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The Realities of 'Bolivarianism'

By Jeffrey Snyder

Oxford 13.08.06 | Bolivia's Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) today announced that it was temporarily suspending its plan to nationalize the country's oil and gas industries for lack of money. This is a rather significant blow to Chavez's regional ambitions and it so far has not received the media attention it probably deserves.

It seems the realities of buying out the likes of Petrobras, Repsol, BP, and British Gas have finally hit home. Of course, I can't imagine Morales's sugar daddy in Caracas would refuse a request for funds, but where will all the money come from? The poor fiscal reputation of PDVSA (see here) and the increasingly extreme foreign policy have isolated Chavez from potential funding sources in ways that 5 years ago would have been unimaginable. The quaint experiment in socialism was then still accepted by some investment circles as at least partly convenient rhetoric. After all, Venezuela was still an oil rich country and the revised hydrocarbons law wasn't nearly as bad as all the fuss suggested it might be, but the more one learns about 'Bolivarianism' the more concerning it becomes to previously tentative but willing investors.

When will the music stop? A good indication of the fiscal status of the revolution will be apparent in the Venezuelan government's response to the cry for help from its regional allies in La Paz. So far not a peep from Caracas.

[News Source: Bolivia admite no tener recursos para la nacionalización de hidrocarburos, El Universal (Caracas, 13 August 2006)]
[Photo Source: AP]

Source Venezuelan News Analysis

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