Companies Agropatria and Lácteos Los Andes Managed by Private Operators, Reports Bloomberg

According to US news agency Bloomberg, the companies Agropatria and Lácteos Los Andes, which became the property of the Venezuelan State as part of a process of nationalizing companies in strategic sectors of the economy by Hugo Chávez’s government, are managed by private operators.

An article authored by journalists Fabiola Zerpa and Nicolle Yapur, published this Friday with Bloomberg, stated that “Agropatria, an agricultural supply company the size of a monopoly, nationalized in 2010” is “run by Agrollano 2910, a local farming firm investing almost $150 million to restock,” according to “four people” familiar with the subject.

Last November 26, Venezuela’s investigative journalism outlet La Tabla, citing a communiqué sent to the workers of the Agropatria stores, reported that their “new employer is a company called Grupo Agrollano 2910, C.A.” The document stated that the substitution of the employer would take effect as of November 1.

“The communication explains that the measure complies with the second clause of the Strategic Alliance between Agropatria and Agrollano signed on April 14, 2020, with the objective of consolidating the production of agrochemicals and tools,” reported La Tabla at the time. “The alliance has a duration of 20 years.”

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Regarding Lácteos Los Andes, Zerpa and Yapur wrote in the Bloomberg article that the company, considered “a large milk processor and beverage manufacturer, bought by the government in 2008, is now managed by a private Venezuelan company, although no official changes have been made to the board.”

Venezuelan investigative journalists also referred to this case in an item published October 28, 2020, mentioning “a set of companies owned by the State, subject to transfer processes to the private sector,” based on the provisions of 2012’s New Associative Forms Law, which allows for “strategic alliances” between the State and private companies.

In addition to Agropatria and Lácteos Los Andes—reportedly managed by an Iranian consortium—Central Azucarero Pío Tamayo (Consorcio VEINCA), Central Azucarero Río Guanare (Aliceole), and Waraira Repano Cable Car were also transferred to the management of a third party, Operadora 1956, in charge of the administration of the Hotel Humboldt.

La Tabla stated that the processes were initiated “several months before” the approval of the Anti-Blockade Law by the National Constituent Assembly, on October 8, 2020, so it’s not likely that these operations are covered by the aforementioned legal instrument.

“Dozens of chemical plants, coffee processors, grain silos and hotels confiscated over the past two decades have been transferred—but not sold—to private operators in so-called strategic alliances,” wrote Bloomberg. These transfers were all falsely attributed by Bloomberg to the Anti-Blockade Law, with which the Venezuelan government is trying to circumvent the sanctions imposed by the United States and the European Union, and strengthen the battered local economy.

Among the assets reportedly transferred to private administration are “two government grain processing plants,” in addition to “milk and coffee plants built during Venezuela’s oil boom and under bilateral agreements with regional allies such as Cuba, Bolivia, Brazil and Argentina,” although no specific names were reported.

According to Bloomberg’s sources, managers are obliged to cover payroll and invest in the company, in exchange for delivering “products and a percentage of their revenues to the government.” These transfers are focused on companies related to agricultural activity, but not exclusively.

“Similar partnering terms have been set before in the oil industry,” wrote Bloomberg. “PDVSA granted local firms more control over state-run assets such as oil fields and gas-compressing plants to operate and raise production. And in some cases, PDVSA granted partners more equity at their joint-ventures.”

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In contrast to the cases of Agropatria and Lácteos Los Andes, Bloomberg didn’t specify which companies allegedly made strategic alliances with the government to join the oil business, nor the terms of these alliances which—if they are as Bloomberg claims—would contravene the provisions of the current Constitution of Venezuela, which reserves the control of all phases of the oil activity to the State.

Moreover, while reporting that “the strategic alliances started to form quietly in 2017,” Bloomberg explains the absence of verifiable data with a reference to the non-disclosure provisions of the Anti-Blockade Law, passed [in September 2020] to protect companies from Washington’s unilateral coercive measures

In another paragraph the article mentions that, according to “some of the people” interviewed for the report, “in some cases, a standardized monthly pay scale of $60-$80 for workers and technicians is being discussed by government and managers at the joint ventures.”

Another of the actions taken by the Maduro administration to generate income and confront the crisis is the authorization of associations between governments and local companies. Thus, they recall that “in December, the governor of the agricultural state of Portuguesa, Rafael Calles, told public service media that the alliances with the private sector in the administration of 24 state companies raised $60,000 per month for his office.”

 

Featured image: Agropatria agricultural supply store in Turen, Portuguesa state, Venezuela. Photographer: Fabiola Ferrero/Bloomberg

(La Iguana)

Translation: Orinoco Tribune

OT/SL/JRE