Venezuela’s Chavez courts Brazilian investors

14 August 2008 20:12  [Source: ICIS news]

CARACAS (ICIS news)--Venezuelan President Hugo Chavez continued to tout his nation's petrochemical potential with an emphasis on the region's fertilizer needs, this week inviting Brazilian private investment to help develop the sector, according to official sources Thursday.

Earlier this month, Chavez struck up much the same theme with Argentine business leaders during a meeting in Buenos Aires.

With an abundance of still unexploited raw materials, Venezuela is fertile ground for private investors who want to set up shop, said Chavez to a group of business leaders at his official residence in Miraflores, according to state media broadcasts.

"Here we have a great petrochemical plan," said Chavez. "We can move forward with the installation of fertilizer plants, plastics, textiles, car parts, airplane [parts.] In sum, the potential here is unlimited."

Chavez noted that his nation has vast untapped reserves of natural gas that could be used to feed petrochemical plants. Both Brazil and Venezuela are largely dependent on using more expensive naphtha as a feedstock for petrochemicals.

The president urged the assorted group to work up business plans to be discussed at a follow up meeting next month in Brazil.

Building up local fertilizer production has become a key concern for Latin American nations, which despite surging commodity-based wealth still have deep pockets of poverty that have been worsened by higher food and energy costs.

Surging fertilizer costs have been especially burdensome for small Caribbean and Central American nations that depend entirely on imports, of which Chavez again made mention.

"In Central America, Daniel Ortega [president of Nicaragua] told me that urea prices have gone from $200 to $800 [per metric tonne]," said Chavez.

In a bid to gain wider regional clout and thwart rising food prices, Chavez has promised discounts of up to 40% on urea supplies to over a dozen Caribbean and Central American nations.

($1=€0.67)

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