Hugo Chavez Nationalizes Cement Industry
President Hugo Chavez ordered the nationalization of Venezuela's cement industry, saying his government cannot allow businesses to continue exporting raw materials needed to help tackle a domestic housing shortage.
Speaking during a nationally televised address Thursday, Chavez said the affected cement companies, which include Mexico's Cemex SAB, France's Lafarge SA and Switzerland's Holcim Ltd, will be paid fair compensation in the state takeover.
"We are going to prepare a plan to modernize these cement plants," he said.
Chavez, who says he is leading Venezuela toward "21st century socialism," said the nationalization would take place in the "short term," but did not provide specific dates.
Chavez spent much of 2007 promoting his revolutionary vision of a new Venezuela, and he began by nationalizing the country's electricity, telecommunications, natural gas and oil industries.
But Chavez began toning down his rhetoric after a stinging electoral defeat in December, when his opponents voted down proposed reforms that would have allowed him to enshrine his socialist agenda in Venezuela's Constitution and push forward with an agenda for revolutionary change.
Thursday's takeover order represents his most radical nationalization move since then.
Most of the cement market in this South American country, which has suffered from a severe housing shortage for decades, is supplied by foreign companies.
In Venezuela, Cemex runs three plants that produce about 2.4 million tons annually. Holcim operates two cement plants in Venezuela with a production capacity of roughly 2.4 million tons a year. Lafarge has two plants that produce 1.5 million tons a year.
In Mexico, calls to Cemex offices were not immediately answered late Thursday.
Mexico's Foreign Relations Department released a statement saying it had begun talking with Venezuela's government to understand the reach and nature of Chavez's statements.
"Naturally, as on previous occasions, the department will do everything within its reach to protect the interests of Mexican companies operating abroad," the statement said.
In Caracas, business chamber offices were closed and there was no immediate comment. But in the past, the president's critics, including leaders of local business chambers, have argued the nationalizations will hurt Venezuela's economy by scaring off foreign investors.
Chavez's political allies argue the takeovers are necessary for the success of the government's development plans.
Prior to Thursday's announcement, Chavez had repeatedly expressed frustration with the high cost of construction materials and threatened to seize control of companies that fail to provide low-cost cement for the domestic market.
Last year, he said many of Venezuela's cement factories prefer to sell their product abroad at higher prices and warned: "If the cement factories do not (sell in Venezuela), we will occupy them."
© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Speaking during a nationally televised address Thursday, Chavez said the affected cement companies, which include Mexico's Cemex SAB, France's Lafarge SA and Switzerland's Holcim Ltd, will be paid fair compensation in the state takeover.
"We are going to prepare a plan to modernize these cement plants," he said.
Chavez, who says he is leading Venezuela toward "21st century socialism," said the nationalization would take place in the "short term," but did not provide specific dates.
Chavez spent much of 2007 promoting his revolutionary vision of a new Venezuela, and he began by nationalizing the country's electricity, telecommunications, natural gas and oil industries.
But Chavez began toning down his rhetoric after a stinging electoral defeat in December, when his opponents voted down proposed reforms that would have allowed him to enshrine his socialist agenda in Venezuela's Constitution and push forward with an agenda for revolutionary change.
Thursday's takeover order represents his most radical nationalization move since then.
Most of the cement market in this South American country, which has suffered from a severe housing shortage for decades, is supplied by foreign companies.
In Venezuela, Cemex runs three plants that produce about 2.4 million tons annually. Holcim operates two cement plants in Venezuela with a production capacity of roughly 2.4 million tons a year. Lafarge has two plants that produce 1.5 million tons a year.
In Mexico, calls to Cemex offices were not immediately answered late Thursday.
Mexico's Foreign Relations Department released a statement saying it had begun talking with Venezuela's government to understand the reach and nature of Chavez's statements.
"Naturally, as on previous occasions, the department will do everything within its reach to protect the interests of Mexican companies operating abroad," the statement said.
In Caracas, business chamber offices were closed and there was no immediate comment. But in the past, the president's critics, including leaders of local business chambers, have argued the nationalizations will hurt Venezuela's economy by scaring off foreign investors.
Chavez's political allies argue the takeovers are necessary for the success of the government's development plans.
Prior to Thursday's announcement, Chavez had repeatedly expressed frustration with the high cost of construction materials and threatened to seize control of companies that fail to provide low-cost cement for the domestic market.
Last year, he said many of Venezuela's cement factories prefer to sell their product abroad at higher prices and warned: "If the cement factories do not (sell in Venezuela), we will occupy them."
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U.S. Cement companies....
thats capitalism at work...
Posted by Quetzal0666 at 03:35 PM : Apr 04, 2008
"Chavez said the affected cement companies, which include Mexico''s Cemex SAB, France''s Lafarge SA and Switzerland''s Holcim Ltd, will be paid fair compensation in the state takeover"
He controls the "State", the people do not!!, There are no American companies listed. Venezuela and Cuba, two of a kind.
Posted by Prinzowhales
yes, socialism is the answer you ignorant a$$
U.S. Cement companies....
thats capitalism at work...
Of course...wages in the industry are kept down... Remember, increased wages always cause inflation... increased profits never do...
Last year, he said many of Venezuela''s cement factories prefer to sell their product abroad at higher prices and warned: "If the cement factories do not (sell in Venezuela), we will occupy them."
So, what does this say, people? He is taking control of everything. I believe that this is not socialism, but more like communism. He IS a dictator trying to take of Venezuela. Eventhough he lost his chance of having unlimited access to the throne, I''m sure he will take the crown anyway!!!
Excellent way to put it. I''d go the step further and say He will NOT be able to deliver in the long term, and is destroying his economy in the short term, but also looks the hero in the short run. Of course - that''s why he was hoping to set up his dictatorship for life in the last vote. He KNOWS he''s doomed.
What''s the matter Hugo - run out of money to give to the peasants ? Have to rape another industry within your boarders to keep the office ?
I''m telling you, one of two things will happen. Either this man (hah - dog) will die in the near future, or his country will go to war, so the peasants won''t depose him. He''s running out of industries to "nationalize". Translation - steal from the rightful owners and wreck in the process.