Economy

From 2005 to September 2009, the government of Hugo Chávez has awarded contracts in the areas of infrastructure, energy and transportation, in excess of USD 100 billion, to foreign governments and enterprises. From street paving in Quíbor, a small town located in northwestern Lara state, to construction of large dams throughout the country, the Venezuelan president has leaned toward foreign technology and privately owned multinationals.

A study performed by Centro de Investigaciones Económicas (CIECA), headed by Franklin Rojas, evidences how the Venezuelan government has chosen foreign conglomerates to perform numerous projects throughout the country. These works, aimed at domestic development in areas such as housing, highways and public roads, power and oil plants, as well as industries and infrastructure, have been awarded to large companies from Brazil, Russia, France, Cuba, China and Iran.

Few projects have been allocated to Venezuelan enterprises, except for developments such as the Caracas-La Guaira viaduct, which was awarded to Venezuelan contractor Precomprimidos CA, whose résumé include large-scale structures like the Rafael Urdaneta Bridge spanning Lake Maracaibo and El Guri Dam.

Rojas believes that, compared with tax revenues, few investments have been made in the country. Figures show that since 2005 projects and donations of over USD 350 billion, a sum tripling the aggregate amount of domestically awarded contracts, have been allocated to foreign sources.

CIECA bases its analysis solely on official announcements by the government. Therefore, since they are nothing but announcements, the developments themselves may or may not eventually come to fruition. Also, the investments announced may span several years.

Housing
In the housing sector, Cuba is amongst the countries most benefited by the award of contracts. The developments planned include "socialist cities," like the one founded in Ciudad Caribia in the coastal state of Vargas, along the Los Indios Trail. Launched in 2007, this project contemplates the construction of 20,000 homes. The island nation has also been awarded the Ciudad Mariches development, a USD 1.3-billion contract, already underway.

China has executed several agreements to build nearly 60,000 homes in several regions of the country. Iran will also develop roughly 5,000 homes for the so-called socialist cities in the Caracas slums of Hornos de Cal, in the sector of San Agustín del Sur. This project faces opposition from the area's current dwellers, who refuse to leave their present homes. Overall, Iran has been allocated development of nearly 25,000 homes. Portugal has also signed housing-development contracts for approximately 100,000 homes. Brazil has entered into contracts for building 10,000 homes, while Belarus and Uruguay have been awarded projects for 7,500 and 12,000 housing units each.

Infrastructure
Brazil has gained the most in the area of infrastructure through three of its conglomerates: Odebrecht, Camargo Correa and Andrade Gutiérrez. The second and third bridges over the Orinoco River were awarded to Odebrecht for USD 2 billion, as well as projects in the Metro de Caracas and several others. The El Guapo Dam and the Tuy IV contracts were awarded to Camargo Correa, the former for nearly USD 100 million and the latter for USD 390 million. A. Gutiérrez signed contracts for development of shipyards in the Eastern region of the country and in Araya. Brazil will build the southern railway and carry out city-planning projects.

Belarus and China have signed road-construction agreements for USD 5 million each. Iran will build the Cerro Azul cement plant for USD 520 million, as well as city planning and development at Anaco, Acarigua and Barinas and even paving works in the town of Quíbor. Mexico built the Cachamay sports facility for the Americas Soccer Cup for USD 74 million, and Portugal performs improvements on the La Guaira port.

Energy and Oil
Brazil leads this sector with joint public-private enterprises (Brasken-Pequiven) for development of a USD 250-million polypropylene plant, a USD 1.7-billion olefins plant, a USD 1.25-billion polypropylene plant, a USD 1.3-billion ethylene plant, Propilsur's USD 400-million plant and the Gran Mariscal de Ayacucho gas project.

In spite of limited expertise in the oil business, Cuba was allocated exploration rights over the Boyacá Block of the Orinoco Belt and construction of 11 ethanol plants for a total of USD 1.52 billion. Also, power generators amounting to USD 513 million have been imported from the island.

Belarus was awarded extraction rights over three Pdvsa fields. Russia holds contracts for works at the Uribante-Caparo dam of USD 850 million; at the Orinoco Belt, Junín Block, of USD 18 million; and at the Rafael Urdaneta gas project of USD 12 million. Japan will perform a USD 20-million overhaul of the refineries of El Palito, Puerto La Cruz, as well as other gas projects.

Interesting data
Cuba is party to contracts in several areas. One of the most noted is the much-heralded Ezequiel Zamora sugar mill, launched in 2002 but expected to open by the end of the year. Cuba has received USD 848.6 million for its development budget.

For Venezuela's Barrio Adentro missions and modules, Venezuelan organizations have received USD 329.11 million. The fact that Cuba, despite not having a single railroad system on the island, was awarded contracts contemplating railroad repair, maintenance, training, as well as development of the Valencia Subway, is a cause for concern.

Lacking trust
A marveled Iranian topographer said that "Venezuela is paradise." He opted to come to Venezuela to earn more money. He thought that everything had to be built from scratch and pictured it similar to an African country. He was surprised to find technological and development capabilities. Earning a salary of USD 7,000, this skilled worker has certainly found paradise.

Humberto Blanco, head of the Venezuelan Engineering Federation, believes that the government does not trust Venezuelan professionals and the country's private sectors. Though certain agreements with foreign countries may be highly profitable and lead to valuable technological exchanges, they must be awarded transparently. In the past, a bidding process was carried out and members of the Engineering Federation sat in. He points out that those multinationals bring in their own experts and hire local professionals only for second and third-tier responsibilities.

Translated by Félix Rojas

Francisco Olivares
EL UNIVERSAL