Monday, June 30, 2008

Venezuela's Chavez Reiterates Threats To Expel EU Companies

President Hugo Chavez on Monday reiterated threats to expel European Union companies doing business in Venezuela because of tough new immigration rules imposed by the E.U. Chavez, who is in Argentina attending a meeting of the regional trade group Southern Cone Common Market, known as Mercosur, said in comments broadcast by Venezuelan state television that E.U. companies operating in the oil, banking and other economic sectors 'would have to be asked to leave' if the E.U. went ahead and applied the new immigration rules. Chavez threatened on June 19 to expel EU companies doing business in Venezuela and warned that he could shut oil sales to Europe because of the new immigration policy. The new E.U. immigration rules allow for illegal immigrants to be held in detention centers for up to 18 months before being deported. The new measure is likely to affect Latin American illegal immigrants in Europe.

Venezuelan "Catholic" sect seen as creation of Chavez

A spokesman for the Venezuelan bishops' conference has denounced the formation of a new religious sect called the Reform Catholic Venezuelan Church, which has pledged its support for the country's President Hugo Chavez. Archbishop Roberto Lückert Leon of Coro, the vice-president of the Venezuelan episcopal conference, told El Nuevo Herald that the new sect is 'a parallel church that Chavez has created.' The group is being subsidized by contributions from Venezuela's state-owned oil company, the archbishop said, and is recruiting priests who have been disciplined by their own bishops because of 'scandalous' behavior. The Reform Catholic Venezuelan Church does not require priests to be celibate. The group also allows divorce, and proclaims that 'homosexuality and bisexuality are not sins in and of themselves.' But the sect is uncompromising on one issue: 'We completely support the socialist project led by Chavez,' announced one of the group's leaders.

Venezuelan President Hugo Chavez was personally involved in covering up his nation's role in an Argentine election scandal

Venezuelan President Hugo Chavez was personally involved in covering up his nation's role in an Argentine election scandal, according to an FBI statement by a Venezuelan witness who may testify at a criminal trial in Miami. The witness, Franklin Duran, faces trial on U.S. charges he acted as an unregistered agent of Chavez's government. Duran conspired to silence a Florida businessman who toted $800,000 in a suitcase from Caracas to Buenos Aires, according to U.S. prosecutors. The American government alleged the cash, seized Aug. 4, was intended for the campaign of Cristina Fernandez de Kirchner, who was elected Argentina's president Oct. 28. Duran, 40, was arrested Dec. 11 with two other Venezuelans, Carlos Kauffmann and Moises Maionica. Kauffmann and Maionica pleaded guilty and said in court that their country's intelligence agency, known as DISIP, played a central role in the cover-up of the alleged payment. In papers filed June 27, Duran said Kauffmann directly implicated Chavez in an FBI statement.

Venezuela Dollar Bonds Gain on Renewed Debt Buyback Speculation

Venezuelan bonds rose, with yields relative to Treasuries narrowing the most in two weeks, on speculation the government will buy back debt. The extra yield investors demand to own developing-nation debt rather than U.S. Treasuries shrank 18 basis points, the most since June 10, to 5.98 percentage points at 3:18 a.m. New York time, according to JPMorgan Chase & Co.'s EMBI Plus index. One basis point equals 0.01 percentage point. The so-called spread swelled 48 basis points last week. Venezuela is ``studying'' plans to buy back some of its international bonds, Finance Minister Ali Rodriguez told reporters in Caracas on June 27. Speculation the government would go through with the buyback had faded in recent days. A government official familiar with the plans said in late May that Venezuela may buy back debt in a series of private purchases. ``Maybe people were giving up on buyback,'' said Igor Arsenin, an emerging-market fixed-income strategist at Credit Suisse Group in New York. ``Now they have some indication that they might do it.''

Less Venezuelan oil going to US, more to China

U.S. imports of Venezuelan oil fell 11.7 percent during the first four months of the year compared to the same period in 2007, the U.S. government said Monday. Independent analysts said the fall could be due to stagnating Venezuelan oil production, lower overall U.S. crude imports and Venezuela's attempts to diversify its market by selling more to China and other countries. The figures released by the U.S. Energy Information Administration showed U.S. imports of crude oil and petroleum products from Venezuela declined to an average of 1.1 million barrels per day in the first four months of 2008 from just under 1.3 million barrels a day in the same period last year. The new figure is its lowest for any four-month period since a 2002-2003 oil strike paralyzed Venezuela's economy. State oil company Petroleos de Venezuela SA says it is producing 3.2 million barrels a day, while the Paris-based International Energy Administration puts Venezuela's production at around 2.4.

Venezuelans revel in costly petrol subsidy

Sipping a cool midday beer on the banks of the mighty Orinoco river, Antonio frowns with distaste as he reminisces about the days when he used to work hard for a living. With international oil prices soaring and domestic petrol among the most heavily subsidised in the world, he ditched his job at a remote jungle gold mine in southern Venezuela to sell petrol illegally across the river in Colombia. “Being a miner was tough,” explains Antonio, as he takes another slug of beer, adding that most of his fellow workers reached the same conclusion. The gold mine is now abandoned.
“Why bother when you can earn more and work far less by buying petrol for next to nothing here and selling it for good money just on the other side of this river? Of course, it helps that the national guard turn a blind eye for a cut.” Such incentives to smuggle petrol mean the practice is rife in most border areas – locals even say that Farc, the Colombian Marxist guerilla group, is profiting handsomely from petrol contraband in the area. Venezuelans pay just 3 to 4 cents for a litre of petrol. A tank can be filled for as little as $1.50.

Fred Cederholm: July 4th is supposed to be a celebration of American Independence...

VHeadline commentarist and money market specialist Fred Cederholm writes: About the forthcoming July 4 holiday (USA), the April 2008 US trade numbers/ our trade deficits, the April 2008 energy numbers/our energy deficits, and observances... Official numbers for our trade deficits, cumulative trade deficit(s) for the calendar year thus far, and our energy import sources for this past April were released a week ago. The results and implications for US/us were actually both startling and depressing.

You see four years ago (on June 29, 2004), I wrote a column about the forthcoming July 4th holiday and how it is supposed to be a celebration of American Independence.

In objectively looking at the US situation I chronicled how much we “were” depending on foreign imported goods, foreign energy sources, and foreign money to keep the good old American economy chugging along. I had growing reservations about whether we are still the "land of the free," in the sense that the freedom of our choices and actions were more and more governed by our dependencies. When you are "dependent," the options that are open to you to choose from become constrained and colored by the very nature of the dependency. Moving ahead four years (and 208 weekly columns) later, it appears this sorry situation has not corrected itself one bit. Things are still as dire for US/ us -- or worse.

Our eight largest trade deficits for the month of April 2008 (and 2008 year to date) are as follows: China $20.239 billion ($74.984 billion YTD), Canada $7.611 billion, ($26.409 billion YTD), Japan $7.562 billion ($28.521 billion YTD), Mexico $6.824 billion ($23.437 billion YTD), Germany $4.438 billion ($15.246 billion YTD), Saudi Arabia $3.406 billion ($12.995 billion YTD), Nigeria $3.382 billion ($12.962 billion YTD), and Venezuela $2.983 billion ($11.757 billion YTD).

Our hands-down overall biggest dollar denominated imports are for crude oil and petroleum distillates -- note that our first, third, and fifth largest deficits are with countries who sell us no energy related products what-so-ever. Our trade surpluses grew by a record $5 billion in April 2008, but our trade deficits grew by a record $9.4 billion for the month! April imports of crude oil ($29.3 billion) and the April average price per barrel of crude oil ($96.81) were records as well.

The top eight sources of Uncle $ugar’s crude oil imports for April 2008 were: Canada (1.952 million barrels per DAY--MBPD) up 8.7% over March, Saudi Arabia (1.453 MBPD) down 5.3%, Mexico (1.259 MBPD) up 2.2%, Nigeria (1.115 MBPD) down 3.4%, Venezuela (1.019 MBPD) up 18.8%, Iraq (0.679 MBPD) down 12.2%, Angola (0.5.79 MBPD) up 50.8%, and Algeria (0.393 MBPD) up 59.1%. Uncle $ugar’s top eight sources of total petroleum imports for April 2008 were: Canada (2.476 MILLION barrels per DAY--MBPD) down 2.6%, Saudi Arabia (1.462 MBPD) down 5.2%, Mexico (1.357 MBPD) no change, Nigeria (1.214 MBPD) up 3.4%, Venezuela (1.176 MBPD) up 13.8%, Iraq (0.679 MBPD) down 12.2%, Algeria (0.628 MBPD) up 42.4%, and Angola (0.591 MBPD) up 52.3%. Crude imports averaged 9.921 MBPD. While the average April price was a record at $96.81, it should be noted that the Monday, June 30 pricing was approaching $143. Domestic energy consumption may be contracting, but the continued erosion of the purchasing power of the US dollar relative to other currencies gives the “appearance” of our spending more.

I’m very much looking forward to the July 4 observances in my little home community where we are having our first “make your own parade” featuring kids, adults, bikes, wagons, and pets “people powering themselves” down Main Street. There'll be patriotic singing and readings by the fire station with hot dogs, chips, and lemonade. Later… the holiday observances will continue with a concert and fireworks.

Happy 232nd Birthday, America! May you finally address your “dependencies” and have many more.

Fred Cederholm


Venezuela is facing the most difficult period of its history with honest reporters crippled by sectarianism on top of rampant corruption within the administration and beyond, aided and abetted by criminal forces in the US and Spanish governments which cannot accept the sovereignty of the Venezuelan people to decide over their own future.

Patrick J. O'Donoghue's round up of news from Venezuela -- June 30, 2008

Venezuelan Air Force (FAV) C-i-C, General Luis Jose Berroteran reveals that when he received office in 2007, only 25% of the fleet was operative and that today because of the government's re-impulse policy the percentage has now risen to around 50%. The General announces that the FAV is waiting for 4 more Sukhoi-30 Russian fighter planes to complete the first fleet of 24 units purchased from Russia. The government is studying the possibility of acquiring more sophisticated planes, such as the Sukhoi-35. Berroteran adds that Russia and China are training Venezuelan military personnel to manage the recent arm systems purchased as part of a technological transfer agreement. On July 7, 83 members of the air force will graduate to the rank of second Lt.

Services & Commerce Confederation (Consecomercio) president, Nelson Maldonado claims that the business sector is languishing under aggressive and fierce state capitalism. The 10 years of Bolivarian rule, Maldonado states, has ruined Venezuelan's productive and marketing system. Speaking at the 38th annual assembly of the Confederation, Maldonado urges the government to rectify its economic policies, which, he proclaims, are inspired by a model of "Communist insinuation." The businessman says the government has rectified before and points to the elimination of the financial transactions tax as one example but more must be done, he maintains, such as rectifying exchange-rate control policies. In the openly hostile and unexpected attack, Maldonado argues that attempts to ignore market logic and substitute it with centralized planning has always failed and has led to "economic tyranny and social poverty."

The National Assembly (AN) will be working against the clock to complete and pass 30 laws within the framework of the Enabling Law, which ends on August 15. House president, Cilia Flores says parliament will try to pass all the laws before the deadline. According to Flores, the majority of laws need only a second debate to be passed. For his part, House defense & security committee president, Rafael Gil Barrios points out that the law against kidnapping and extortion is almost ready for discussion in plenary session.

Communication & Information (Minci) Minister Andres Izarra has announced that 31 community radio stations will shortly take to the airwaves as part of the government's push to democratize communication. In February, Izarra recalls, the governments gave credits to community media and made a commitment to install 23 stations. At the moment, there are 28 community stations that are ready for installation and should be on the airwaves today. The Minister reports that a document has been drawn up to give structure to alternative and community media so they can work organically, adding that the system should not be seen as an imposition from the government or the State because he argues that the document is a product of meetings between the government sector and the alternative media over the last couple of months.

The National Union of Workers (UNT) has been answering a challenge launched by Las Ultimas Noticias editor, Eleazar Diaz Rangel who criticized a communique from leaders of the trade union organisation rejecting President Chavez' call to the business sector to set up an alliance. What irks the trade union leaders is the editor's reference that the extreme left were responsible for the coup against Chilean President Salvador Allende in 1973. According to UNT national coordinator, Stalin Perez Borges, Diaz Rangel has distorted the reality of the Chilean historical process, letting the real coupsters off the hook and ignoring the Allende government's own vacillations. The UNT leaders have declared that President Chavez should undertake an alliance with the people and workers and not with the treacherous business sector. Chavez himself has used the same argument to attack what he considers undisciplined and extreme left sectors of the Bolivarian movement especially in the 23 de Enero district of Caracas. The UNT has announced that he will continue to function as a union central, despite desertion by many members and groups to form the Bolivarian trade union central currently in the stage of construction.

Patrick J. O'Donoghue

Deadline for completing State takeover of Ternium-Sidor falls due today ... still far part on compensation

Caracas Daily Journal (Jeremy Morgan): The deadline for completing the state takeover of steelmaker Ternium-Sidor falls due today, amid speculation the two sides are still far apart on compensation. If that's the case -- and President Hugo Chavez sticks to his word -- the next step would seem to be outright nationalization.

The biggest shareholder in Ternium-Sidor is Argentine engineering group Techint, with 60 percent. Chavez wants the State, which already has 20 percent, to have a minimum 60 percent.

With employees and retirees holding 20 percent, that implies Techint handing over 40 percent. At issue is how much it gets in compensation. Ternium-Sidor's book value was $2.758 billion at the end of 2007, but Techint's initial demand was $4 billion in market value. Chavez opened with a meager $800 million, vowing he wouldn't pay more although Techint could stay on in a minority.

However, both sides are said to have budged, with Techint coming down to $2.4 billion. The government went to $1.6 billion -- but for 50 percent, leaving Techint with just 10 percent.

Opposition moves forward ... nominations for eight governors agreed, elsewhere still to be settled

Caracas Daily Journal (Jeremy Morgan): More than five months after eight mainstream opposition parties signing an accord to pick single unity candidates for November's regional elections, they've made progress in eight states but still have much do before the deadline for electoral registration in mid-August.

The impetus for making decisions is said to have come from Un Nuevo Tiempo, the party built around opposition Zulia State Governor Manuel Rosales. UNT party President Omar Barbozo has said the opposition will have its full list ready by July 15.

Among the single nominations already agreed, former Carabobo state governor Henrique Salas Feo will run for Proyecto Venezuela, a local party founded by his father. Other reportedly agreed candidates are independent Roberto Smith for state governor in Vargas, Enrique Catalan of UNT in Trujillo, and Eduardo Morales Gil of the erstwhile pro-government but now opposition social democratic party, Podemos, in Sucre.

Accion Democratica (AD) is said to have secured its candidates in Cojedes and Monagas states, while its old Social Christian rivals at Copei will run Victor Cedeno for governor of Delta Amacuro. Nueva Esparta is also said to have been settled. But at state level, that's just about as far as it gets. Comptroller General Clodosbaldo Russian's ban on 386 potential candidates running for office has inevitably complicated matters.

The opposition's still struggling between sticking with barred nominees, or standing them down to pick someone else -- to which the answer is they might get banned, too. William Mendez of Primero Justicia hopes to run for governor in Tachira state but he's banned. He faces competition from Copei Secretary General Cesar Perez, who's said to have problems in his own back yard.

In Miranda state, former governor Enrique Mendoza of Copei wants his old job back but he's banned, too. Baruta Mayor Henrique Capriles Radonski of Primero Justicia is pushing himself as the opposition's alternative.

Similarly, at municipal level, time was when Chacao Municipal Mayor Leopoldo Lopez looked a shoe-in to run for Metropolitan Mayor. But he's on Russian's list, and three contenders who aren't say they've got a case: Antonio Ledezma (who's been city chief before) of Alianza Bravo Pueblo, backed by AD; Ismael Garcia of Podemos; and independent Augusto Uribe.

In other contests for a crack at governor, UNT is head-to-head with Copei in Zulia and Falcon, AD in Barinas (President Hugo Chavez' home state), and Podemos in Aragua. In Apure state, it looks like the old days with AD and Copei at each other for nomination for governor; MAS, which gave way to Gerardo Blyde in the race for mayor of Baruta, is up against independents for governor in Guarico and Portuguesa states.

Caracas Daily Journal News Briefs -- Monday, June 30, 2008

The government has questioned proposals put forward by Cemex, the Mexican cement giant whose Venezuelan operations are being taken over by the state, on the choice of who should audit the value of those assets for purposes of compensation. At issue, it's said, is a string of supposed doubts about the sale of interests Cemex Venezuela held in Panama, Guadalupe, and Trinidad and Tobago.

Enrique Naime of the Social Christian opposition party Copei, claimed that the ruling United Socialist Party of Venezuela (PSUV) "hadn't paid a cent" in fees to the National Electoral Council (CNE) for assistance it provided during the party's primary elections for regional election candidates on June 1. Naime said he expected responses from the CNE, the scientific and investigative police, Cicp, and the Attorney General's Office.

Air Force Commander Luis Jose Berroterán Acosta said that the fleet of operational aircraft had been doubled last year, although it was still short of 100 percent capacity. The fleet had only been 25 percent operational when he took up office in 2007, and this figure had been raised to "about" 50 percent, he claimed, as reported by the newspaper El Universal on Sunday.

There was no regular Sunday broadcast by President Hugo Chavez this weekend, perhaps to the relief of some reporters who have to hang on every word to make sure they don't miss something that's new. Officials said Alo Presidente had been ceded in support of a volleyball match between Venezuela and Brazil, which was due to start at the Poliedro in Caracas at 2:30 in the afternoon. Cynical minds suspected that the no-show might have had more to do with the parallel football clash on television between Spain and Germany in the Euro Cup. In other words, folks might have switched over in large numbers.

Foundation stone of any fair system of justice seems to have been absent in the Russian ban

Caracas Daily Journal (Jeremy Morgan): A logjam of legislative work is piling up at the National Assembly (AN), and is likely to get bigger when the Enabling Law granting President Hugo Chávez special powers expires on July 31. AN president Cilia Flores says the Assembly won’t extend the Enabling Law.

Chavez has used his special powers extensively during the 17 months the Enabling Law has been in force. One law created the "strong" Bolivar Fuerte at the turn of the year. Another converted food hoarding and "speculation" into criminal offenses punishable with prison.

Most famously, earlier this month Chavez signed a law on the secret services only to veto it just days later. Perhaps he’d reached for his pen without thoroughly reading the intelligence law, widely thought to have been the work of Interior and Justice Minister Ramon Rodriguez Chacin. The law reorganized the intelligence community with the stated intention of doing away with two of them -- the state security service, Disip, and the military intelligence directorate, DIM. But it was Article 16 that caught the eye. This legally obliged people to inform on anyone who seemed to be acting or speaking against the security of the state, and was quickly seen as writ for snoopers and snitches.

The ink was barely dry when Chavez’ took to the airwaves on June 10 to denounce "disastrous" parts of the law which were not going to happen while he was around, vetoed the law and called on the Assembly for alternative legislation. Just how high up the legislative agenda this now is remains unclear. It’s said the plan won’t be resurrected until next year, by when Rodriguez Chacin maybe won’t be around any more.

Be that as it may, AN deputies have no shortage of things to do. The interior policy committee -- first port of call for Intelligence Law Mark II -- is looking at a reform of the Organic Penal Process Code aimed at speeding up court proceedings. Deputy Tulio Jimenez says this should go to a second debate and vote in the chamber this week.

Waiting in the wings are new laws on banks and other financial institutions; insurance and re-insurance; profits tax; the Organic Tax Code, and overturning the National Public Treasury Law because it’s "distorting" the national accounts.

All this time, the question has been why Chavez needed special powers in the first place, given his overwhelming majority in the legislature. The answer may be legislators’ tendency to fiddle with lesser items instead of the heavy stuff. Last week, for instance, they not only took time out to back the Russian ban on 386 aspirant election candidates, an issue for the courts, but also to make the rather meaningless gesture of declaring 2008 the Year of Salvador Allende, the Marxist president of Chile who died during a coup d’etat 35 years ago.

Meeting between Uruguay Foreign Minister and Venezuela's Nicolas Maduro was abruptly suspended

Caracas Daily Journal (Jeremy Morgan): A meeting between Foreign Ministers Gonzalo Fernandez of Uruguay and Nicolas Maduro of Venezuela was set for Sunday but abruptly suspended, apparently at Montevideo’s behest.

Officially, the meeting was called off for "reasons of agenda," according to the Uruguayan Foreign Ministry. And, anyway, it was said, the two would meet at the Mercosur summit in Tucuman, Argentina, today and Tuesday, which Venezuela has been invited to attend.

But it was also noted that Uruguayan Industry and Energy Minister Daniel Martinez last week said a contract for a refinery project would be put out to tender and not directly awarded to state oil corporation Petroleos de Venezuela (PDVSA), as had been stated in Caracas.

That is said to have prompted PDVSA into not having anything more to do with the project. Reports also say that Uruguayan President Tabare Vazquez has doubts about the suitcase of cash Guido Antonini Wilson allegedly tried to take to Argentina from Venezuela. President Hugo Chavez is said to have accused fellow leftist Vazquez of "flirting" with the Bush Administration.

Archbishop claims creation of a "reformed" Catholic Church could cost Chavez votes in November elections

Caracas Daily Journal (Jeremy Morgan): The vice president of the Venezuelan Episcopal Conference, Archbishop Roberto Luckert of Coro, claimed that the government intended to back the creation of a "reformed" Catholic Church, warning this could cost it votes at the elections scheduled for November 23.

"I understand that this government doesn’t even accept what’s called the philosophy of history because what they’re trying to do failed in history," Luckert was reported to have said on Friday.

Luckert’s claims and complaints seemed to have something to do with a Mass that is said to have been held by Paraguayan President Fernando Lugo -- who resigned his position as a bishop to run for elected office -- during his official visit to Venezuela last week. He also questioned why the Defense Ministry was supposedly trying to install a "priest in every barracks."

The archbishop went on to claim that an individual, Jon Jen Shu Garcia, a member of the National Guard (GN) and married with children, was to be "ordained" as a "supposed" bishop on July 29.

Carabobo State seen as an uphill climb for PSUV and it’s suggested some of that could be down to Chavez

Caracas Daily Journal (Jeremy Morgan): The approaching election for governor of Carabobo State was once seen as a favorable prospect for President Hugo Chavez’ United Socialist Party of Venezuela (PSUV), but is now being seen as an uphill climb -- and it’s suggested some of that could be down to him.

Chavez strolled to victory in Carabobo at the presidential elections in 2006, winning by 583,773 votes against Zulia state Governor Manuel Rosales’ 359,519.

The incumbent governor was Luis Felipe Acosta Carles, an old friend from way back when and a military man to boot. But since then, it’s all been downhill. When the citizens of Carabobo came to vote on Chavez’ ambitious bid to reform the Constitution last December, the vote went against him by 411,622 to 367,532.

Now it’s suggested that Chavez’ decision to spurn Acosta Carles -- and to do so in such a public manner during a speech at a military parade commemorating the historic Battle of Carabobo on June 24 -- could backfire on him in the state. Chavez said the candidate would be Mario Silva, a broadcaster.

Acosta Carles, a former general, said he might stand as an independent for re-election. While he’s not given much chance of winning, it’s said he could put a large enough dent in the PSUV vote to stop Silva winning. The opposition has already settled its choice of candidate, and the president’s supporters or chavistas are at odds in Carabobo.

In Caracas, Lina Ron is openly backing two alternatives on the grounds she thinks Silva’s already beaten if Acosta Carles runs, and maybe even if he doesn’t. The problem, it seems, is that local PSUV members aren’t enthused about Silva, who also appears to be a less than ideal candidate.

Barak Obama must carefully show himself from now on as whiter than white...

VHeadline's Washington DC-based commentarist Chris Herz writes: I have thought there little point to writing for the blogosphere if one was just to repeat the silly stuff found in the corporate press. After all why take the trouble to work without renumeration, even make direct financial sacrifice in terms of lost time from paying work or even subscription costs or donations if one cannot make some original contribution lacking from the conventional corporate media?

Ron Jacobs, an important commentator writing at seems the latest to find himself surprised by "opposition" presidential candidate Barak Obama's warm and fuzzy friendliness to the warfare policies of our US corporate state.

Mr Jacobs professes to find himself bemused by Mr Obama's cozying up to the Israel-American Political Action Committee -- the candidate expressing before that group his support for the expansion of war for oil in the Middle East. Mr Obama has in recent days also supported the extension of the death penalty, and criticised the members of his own racial minority for their propensity to anti-social behavior.

At least on the matter of war, such support seems utterly unnecessary in attracting votes, given that a substantial majority of the voters here want us out of Iraq now.

Anti-black racism is another matter -- it being of near-constitutional importance here in the supposedly United States.

You see, dear foreign reader, how successful we have been in the assimilation of all the mutually hostile tribes of Europe into a cohesive, even often a fanatical nationality. We Euro-Americans are all whites together. And we can only define ourselves in this way because we are not-blacks.

Here Serbs marry Croats. Irish girls make babies with English guys. Germans and French live in the utmost harmony. Magyars and Poles go to the same churches. All see themselves as 100% Americans.

This is a real problem for Obama. He is actually of course, half white himself. But here that does not signify. He looks like one of "them", not us. Here is the existential difference between the US and European styles of Toryism. (Although the European leadership are learning from us now how to introduce into their own poisonous corporatism their own coded racisms) All the US political class is aware of how to appeal to this fundamental factor by carefully coded appeals to prejudice. And they are usually successful when they do so.

Hence his ability to move away from the conservative paradigm is very limited. Since the days of President Nixon's election, by a landslide, it has been clear that most of our citizens had then and have now no use for Black equality. There is only one place, because of their historic social disabilities, that we are ready to make some extra places for blacks -- the penitentiaries.

Barak Obama must, to have any chance at all at election, carefully show himself from now on as whiter than white. He must disparage the interests and the aspirations of his own minority. He must govern from the right like all other US politicians.

He will, as was Clinton before him, if elected by the influx of younger voters, less impressed with racism than their parents, STILL be unable to enact any sort of liberal or progressive programme and will face unremitting attack for the slightest misteps from an hostile corporate press and TV. And however much foreign leaders would like to deal with Mr Obama this inability to deliver on any deals outside the corporate and militaristic box will make their diplomatic tasks just as frustrating as has been this work vis-a-vis the present regime.

Too many liberals like Mr Jacobs have little appetite for facing the reality of just how little the civil rights struggles of the sixties and seventies impress most of white America. In fact, this historical memory still induces most to vote conservative.

And as with any other psychopathology the failure to come to grips with root causes makes the insanity of US policy and negotiating positions appear to many incomprehensible.

This is why this writer thinks foreign leaders interested in the protection of their own, have little choice but to find ways of breaking with the empire. For it can no more reform itself from within than could the equally ossified Soviet state. No one is more aware of these facts of life than Barak Hussein Obama.

From the imperial capital

Chris Herz


Venezuela is facing the most difficult period of its history with honest reporters crippled by sectarianism on top of rampant corruption within the administration and beyond, aided and abetted by criminal forces in the US and Spanish governments which cannot accept the sovereignty of the Venezuelan people to decide over their own future.

Oil at $150 ‘may be the tipping point’

Oil price hawk and major exporter Venezuela said at the weekend there was no evidence that record crude values were hurting demand despite economists’ predictions that the cost could dent demand and trigger a sharp price fall. Venezuelan Oil Minister Rafael Ramirez reiterated the Organisation of Petroleum Exporting Countries (Opec ) member’s position that oil markets were well supplied. The comments come as oil continues to set new records, with oil surging to within a whisker of $143 on Friday. US crude settled $0,57 higher at $140,21 a barrel, falling back from a record $142,99 hit earlier. London Brent crude settled up $0,48 at $140,31 a barrel.

Venezuela nears new mining law

Venezuela may send a new law to the legislature within the next month that would lead to more joint ventures between the government and mining companies, said Rodolfo Sanz, the minister of basic industries and mining. The law won't be implemented under President Hugo Chavez's decree power, Sanz told reporters today in Caracas. That power is set to expire next month. Mining companies in Venezuela have awaited the new law for more than a year. In Venezuela's oil sector, companies have to work through joint ventures that are at least 60 per cent owned by the state. Asked about whether Spokane, Washington-based Gold Reserve Inc. and Toronto's Crystallex International Corp. will be able to continue operating in Venezuela, the minister declined to comment.

Washington Post: The Rival Chávez Won't Permit -

Defenders of Hugo Chávez like to argue that there is no alternative to the Venezuelan caudillo other than the feckless and unpopular politicians who preceded him in the 1990s. The simple refutation of that canard is Leopoldo López, the 37-year-old mayor of central Caracas, whose boyish good looks only underscore the fact that he represents a fresh generation. López, a hyperarticulate graduate of Kenyon College and Harvard, is a pragmatic center-leftist, like most of the presidents elected in South America since the turn of the century. He won his last election in the Caracas district of Chacao with 80 percent of the vote. An opinion poll taken this year showed his popularity rating at 65 percent in greater Caracas, compared with 39 percent for Chávez; nationally, he beat Chávez 42 percent to 41. In the upcoming election for mayor of the capital district -- the most important elected post in the country after the presidency -- López leads the Chávez-backed candidate by 30 points. 'Change is coming,' promise the blue posters with López's smiling face that are up around Caracas. Only maybe it isn't. Two weeks ago, Venezuela's national electoral council, dominated by Chávez's followers, moved to ban López and 371 other candidates from the November state and local elections, which are shaping up as the most important since Chávez was first elected nine years ago. This broad exclusion was based entirely on the finding of another Chávez appointee, who ruled that each of the candidates was guilty of an administrative or legal offense, though none has been judged in court.

Sunday, June 29, 2008

Rosales expondrá violación de derechos en Venezuela ante Internacional Socialista

El líder de Un Nuevo Tiempo (UNT) y gobernador del estado Zulia, Manuel Rosales, expondrá lo que considera la violación de los derechos políticos y civiles de los venezolanos durante su participación en el XXIII Congreso de la Internacional Socialista (IS), el cual se llevará a cabo en Grecia, Atenas. Su participación la realizará el próximo martes 1º de julio. Su exposición se basará en las consecuencias de la falta de democracia expresadas en 'la violencia, el abuso del poder, el irrespeto a los Derechos Humanos, la represión y el sufrimiento humano', según se detalló a través de una nota de prensa del partido que preside. Rosales estará acompañado por el director del Comité de Política Internacional del partido azul, Timoteo Zambrano, así como también, de los dirigentes nacionales Elías Matta y Heliodoro Quintero.

Hugo Chavez faces political crisis as allies desert him

President Hugo Chavez, the 'socialist revolutionary' leading a global campaign against America's 'empire', is facing a political crisis in Venezuela where crucial elections are approaching and old allies have turned against him. Mr Chavez, a devoted admirer of Fidel Castro, has forged an anti-American front with leaders ranging from President Robert Mugabe of Zimbabwe to President Mahmoud Ahmadinejad of Iran. At home, however, Mr Chavez is in trouble. State elections are due in November and Venezuela's opposition, which now includes former followers of South America's standard-bearer for socialism, is expected to perform well. The constitution compels Mr Chavez to leave office when his term ends in 2013. He tried to remove this clause and dramatically extend his powers last December - but lost the necessary referendum.

Headliner: "At the gateway to a coup d'etat, Chavez hostage to insecurity!"

VHeadline editor & publisher Roy S. Carson writes: I must admit to a certain bewilderment over the last several days since last Tuesday's brouhaha at the site of the Battle of Carabobo's 187th aniversary. I've sought explanations as to the circumstances surrounding President Hugo Chavez Frias 'letting off steam' about the encumbent Governor of that State, Luis Felipe Acosta Carlez, whose first claim to fame came when (shortly after the April 2002 coup d'etat), he unceremoniously burped on national television after sampling some of the product during the intervention of a privately-owned soft drinks factory.

To try to navigate among the various levels of political chicanery and media manipulation that have beleagured the Governor's current status (in the Venezuelan equivalent of Siberia), is probably the subject of some political-psychological treatise in the upper echelons of academia, but the baseness of insults and counter-insults slung through the celebratory air, defies rational explanation other than its getting down and dirty in the inevitable aftermath of the June 1 launch of the President's attempt at unifying left-leaning Venezuelan politics under a single banner of the United Socialist Party of Venezuela (PSUV).

The anglo-vocalised English acronymn PSUV has the unfortunate ability to sound like a deflating tire ... which could easily describe deflated or deflating spirits on the Venezuelan left who've found their individual party allegiances forcibly subdjugated to an ethos of 'either with us or against us' rather reminiscent of arch-enemy George W. Bush's remonstrations to the Republican faithful Stateside.

The brouhaha appears to have originated in the PSUV party leadership's decision to 'parachute' its own candidate to challenge Acosta Carlez' continued governorship, making it plain that he should move over ... or as President Chavez somewhat indelicately put it: 'to leave by the back door,' presumably with his revolutionary tail between his legs.

It seems like the many supporters that Chavez though he had had in the Bolivarian Revolution are failing him in droves and news reports claim that he's had to send hundreds of military personnel home on enforced non-operational leave because they're refusing to accept a politicization of the Venezuelan military in the swearing of political allegiances rather than the traditional pledge of allegiance to the President and the Flag. Considering that it is only a few short years since the military won the right to vote, it is something the men and woman in uniform are finding it hard to stomach, especially if they come from the political 'right' side of the tracks, as many senior officers do!

The situation is getting darker by the minute as PSUV officials insist on blind allegiance, or immediate exile to the political wilderness with all the follow-on effects that that implies in Venezuela's very much codified heirarchy of social inclusion/exclusion.

Readers will be reminded that VHeadline has always pledged itself to support Venezuela's democracy, constitutionality and the rule of law ... BUT ... it is increasingly difficult to tally the current adminsitration's brand of political representation with democracy per se; especially considering that the President has always preached the enfranchisement of the masses ... those who believed (and perhaps continue to believe) that power was being turned over to them to decide the nation's political and economic future from the grassroots up and not imposed on them fromt he top down.

Chavez has been insistent about his personal pledge to the Venezuelan people but reality is showing the pledge to be no further from reality than enforcement by caudillos of cliques within the party or administrative structure who seem to impose their will rather than to accept leadership from the people they are supposed to represent.

How this will resolve itself -- if indeed it will resolve itself -- ahead of November 23 local and regional elections is anybody's guess, but already there are angry murmurs from the provinces that point to huge dissatisfaction and a presumptive electorate that's could be rallied to reject the President's best laid plans.

Disturbing effluent from the pre-election battle maneuvers also comes in the form of a decision to approve Attorney General Clodosbal Russian's plan to ban some 400 candidate (mainly opposition) from the November hustings based on the spurious claim that they have pending charges against them on allegations of corruption, malfeasance and other violations.

The electoral blacklist, however, points to a culture where the allegation of some crime appears to be sufficient in the public mind to construe immediate guilt withbout the benefit of a court of law or a judge's sentence. It is one of the more unfortunate aspects of Venezuelan journalism that reporters don't seem to have brought themselves up-to-date on the new Criminal Code after the dissolution of the Napoleonic Criminal Code many years ago. Quite simply put, justice is intended to deem the alleged criminal innocent of all charges until such times as a court of law pronounces legal sentence ... and, while this is a concept that is easily understood elsewhere around the world, the Napoleonic concept of 'guilty until proven innocent' pervades despite the best efforts to modernize the law.

That said, the luckless 400 have been branded guilty, although it must be admitted that many of them are 'as guilty as hell' though not yet decided upon by a judge... Why not? you may ask ... and that's the point of the whole.

If indeed Attorney Russian were to question the fact that those who are 'guilty as hell' have so far evaded criminal penalty, it would be much better -- from an internationally legal perspective -- for him to attack the Why rather than to seek to by-pass legal restraints that are purposely included in the country's Constitution to avoid abuse by officialdom, present or future.

What will be the outcome ... God alone knows ... since the opposition is seething at its teeth to use the 400 injustices as a clarion call to further decry the Chavez administration as an Evil Dictatorship at the behest of the Washington Beltway Bullies who are eager to see President Chavez go down the proverbial tube come November.

Small wonder then that this weekend's issue of 'Las Verdades de Miguel' splashes its front page with "At the gateway to a coup d'etat, Chavez hostage to insecurity!" and colleague Miguel Salazar is not tardy to editorially detail cause and effect!

Roy S. Carson


Venezuela is facing the most difficult period of its history with honest reporters crippled by sectarianism on top of rampant corruption within the administration and beyond, aided and abetted by criminal forces in the US and Spanish governments which cannot accept the sovereignty of the Venezuelan people to decide over their own future.

Chávez-linked church decried

A church modeled in part after one in Miami but with a ''revolutionary'' spirit that praises Venezuelan President Hugo Chávez is now at the center of a religious and social controversy in Venezuela. Although it has adopted many of the symbols and rites of Roman Catholicism, the new Reform Catholic Venezuelan Church departs from traditional belief in some key ways. For example, reformists consider that ''homosexuality and bisexuality are not sins in and of themselves.'' Divorce is allowed and priests do not take vows of chastity. The church, which was publicly announced last week, also lines itself up squarely behind Chávez's ''Bolivarian Revolution'' and its socialist agenda. Venezuelan Catholic leaders, who reacted sharply to the new church, claim Chávez is bankrolling it with petroleum proceeds. But whether that's true or not, Reform Catholic leaders line up squarely behind the Venezuelan president. ''We completely support the socialist project led by Chávez,'' said Enrique Albornoz, one of the new church's first bishops -- a group that is to be ordained on Sunday.

Venezuela owns Citgo, not Conoco

While two readers were busy writing letters about Conoco being owned by the Venezuelan government (which it isn't), they missed that since 1990 Citgo has been 100 percent owned by Venezuela. Every time we fill up at Citgo, we put money in Hugo Chavez's pocket. Considering that the Bush administration takes every opportunity to bash Chavez, isn't it more than passing strange that no one from President Bush on down has called for a nationwide boycott of Citgo? Could it be we need Venezuelan oil so badly, we're willing to prostitute ourselves to get it? And to the Friday letter writer, who could miss the racist underpinnings of that comparison of the flooding in Iowa to Hurricane Katrina? I'll tell you the difference between Iowa and New Orleans. The federal government took almost a week to make any kind of meaningful response to Katrina. In Iowa, no citizens drowned in their own homes or in their beds in nursing homes because the federal government couldn't or wouldn't act. Instead of pontificating, the writer should look inward to see where the real problem lies.

Heather Mills’ new lover has already cheated on her

Finding true love may not be that easy for Heather Mills, for her new boyfriend Jamie Walker has already cheated on her, it has emerged. The hotel gofer bedded his ex-girlfriend just a few days after hooking up with Mills in Tenerife last month. In an exclusive interview, Venezuelan model Elsa Maneiro spoke for the first time about her sex-fuelled relationship with Walker. She revealed that they still share the same bed at the apartment they own together even though they have split up romantically. “I don’t think Jamie has told Heather about our home arrangements, News of the World quoted Maneiro, as saying. “Every night we sleep together. I don’t want him to sleep on the floor or sofa as that would be uncomfortable. “We had sex once after our split and I can’t say we won’t again. “It is complicated. I don’t expect Heather to understand as my friends don’t think this situation is right either,” she added.

Crystallex International Corp.-- This Venezuelan Mining Company May Again Be a Buy

Mid-May 2008, all looked grim for shares of Crystallex (KRY), as Venezuela pulled the plug on the company's Las Cristinas property. Production was expected to begin there by 2009. At the time, Venezuela refused to grant a permit to KRY for the Las Cristinas mine after deciding not to grant licenses for open-pit mining for gold, diamonds and coal. Instead, they opted to step up oversight on the mining industry. Citing ecological damage for the move, Venezuela dashed KRY's hopes to mine in the nine million acre reserve. But that was in May. Today, shares of Crystallex may be a buy after the Venezuelan government said it was willing to reconsider the cancellation of the permit for the Las Cristinas project. In this release, the company said it was invited to a meeting by representatives of the Ministry of the Environment, and was told that possible modifications of the Las Cristinas project could result in an issued permit.

Saturday, June 28, 2008

Dissenting military officers say they've been pushed aside in Venezuela under Chavez

Hundreds of Venezuelan military officers are no longer assigned duties and have been relegated to their homes, quietly pushed aside for their dissent under President Hugo Chavez, according to former military commanders and a watchdog group. They say the officers have been sidelined for objecting to Chavez's socialist ideology, his push to form civilian militias and his ambiguous stance toward Colombia's leftist rebels. Dissident army Gen. Angel Vivas Perdomo says he sought to defend the military's apolitical tradition when he asked the Supreme Court to toss out Chavez's order for troops to salute with the motto: 'fatherland, socialism or death — we will triumph.' 'It's a motto from Fidel in Cuba that, on top of being unconstitutional, is absolutely undemocratic,' Vivas Perdomo told The Associated Press in his first interview since challenging the motto in court in May.
He said the motto, previously used by Cuban leader Fidel Castro, 'takes away the right of every Venezuelan citizen to think differently and to disagree with socialism.'

Newsweek: The War Premium On Oil

There are two questions being asked around the global water cooler these days, and no one seems to have a very good answer for them. First, why does the price of oil keep rising, even if the world economy is slowing down and the Saudis appear to be willing to raise production? Second, why do so many analysts and governments think that the United States or Israel, or both, will attempt to destroy or set back the Iranian nuclear program sometime before George W. Bush's departure from the White House early next year? While there is a early infinite number of answers available to both of these questions, this writer likes one: it lies in the link between the two questions. Obviously there is no single explanation for the astonishing and persistent rise in oil prices, recently hitting more than $140 per barrel. But one explanation may well be that energy traders and even real consumers, including refiners, companies and governments, are betting on an American-Israeli intervention against Iran in the near future, and logically believing that such an act would drive oil prices sky-high. While the American, Israeli and increasingly European attitude of turning up pressure, sanctions and threats against Tehran may well be the best way to both avoid military action and ensure that Iran does not acquire nuclear weapons, it has the unintended consequence that some people may actually believe it. Speculators and others may be acting on the assumption that Washington and its Israeli ally will proceed to 'take out' Iranian nuclear facilities, because that is exactly what Bush and his allies are implying will happen if the Ahmadinejad regime does not comply with U.N. resolutions.

Deputy minister of industry to become Belarus’s ambassador to Venezuela

A standing commission on international affaires and national security of the “council of the republic” of the “national assembly” of Belarus recommended to appoint deputy minister of industry Valyantin Hurynovich as Belarusian ambassador to Venezuela. “I’d like to bring to notice that the commission has recommended to appoint deputy minister of industry Valyantin Hurynovich as Belarusian ambassador to Venezuela,” the head of the commission Mikalai Charhinets said at the 10th session of the “council of the republic”, Interfax reports. He also said about the decision to recommend candidature of Alena Hrytsenka (head of the department of foreign policy analyse at the Ministry of Internal Affaires of Belarus – IF) for a post of Belarusian ambassador to the Netherlands, and candidature of Valery Kalesnik (head of the department of international security and arms control at the Ministry of Internal Affaires of Belarus – IF) for a post of ambassador to Turkey, Alena Kupchanka – for Hungary with concurrent accreditation in Slovenia, Ihar Fisenka (head of the department of international organisations at the Ministry of Internal Affaires of Belarus – IF) – for a post of ambassador to Egypt with concurrent accreditation in permanent representative to the League of Nations, Alyaksandr Syameshka (head of the department of bilateral relations with CIS countries at the Ministry of Internal Affaires – IF) for a post of ambassador to the United Arab Emirates.

Foundation stone of any fair system of justice absent when National Assembly voted on the Russian ban

Caracas Daily Journal (Jeremy Morgan): The principle of innocence until proven guilty appears to have gotten overlooked when the National Assembly (AN) dutifully voted for a resolution to support Comptroller General Clodosbaldo Russian's judicially dubious ban against people running for election in November. AN deputy Carlos Escarra, who's described as a specialist in constitutional law, led the argument for backing the ban. He reminded everyone that the Liberator, Simon Bolivar, had wanted the death penalty for people who stole from the public purse.

Escarra claimed that the 386 people on Russian's list had been barred from standing as candidates "because they're thieves, they took money away from the national patrimony." This was not quite the case in law, as a handful of dissident deputies subsequently pointed out.

Deputy Ismael Garcia of Podemos, the social democratic party which once sided with the government and is now in opposition, pointed to Article 65 of the Constitution. This, as he and numerous others have noted, states that people can't run for elected office if they've been convicted by a court of criminal offenses while they were exercising public office. García went on to observe that even a report by Russian's own office concluded that the "irregularities" supposedly committed by the people in question had not caused "patrimonial damage" to the country. If they were thieves, he asked, why weren't they behind bars?

Escarra's response was to raise the case of opposition Mayor Leopoldo Lopez of Chacao, who's alleged to have taken funds from his mother while she was at the state oil corporation, Petroleos de Venezuela (PDVSA). This accusation has yet to be proven in court, but Lopez is nevertheless on the list. Earlier this week, Lopez and his wife were held at the airport for two hours by shadowy officials on their return from the United States, where'd he spoken out about the ban.

Troublesome deputy Luis Tascon chipped in, as might have been expected after being sent to the doghouse for persisting in questions about alleged corruption at the Infrastructure Ministry. What he wanted to know was how many times cases had been brought to the chamber and nothing had happened.

Garcia is acquiring a reputation as the chamber's resident troublemaker. He asked for the list of legislators to be reviewed because as he understood things, a person who had been "inhabilitated" was a member of the chamber. That individual, deputy Regulo Hernandez, reportedly insists the ban against him has been lifted.

Earlier, Garcia had claimed AN employees had sat in the chamber during a recent debate, and even taken part in a vote. At the time, this was laughed off as yet another bee in Garcia's bonnet, but he's plugging for a full investigation.

Caracas News Briefs -- Saturday, June 28, 2008

Mercal, the state-run chain of low-cost food outlets, announced that it had sufficient powdered milk in store to meet demand for five months. Mercal says it's building a "strategic reserve" of food to avoid shortages, of which powdered milk has been a notorious example.

Panhandlers who are being pressed to move into agriculture took to the streets in Raul Leoni in Bolívar state on Thursday, blocking access roads into the town. They say they're still waiting for payment of Bs.F.10,000 to each of them which they claim Basic Industries and Mining Minister Rodolfo Sanz promised three months ago.

Uruguayan Industry and Energy Minister Daniel Martinez said there was no agreement with state-owned Petroleos de Venezuela (PDVSA) on a refinery project, as has been reported in Caracas. The project would be put out to international bid tender, the minister said.

Officials at state electricity company Cadafe are said to have prepared plans to ration supplies in the states of Anzoategui and Sucre -- and possibly elsewhere in the country as well -- because there isn't enough power to go arround. Consumers could be put on a rota of cuts of up to 90 minutes at peak times.

Police in Miranda state say they've caught a fraudster whom they'd been chasing for 10 years. The suspect, named as Gustavo Perez, had fooled families in Plaza and Zamora by promising homes to them. He was arrested after being stopped on a rural road in broad daylight. As they say, there's one born every minute.

Watchrepairer Javier Antonio Marin Martinez, 31, was minding his own business and doing his work when a gunman turned up and shot him twice in the head without uttering a word on Avenida Fuerzas Armadas last Thursday. Bystanders said they'd witnessed two killings at the same spot and both victims repaired watches.

Schools dig in their heels against 15% ceiling on fee increases

Caracas Daily Journal (Jeremy Morgan): Private schools are digging in their heels against Health Minister Hector Navarro's ceiling of 15 percent on fee increases, and they may have the parents with them. The Venezuelan chamber of Private Education (Cavep), which claims to number 257 schools among its members, says it's "disposed" to sticking to increases agreed at assemblies of parents and guardians before Navarro abruptly imposed his limit.

The national institute for the defense of the consumer, Indecu, has threatened to impose fines on schools and colleges that don't abide by the ministerial order. Fines ranging up to 3,000 tax units could reach as much as Bs.F.110,000.

This prospect doesn't seem to faze Cavep president Octavio de Lamo. He's willing to meet Indecu, but says Cavep will fight its case in the courts over each and every fine levied on a school. This could prove anything but an idle threat, to judge by comments from middle class parents opting for private education. "I don't want my children getting behind and then lost in the state system," said one father who's carrying the burden of three with another coming up on the rails.

This is by no means a sun-tanned, gold-bedecked man in a smart (imported) suit who's just stepped out of a swanky (ditto) automobile. Most times, this individual can be seen carefully counting cents and beers. He goes to work on the Metro and a bus. He's willing to pay more, even if it means taking a second job. He's worried that if schools can't get by, rising costs will inevitably erode standards. "If they dealt with inflation, the schools wouldn't need an increase," he says.

People nearby, having caught on to the conversation, nod in agreement. They, too, don't see the problem as the fault of school proprietors, but the government's inability to get a grip on constantly rising costs. "The buck stops there, not at the school gates," says a lawyer, in English.

Navarro says parents can make donations to schools if they so wish. But he's reported to want a 15 percent limit on that as well.

Lula, Chavez meeting shows confidence, not distancing, between the two leaders

Caracas Daily Journal (Jeremy Morgan): Presidents Luiz Inacio Lula da Silva of Brazil and Hugo Chavez of Venezuela met Friday for a brief exchange of views and signed 15 economic accords including an agreement on exchanging electricity supplies, officials said. The meeting was the latest of a regular series of three-monthly talks aimed at forging closer economic ties between the two countries, officials said.

Other accords covered natural gas, agriculture, industry, telecommunications, and food supply, French news agency AFP reported. Lula's visit was scheduled to last about five hours, officials said.

Chavez met Lula with a warm embrace on the steps of Miraflores presidential palace, after which Lula inspected a military guard of honor. Chavez' welcome was attended by Foreign Minister Nicolas Maduro, Finance Minister Ali Rodriguez Araque and Oil and Energy Minister Rafael Ramirez, who is also head of the state oil corporation Petroleos de Venezuela (PDVSA).

Maduro told reporters that the meeting would allow for the "consolidation of confidence between both countries" at a time when it was being suggested that there had been a "distancing" between the two presidents. Discreet talk in diplomatic circles has it that Lula has in the past bluntly advised Chavez to lower the volume of his comments about, and tone down his attitude towards, the governments of other countries, not least the Bush Administration in Washington.

Lula was accompanied during his visit by Brazilian Defense Minister Nelson Jobim, Mines and Energy Minister Edison Lobao, Development Minister Miguel Jorge, and presidential international adviser Marco Aurelio Garcia. The head of the state oil corporation, Petrobras, Jose Sergio Gabrielli, was present as a member of a delegation of Brazilian business executives.

Lula recently chided Petrobras and PDVSA for not making more headway towards joint projects, chief among them a refinery to process 200,000 barrels a day (b/d) of oil at Pernambuco in north-east Brazil. Brazil is Venezuela's third largest trading partner after the United States and Colombia. Bilateral trade with Brazil totaled more than $4 billion in 2007.

Hopes of boosting Venezuela's oil trade with Brazil went under a cloud after Petrobras announced a giant offshore oil and natural gas find earlier this year. Whether non-economic issues were also on the agenda remained unclear. There'd been speculation the two presidents would discuss ways of cooperating in efforts to secure the release of hostages held by the Revolutionary Armed Forces of Colombia (FARC). The best-known of the hostages is the Franco-Colombian former presidential candidate Ingrid Betancourt. Chavez also met former French Premier Dominique de Villepin on Friday morning.

Venezuelan, Colombian presidents will accept differences in planned talks: Chavez

Venezuelan President Hugo Chavez says he won't let differences with Colombian President Alvaro Uribe impede talks the two leaders are planning. The pair has not met one-on-one since a deadly Colombian military strike destroyed a guerrilla camp in Ecuador in March, aggravating already tense relations between the Andean neighbors. Chavez said late Friday that while he's sure observers are betting the meeting won't happen, he and Uribe are committed to “accepting each other with whatever differences there may be.' Uribe has confirmed plans to meet with Chavez in July.

Venezuela says high oil prices not hurting demand

Oil price hawk and major exporter Venezuela said there is no evidence record crude values are hurting demand despite economists' predictions the cost could dent demand and trigger a sharp price fall. Venezuela's oil minister Rafael Ramirez also reiterated to reporters the OPEC member's position that oil markets are well-supplied and any decision on changing output levels should be taken at OPEC meetings. Many analysts think oil prices, which closed above $US140 a barrel on Friday, will hit at least $US150 a barrel before they come down sharply. 'At that point, we will start to see more signs of demand destruction and an eventual tipping point in oil markets,' said Deutsche Bank in a research note. The United States and other consumer nations have pressured OPEC to increase supply to try to tame record prices and the world's largest producer, Saudi Arabia, a US ally, has upped its output in recent weeks.

Chavez plans to keep Venezuelan gasoline among world's cheapest

President Hugo Chavez says Venezuela has no plans to raise state-subsidized gasoline prices anytime soon. Gasoline is cheaper in Venezuela than almost anywhere in the world, selling for as little as 3 cents (USD) a liter. Chavez on Friday pledged to maintain fuel subsidies as a matter of 'sovereignty' for the oil-producing nation. Gasoline prices haven't changed there for years, and many Venezuelans consider cheap gas a birthright. Hours-long traffic jams clog cities including Caracas, where fuel-guzzling sport-utility vehicles are common.

Friday, June 27, 2008

Hecla Extends Date for Closing on Venezuelan Gold Property Sale

Hecla Mining Company has approved a revision to its agreement with Rusoro Mining Ltd. (Rusoro) to extend the date to July 8, 2008, for closing the transaction to sell its subsidiaries engaged in mining and exploring for gold in Venezuela to Rusoro for $25 million. The sale agreement was previously announced on June 19, 2008, with a closing date originally targeted for today, June 27, 2008. The date was extended to allow additional time to receive regulatory approval on the transaction. Hecla Mining Company, headquartered in Coeur d'Alene, Idaho, mines, processes and explores for silver and gold in the United States and Mexico. A 117-year-old company, Hecla has long been well known in the mining world and financial markets as a quality producer of silver and gold.

Argentina, Brazil, Venezuela To Put $2B Each In Bank Of South

The three biggest South American countries behind the new Bank of the South multilateral development bank will each contribute $2 billion toward the total startup capital of $7 billion, an official at the Argentine Ministry of Economy said after a meeting of member countries here Friday. The official, who asked not to be named, said Brazil, Argentina and Venezuela would each contribute $2 billion to the startup capital, with the remaining $1 billion comprised of $400 million each from Uruguay and Ecuador, and $100 million each from Bolivia and Paraguay. The countries agreed on authorized capital of $20 billion, a figure that represents the eventual target once other contributors are brought on board and new contributions are made. The official said that a further $3 billion in capital contributions was earmarked with contributions from Chile, Colombia, Peru, Suriname and Guyana. That would bring the total startup capital to $10 billion, the figure cited as the initial capital in a separate press statement released Friday. The press release said that a joint technical commission had been instructed to deliver a constitutional document outlining the decisions made during the meeting Friday.

Chávez, French ex premier talk about FARC hostages

Venezuelan President Hugo Chávez met on Friday at Miraflores presidential palace with French ex Prime Minister Dominique de Villepin, an 'old friend of Venezuela,' and talked, among other topics, about the hostages held by the Colombian Revolutionary Armed Forces (FARC), immigration and bilateral cooperation. 'We have discussed the situation of the hostages and Ingrid (Betancourt). I know about Chávez's endeavors to improve things and get that release,' said Villepin and underscored that his visit to Caracas was private and not intended to 'interfere by any means in such a difficult situation,' AFP quoted. Villepin, prime minister until May 2007 and previously Minister of Foreign Affairs, is a personal friend of French-Colombian Ingrid Betancourt, who has been in the guerrilla hands since 2002.

Venezuelan Money Reserves Increase

The international monetary reserves of Venezuela were increased during the last seven days in about 268 million dollars, confirmed a report of the Central Bank (BCV) Friday. The financial inventory reached the figure of 33. 802 billion dollars, of which 821 millions are located in the Fund of Macroeconomic Stabilization, created to palliate eventual contingencies of the national industry. Venezuela maintains a privileged position regarding the level of its international reserves when comparing official indicators of other Latin American countries of Latin America and dividing them for the respective number of citizens. The current remnant, with regard to the amount of inhabitants of the nation (27 million people), it represents an average level of 1,250 dollars for each inhabitant. On Friday June 20, the BCV informed a catalog of 33.534 billion dollar and an increase of 1.89 billion dollars regarding the previous cycle.

Nigeria's Yar'Adua plans mini oil summit with Venezuela's Chavez: presidency

Nigerian President Umaru Ya'Adua said Friday he intends to meet his Venezuelan counterpart Hugo Chavez 'soon' to discuss the current global energy situation, a statement from his office said. The statement followed Yar'Adua's bidding farewell to Venezuela's outgoing ambassador to Nigeria, Boris Henrique. Yar'Adua told Henrique the meeting had become 'imperative because fingers are being pointed at our two countries as a result of the energy situation in the world.' Yar'Adua said Nigeria and Venezuela have a common responsibility to improve the welfare of their peoples and called for 'greater cooperation and collaboration especially in the petroleum sector.'

Venezuela hails 'strategic partnership' with Russia

Relations between Venezuela and Russia have developed into a strategic partnership, the country's vice president said Friday. Venezuelan Vice President Ramon Carrizales was in Moscow at the end of a three-day official visit during which he met with Russian Prime Minister Vladimir Putin, Deputy Prime Minister Alexander Zhukov and other government officials. 'Russia has become our trusted partner and proved it at various international meetings and through cooperative efforts in various international organizations,' Carrizales told a news conference in Moscow. 'I would say relations between our countries are strategic,' he said. 'We share exceptionally close ties.' The two countries have been prioritizing cooperation in the energy and mining sectors. Russian gas monopoly Gazprom, the country's largest independent oil producer LUKoil, Russian-British joint oil venture TNK-BP, aluminum giant RusAl and a number of other companies are active in the Venezuelan market. Oil-rich Venezuela is also a major purchaser of Russian weapons and hardware. In 2005-2006, Venezuela ordered weaponry from Russia worth $3.4 billion, including 24 Su-30MK2V Flanker fighters, Tor-M1 air defense missile systems, Mi-17B multi-role helicopters, Mi-35 Hind E attack helicopters and Mi-26 Halo heavy transport helicopters.

Venezuelan National Assembly's Permanent Committee for Economic Development minutes from June 4, 2008

The National Assembly (formerly known as Venezuela's Congress) is the head of the legislative branch of the Republic of Venezuela. The attached translation of the National Assembly's Permanent Committee for Economic Development minutes of a meeting convened on June 4, 2008 was translated by a Caracas law firm and have been made available to the public by the National Assembly.

Download link -- PDF file

Patrick J. O'Donoghue's round up of news from Venezuela -- June 27, 2008

The National Assembly (AN) has upheld the ban preventing politicians disqualified for having taken part in criminal or anti-state activities from running as candidates in the upcoming regional elections. Podemos party leader, Ismael Garcia criticized the ban as a "political arm against the opposition." United Socialist Party of Venezuela (PSUV) deputy, Carlos Escarra called the 400 disqualified politicos " thieves," pointing out that they are responsible for having committed irregularities against public patrimony. Garcia replies that if they are thieves, then why haven't the been sentenced and imprisoned. The ban imposed and ratified by Comptroller General, Clodosbaldo Russian was passed by a majority in the house.

One of the disqualified politicians, Chacao Mayor Leopoldo Lopez says his passport was taken from him and his wife at Simon Bolivar international airport at Maiquetia when he returned from a visit to the USA where he was campaigning against the ban. While in Washington, Lopez managed to hold a meeting with US presidential candidate, Obama Barack. After two hours of waiting, the passports were returned but no explanation given for the hassle.

According to Communication & Information (Minci) Minister, Andres Izarra the Venezuelan government will propose the setting up of a radio station and a news exchange network at the next meeting of information ministers belonging to the Movement of Non-Aligned Countries. Venezuela will host the meeting on Margarita Island on July 2-4. At a press conference to inform about the event, Foreign Minister Nicolas Maduro insists that the domination of mainstream news networks must be broken and information and communication de-colonized. Izarra reports that 118 member countries are working together and seeking agreements that will benefit communication. 73 delegations have confirmed their assistance, of which 43 will come with ministerial representation and 11 represented by deputy ministers. The new news agency will have its base in Malaysia and Venezuela will be on the editorial committee.

Brazil's President Lula da Silva is in Caracas today to meet President Chavez and review bilateral projects currently in motion. A Venezuelan Foreign Ministry communique states that the meeting is part of a three- monthly work schedule. Minister Maduro calls the meeting positive and hails its mechanisms that allow the two countries to advance in bilateral cooperation and political confidence, as well as intensifying cooperation to push forward regional projects.

Executive Vice President Ramon Carrizalez is currently visiting Russia and says the motive of the visit is to strengthen relations of cooperation between the two countries. The Vice President is accompanied by Defense Minister, General (G-i-C) Gustavo Rangel Briceno, Deputy Foreign Minister for Europe, Alejandro Fleming, Deputy Finance Minister Gustavo Hernandez and Basic Industry & Mining Deputy Minister Jesus Paredes. It has been announced that Venezuela will purchase 4 more Sukhoi-30 fighter planes for the Venezuelan Air Force (FAV).

Patrick J. O'Donoghue

Mexico's Cemex keen to stay in Venezuela

Mexico's Cemex, the world's No. 3 cement maker, is eager to stay in Venezuela despite the pending nationalization of its local assets, the company's chief executive told a newspaper on Friday. Venezuelan President Hugo Chavez said earlier this year he would take over the Venezuelan units of Cemex, Switzerland's Holcim and France's Lafarge, taking at least 60 percent ownership. Chavez's government says the cement companies can negotiate over continuing as minority partners and seek compensation for the loss of their assets. 'Cemex ... will continue to contribute to Venezuela's prosperity. Our intention is ... to collaborate with the Venezuelans,' Cemex's Chief Executive Lorenzo Zambrano told La Jornada newspaper. 'We are willing to continue working in that country,' he added. Venezuela said this month that once negotiations are over with Cemex, Holcim and Lafarge, the state will complete the transfer of ownership and operations by the end of the year.

Venezuela to lend $500 million to Belarus

Venezuela is to issue a $500-million loan to Belarus, Venezuelan Ambassador Americo Diaz Nunez said at a news conference in Minsk on Friday. The ambassador said that all required documents were being drawn up. As for a fund that the two countries intend to set up to fund joint projects, Mr. Nunez said that it was 'operating.' He said that a package of projects to be funded from the fund had already been prepared, citing the construction of housing in Venezuela among major projects. 'This project envisages a very big amount of investment,' he said. 'A project to redevelop the central district of Caracas will demand several billions dollars alone.' The fund is to total $500 million with the entire sum to be contributed by Venezuela. 'This will be a renewable fund,' the ambassador said, adding that it would accumulate more money.

U.S. Diplomats and Legal Experts Comment On The Unusual Circumstances Surrounding the Cedeno Case In Venezuela

Diplomatic leaders and legal and human rights experts presented unique perspectives on Latin America's political landscape and democracy last night during an academic discussion held at the University of Miami. Among topics discussed was the state of political prisoners in Latin America, in particular the corrupted case against Eligio Cedeno, the Venezuelan banker imprisoned more than 505 days ago and still awaiting a fair trial after months of unfounded judicial delays. Participants contributed to a political discussion about the lack of transparency found in many Latin American judicial systems, the recent politicization of legal cases, and the lack of autonomy that exists in the judicial branches of those governments. They called attention to the growing number of political prisoners in Latin America, the numerous human rights violations and assaults to democracy, and the unjust treatment of political prisoners, like Eligio Cedeno, and their experiences during 'so-called' impartial legal hearings. The Cedeno case which began in Venezuela in March 2008 was again postponed earlier this month, marking the 5th time the case has been delayed due to a prosecutor's unsubstantiated allegations against the presiding judge. This most recent development is yet another example of the irregular profile of the case against Eligio Cedeno, the government's lack of evidence to uphold the charges of Cedeno facilitating the illegal exchange of U.S. currency to a local businessman, and the failure of the Venezuelan judicial system to expeditiously rule and bring the Microstar case to a close.

Nigeria wants talks with Venezuela on oil price

Nigerian President Umaru Yar'Adua wants to meet with his Venezuelan counterpart Hugo Chavez to discuss world oil prices, his office said on Friday. 'Fingers are being pointed at our two countries as a result of the energy situation in the world,' Yar'Adua was quoted as saying in a statement from the presidency. It didn't say who was pointing fingers nor why. In remarks to Venezuela's outgoing ambassador to Nigeria, he said a meeting between the two nations -- both members of the Organization of the Petroleum Exporting Countries (OPEC) -- had become 'imperative.' No indication was given of whether steps had already been taken to set up a meeting between the two leaders. Record oil prices are putting pressure on the global economy, saddling companies and consumers around the world with higher energy costs and triggering protests from farmers in Spain to students in Nepal. OPEC's biggest exporter Saudi Arabia has announced plans to hike output to 9.7 million barrels per day (bpd) -- the fastest pace in decades -- but some consumer economies blame the oil exporter group for doing too little to combat the rally.

Dr. Odeen Ishmael: Examining the "food crisis" in Latin America and the Caribbean

Guyana's ambassador to Venezuela, Dr. Odeen Ishmael writes: With the problem of food shortages and increasing prices becoming a global concern, Latin American and Caribbean (LAC) countries have been examining the situation and proposing remedial action for medium and long term solutions.

Without a doubt, what is now called a "food crisis" is having a dire effect on the poor in the region. Actually, a recent ECLAC study indicates that more than 10 million people could join the 80 million in the region who already cannot afford a minimum diet.

While the problem is already causing some economic and social setbacks in the region, it is more related to the escalating prices for food than a shortfall in local food production and supply. Even so, Ecuador has restricted its rice exports to meet increased local demands while Argentina has placed export controls in addition to a 10 percent export tax on meat and cereals. The Argentine government says farmers are benefiting from rising world prices and the profits should be spread to help the poor. However, farmers are protesting against the tax saying they want to reinvest the profits but the higher taxes prevent them from doing so.

The Caricom response

But even before the "food crisis" assumed global proportions, the Caricom sub-region had already begun to address such an eventuality, and agreed, as a priority, to increase agricultural production to meet the needs of the region as well as the international market. This is especially important since there are eight Caricom nations which are dependent on agriculture with 10 to 40 percent of their GDP being attributed to this sector.

President Bharrat Jagdeo of Guyana, who has the lead role for agriculture within Caricom, set the stage in 2004 with the preparation of a strategy to reposition Caribbean agriculture in the economic development of the region. This approach, known as the "Jagdeo Initiative", seeks to re-position the agricultural sector to ensure food security, rural development and further wealth in the Caribbean. Thus, it proposes the implementation of targeted, focused and practical interventions at both the regional and national levels to alleviate ten identified constraints affecting agriculture in the Caribbean region.

These constraints are: limited financing and inadequate new investments; outdated and inefficient agricultural health and food safety systems; inadequate research and development; a fragmented and disorganised private sector; inefficient land and water distribution management systems; deficient and uncoordinated risk management measures; inadequate transportation systems; weak and non-integrated information and intelligence systems; weak linkages and limited participation of producers in marketing; and the lack of skilled and quality human resources.

Caricom governments have since been working together to overcome these problems, but they still have to make greater efforts to alleviate them.

And in the endeavour to boost agricultural production, the Guyana government has offered the Caribbean island-states, which have limited areas of arable land, the opportunity to invest in agricultural production in Guyana in order to expand the region's food supply and agricultural exports.

Throughout the region, governments are introducing programmes aimed at reducing in the short and medium term the effects of the rapid rise in food prices on their citizens. In Guyana, for instance, these include a 5 percent increase in pay for Government workers; an increase in the tax free allowance for low income workers; a reduction by 10 percent of the fuel tax; and the distribution of seeds, fertilisers and pesticides to farmers aimed at increasing food production. These actions have since been assessed by the Inter-American Institute for Cooperation on Agriculture (IICA) as the best in the Caricom sub-region.

Causes of the crisis

The wider regional food situation was discussed in Caracas on May 30 when the Latin American and Caribbean Economic System (SELA) held a high-level regional meeting on food security, which drew participation from its 26 member-states, as well as international organisations including the World Food Programme, the Food and Agriculture Organisation, the Inter-American Institute for Agricultural Cooperation and IICA. At this meeting, the SELA secretariat presented a significant analysis of the current global food situation, outlining the structural and circumstantial factors responsible for the food shortages and escalating prices.

These include the seven-fold increase of financial investment and speculation in agricultural products in the past four years. Added to this, the weakness of the US dollar and low international interest rates are driving financial operators to seek shelter for their funds in the acquisition of various commodities, thus pushing up prices.

Further compounding the problem, the rapid rise in the price of oil, a necessity for food production and transport, has pushed up production costs in almost all areas. (SELA notes that, as an example of the rapid rise in food prices, a tonne of powdered milk cost $1,500 eight years ago when a barrel of crude oil cost around $30; with oil now hovering near $140 dollars a barrel, a tonne of powdered milk has gone up to $4,500).

Undoubtedly, a food crisis has gripped some regions. Food stocks, especially of cereals, have fallen at a rate of 3.4 percent annually since 1995. This is now leading to restrictions on rice exports, particularly by some Asian countries, and such action has resulted in the skyrocketing price of this commodity. However, over the past two weeks the price on the world market has slipped back since rice stocks are not as low as were initially estimated.

Much of this shortfall in especially cereal production can be attributed to climate change which has caused severe droughts (and devastating floods) in countries which are normally large food producers, such as Australia, Ukraine and the United States. In LAC, hurricanes and tropical storms have affected food production in Cuba, Haiti, Nicaragua and the Dominican Republic while floods also severely damaged agricultural areas in Bolivia and Ecuador.

At the same time, demand for food has increased in Asia with its growing population. For example, in 2003-04, maize consumption in south, east and south-east Asia totalled 200 million tonnes while in 2007-08, this increased to 227 million tonnes. Some blame for the cereal shortage is also attributed to the increased demand for animal feed, especially in the United States where fodder accounted for 47 percent of the 332 million tonnes of maize produced last year.

Significantly, in 2007, domestic maize consumption in the United States increased by 48 million tonnes, but of this amount, nearly 30 million tonnes were used exclusively for ethanol production. Thus, the increased demand for biofuels, the production of which utilises mainly maize for ethanol, as in the United States, is identified as a factor spurring the "food crisis".

LAC governments are generally opposed to the production of biofuels from edible agricultural raw materials. Nevertheless, Brazil, the largest biofuel producer in the region, takes the position that the production of biofuels does not preclude an increase in food production.

At the recent Food and Agriculture (FAO) meeting in Rome, President Lula da Silva expressed this view, adding that biofuels "are an important instrument for generating income and creating jobs "helping countries to combat food and energy insecurity." Showing the advantages of using sugar cane for ethanol, he said it gives off 8.3 times more energy than is needed to produce it, while for maize the ratio is 1.5 times. He explained that Brazilian cultivation of sugar cane for ethanol accounts for just one per cent of Brazil's 340 million hectares of arable land, and the plantations have not encroached on land used for food cultivation or on the Amazon rainforest.

The SELA analysis, further, blames the protectionist policies in the industrialised countries of the North for distorting the global agricultural market. For instance, Haiti, almost self-sufficient in rice 30 years ago, was forced to cut import tariffs and local subsidies to qualify for credit from the multilateral financial institutions. The result was massive imports of subsidised rice from the United States which undercut local prices and Haitian farmers, unable to earn a living in rice farming, migrated to the overcrowded urban areas.

Looking to the future

At the regional meeting, SELA members agreed that the region must respond to the food crisis with a regional food security programme. During the debate, Guyana proposed the establishment of a special fund to assist poor countries with food security and to offer concessionary term credit for small agricultural producers to assist them in overcoming the high cost of restarting after losses due to pests, floods and other natural disasters.

In the end, the meeting called for the establishment of a special fund administered by any of the multilateral financial institutions to assist countries affected by the food crisis. This proposal was subsequently sent to the FAO meeting in Rome.

Looking to the future, LAC governments, keeping in mind the constraints and factors affecting food supplies, must actively encourage sustained and scaled-up investment in agriculture at all levels, including the enhancement of the security of tenure for small land-holders and the preservation and expansion of agricultural livelihoods.

Certainly, the current food crisis must not be considered as just a phase in global development. And, definitely, its adverse consequences in the region, as well as globally, will not be confined only to small developing countries and poor people.

Odeen Ishmael

(The writer is Guyana's Ambassador to Venezuela. The views expressed are solely those of the writer)