Thursday, February 07, 2008

  http://daniel-venezuela.blogspot.com/

Chavez political cash frozen by, Exxon?

[Updated]

Thinking a little bit more about what I just posted, that 12 billion USD were frozen until a settlement takes place between Venezuela and Exxon Mobil, I realized that this was a much bigger issue than what I thought originally. And trust me, I did not underestimate it even though I posted late on it.

See, the first question is what the heck is PDVSA doing with around 12 billion dollars in banks accounts of Aruba and Curaçao? I mean, sure, there are some oil tankers to be managed, some payrolls to be met, but 12 billions? In Curaçao? For that money you almost own the darned island!

I suspect that this is one of the ways that Chavez has financed his little adventures. PDVSA keeps its money overseas, at least part of it. That way it is not scrutinized by Venezuelan controls (as those might be...). Then he can decide to buy lots of milk for Mercal or send a check to finance Evo in Bolivia or pay for whatever political buy out he needs to do.

OF course there are people in the US that are specialized in tracking down money and they have known long ago where PDVSA cash is. Surely they were delighted to tell Exxon where to go to get the loot. And at the same time they get to cramp down Chavez style. A sweat deal, no? There is nothing innocent about the whole thing. But then again Chavez has only himself to blame, does he not? After all, the aggrieved party is Exxon and since the PDVSA money will not go all to the Venezuelan people anyway as it is more and more siphoned out by corruption and obscene foreign interventions, why should Exxon abstain form its fair share? What Venezuelans will Exxon hurt that are not already hurting?

I suspect that chavismo will manage to arrange some deal and pay off Exxon quick. After all, fighting back with even more takeover of US assets will only result in less money for his adventures. That he cannot do without, the more so that regional elections loom. And let's face it: who is going to support some guy who backs the FARC druggies and robs investors, not to mention his own citizens? They might support him on hot air, but now we are talking big bucks. People understand big bucks; they do not like folks who take the big bucks away without any real reason.

Then again Chavez has done enough certifiable things recently that he might finally go for his confrontation with the Empire. Since no one will invest anything or lend anything or sell anything to Venezuela while this situation exists (they risk Venezuela to default if more assets are seized and to be unable to pay its bills) we might be starving and yet neither the US nor Colombia will fire a single shot at us. Ah! The wonders of globalization! Defeated by the banks!

Update: I need to make a small correction. I suppose that the Curaçao assets also include the giant Curaçao refinery. It is not clear exactly how much money was in the Netherlands Antilles banks (though it seems to have been more than what was needed anyway for day to day run of PDVSA business in the island). Still, the only thing that this would change would be the speed at which Venezuelan finances will be affected. Curaçao refinery is a collateral for any loan that PDVSA or Venezuela needs to raise. Now they cannot. Same effect, posterior date. Not to mention that so much oil is refined at Curaçao that any judicial closing of it would affect PDVSA greatly. Because of course you can bet that after this precedent there are more judicial actions on the way against Venezuela.

-The end-