the news.

Venezuela says Cemex wanted about $1.3 billion for its local division, but on Tuesday said the company would now be lucky to get $400 million. Mexican diplomats formally asked Venezuela to restart talks with Cemex.

Chavez wants the cement companies, as well as a major steel plant he is buying from an Argentine group, to help quell criticism he has failed to meet home-building goals.

After nearly 10 years on office, Chavez also has an eye on key local elections in November, where his coalition's control of most states and cities will likely erode as voters fed up with crime and corruption turn to other parties or abstain.

The one-time coup leader has long won elections because of support for his sharing of oil wealth among the majority poor.

Workers at the Pertigalete plant on Tuesday shouted: "That's the way to govern," reflecting the popularity of nationalizations among many Venezuelans.

Others are unsure the state will run the companies well.

"Many of us have been waiting nervously for the nationalization," said Reinaldo Hernandez, a machinist at Cemex for nine years. "We don't know how things will work out."

Oil Minister Ramirez said the three private cement companies now moving into government hands would be merged into one operation controlling almost all of the sector.

He said the merger would reduce costs and increase efficiency, despite oil state Venezuela's history of bloated, poorly run government enterprises.

http://www.reuters.com/article/world...25911020080819

I was wondering why Chavez thought this was a good idea given the poor track record of the nationalization of business, then I remembered that he is a crazy SOB.

[teeb]

Originally Posted by jetsetter

I was wondering why Chavez thought this was a good idea given the poor track record of the nationalization of business, then I remembered that he is a crazy SOB.

Denationalization of businesses isn't exactly a cup of tea either; just ask British Rail.

As part of the cement nationalization, Venezuela struck deals to buy majority shares in the local operations of European cement makers Holcim and Lafarge, following a pattern of usually compensating takeover targets well. But the government said Cemex was asking for too much.

So you just seize it? That doesn't sound quite right.


I agree with jetsetter (unusually). Each piece of news coming from Venezuela worries me a little bit more. Although I can't argue with his policy of giving oil earnings to the poor; I can with the way Chavez goes about things.

I'd never thought of cement as a very valuable resource, although now that I think about it it must be, as building can't be done without it.

[jayhawk]

commies love concrete!

[Cobol74]

Nationalise by all means, after all it their country, but the government must always give the beneficial owners (i.e. the stock/share holders) an equitable price for their holdings. Its not like he is not rolling in petro-dollars and can not afford it now is it?

Whether this is good for Venuezla is quite another matter. Nationalisation without restitution can lead to wars, remember Egypt and the Canal company in the 1950s.

[anti-net]

I'm always surprised how people think Chavez is like a threat, he's not a Fidel, he's not going to come over and convert the US to Socialism any time soon

and its fine because Nationalizing everything works......for about 5 minutes, so Venezuela will properly hit problems, but hopefully the divide between the Working class and upper class will be reduced and the poor will get some housing.

Or it'll run out of money and people will be even more worse...good luck to them!

[phuckingduck]

Originally Posted by jayhawk

commies love concrete!

Just as with other things, they do wonderful things with their beloved concrete too! Pyongyang Hotel...

[73GMCSprint]

Originally Posted by anti-net

I'm always surprised how people think Chavez is like a threat, he's not a Fidel, he's not going to come over and convert the US to Socialism any time soon

And you think he doesn't want to?

[efoolution]

Originally Posted by phuckingduck

Just as with other things, they do wonderful things with their beloved concrete too! Pyongyang Hotel...

Wiki sayz:

Esquire dubbed it "The Worst Building in the History of Mankind" and noted that the government of North Korea has airbrushed the building out of pictures. The Christian Science Monitor called it "one of the most expensive white elephants in history".[2] Over the years, the skyscraper has earned such nicknames as the "Hotel of Doom," "Phantom Hotel," and "Phantom Pyramid."[3] Construction began in 1987 and ceased in 1992, due to the government's financial difficulties. The unfinished hotel remained untouched until April 2008, when construction resumed after being inactive 16 years.

The basic structure is complete, but no windows, fixtures, or fittings were installed when construction came to a halt in 1992, and it has never been certified safe for occupancy. The cement originally used to build the hotel was of substandard quality, and at one point, according to ABC News, it was actually crumbling

look! a 330 m (1,083 ft) high building without windows for over 15 years

What a huge load of different sorts of concrete related fail ...

[Luca]

Trailer:

+ YouTube Video

torrent

[Censport]

Maxine Waters must be so proud...

Originally Posted by anti-net

I'm always surprised how people think Chavez is like a threat, he's not a Fidel, he's not going to come over and convert the US to Socialism any time soon

He doesn't have to, George Soros is already on the job. He's got plenty of help from tens (if not hundreds) of thousands of public school teachers, college professors, media journalists, DNC politicians...

[teeb]

London's recently-ex-mayor appears to disagree with the anti-Chavez sentiments...link

There are some countries whose reality is distorted by sections of the media. And some about which straightforward lies are written. My first trip to Caracas revealed Venezuela to be firmly in the second category.

The idea that this country is a dictatorship is ridiculous – probably some of those assiduously promoting it have difficulty in keeping a straight face. Some "dictatorship" where the president accepts the loss of a referendum to change the constitution, which holds more national elections than virtually any other country in the world, and where walls and lamp-posts in areas of Caracas are vividly festooned with posters of anti-Chávez candidates. No, a dictatorship is a country like Saudi Arabia – whose leader is of course officially feted on visits to London.

Attending a meeting with pro-Chávez candidates for the forthcoming local government elections in the capital, there was very definitely no certainty of success – as with the recent constitutional referendum, defeat was possible. The discussion, as with any local election in Britain, was how to address practical issues affecting peoples' quality of life.

Caracas showed visibly the problems the country faces and progress made in recent years. In west central districts the houses of the old elite and upper-middle class are better than the most upmarket London suburb. They are surrounded by several million people living in poverty in "barrios" – rough-built slums perched on the side of mountains without basic facilities. These areas were not even marked on the maps under previous administrations!

This is the product of a system where tens of billions of dollars of oil wealth each year were sent abroad to serve this elite without addressing the most elementary questions of quality of life of the majority of people.

That has changed. A trip to one of many new community facilities showed how millions of people have been given access to a new free healthcare system, including dentistry. Illiteracy has been eliminated to Unesco standards. Further education is being rapidly expanded.

A top priority now is to transform the basic infrastructure throughout the city. So that, as mayoral candidates put it to me, people feel like citizens with a stake in their neighbourhoods.

The keys are reducing crime and transforming the city's economic efficiency and quality of life.

A remarkable programme of expansion of tube and rail lines in poor areas has begun. Alongside this it is necessary to tackle congestion, improve bus services, develop community policing, tackle waste and environmental protection.

Venezuela always had the resources, and now has the political will, to begin to raise its cities to world-class standards. But it needs expertise to do this effectively and rapidly.

That is where London's experience helps. Between 2000 and 2008 London was recognised as the most successful city of its size in world and transformed its bus services, put the police back into local communities, tackled traffic congestion and won the Olympics.

That experience is now sought by very many other cities – including Caracas. It is why President Chávez invited me to Venezuela and why, together with other cities, I am pleased to continue the programme of advice and discussion between London and Venezuela.