[Marxism] Chávez oil dollars buy bus tickets for London

Walter Lippmann walterlx at earthlink.net
Mon Aug 20 15:52:43 MDT 2007


FINANCIAL TIMES
Chávez oil dollars buy bus tickets for London
By Tom Burgis and Dino Mahtani in London
Published: August 20 2007 18:49 

http://www.ft.com/cms/s/0/479d0a60-4f38-11dc-b485-0000779fd2ac.html 

Hugo Chávez, Venezuela’s president, broke new ground in his campaign of global oil diplomacy on Monday when London mayor Ken Livingstone announced half-price bus travel for poor Londoners, funded with millions of Venezuelan oil dollars.

An initial one-year deal will see Petróleos de Venezuela Europa, the European arm of state oil company PdVSA, spend up to $32m (€23.75m, £16m) to subsidise bus fares for residents in the UK capital who receive low-income welfare payments.

Up to 250,000 Londoners – including lone parents and sick and disabled people, but excluding most other unemployed – stand to benefit under a plan first conceived during the Venezuelan socialist president’s visit to the UK last year, when he dazzled the British left but eschewed meeting Tony Blair, then prime minister.

In return, London is establishing an office in Caracas, Venezuela’s capital, that will school officials there in techniques of traffic management and urban planning.

The deal follows a rush of recent pledges by Venezuela, home to the world’s fifth-largest proven oil reserves, to assist countries throughout Latin America and even as far afield as Belarus by financing energy projects and offering cheap credit.

Mr Livingstone on Monday denied he had been seduced by Mr Chávez’s petro- iplomacy. “When someone turns up and says: ‘Do you want £14m?’ they get my attention,” Mr Livingstone told the Financial Times.

But he told reporters: “Frankly I’d rather be getting into bed with [Mr Chávez] than, as the British government has been, getting into bed with [US president] George W. Bush.”

The agreement has drawn the ire of Mr Livingstone’s critics, who ask why London, one of the world’s richest cities and a booming financial hub, is effectively accepting handouts from a developing nation whose gross domestic product per head is estimated at less than a quarter of Britain’s. The mayor’s officials confirmed the cost of London’s side of the deal would be “minuscule” compared with Venezuela’s largesse.

The subsidy amounts to a maximum of only $32m, a fraction of Venezuela’s overall oil revenues, and marks another public relations coup for Mr Chávez, following recent deals to supply 100,000 deprived US households with heating oil at a 40 per cent discount and gasoline to help Iran to alleviate its shortages.

“If you have an excellent ruler, you get publicity,” Temir Porras, chief of staff to the Venezuelan foreign ministry, said on Monday in reference to Mr Chávez, adding the pact sealed a bond between two “sister cities”.

He said the surge in his country’s oil revenues – which account for about a third of its $190bn gross domestic product – made the deal a “win-win” arrangement. He placed it alongside what he said was a 360 per cent rise in domestic social expenditure per head since Mr Chávez’s “Bolivarian revolution” began with his 1998 election victory. Now, Mr Porras said, “our co-operation must help the poorest people, wherever they are”.

Mr Chávez has escalated spending abroad in recent years, according to Venezuelan opposition groups, who say the cash would be better spent at home, particularly on curbing high crime rates. Opponents claim the spending is burdening PdVSA with heavy costs.



Copyright The Financial Times Limited 2007





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