Charlie Devereux's Notebook:

Iran draws only silence from Venezuela

Venezuela’s President Hugo Chavez was one of the first world leaders to congratulate Mahmoud Ahmadinejad on his victory in last Sunday’s elections.

“It was a very big and important victory for the people fighting for a better world,” he was quoted as saying by the Venezuelan Ministry of Information.

Since then, silence from normally vociferous Chavez, suggesting some discomfort at the situation. Two short reports have appeared on the government news agency’s website reporting the unrest. Another quoted Ahmadinejad in Shanghai saying that the epoch of empires must come to an end.

But pro-Chavez blogs have been less restrained. Writing in the pro-government blog Aporrea.org, Aldo Bianchi pointed to a far-right, U.S.-led conspiracy to oust Ahmadinejad. “Did you think that Mossad, the CIA and the ultra-right Republicans would allow this outcome???? (sic). Ahmadinejad is the immediate enemy but the Obama is the crucial target.”

Venezuela has always had relatively close ties with Iran since both are considered rebel members of OPEC, but Chavez and Ahmadinejad have forged a particularly close relationship as crusaders against perceived American “imperialism.”

Chavez visited Iran in April and both Iran and Venezuela have promoted their bilateral relationship joint ventures. Recent trade agreements include the building of Iranian tractors on Venezuelan soil and the Iranian-Venezuelan Development Bank, an entity set up to confront the global economic crisis.

Given their close ties, it’s no wonder you can hear the silence here.

See here for an overview of local reaction around the world.

Government attacks TV station

Police last night raided the home of the president of the Caracas-based Globovision in what may well be the first step in the total shutdown of the TV station.

The police were there purportedly to inspect a collection of cars that Guillermo Zuolaga was keeping at the property. Zuolaga said he had moved them from a showroom because it had recently been burgled.

But most will interpret this as a direct attack by the government on a dissenting voice.

The government repeatedly attacks Globovison and threatens it with closure. By my count it’s about once every three months. But this time it looks like they may well carry it through.

President Hugo Chavez’s rhetoric has been particularly strong this time. On a visit to Argentina he specifically warned that he might have to shut down some media outlets.

The most ludicrous aspect is the latest charge the government is levying against them: they are accused of spreading panic by reporting on an earthquake last month before the state channels did so.

Globovision are no saints and they are certainly not known for their impartial coverage. Think of them as the equivalent of Fox News. Even many people who identify themselves as opposition don’t like them and see them as a hindrance to the opposition’s credibility.

But they are the last dissenting voice on the broadcast airwaves after Chavez neutralized other private channels by threatening to take them off the air. A large majority will see that as an attack on freedom of expression.

The last time this happened – to RCTV in 2007 - there were huge marches in the streets and Chavez lost a referendum six months later.

Globovision won’t relent: attacking the government is their brand and unlike other private channels they don’t have telenovelas to fall back on. The government seems just as dedicated to the fight.

Is this raid just a shot across the bows or the first step in a total shutdown? To me it looks like the latter.

To expropriate or not to expropriate?

 The wave of expropriations that has hit Venezuela in the last few months continued today with the seizure of installations belonging to oil and gas service companies.

 The Venezuelan National Assembly passed a law Thursday entitling the state oil company PDVSA to expropriate property belonging to companies that provide services such as gas and water injection in the oil fields and transportation for workers.

 As of today, 35 percent of the installations — oil rigs, tugboats, terminals, etc. — are now in government hands, guarded by the army.

It’s the culmination of months of wrangling in which service companies have been negotiating with PDVSA over an unpaid bill that is believed to be as much as $14 billion.

 PDVSA wants the service companies, which include household names such as Halliburton and Schlumberger, to reduce their fees by 40 percent because of the crash in oil prices that has seen the price of a barrel of oil fall from a high of $147 last year to its current price of $58, severely cutting into the company’s profits and cashflow.

 This is something that is going on across the oil industry, not just in Venezuela. But the main sticking point seems to be that PDVSA wants this to be a retroactive reduction from when prices were still high last year.

 I’m not going to go into the ethics of taking over companies when you can’t pay them but a crucial point is: what kind of message does this send to the oil industry and the world?

 Oil is essential to Venezuela. It constitutes 93 percent of its exports and oil makes up half the government’s budget. The country is brimming with oil but in current circumstances lacking the capital to exploit it. And common consensus is that daily production is falling by around 8 to 10 percent per year.

 It’s in the middle of a bidding round to sell the rights for developing seven projects in the enormous heavy oil Orinoco Belt. There has been plenty of interest — 19 companies including majors such as BP, Total and Chevron bough $2 million data packs — but also plenty of wariness: the round has been delayed by three months so far because of worries about terms and conditions.

 These expropriations — which some analysts believe are a way of gaining leverage to negotiate lower fees — may be effective in the short-term. But if it scares off the investors it needs to develop the Orinoco Belt what will happen to PDVSA — and Venezuela — in the long run? 

Good, but a work in progress

When it comes to Venezuela, Obama has achieved more in 100 days than his predecessor did in eight years.

There has been a famous handshake, a book and a declaration: “I want to be your friend.”

The outcome? It looks as though relations will return to how they were a year ago, with diplomats reinstated and channels of communication reopened.

But a couple of photo opportunities aside, there is still a long way to go in repairing relations that have bristled with tension between the two countries since Chavez came to power some 10 years ago.

Here in Venezuela, Obama and Chavez’s newly found friendship has been largely welcomed but also met with indifference and  skepticism.

The opposition media has been largely quiet since the handshake and there has been some disquiet. The belief is that Obama is condoning Chavez’s systematic rout of opposition candidates.

Pro-Chavez media, meanwhile, warns that Obama is a wolf disguised as a sheep. “Obama is a laboratory experiment,” wrote Nelson Lucena in Aporrea, a pro-Chavez blog. “He will fail as much in his internal policies as in his external ones, for neither his government, his advisers and his cabinet are different to the advisers, ministers and programs of his predecessors.”

However, it won’t be hard to beat the relationship Chavez had with Bush.

That is at least something.

Photo Opportunity No 2

Following what Venezuela’s press office labeled a “historic” first encounter between Barack Obama and longtime scourge of the United States, Venezuelan President Hugo Chavez, it seems Chavez has taken a shine to Obama and his administration.

Encounters now seem to be coming thick and fast. Today, they met once more, again on the fringes of the summit.

 Later, Chavez met with Hillary Clinton and mentioned the possibility of reinstating diplomatic ties between the two countries. Venezuela expelled the U.S. ambassador last year.

 Said Chavez of Obama: “He’s an intelligent man, young; a black man. I think we need to take note of the gesture and words.”

 Could this be the end of a decade long rift between the United States and Venezuela?

 Possibly.

 However, Chavez could not resist throwing a barbed message at Obama. On their second meeting he gave Obama a book by Eduardo Galeano titled “The Open Veins of Latin America.”

The subject? The history of US political and economic interventionism in the region. 

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