Sun, May 12, 2019 - Page 7 News List

How a Chinese venture in Venezuela made millions while locals grew hungry

Caracas and Beijing agreed to hundreds of projects to kickstart growth in Venezuela, but after billions in investments, little has materialized

By Angus Berwick  /  Reuters, TUCUPITA, Venezuela

Some developments have stalled because of graft, while others were derailed by incompetence and a lack of supervision, people familiar with the projects said.

In Delta Amacuro, even government officials have said that a mixture of both ruined the rice project.

“The government abandoned it,” said Victor Meza, state coordinator for Venezuela’s rural development agency, which worked with CAMC. “Everything was lost. Everything was stolen.”

Prosecutors in Andorra, where secretive banking laws long made it a tax haven, launched their investigation into Venezuelan laundering amid a broader effort to clean up the local financial sector.

The indictment is part of a much larger case in which the prosecutors said that Venezuelan officials from 2009 to 2014 received more than US$2 billion worth of “illegal commissions” from contractors, state companies and other sources, often for enabling transactions with the government.

The payments passed through accounts held at local bank Banca Privada D’Andorra (BPA), the indictment said.

In 2015, the Andorran government, after the US accused BPA of money laundering, took over the bank. Courts there since then have charged 25 former BPA employees with money laundering in a series of cases, including the one probing the Venezuela contracts.

An Andorran government spokeswoman declined to comment for this article.

PRODUCING NOTHING

In addition to CAMC’s agricultural projects, the Andorrans examined two power-plant projects by the company and four other power plants built by Sinohydro Corp, another state-owned Chinese engineering firm. None of those plants ever became fully operational, leaving towns near them subject to regular blackouts.

Sinohydro was not charged in the indictment. The company did not respond to calls, e-mails or faxes seeking comment.

A visit to Delta Amacuro showed that the CAMC rice plant remains unfinished. Only one of its 10 silos, half full, held any grain. Some machinery was running, but processing rice imported from Brazil. The nearby paddies lay fallow, the laboratory incomplete and, the roads and bridges unbuilt.

Delta Amacuro’s capital, Tucupita, has 86,000 residents. It hugs the banks of the Cano Manamo, an offshoot of the Orinoco, one of South America’s biggest rivers. Once, Tucupita was a stopover for vessels shipping goods from inland factories to buyers in the Caribbean and beyond.

The government in 1965 dammed the Cano Manamo. Boat traffic stopped, fresh water receded and seawater seeped inland, degrading soils. By the time that Chavez became the Venezuelan president in 1999, little farming remained.

“When I was a kid, there was rice everywhere,” said Rogelio Rodriguez, a local agronomist. “Now we don’t produce anything.”

In 2009, Chavez and then-Chinese vice president Xi Jinping (習近平) expanded a joint fund that the countries had created with the 2007 development agreement.

“Aren’t we grateful to China?” Chavez said at a ceremony with Xi at the presidential palace in the Venezuelan capital of Caracas.

Promising to supply Beijing with oil “for the next 500 years,” Chavez pointed toward Delta Amacuro on a map.

“Look, Xi,” he said, announcing an effort to rehabilitate the region.

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