http://www.worldpaper.com/archive/2002/august_14/august1.html
Oil values
in Venezuela are up for debate
By Frank Bracho
Reporting from Caracas
Oil still contributes about 80 percent of Venezuela’s foreign income,
60 percent of the fiscal public income and 25 percent of the nation’s
GDP, so it remains of paramount importance to the country’s financial
life.
At a world level, Venezuela has been a distinguished and emblematic oil
producer. Standard Oil and Shell became grand thanks to the vast income
derived from Venezuela’s oil and installations. For many years,
Venezuela was the greatest oil exporter in the world and a critical
supplier of the military machinery of the allied forces during World
War II. For this, Venezuelan oil was a target of the German fleet.
Venezuela was also the founder of OPEC and today holds the
second-largest oil corporation in the world (in terms of assets):
Pdvsa, the Venezuelan state oil company.
So what does Venezuela have to show for all that? To say the least, the
balance is bittersweet. The oil boom that began at the turn of the past
century practically swept away the nation’s agrarian culture.
Self-sustaining traditional peoples succumbed in those regions
dedicated to oil exploitation. There were many spills and great
contamination at the time. In 1922, spillage at the well Barrosos No. 2
was almost four times greater than the notorious Exxon Valdez disaster
in Alaska. The “easy” oil money undermined the productive, moral and
social weft of the nation.
On the other hand, oil was the great modernizer: It facilitated
national integration and gave Venezuela the necessary resources to
build roads, schools and hospitals unparalleled in Latin America. Oil
revenues spurred industrial development and put Venezuela on the world
map.
That was the past. Today, there is much discussion in Venezuela about
using oil to create a healthier economy—diversified and independent—and
about planning for a day when oil revenues may fall short. Slogans such
as “Planting Oil” and “Post-Oil Venezuela,” both emphatically stated by
Arturo Uslar Pietri, reflect a generation of Venezuelan thinkers who
grew up in the oil-producing 20th-century and are well aware of the
good and bad aspects of oil exploitation. Some of the most outstanding
thinkers of this generation are Alberto Adriani, Juan Pablo
Pérez
Alfonso (the father of OPEC) and Manuel Pérez Guerrero.
In reality, however, Venezuela hasn’t been all that successful in
achieving the “planting of oil.” Shortly before his death in 1999,
Uslar left the following scathing judgment of Venezuela’s oil century:
“The fact is that there was no development. There was no improvement of
the quality of life and work of the population, and we have not managed
to give the majority of Venezuelans the real possibility of a decent
social and financial destiny.”
Oil days are numbered
Today, three conflicting schools of thought represent the evolving
debate over oil in Venezuela. One could be called classic
pro-government, which favors keeping the oil industry in the hands of
the state, selling on the basis of better prices (rather than on
quantity) and maintaining a tight bond with OPEC.
Another school could be called reformer-opposition, promoting
privatization of the industry, selling on the basis of high volume
(even if this means increasing production fourfold) instead of at
higher prices and distancing Venezuela from OPEC and favoring
privileged ties with (concessions from) the United States. Given the
upcoming changes in the worldwide energy paradigm, the latter school,
with its expansionism, seems to be in a hurry to “scrape the bottom of
the pot” and is probably backed by powerful transnational interests.
Despite their differences and shared admission that, in face of the
inexorable ecological, technical, social, political and corporate
factors, the days of oil are numbered, the two schools still want to
continue with risky oil dependency and addiction.
The third school of thought, still a minority but gaining in the
national conscience, could be called the voice of a genuine post-oil
Venezuela. This school of thought doesn’t care whether oil production
is in the hands of the government or the private sector; what counts
are the values with which the industry is handled. This school
recommends Venezuela undertake a serious and responsible transition
toward a post-petroleum economy (akin to what Mexico accomplished when
it brought down oil dependence from 90 to 10 percent of foreign income)
as well as an energy model based on clean and renewable resources such
as wind, eco-hydro, geothermia, biomass and hydrogen, to safeguard the
integrity and health of the country and the planet. Fortunately,
Venezuela is favored with an immense biodiversity that may be used in a
sustainable fashion.
Because of the power of this call to conscience, post-oil Venezuela
thinking has influenced the other schools of thought. On the
pro-government side, it has played a part in preparation of the
official position at the Second OPEC Summit, held in Caracas in
September 2000, and in an alternative seminar in Caracas undertaken by
Centropep, with the support of the president, in the run-up to the
summit. Moreover, the recent Forum for a Post-Oil Venezuela, sponsored
by the World Society for Venezuela’s Future—an event that would have
been considered taboo in Venezuela only a few years back—was well
attended by important actors of the reform/opposition movement and
featured Jerome Glenn, director of the UN’s Millenium Project, as its
main international guest.
In the great Venezuelan political debate and ideological struggle of
recent times, the oil issue has always been in the background in an
omnipresent way.
Frank Bracho served as Venezuela’s
ambassador to India from 1990 to 1993.
|