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  HOME | Venezuela (Click here for more Venezuela news)

Venezuela Expropriations: Chávez Talks Himself into Trouble with Argentina's Fernández de Kirchner
The spark for the conversation sought by Fernández de Kirchner was a remark Chávez is reported to have made in private to Brazilian President Inacio Lula da Silva. That remark, it’s said, was to the effect that Venezuela was on course to take over foreign companies except for Brazilian ones.

By Jeremy Morgan
Latin American Herald Tribune staff

CARACAS – President Hugo Chávez’ strategy of nationalizing companies including foreign ones, and a remark he did or did not make in seriousness to Brazilian President Ignacio Lula da Silva, appear to have posed problems for him and his Argentine friend and colleague, Cristina Fernández de Kirchner.

Chávez has depicted Fernández de Kirchner as an ally and soulmate in his bid to build a regional alliance to counter what he sees as the undue influence and power of the United States in Latin America. But his peremptory takeover of steelmaker Sidor and his tendency to talk off the top of his head may well have put her in between the proverbial rock and a hard place at home.

Fernández de Kirchner is said to have telephoned Chávez asking him to explain his nationalization program and how it affected other countries’ interests. Chávez has “expropriated” a 60% controlling stake held by Argentine engineering group Techint in steelmaker Sidor.

But it’s said that compensation terms have yet to be settled, and that Techint and the government are still far apart on that issue. Furthermore, Chávez is talking of taking over three subsidiary companies in which Techint has interests. The companies are Tavsa and Matesi, where Techint is the majority shareholder, and Comsigua, in which it has a minority stake.

The spark for the conversation sought by Fernández de Kirchner was a remark Chávez is reported to have made in private to Brazilian President Inacio Lula da Silva. That remark, it’s said, was to the effect that Venezuela was on course to take over foreign companies except for Brazilian ones.

In Caracas, the Foreign Ministry tried to dismiss the statement, saying Chávez had spoken in jest. If that were the case, it might have been better to have left it at that.

Instead, an official statement released by the Foreign Ministry went on to rail at considerable length against “a ferocious campaign of defamation against Venezuela” by the Argentine media, which it claimed was out to mislead the Argentine public into seeing Venezuela as a threat to their interests.

The French news agency, AFP, had already reported the humorous nature of Chávez’ remark, noting that it had prompted “jocularity” among those present at the time, the statement said.

The Argentine media had set out to misrepresent the motives which had led to a “sovereign and legally made decision” by the Venezuelan government,” the statement fumed.

The statement insisted that the takeover procedure had “guaranteed” Techint “just and prompt compensation for the shares that now return to be the property of the Venezuelan people, after having been unjustly and fraudulently privatized during the long and dark neoliberal night.” Once again, the ministry’s press officers primarily had their eyes on domestic consumption.

But a report by the Argentine state news agency Telam, which had reached the public domain several hours before the Foreign Ministry acted, put a rather different interpretation on events.

Telam’s report if anything pre-emptively undermined the ministry’s retrospective rationalization had Chávez had only been joshing with the guys. In fact, its version of events was severely at odds with what the ministry was to say later on.

Telam said that Chávez denied to Fernández de Kirchner having made any such statement to Lula. At which point, she is said to have told him to issue a public denial to that effect. Presumably, the Foreign Ministry eventually took that one on board, albeit after nary a word from the presidential palace, Miraflores.

As reported by Telam, the tone of Fernández de Kirchner’s response to Chávez’ denial, and much of what was to follow, suggested a lady who was not best pleased. It’s unlikely that, as the official news agency, Telam would have misconstrued her words – even if, as the ministry claimed, the rest of the Argentine press industry was.

Fernández de Kirchner was further said to have told Chávez that she would be keeping an eye on statements before saying anything herself from then on. Whether this was an attempt to get Chavez to rein himself in remains to be seen.

Telam quoted her as having said that any such statement as he was supposed to have made to Lula would imply “a degree of discrimination” in Chávez’s approach to nationalizations. This, she added, would impinge upon the sovereignty of individual nations.

That, she was said to have continued, would be “an unacceptable attitude” and an “absolute contradiction” of agreements signed by Argentina and Venezuela. She and Chávez have signed a string of cooperation agreements.

Ahead of the telephone conversation, Argentine Foreign Minister Jorge Taiana had announced that he was to meet next Monday with his Venezuelan counterpart, Nicolás Maduro, to discuss the plan to take over the three other companies linked with Techint.

“We are going to express the interest which the Argentine government assigns to the respect of the rights of a company, but within the framework that we have also to respect the sovereignty of other countries,” Taiana pointedly remarked.

The two ministers are due to thrash this out when they meet at the General Assembly of the Organization of American States (OAS) in San Pedro Sula in Honduras between May 31 and June 3. Noting that he and Maduro had spoken about these issues before, Taiana expressed hope that the two ministers would be able to sort things out.

In Buenos Aires, Fernández de Kirchner was under mounting pressure from the Argentine business community, where dislike of Chávez and all that he stands for would seem to be mounting by the day.

A director of Techint warned last week that he intended to raise the company’s case with Fernández de Kirchner. Since then, the pressure on her to take a stand on the takeover has steadily mounted as Argentine business leaders focus their sights on Chávez.

They have now homed in on one of Chávez’ pet aspirations – that Venezuela should join Mercosur, the economic bloc formed by Argentina, Brazil, Paraguay and Uruguay.

To date, this idea has met with an at best mixed reception from the business and political communities in those countries. Now, Argentine business leaders are said to have called on Mercosur not to admit Venezuela.

 

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