By Jeremy Morgan
Latin American Herald Tribune staff

CARACAS – Yet more storm clouds are gathering on the horizon as Venezuela counts the likely cost of the fall in all-important oil export revenues in the wake of the global economic downturn. And there’s little sign of anything even remotely resembling a consensus about what should be done.

Conindustria, which claims to represent small and medium-sized industrial companies and has long been on one side of what looks very like a dialogue of the deaf with the government over economic policy, has warned that unless production is increased the entire country could collapse.

In this, outgoing Conindustria President Eduardo Gómez Sigala was making yet another plea for manufacturers, who make up the bulk of his members. Manufacturing companies went to the wall in droves during the last recession earlier this decade – the worst slump on modern record in Venezuela – and they’ve not forgotten that.

On Monday, Gómez Sigala, who after four years in the top slot at Conindustria is making way for Carlos Larrazábal, said he was still willing to talk with the government, and in fact wanted to do so. But he expressed concern about a reform of the law on work rights now going through a National Assembly all but entirely dominated by President Hugo Chávez’s United Socialist Party of Venezuela (PSUV) and its minor allies.

Business leaders claim they weren’t consulted, much less called in, as the legislation was drawn up, and never had a chance to make known their misgivings. It’s debatable whether the government would have listened, much less taken note, had they been able to do so.

Now, they’re convinced that the labor legislation will work against the interests of the business community and, ultimately, its employees. Government officials tend to argue they’ve heard it all before and its time business got real, changed its tune and recognized the world’s no longer the way they wanted it as Chávez pushes through permanent change.

Whether or not ears in official circles once again turn away from González Sigala’s latest prognosis remains to be seen. But if they are, it won’t be for lack of trying in trying to make himself heard: Conindustria, he said, was forecasting a decline of between 3% and 3.5% in manufacturing activity this year.

Along with this, there would be a parallel drop in personal incomes and consumption, as was already being witnessed by Consecomercio, whose members hail from retailing and distribution. For the first time, inflation wasn’t being covered or compensated for by incomes, González Sigala said.

There were more dire tidings from the Opposition-controlled oil-rich state of Zulia, which is still trying to take account of the likely impact of the government’s nationalization of the oil fields services industry. This, warned Juan Gil, president of the Zulia Industry Chamber, wasn’t the only headache with which industrial companies were contending,

As usual, companies were having difficulty in get hard currency out of the Foreign Exchange Administration Commission (Cadivi). But now, Gil claimed, recent new rules were pushing out delays at Cadivi beyond the “normal” 180 days it took to secure permits.

In Caracas, spokesmen for the clothing and footwear industries, which have been in decline for years, said it was now taking more than 200 days to squeeze money out of Cadivi.

On top of this was a growing threat from contraband competition, which they said accounted for around 50 percent of the clothes and shoes now being sold in the country. As it is, some four-fifths of the clothes on the market are made abroad.

In Carabobo – one of three states which switched from the Chávez camp to the Opposition at last November’s regional elections – the Industrial Chamber said its 942 member companies in food, chemicals, metalworking, pharmaceuticals and auto assembly were facing the “most difficult times in their history.” Again, the chief gripe was Cadivi.

In Aragua state, which stayed with the president at last year’s vote, Industry Chamber President Vincenzo Ciccola voiced concern about nationalization and expropriation. Aragua, he noted, wasn’t rich in raw materials and relied on commercial and industrial activity for its economic wellbeing.

The National Statistics Institute (INE) meanwhile confirmed that gross domestic product (GDP) expanded by 0.3 percent during the first three months of this year.

Reiterating this statistic from the Venezuelan Central Bank was INE President Elías Eljuri’s way of saying the economy had expanded for 22 consecutive quarters. When the figures were first issued, economists said the increase was so minimal as to be marginal in terms of deciding whether or not the economy had in fact ground to halt, and they’d wait for the second quarter figures before deciding just what they thought was going on.