Chavez uses oil to expand his influence around Latin America

by Steven Dudley

17-11-05

While Cuban leader Fidel Castro tried to export his revolution throughout Latin America in the 1960s with AK-47s, Venezuelan President Hugo Chavez is fighting to expand his ''21st century socialism'' with oil barrels. Flush with huge profits from high petroleum prices, Chavez has offered cheap crude and refineries to neighbours, bought up some of their bonds and offered cash aid for development programs in a bid to unify the region around his ideology.
''I think that we Caribbean and Latin Americans need to think about, when the North American empire crashes, what comes next for us,'' a confident Chavez told delegates from the Caribbean during the October launch of PetroCaribe, an arrangement to send Venezuelan oil to those nations.

Chavez may be underestimating the future of the ''empire,'' and not everyone seems to be signing on to his revolution. Colombian President Alvaro Uribe and Mexican President Vicente Fox -- who recalled his ambassador from Venezuela in responseto a similar move by Chavez after the two exchanged words about economic policy during the Summit of the Americas -- seem to be emerging as the United States' strongest allies.
How much sway Chavez gains and maintains with the countries that receive his largess will also depend on his own staying power at home, the future price of oil and US policies.

Bolivar's dream
But that has not stopped the Venezuelan president from offering his help around the region while pushing to revive the dream of his hero, Simon Bolivar, the 19th century soldier who led a region from Peru to Venezuela to independence from Spain but then failed in his efforts to keep it unified as one nation.
''We are prepared to go little by little towards integration, a union so that we are stronger, and to march forward, as Bolivar says, towards the prosperity of our people,'' Chavez told the leaders of the Caribbean.

His efforts to export his ideology recall campaigns by Castro, Chavez’s political mentor, to export hisrevolution with armed groups to Latin America in the 1960s and '70s. But while unconfirmed Ecuadorian intelligence reports have alleged that some 20 Latin Americans received guerrilla training in Venezuela earlier this year, Chavez is more openly using his oil wealth to win influence over the region.
PetroCaribe, a pact between Venezuela and 14 Caribbean nations, will provide cheap financing for oil purchases, to be repaid over 25 years. Venezuela also pledged $ 50 mm for social programs in the Caribbean.

In addition, Chavez is pushing forward PetroAmerica, a Latin America-wide arrangement that could include swapping human resources like doctors for oil and natural gas. As part of the deal, the Venezuelan leader says he'll invest $ 2 bn to expand refining capacity in Jamaica, Cuba and Uruguay, and has spoken of joint ventures to build refineries in Brazil and Ecuador.
PetroSur -- which involves Brazil, Uruguay, Argentina and Venezuela -- and PetroAndina -- with Colombia, Ecuador, Peru, Bolivia and Venezuela -- are both in motion to round off the PetroAmerica family.

Chavez also is seeking agreements between nations, most of them involving oil or oil money -- deals to buy bonds and petroleum loans, for example -- and even attempts to forge accords with like-minded municipal leaders.
In Nicaragua, for example, Chavez has proposed oil sales at below market price to an association of mayors controlled by the leftist Sandinistas.

Like JFK
''What Chavez is doing is no different than what [President John F.] Kennedy tried to do [in the 1960s] and what the [US] Agency for International Development does all the time: He's trying to buy influence,'' said Larry Birns, director of the Council on Hemispheric Affairs, a Washington think tank often critical of US policy on Latin America.
Chavez’s plans for regional unity around his side of the political spectrum is running headlong into the Bush administration's policies. US officials have branded the Venezuelan president a destabilizing influence in the region, but he remains popular with many of its residents.

''What has happened is that the Bush administration is on a major offensive to discredit Chavez,'' Birns added. “But it's the Bush administration policy, not Chavez, that really is isolated.''
Chavez has fought back and regularly chastises the United States as “imperialist.''Chavez’s search for regional influence already has had some impact. US officials privately complains that his warm relations with the 14 Caribbean countries swayed some of their votes in the 34-member Organization of American States.

OAS leader
The Caribbean members, for example, joined Chavez in opposing the US-backed conservative candidate for the post of OAS secretary general, former Salvadoran President Francisco Flores. Flores eventually withdrew and Chile's José Miguel Insulza was elected.
' He's... castrating the OAS,'' said retired US Ambassador Myles Frechette, a Latin American specialist now in private consulting.

But Frechette and other analysts say it may not be so easy for Chavez to maintain his new alliances, especially if a drop in oil prices hurts his foreign assistance plans and perhaps even his chances of holding power at home.
What's more, Frechette says that Chavez, with his aggressive anti-Americanism and still undetailed brand of socialism, may not be as appealing to his neighbours as he thinks -- and some US officials fear.

 

 

Source: Miami Herald