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VENEZUELAN NOTES

Venezuelan society can be summed up as a country where the state is rich and the people poor. Most of the population is concentrated in and around a few metropolises whilst other folk live in the ranchos or shanty towns which are scattered in the hills and the valleys. Caracas itself is unique in that a higher percentage of its population live in ranchos around the city than the number of people living in the city itself. There is next to nothing in the way of facilities for these people and violence rates are among the highest in the world.

Oil brought in some $270bn between 76 and 95 (the post W.W.II Marshall Plan cost $13bn) but the revenue has not been used to provide even a basic infrastructure let alone to help lessen social inequality. Meanwhile, those who profit, have salted $100bn away in foreign banks whilst 71% live in poverty, 21% are unemployed, 2,000,000 children live in hardship while 200,000 beg. No wonder some 40% are estimated to be dependant on the informal economy.

Due to a colonial twist of history the oil wealth in Venezuela has always belonged to that state. The monopoly PDVSA saw Venezuela into second place as an oil producing nation in 1976. No serious attempt was made at the time to industrialise and people were bought off with a minimum income policy and dependency started to set in.

Despite a recent burst of the privatisations key sectors remain in state hands leaving Venezuela as one of the most state dominated economies in the world. The people have seen little benefit. Instead of health, education and public services the state squanders money on useless megalomaniac projects.

Caldera the current president since 1993 tried to distance himself from the IMF and he appointed a seasoned 'lefty' - Teodoro Petkoff - in charge of economic planning. International finance organisations and Washington put the pressure on and Caldera caved in in 1996 accepting a severe Structural Adjustment Plan which is now being implemented by born again free-marketeer Señor Petkoff.

Oil prises and interests went up and the bolivar came down. Privatisation dominated the political agenda. So much so that the historically state dominated oil industry started to inch into the hands of foreign owners.

Is it surprising then that we find a former military man - Hugo Chavez - riding high on a wave of popularity? The two main political parties Copei (Christian Democrat) and AD (Social Democrat) have been too chummy for too long and the people are fed up with broken promises. The outcome on November 8th in an election where barely half the population turned out was Colonel Chavez' party - the MVC - in second position behind the Social Democrats. However, the patriotic groups within the Congress have a potential working majority. A new round of corruption and horse trading seems to have begun but in reality it will turn out to be simply another episode in another South American soap opera.

Information from Le Monde Diplomatique December 1998

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