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Chavez threatens to nationalise banks

30 January 2012, 13:32

Venezuela - Venezuelan President Hugo Chavez warned private banks on Sunday that he will consider nationalising any that refuse to finance agricultural projects promoted by his government.

Banks are required by law in Venezuela to provide at least 10% of their lending to finance government development projects.

"The private banks that do not comply with the constitution and their duty, well, I do not have any problem nationalising them," Chavez said during his weekly radio and television programme. "We must ensure the constitution and laws are complied with!"

Chavez charged that the rules aren't being followed by some of Venezuela's biggest private banks - Banesco, Banco Mercantil and Banco Provincial, which is controlled by Spain's Banco Bilbao Vizcaya Argentaria.

Chavez singled out the president of Banesco, Juan Carlos Escotet, ordering him to lend more to Venezuela's cash-strapped farmers.

"If you cannot do it, give me your bank," Chavez said, prompting applause from a crowd of government officials and supporters.

28% of sector under government control

A bill approved last year by Chavez's allies in the National Assembly describes banking as a "public service" and gives the government the authority to declare banks to be of "public utility", which paves the way for state nationalisations.

The government already seized control of about a dozen banks in recent years, accusing them of causing financial problems and violating banking rules.

Chavez's government controls about 28% of Venezuela's banking sector.

The president hosted Sunday's programme from the city of Barinas in the heart of "Los Llanos", Venezuela's vast central plains.

The sun-baked region produces most of Venezuela's meat, fruits and vegetables, but many farmers and ranchers complain of state expropriations and say government-imposed price controls on many basic foods cut into their profits.

In between telephone calls and announcements of forthcoming government agricultural programmes, folkloric music typical of the president's home state - called "joropo" - boomed over loudspeakers.

Advance on land

Chavez kicked off the programme chatting with workers at a state-financed cattle ranch. The self-proclaimed "revolutionary" spent much of Sunday's show discussing the need to develop "idle" lands as a means of boosting agricultural production, which has diminished in recent years.

"We must advance quicker with the recuperation of land," Chavez said, stressing that the government must make more land available to the poor.

Chavez instructed government-friendly mayors and state governors "to travel on horseback and on foot, day and night" in search of lands that have not been put to adequate use under government standards that define when officials can initiate expropriations.

The government says it is redistributing large estates and other land that is not adequately used. Critics contend the land seizures have hurt productive farms, thus cutting agricultural production and forcing the oil-exporting country to boost food imports.

Opposition leader Pablo Perez, a state governor who hopes to challenge Chavez in an October 7 presidential election, strongly criticised the government's agriculture initiatives on Sunday, noting that oil-rich Venezuela imports much more food than it produces.

"We must create an axis of development that not only provides a supply for Venezuelans, but also to export to other countries, and put an end to the government's importation policy," Perez said during a visit the agriculture-dependent state of Merida.


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