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Viewing cable 06CARACAS944, VENEZUELA URBAN AND RURAL EXPROPRIATIONS CONTINUE
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Reference ID | Created | Released | Classification | Origin |
---|---|---|---|---|
06CARACAS944 | 2006-04-06 20:59 | 2011-08-24 01:00 | UNCLASSIFIED | Embassy Caracas |
VZCZCXRO5005
RR RUEHAO
DE RUEHCV #0944/01 0962059
ZNR UUUUU ZZH
R 062059Z APR 06
FM AMEMBASSY CARACAS
TO RUEHC/SECSTATE WASHDC 3989
INFO RUEHBO/AMEMBASSY BOGOTA 6272
RUEHBU/AMEMBASSY BUENOS AIRES 1126
RUEHLP/AMEMBASSY LA PAZ 1874
RUEHPE/AMEMBASSY LIMA 0080
RUEHMD/AMEMBASSY MADRID 3079
RUEHQT/AMEMBASSY QUITO 1949
RUEHSG/AMEMBASSY SANTIAGO 3423
RUEHAO/AMCONSUL CURACAO 0719
RUEHGL/AMCONSUL GUAYAQUIL 0409
RUCNDT/USMISSION USUN NEW YORK 0086
RHEHNSC/NSC WASHDC
RUCPDOC/DEPT OF COMMERCE
RUEATRS/DEPT OF TREASURY
UNCLAS SECTION 01 OF 03 CARACAS 000944
SIPDIS
SIPDIS
E.O. 12958: N/A
TAGS: ECON PGOV VE
SUBJECT: VENEZUELA URBAN AND RURAL EXPROPRIATIONS CONTINUE
(PART 2 OF 2)
REF: A. CARACAS 808
¶B. CARACAS 330
¶C. CARACAS 444
¶D. 05 CARACAS 2956
This message is sensitive but unclassified, please treat
accordingly.
-------
Summary
-------
¶1. (SBU) Threats of rural land expropriations continue in
Venezuela. The private agricultural landholders are
suffering, as squatters occupy and destroy land under the
complicit eye of authorities. The National Assembly also
passed legislation allowing seizure of agricultural
stockpiles in cases of "emergency." Few interventions by the
BRV's land institute (INTI) result in actual expropriations
-- most landowners instead negotiate a settlement with the
government or wait the battle out in court. However, the
famed "Cha-Az Method" (government-owner negotiation process
touted by the BRV as an amicable land reform solution)
ultimately failed when INTI took over the landmark La
Marquesena ranch on March 15 (the landowner had abandoned the
negotiation process to wait for a court decision). A week
later, Chavez gave "idle" land owners a three-month ultimatum
to negotiate, or else the Armed Forces would occupy the land
forcibly. As of February 2006, over 900 land occupation
documents have been issued, causing affected Spanish
landowners to prompt their government to intervene. In an
attempt to justify takeovers, Chavez has declared that nearly
90 percent of existing land titles are illegal. The ultimate
beneficiaries of "rescued" land are Chavez' voter base -
peasants and members of agricultural cooperatives. End
Summary.
--------------------------------------------- --
Rural expropriations damage agricultural sector
--------------------------------------------- --
¶2. (SBU) Rural land expropriations continue to make
headlines. The president of the Venezuelan Cattleman's
Association (Fedenaga) has repeatedly denounced that the
National Land Institute (INTI) and the BRV are backing
landowners into a corner by "taking over property through
violent means." There are increasing reports of invasions
and extorsions by squatters, who threaten landowners with
property destruction unless a percentage of the harvest is
handed over. Though few actual expropriations have taken
place, the BRV has called takeovers "rescues" - and has
largely obtained the land through capitulation of landowners
in negotiations. Many farms occupied by squatters and
targeted by INTI are still pending legal process.
¶3. (SBU) In Yaracuy state alone, over 35 properties have been
"confiscated" by INTI, many with complicity of military,
local and state government authorities. Invasions and
vandalism in this state have accounted for, according to
Fedecamaras (the private sector umbrella business chamber),
the loss of 5,000 jobs, destruction of over 4,000 hectares of
sugar cane crop, and a revenue loss of USD 14.8 million. In
the case of El Charcote ranch in Cojedes state (also targeted
for expropriation by INTI), squatters drove down the price of
the land (even burning some of it) and the British owners
finally settled, receiving far less for their land than its
original worth.
¶4. (SBU) On March 29, the National Assembly passed
legislation reforming the existing Agricultural Storage Law,
which now allows the government to confiscate stored goods in
cases of "emergency" and if "food sovereignty" (domestic
production to cover domestic demand) is compromised. Owners
will have a 24 hour window in which to "justify" their
stockpiles to authorities. In addition, the law previews BRV
plans for sustainable development through construction of
public storage infrastructure. (Note: this move hints at a
BRV strategy to replace or compete directly with the
agricultural private sector (Ref C). End Note.)
CARACAS 00000944 002 OF 003
------------------------
Failure of Cha-Az Method
------------------------
¶5. (SBU) In Chavez' November 2005 push against "latifundios"
(idle lands), Hato La Marquesena, an 8,400 hectare cattle
ranch and environmental preserve, was hailed as an example of
land reform resulting from amicable negotiations between
owner and government (see Refs B,D). The process was
baptized the "Cha-Az Method" (CH for Chavez, AZ for Azupure,
the ranch's owner). However, Azupure didn't reach an
agreement via negotiation, and chose to wait the battle out
in court instead. To his surprise, on March 15 INTI declared
that the land was government property (despite lack of court
resolution) and has moved forward with plans to invite
cooperatives onto the ranch and begin construction of a
government-funded genetic studies center (Centro Genetico
Florentino).
¶6. (SBU) The new Minister of Agriculture, Elias Jaua,
declared on March 9 that "the revolution is above legal
order" when justifying INTI's takeover of the ranch. INTI's
director, Richard Vivas, announced that the owners had not
responded to INTI's court motion for over a month (though
Azupure's lawyers say they have a 60-day window to respond),
and declared that Azupure couldn't produce a title chain to
prove the land was privately-owned (Note: only a court can
make this determination, not INTI. End Note.) He later said
that if a court ruled in Azupure's favor in the future, INTI
would indemnify the cost of the land and any improvements
made upon it as per expropriation law. On April 4, BRV
officials attempted to move 8,000 of Azupure's cattle off the
land designated for construction, but after managing to move
only 700, the cows wandered back to their original grazing
grounds.
¶7. (SBU) Although Chavez has said in the past that he will
respect court rulings, he declared on March 19 that he would
give a three-month window for landowners to negotiate with
the government or else he would send in the Armed Forces to
occupy their land. (Note: Given the lethargy of the courts,
they will not likely make any land dispute rulings before
this time frame End Note.) He urged mayors, governors and
peasant groups to "have more initiative" in fighting
latifundios, and linked the issue with Venezuela's dependence
on food imports.
------------------
Going Back to 1492
------------------
¶8. (SBU) Many of the "cartas agrarias" (documents that allow
land occupation) issued by INTI are for land owned by Spanish
citizens. (Note: INTI has issued over 900 as of February
2006, versus the 3,000 issued in the entire 2005 calendar
year. End Note.) Over 40,000 hectares of Spanish-owned
sugar cane farms have been invaded (affecting over 200
families), prompting owners to call on the Spanish Embassy in
Caracas to intervene. Spanish Foreign Minister Moratinos
reportedly engaged Chavez himself on the issue, who promised
not to expropriate Spanish-owned lands. (Note: this has
prompted many Venezuelan landowners to opt for Spanish
citizenship. End Note.) In Yaracuy state, Italian and
Portuguese landowners have also been affected by the
invasions.
-----------------------------
Taking land on a technicality
-----------------------------
¶9. (SBU) On March 19, Chavez proclaimed that "there are no
real property titles, as the law dictates, in 90 percent of
the (agricultural) land in Venezuela." However, legal
experts vehemently disagree, noting that the Civil Code and
the Notary and Registry Law have guidelines on land titles
and most existing land titles follow them. In addition,
experts note that the law puts the onus of proof regarding
land ownership on the government, not on the private
CARACAS 00000944 003 OF 003
landholder. The lack of willingness of courts to make timely
rulings (or any rulings at all) on title disputes sways
public opinion to Chavez' claim that land titles, even if
held, are illegal. (Note: Most likely, Chavez' comments are
intended to make him appear magnanimous by allowing ranchers
to negotiate for land that they allegedly do not own. End
Note.)
¶10. (SBU) Aside from "food sovereignty," other BRV players
have found creative ways to justify land "rescues." INTI's
president cited on March 29 that land in the border state of
Tachira was being used for narcotrafficking and confiscated
fourteen ranches. Portuguesa state governor Antonia Munoz
made a call on March 24 to all peasants in the region to
"keep their eyes peeled" for idle lands and aggressive
landowners, and praised INTI's efforts to deliver "social
justice" to the state. Various INTI spokespeople have
declared they'll protect peasant rights and interests.
------------------------
Who gets "rescued" land?
------------------------
¶11. (SBU) The immediate benefactors of BRV-"rescued" land
are squatters and agricultural workers, who receive documents
(but not land titles) permitting them to occupy and work the
land legally. Most "rescued" land is handed over to
agricultural cooperatives (often made up of the same
squatters and agricultural workers) or used by the BRV for
various ad hoc projects, such as the genetics center in La
Marquesena and an agricultural training school in El
Charcote. Though there is a severe housing crisis in
Venezuela (Ref A), rural land is rarely sought out for
housing solutions. Anecdotal evidence suggests that urban
dwellers who receive rural land tend to return to the city.
¶12. (SBU) In 2004, Chavez created Mision Vuelvan Caras
(Mission About Face), which trains participants to create
"endogenous development models" (loosely-defined business
models similar to cooperatives, with collective
decision-making and use of local natural resources for
production). Graduates from this program are called
"lanceros" (javelin-throwers) -- they receive preferential
loans from Fondafa (Agricultural, Forestry and Fishing
Development Fund) and first dibs on expropriated land.
Productivity statistics for "Fundos Zamoranos," as the
cooperatives on rescued rural land are called, are not known.
One analyst said that agricultural financing increased by 45
percent in 2005 while agricultural production only rose three
percent.
-------
Comment
-------
¶13. (SBU) Though Chavez has made public calls for more
initiative in fighting idle lands, the number of ranches
actually expropriated remains low. Most owners cave into BRV
pressure and reach a settlement or choose to wait the battle
out in court -- though Chavez has made it clear that those
who wait will ultimately lose out. The people who receive
the rights to work on (but not own) "rescued" lands are
clearly those in Chavez' political base, and continuation of
"idle" land interventions fits well within his election year
strategy. Threats of expropriation are wreaking havoc on the
agricultural sector and deterring investment. After
decreasing his herd size in view of expropriation threats,
one rancher emblematically said: "We cattle farmers have one
foot in Venezuela, and the other out." If the government's
solution is to alienate ranchers and substitute them for
unproductive cooperatives, the BRV can kiss their "food
sovereignty" dream goodbye.
BROWNFIELD