Banco de Venezuela: It might take some more time for people to trust the government’s decision

Caracas Daily Journal: President Hugo Chávez on Sunday called on workers and savers of the Banco de Venezuela to trust the Republic and its decision to nationalize the currently Spanish-owned financial entity, national news agencies reported. Chávez spoke during a political act held in Bolívar state, southeastern Venezuela.

Savers, the president was reported as saying, have more guarantees than before because Banco de Venezuela belongs to the Republic now, and the Bolivarian Republic of Venezuela is one of the strongest in the continent nowadays," the state-run TV station Venezolana de Televisión, VTV, quoted Chávez as saying.

The aim of the move, the president explained, is to recover a bank that since its beginnings had belonged to Venezuela. With the purchase of the bank, which is part of a strategic economic field, the president was quoted as saying, the financial entity is now property "of the people and of the state."

President Chávez referred to the nationalization strategy as one opposed to privatization, which had put Banco de Venezuela into foreign investors’ hands years ago, along with other important enterprises.

Sidor, the president recalled, had been put into capitalist hands, and the workers had to "suffer the worst side" of the "fiercest capitalism." "One of the first thing Sidor's foreign managers did was to dismantle the Scientific Investigation Institute of the enterprise."

"But we are reactivating it with another mission – downstream development," VTV quoted the president as saying. The president went on asking what would have happened if PDVSA had been put into foreign capital's hands too. "Where would Venezuela get resources for the national economic development project?"

An opponent to the nationalization of Banco de Venezuela was also reported to have spoken on Sunday, not only opposing the government's decision, but also calling on Venezuelans to give the case the importance it had. For Economist Vicente Brito, who heads the opposition-aligned organization Red por la Defensa al Trabajo, la Propiedad y la Constitución, the move was "a bad business for Venezuela," the private TV station Venevisión reported.

"I we analyze the purchases of private enterprises that the government has made during the last three or four years … it would make some 10 million dollars Venezuela has compromised to acquire private enterprises that pay taxes and have given an efficient public service," Brito was quoted as saying. "We estimate that in 2008 over $5,000 million will be allocated to cover the deficit created by many public enterprises."