The Washington post
May 4, 2007; Page D08
CARACAS, Venezuela, May 3 -- President Hugo Chávez on Thursday threatened to nationalize the country's banks and largest steel producer, accusing them of unscrupulous practices.
"Private banks have to give priority to financing the industrial sectors of Venezuela at low cost," Chávez said. "If banks don't agree with this, it's better that they go, that they turn over the banks to me, that we nationalize them and get all the banks to work for the development of the country and not to speculate and produce huge profits."
It was not clear whether Chávez was referring only to Venezuelan banks such as Mercantil Servicios Financieros and Banco Provincial, or if he was also aiming the threat at major international banks with subsidiaries in the country, such as Citigroup and two Spanish banks, Banco Bilbao Vizcaya Argentaria and Banco Santander Central Hispano.
Chávez also warned that the government could take over steel producer Sidor, which is controlled by Luxembourg-based Ternium. Shares of Ternium fell 3.9 percent to $26.15 in U.S. trading after Chávez's comments.
Sidor "has created a monopoly" and sold most of its production overseas, forcing local producers to import tubes and other products from China and elsewhere, Chávez said.
If Sidor "does not immediately agree to change this process, they will obligate me to nationalize it," Chávez said. "I prefer not to."
Chávez ordered Mining Minister Jose Khan t
o leave immediately for the company's headquarters and come back with a recommendation within 24 hours.
Chávez began a nationalization drive in January that is bringing the country's largest telephone company CANTV and the electricity sector under state control. The state oil company also took over the last privately run oil operations in the country from major international oil companies on Tuesday.