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Business is Booming in Venezuela

chavez.jpgContrary to conventional wisdom, business is booming in Hugo Chavez' Venezula according to BusinessWeek:

No doubt, Venezuela is a pretty scary place to invest these days. But in some respects business is better than ever. Thanks to soaring oil revenues, Chávez is spending heavily--some $13.3 billion last year alone--to win support for his "Bolivarian Revolution." For the past three years the economy has grown at an 11%-to-12% clip, while consumption has expanded by 18% annually. The poor, 58% of all Venezuelans, have seen their meager household incomes more than double since 2004 thanks to cash stipends, subsidized food, and scholarships from the government's social-development programs.

Trade with the US has never been better:

You might call it business' love-hate relationship with Chávez. Local and foreign companies alike are raking in more money than ever in Venezuela. Two-way trade between the U.S. and Venezuela has never been higher. Venezuela exported more than $42 billion to the U.S. last year, including 1 million barrels of oil daily, and imported $9 billion worth of American goods, up 41% from 2005.

High-tech US companies like Intel are finding opportunity in Venzuela:

Other industries are not only putting up with Chávez but also benefiting directly from his programs. Take Intel Corp.: Sales of its microprocessors in Venezuela jumped by 15% in 2006 and look set to grow at the same pace this year as the government equips schools and public offices with new computers.

Venezuela is proving to be a good investment for our ailing auto companies:

Ford and General Motors Corp. (GM) have manufactured cars in Venezuela for nearly a half-century, but with the strength of the bolivar, imports of pricier models such as the Ford Expedition sport-utility vehicle and GM's Silverado pickup are on the rise. Last year, Ford's sales increased 52%, to nearly 62,000 cars and trucks, as its imports more than tripled, to 28,000. GM's sales jumped 21% last year, to 71,000 vehicles, and so far this year are on track to climb by 50%.

On the down side, Hugo Chavez has been steadily consolidating his power and curtailing the opposition in a distinctly non-democratic manner. Still, whenever dealing with these situations it's helpful for us to put things into perspective. Chavez has succeeded in improving the lot of Venezuela's huge lower classes and remains extremely popular with them. The country has always had an extraordinarily stratified society in terms of wealth with a hugely rich and tiny upper class and a massive and impoverished lower class. Correcting that historic imbalance is surely a controversial task, but in doing so Chavez has laid the groundwork for a much more prosperous, egalitarian and middle-class Venezuela in the future.

We do business every day with countries that have far worse human rights and democratic records than Venezuela. Saudi Arabia and Pakistan, two of our most important allies in the war on terror, come immediately to mind. Maybe it's time to get off our high horse when it comes to Venezuela.

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Comments (8)

Steve Crickmore:

I visited Caracas for about two weeks in 95 and what struck me most were all the old wide fin gas guzzling 50's Plymouths and Fords that were on the streets...This plus you could take a taxi for a 300 mile trip for less than 20 dollars....As long as Chavez and Venezuela has oil, and the prices are high the economy will be fine, but Chavez is fundamentally interested in power for himself and those in his party..I see the rising emergence of an elite society in Venezuela in the future, those that are members of Fifth Republic Movement (MVR) and those that are not...I doubt this will be any better than the old system, in many respects worse, though like Cuba, some things like health care, have certainly improved for the poor.

Paul Hamilton:

Chavez is all about Chavez. He'll toss an occasional bone to the poor folks to keep their support, but he's just like any other dictator and will do whatever it takes to be the only game in town.

Simon Bolivar:

All the statements about booming economy are backed up by numbers, but I suppose this is just your opinion?:

"On the down side, Hugo Chavez has been steadily consolidating his power and curtailing the opposition in a distinctly non-democratic manner."

62% of the Venezuelan electorate voted to re-elect Chavez in democratic elections approved by a massive amount of international observers on Dec. 3, 2006. Rather than writing a thirty page essay in this comment, I will offer to refute, one by one, any of the mainstream media, imperialist, or rightwing South American produced lies from the last couple of years that may have led you to make such a statement.

Not only is business booming, but so is participatory democracy and a truly new form of government.

Lee Ward:

Chavez's success and ease with which he silenced the opposition media outlets RCTV and Globovision suggests other wise, Simon.

A democracy in an environment where the freedom of the press is limited can hardly be called thriving.


Venezuala is thriving!!!!1!

CARACAS, Venezuela -- President Hugo Chavez urged soldiers on Sunday to prepare for a guerrilla-style war against the United States, saying that Washington is using psychological and economic warfare as part of an unconventional campaign aimed at derailing his government.

Dressed in olive green fatigues and a red beret, Chavez spoke inside Tiuna Fort -- Venezuela's military nerve-center -- before hundreds of uniformed soldiers standing alongside armored vehicles and tanks decorated with banners reading: "Fatherland, Socialism, or Death! We will triumph!"

"We must continue developing the resistance war, that's the anti-imperialist weapon. We must think and prepare for the resistance war everyday," said Chavez, who has repeatedly warned that American soldiers could invade Venezuela to seize control of the South American nation's immense oil reserves.

U.S. officials reject claims that Washington is considering a military attack. But the U.S. government has expressed concern over what it perceives as a significant arms build-up here.

"It's not just armed warfare," said Chavez, a former army officer who is leading what he calls the "Bolivarian Revolution," a socialist movement named after 19th-century independence hero Simon Bolivar. "I'm also referring to psychological warfare, media warfare, political warfare, economic warfare."

Under Chavez, Venezuela has recently purchased some $3 billion worth of arms from Russia, including 53 military helicopters, 100,000 Kalashnikov rifles, 24 SU-30 Sukhoi fighter jets.

Yes, a new form of government Simon. Or, not really. "Fatherland, Socialism, or Death! We will triumph!"

Simon Bolivar:

Yes, Chavez is purchasing arms, as most countries do. Our very own land of the free is after all the world's biggest arms purchaser and arms dealer, yet nobody flinches when GW or Clinton or any of the others were addressed as, leader of the free world. Heh, the free world of arms trading. If you care to do the research and not be influenced by mediated perceptions... Venezuela's current military budget is no greater than it was under the previous neoliberal administrations, and this government does have much to fear from its superpower neighbor in the north, which already supported a military coup against it and funds through the NED dozens of opposition groups itching to overthrow.

Check this link and scroll down to june 11.

Globovision has not been shut down or silenced, neither has RCTV really. RCTV had a concession to broadcast over a certain frequency, and it was simply not renewed.

Our very own land of the free is after all the world's biggest arms purchaser and arms dealer, yet nobody flinches when GW or Clinton or any of the others were addressed as, leader of the free world.

What, you think I'm just concerned because they didn't buy the weapons from us? Not so.

You don't become and remain the world's only superpower without the most weapons. Wish the world didn't work that way, but it does.

Venezuela's current military budget is no greater than it was under the previous neoliberal administrations, and this government does have much to fear from its superpower neighbor in the north,..

Here's the rub. If Chavez wants to turn his country in to a socialist paradise, you know, like Cuba, that's one thing. But can he really expect to turn his people's attention away from his power grab and focus it on us for very long? There is the highly agressive and offensive rhetoric constantly vomited by Chavez towards both the U.S. as a whole and Bush and particular. Consistent, publically expressed paranoid delusions about people out to get him doesn't help issues either.

Every country buys weapons, yes. It's who holds the keys to these weapons that causes concern.

One man can buy a whole collection of arms without raising an eyebrow, but the man who might buy less, while running through the streets screaming challenges to people will draw more concern.

This whole scenario reminds me of the Dachsund who growls and barks and strains against it's leash, trying to get the Rottweiler's attention. It won't end well.

Simon Bolivar:

Huh? No, I'm not at all concerned about where the guns are purchased, my point was that Chavez is not engaged in any military buildup despite the perception that may be created by corporate media coverage. His military spending is in line with previous neoliberal administrations.

I guess I don't really understand the rest of your statement, other than that it shows your focus on the United States as the center of the world and as holding this position with some level of legitimacy- something which goes without saying in both Republican and Democratic circles, but not so in the rest of the world, or amongst the true patriots of our great nation.

Your opinion might be different if you or your family had lived through any of the dozens of popular governments in Latin America which have been overthrown overtly or covertly with United States assistance, or even worse the brutal military dictatorships which followed them. Yes, in these cases, it did matter who controlled the guns, because there was no democratic oversight or constitutional guarantees as there are today in Venezuela.

As my namesake famously said: "it seems the United States are designated by providence to plague America (meaning the entire continent, of course) with misery, in the name of liberty"

So, I guess we part ways, I don't see any way we can agree, but I appreciate and respect your earnest responses and the enlightened conclusion of the original blog post.


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Editors: Lee Ward, Larkin, Paul S Hooson, and Steve Crickmore

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