MEXICO CITY -- Venezuelan President Hugo Chavez is planning a government takeover of his country's cement industry, his latest effort to impose state control over key sectors of an economy battered by shortages and inflation.
Chavez made the declaration during a televised cabinet meeting late Thursday. He has long accused foreign cement companies of keeping prices high and supplies tight by exporting their products to other countries while Venezuela is suffering a housing shortage.
"We're going to nationalize the cement industry. Enough already!" Chavez said.
The action is a blow to Monterrey, Mexico-based Cemex, the largest producer in Venezuela. Industry companies LaFarge of France and Switzerland's Holcim Ltd. would also be affected.
Chavez's government said it soon would begin compensation talks with the firms. But Mexico's Finance Minister Agustin Carstens on Friday condemned Venezuela's move against one of Mexico's largest and most successful multinational companies.
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Importance: Well the decision is Chavez's but a lot of the action this development is causing will be played out by Mexico's Calderon thanks to our friend globalization, inherently and heavily aided by multinational corporations (couchCEMEXcough). Thanks to our wonderful Globalization Briefing Paper, I believe we can all see the importance of the ramifications of Mr. Chavez's actions for Mexico. Although, I do feel the need to point out the irony in Mexico's taking offense at another nation's lack of faith in market operations, albeit their problem has mostly been with foreign investment as opposed to Venezuela's communistic approach of blaming business owners for the effects of governmental tinkering in the economy ...
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