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The "E" word: Venezuela and the return of expropriation

An emboldened Chavez moves to extend his government's reach over private property.

Women work in a cabbage field at the expropriated Fundo Aracal in the state of Yaracuy, about 200 miles west of Caracas Aug. 27, 2007. Hugo Chavez's government has moved to expand expropriations of farms deemed to be idle and put them in the hands of state-backed peasant cooperatives. (Jorge Silva/Reuters)

CARACAS — It’s expropriation season in Venezuela.

Emboldened by a comfortable win in a referendum last month that abolished term limits, President Hugo Chavez has issued a wave of decrees that has seen rice mills, farms and parking lots taken over by the state.

Last week, Chavez — who can now run for re-election indefinitely — went after the U.S. food giant Cargill, the world’s largest trader in agricultural commodities. After an inspection of one of Cargill's rice mills, Chavez accused the company of “flagrantly violating” a law that requires food producers to sell basic staples at regulated prices. The company was allegedly found to be coloring its rice in order to bypass the laws. 

Polar — the country’s largest private company and the producer of many of Venezuela’s most popular food brands — has also been the subject of Chavez's ire. He sent in the National Guard to occupy one of Polar's rice-processing plants. Coca-Cola, meanwhile, has had a car park seized for use for housing.

The government has also used a law that allows it to seize "latifundios," or large estates, that are deemed idle.

Last Friday, the National Land Institute (INTI) took over a eucalyptus farm belonging to Irish paper manufacturer Smurfitt Kappa, saying that it was needed to produce other crops. Other farms have also been seized.

Chavez has even extended his reach to museums. While he didn't actually take over the touring Bodies Revealed exhibit, he did shut down the controversial show, which uses real human cadavers to demonstrate the inner workings of the human body. There appeared to be some confusion, with the Venezuelan government thinking that the bodies would be made of plastic.

"We are in the midst of something macabre," Chavez said on his weekly Sunday television program. "They are human bodies. Human bodies! This is a really clear sign of the huge moral decomposition that is hitting our planet."

In recent years, the government has taken a greater hand in the pricing of goods. 

Since 2003, the government has imposed price restrictions on basic staples such as rice, chicken, coffee and sugar to combat the effects of rising inflation, which last year increased 31 percent. “These private companies can continue functioning as long as they remain within the scope of the law and the constitution," Chavez said Wednesday.

Companies are obliged to ensure that between 70 and 95 percent of their products fall within the regulations. But many argue that the rules force them to sell at a loss.