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Page added on November 29, 2007

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In Venezuela, petrodollars breed opacity

CARACAS, Venezuela: As petrodollars stream into oil-producing countries, Western officials have begun to demand greater accountability for the way they are spent. Some corruption-plagued states, like Nigeria and Azerbaijan, have heeded the call, increasing financial transparency, or at least paying lip service to it. Hugo Chavez’s Venezuela, however, appears headed in the opposite direction.

“We see Venezuela on the other side of the road,” said Mercedes de Freitas, executive director here of Transparency International. The global anticorruption group ranks Venezuela the least transparent country in Latin America and 162 out of 179 nations globally. Soon it could fall lower.

On Sunday, Venezuelans will vote on a referendum that would grant Chavez the power to run his country’s finances as he sees fit. If the proposal passes, government accounting will become even more opaque and foreign businesses, some already besieged and fleeing, will find Venezuela even more forbidding.

Already, Chavez’s government is putting large amounts of oil revenues into development funds and state-owned companies that operate off the country’s books, not subject to audits or lawmakers’ approval.


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