Venezuela Discusses Compensation with Colombian Companies for Confiscated Assets
In a surprising turn of events, Venezuela’s socialist government is in discussions with at least two Colombian companies regarding compensation for assets that were confiscated during the presidency of the late Hugo Chávez. According to Colombia’s Minister of Commerce and Tourism Germán Umaña, Colombia’s largest cement manufacturer, Cementos Argos SA, is in talks for the possible acquisition of a state-owned cement plant near Venezuela’s Caribbean coast. Additionally, an expropriated subsidiary of Cali-based sugar exporter Comercializadora Internacional de Azúcares y Mieles, Ciamsa, is also in negotiations to obtain compensation.
The relationship between the two countries has seen improvements since Gustavo Petro assumed presidency in Colombia in 2022. Petro immediately worked towards restoring ties and reopening the border, leading to a more favorable environment for discussions on resolving trade disputes without resorting to legal battles, as stated by Umaña in a recent interview.
During his presidency from 1999 to 2013, Chávez ordered hundreds of expropriations as part of his socialist vision to increase the state’s role in the economy, leading to the confiscation of various businesses ranging from cattle ranches to insurance companies.
The expropriated assets, including the Cementos Argos plant and Ciamsa’s sugar mill, have suffered from years of mismanagement, with many of the companies now closed, inactive, or operating at minimal capacity. In an effort to revive the country’s economy, President Nicolás Maduro has handed control of some state companies to private partners and even reversed some of the previous seizures.
Cementos Argos is seeking a U.S. license that would enable them to receive the acquired asset from Maduro’s government as payment without violating sanctions, potentially opening up opportunities for exports to the United States. Venezuela’s Information Ministry has yet to respond to requests for comment on the matter.
As negotiations continue between the governments of Venezuela and Colombia, the resolution of these long-standing disputes could signal a new chapter in the relationship between the two neighboring nations.
Source: Bloomberg