Jim McIlroy & Coral Wynter, Caracas
A feature article in the August 21 Newsweek International criticised the role of state-owned oil companies (dubbed the "Seven Sovereigns") that compete with privately owned oil multinationals in the world market. One of those that came under fire was Venezuela's PDVSA: "Venezuelan President Hugo Chavez, for example, is famous for using oil money to fund his socialist agenda, but the practice is now quite common, from Iran to Russia."
In late August the conservative Caracas daily El Nacional published a piece attacking PDVSA for becoming virtually "bankrupt", and wasting its revenue on funding social programs. These programs include the "social missions" and infrastructure development projects established by Chavez's revolutionary Bolivarian government over the past few years.
These attacks on PDVSA's social role underline a fundamental difference between the neoliberal, pro-capitalist viewpoint of the big business media — internationally as well as inside Venezuela — on the purpose of the massive revenues generated by the petroleum industry.
From the conservative standpoint, oil profits should go into the pockets of the wealthy First World shareholders of the multinational corporations. But the Chavez government believes the majority of oil industry profits should serve the interests of the people, especially in a Third World country like Venezuela.
On its website (<http://www.pdvsa.com>) PDVSA responded strongly to El Nacional: "Once again, the El Nacional daily charges ahead blindly with information aimed at disqualifying New PDVSA's performance through a manipulated piece of journalism ... in another fruitless attempt to belittle the efforts made by the Bolivarian Government of Venezuela in the application of its Full Oil Sovereignty policy, to the benefit of the Venezuelan people.
"For the first seven months of 2006, PDVSA's financial results for the national sector show a net profit of [US]$6.2 billion, according to preliminary figures. This sum is much higher than the net profit obtained for the whole year ending 31 December 2005 ...
"The 2006-2012 Sowing the Oil Plan incorporates social development — which is a commitment for PDVSA — that will be achieved without compromising the company's financial and operational health. This alignment enables the efficient, sovereign and revolutionary use of resources for the development of our main shareholder: the Venezuelan people."
The article explained that the "new PDVSA", born after the defeat of a pro-boss December 2002-January 2003 "strike" against the Chavez government, "represents a milestone in the development of the nation's right to full control of oil sovereignty".
The website explains that "Social development in PDVSA is a process of formulating and executing projects in alignment with the Community Development plans of the State. In order to put oil resources at the service of the wider population and create a new economic model, putting an end to the social inequalities so apparent in Venezuela in the last decades, PDVSA promotes FONDESPA (The Fund for Social and Economic Development within the Country), which has the task of promoting social development through a transparent and fair distribution of oil revenues.
"Backing the social missions promoted by the National Executive is one of the ways in which PDVSA gets directly involved in the lives of ordinary Venezuelans. The company, as part of its revolutionary, corporate responsibility program, encourages groups to take part in their own development projects by first considering the specific conditions (cultural, productive, etc.) of each region in the country. By doing so, the corporation acknowledges and respects the constitutive plurality of Venezuelan society ...
The article quoted from a National Assembly speech by Rafael Ramirez, PDVSA's president, in May 2005: "The use of surplus oil profit in investment projects contributes not only to socioeconomic development, but also reduces the financial pressure on the Treasury and as a consequence improves the country's financial performance in the mid-term."
Major construction projects that PDVSA is helping to fund include a second bridge over River Orinoco in the east of the country; the giant Orinoco Port terminal; the groundbreaking Doctor Gilberto Rodriguez Ochoa Children's Cardiological Hospital (the biggest in Latin America); the railway system at Valles de Tuy; the new metro rail network in Venezuela's second-largest city, Maracaibo; and the Trolleybus project for the southern Andean city of Merida.
These national infrastructure projects are crucial to Venezuela's socioeconomic development. They are part of Chavez's ambitious plans to utilise Venezuela's major natural resource, oil, to gain national independence and self-reliance, in opposition to the longstanding domination of the country by US imperialism — as well as to promote equality and genuine participatory democracy among Venezuela's citizens, part of the general goal of "socialism of the 21st century".
The social role of PDVSA under the Chavez government doesn't stop at Venezuela's borders. A multitude of joint projects with Third World governments around the globe have provided direct assistance to people suffering from poverty or natural disasters in many countries, not least the USA itself.
CITGO, a US subsidiary of PDVSA, initiated a system of subsidised fuel for poor communities in a number of US cities following the devastation wrought by Hurricane Katrina last year. As of February, subsidised fuel was being distributed to poor communities in seven states. CITGO chief Felix Rodriguez said that at that stage the aid program was worth US$50 million.
The social role of PDVSA is a product of the Bolivarian revolution. This contrasts with the role of PDVSA under the old regime in Venezuela, when almost all the oil profits went into the pockets of multinational corporations and a wealthy Venezuelan elite, while millions lived in dire poverty.