In less time than it takes to shake a donkey's tail the USA-biased international wire services were all over the story gloatingly headlining "another nationalization" ... "Chavez' grab for more power" etc., etc., etc.
In the cold light of a Friday dawn, however, another picture presents itself! Unfortunately the brouhaha overshadows the equally important news that in the dying embers of his franchise to decree on urgent economic issues under Congressionally-granted Special Powers (that ran out yesterday!), today's edition of the Gaceta Oficial (Venezuela's legal gazette) publishes Chavez' presidential decree ordering much-needed reforms to Venezuela's banking code.
Meanwhile, the Spanish government didn't react overtly as excited to the news as Reuters, Bloomberg, AP et.al. and already this morning Spain's Grupo Santander sheepishly confirmed that it's "in discussions" with the Venezuelan government on the issue. No shock, horror reaction from Madrid as Santander admitted that it had already been considering the sale of Banco de Venezuela to a private investor group in Venezuela. That "certain undertakings" had been entered into, but that nothing specific had been agreed.
The train crash scenario was of course ready meat on the barbecue for Venezuela's detractors who immediately envisioned a wholesale bank robbery taking place ... the Internet was immediately filled with messages claiming that Chavez is every bit as much a megalomaniac as Carlos Andres Perez (CAP) and then some ... you would have thought the Banco de Venezuela would not be rolling up the shutters this morning and that the bank staff would have turned up for work with no jobs to turn up for. But the lie became evident as Caracas wakened to the usual cacophony of endless queues of blaring 4WD speakers stuck in traffic on the freeways in from Lagunita and assorted other luxury suburbs around the city.
What was forgotten in the hysterical of the media mele was that President Chavez had said that the Venezuelan government would buy Santander's Banco de Venezuela holdings and place the network of high street banks "at the service of Venezuelans." In fact he pledged to pay "a fair price" which is initially estimated at some US$1.9 billion by the Spaniards themselves for 11.8% of Venezuela's total bank lending and 10.7% of total national deposits. Some 300 offices and 3 million clients also form part of the total package nationwide.
Certtainly NOt taken by surprise, Santander chairman Emilio Botin had already briefed Spain's Foreign Minister Miguel Angel Moratinos who had also had discussions with his Venezuelan counterpart, Foreign Minister Nicolas Maduro during Chavez' visit to Spain last weekend. Somehow or other, Chavez had managed to "shut up" and NOT mention the up-coming deal even when he met and shared levities with Spain's King Juan Carlos.
According to update information, Grupo Santander has a total of 131,819 employees, 65.1 million customers, 11,178 branches and 2.27 million shareholders worldwide and is reckoned to be among the top 10 banking organizations in the world, certainly the biggest bank in Europe. Banco Santander Central Hispano (BSCH) has been buying up banks and has strong holdings in a list of other banks around the world and last month the Santander group announced a possible takeover of Britain's Alliance & Leicester.
But, looking back a spate of years, Banco de Venezuela was in fact one of some eighteen banks that went into receivership when Chavez' predecessor, President Rafael Caldera allowed Venezuela's banking businesses to implode in what began with the Banco Latino crisis in March 1994 with $2 billion in losses and the defection of some 83 bank directors to Florida USA to avoid criminal prosecution. The run on the rest of the banks cost Caldera upwards of $11 billion which was financed by long-term borrowing from international money markets that the Chavez government was left to pay, nevertheless against continued efforts by corrupt financial manipulators who couldn't accept that their ran corruption had run its course with impunity for all concerned.
Essentially then, the Venezuelan government's impending purchase from Santander of Banco de Venezuela returns the high street banker to Venezuelan ownership and avoids the perplexing problem of letting the cash cow fall into the marauding hands of out of private Venezuelan interests, mindful of the financial carnage that went before.
Frankly, last night's hysteria and missals of impending doom were a trifle premature although it can be said that President Chavez could have handled the breaking news with substantially more panache. While Communications & Information (MinCI) Minister Andres Izarra seemed forced to call a press conference this morning to explain that the skies had NOT fallen in, he could perhaps more easily have advised the President of cause and effect and the willingness of the anti-Venezuelan media at home and abroad to go into spasm of euphoria at the slightest hint of possible negative spins on any story under God's heaven.
Roy S. Carson
Venezuela is facing the most difficult period of its history with honest reporters crippled by sectarianism on top of rampant corruption within the administration and beyond, aided and abetted by criminal forces in the US and Spanish governments which cannot accept the sovereignty of the Venezuelan people to decide over their own future.
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