Venezuela fortifies protection to investments of political allies

In the last years the Government has carried out a resetting of his fan of investors. The interest has changed, and not indeed by economic strategy, but by the ideological load of the businesses.

Indeed, by this change of north happened during the mandate of president Hugo Chavez, the guarantee for those groups or companies that wish to inject capitals to the Venezuelan economy also has varied.

Professor of the UCAB and UCV, Eugene Hernandez Bretón, indicated this week that the direction of Venezuela in the protection of the investments has concentrated in the economic subjects, but also politicians.

During the forum Expropriations or routes in fact? , that was realised in last days, the educational one said that Venezuela does not have treaties of protection and promotion of investments with its main economic partners - United Colombia and Estados, with whose Chávez governments has had bitter political conflicts.

Between friendly
The National Council of Promotion of Investments indicated among others in his report of 2008 that the priority has settled on Vietnam, Belarús, China, Brazil, Argentina, Ecuador and Russia, nations with which the Government agrees ideologically, and with some agreements majority of the cases of cooperation have been signed of protection of investments and, in the agreement, promotion and. A Chinese factory of cellular, an Iranian assembler, oil businesses with Russia, besides the cooperation with the countries of the DAWN, are some of the investments that have stepped on Venezuelan ground.

In a scene of repeated estatizaciones, the protection to the foreign capital has acquired relevance, in view of the payments that must be suitable the affected ones and the State.

The allied countries politicians of Chávez have not found ties in the payment of the compensations by the expropriations. The most recent case is the one of the cementera Holcim, of Swiss capital, that was not satisfied with the compensation offered by the Government after the estatización with its branch in the country.

Although between Venezuela and Switzerland it exists an agreement of protection and promotion of investments, the cementera indicated that from the economic and legal point of view, the payment offered by the Government is unacceptable.

Not only Holcim, the Lafarge French the Executive will recognize 40% to him of the compensation immediately and percentage will cancel the remaining it in four years and without interests.

Other partners investors under risk are the Colombians, after which this week president Chávez, in the heat of impasse politician who affects both nations, threatened expropriating to the companies neogranadinas seated in Venezuela.

Certain conditions apply
With Spain also a threat years ago appeared, when king Juan Carlos him espetó “why you do not shut up yourself” to Chávez, and a stage of diplomatic tension between both governments was caused. Chávez said at the time that the Iberian investment was not essential. But already surpassed the incident, and within the framework of one recent visit of the minister of Outer Relations of Spain, Miguel Moratinos Angel, the Executive promised to Madrid legal security to the investments, although with conditions.

Members of the ministerial train of Chávez only indicated to Moratinos that the Spanish capitals will be respected, if the companies transfer their technology.

“The investments Are welcomes, but they must be committed to realise the technological transference and to give the due attendance”, explained Public Work minister and Vivienda, Diosdado Hair.

Indeed in this scope it is that the Government has centered his new formula to protect the investments. The effective Law of Promotion and Protection of Investments, that Chávez approved during his first Qualifying one in 1999, will be reformed.

The minister of Commerce, Eduardo Samán, clarified that the objective of the changes is to restrict the foreign investment only to those who transfer technology, although will apply other requirements to accept the injection of foreign capitals.

Until now, the most concrete effect of the reordering of the investments is a loss of 40% in nine years (1,716 million dollars in 2008), according to data of the Central bank of Venezuela.

Suhelis Tejero Puntes
THE UNIVERSAL ONE