Venezuelan President Hugo Chavez recently threatened private banks with nationalization if they refused to support his government agricultural programs.
Chavez’s presidency has been nothing if not controversial. At the center of his government’s most recent activities have been efforts to increase governmental control of critical economic sectors. Of primary importance has been revolutionizing and nationalizing key agricultural industries.
Over the past several years, Chavez has moved to restructure agriculture in Venezuela. In 2010, his government nationalized the nation’s largest agricultural supply company as well as the nation’s largest fertilizer company. The attention paid to the farm sector has paid off. In recent years, the amount of cultivated land has increased 48 percent and the production of staple crops like rice has increased 84 percent.
Financial support for these agricultural projects is the key to their support, Chavez says. Venezuelan laws require banks to provide 10 percent of their lending to finance government development projects. These requirements, Chavez says, are not being followed. During a weekly radio address, Chavez claimed, “The private banks that do not comply with the constitution and their duty, well, I do not have any problem nationalizing them. We must ensure the constitution and laws are complied with!”
In addition, Chavez singled out the largest banks in the country, accusing them of undermining national progress. According to Chavez, large banks need to do more to make money available to cash strapped farmers.
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Written by: Justin Ellison / Farm Plus Staff Writer