CARACAS, Monday August 29, 2011 | Update
Venezuelan gov't has seized 988 companies

The Venezuelan Confederation of Industries (Conindustria) is afraid that seizures drives investments away

The Venezuelan government has seized 401 private companies so far this year, 41 percent more than in 2010, according to estimates by Conindustria, the Venezuelan industrial association (File photo)
Monday August 29, 2011  10:02 AM

From 2002 to date, the Venezuelan government has seized 988 companies, according to data from the Venezuelan Confederation of Industries (Conindustria).

An in-depth analysis of the annual number of seizures found that, far from diminishing, government's seizures have increased. So far this year, 401 companies were taken over by Venezuelan authorities, which is 41 percent more than the 284 companies expropriated in 2010.

The faster pace of expropriations is also shown in the fact that between 2009 and 2010 there were 422 seizures of companies, almost the same amount of expropriations than in the first eight months of 2011.

According to Conindustria, this scenario "only creates legal uncertainty; drives investments away; and reduces the possibility of increasing production," and results in less opportunity to solve problems such as supply and the high cost of living.

Meanwhile, Jorge Botti, the president of the Venezuelan Federation of Trade and Industry Chambers (Fedecámaras), thinks that the Executive Office "has not measured" the effect of seizures in the domestic economy. "Every time a company is seized, this decision acts as an inhibitor, as a fear factor for millions of Venezuelan who intended to invest."

Data from the Central Bank of Venezuela (BCV) show that in the in the second quarter of 2011, investment fell to its lowest level in five years (3.6 percent). Foreign investment is not very encouraging either; in the first six months of the year it amounted to USD 1.18 billion.

"Economy has come to a standstill for these reasons. Governments should dedicate to inaugurate (works), they should not seize (companies) ... It is a bad signal for the attempts at investment of the Venezuelan people," the president of Fedecámaras insisted on saying.The construction sector has been the hardest hit by the expropriation policy. According to Conindustria, 408 of 988 seizures carried out since 2002 have been in the building sector, a 41.3 percent of the total.

Translated by Gerardo Cárdenas

Is protest over?

That political protest in Venezuela has lost momentum seems pretty obvious: people are no longer building barricades to block off streets near Plaza Francia in Altamira (eastern Caracas), an anti-government stronghold; no new images have been shown of brave and dashing protesters with bandanna-covered faces clashing with the National Guard in San Cristóbal, in the western state of Táchira; and those who dreamed of a horde of "Gochos" (Tachirans) descending  in an avalanche to stir up revolt in Caracas have been left with no option but to wake up to reality. Estampas
Alianzas Estampas