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Maduro replaces Venezuela's longtime oil chief

Wednesday - 9/3/2014, 6:42pm  ET

FABIOLA SANCHEZ
Associated Press

CARACAS, Venezuela (AP) -- The parts of the political base holding up President Nicolas Maduro appear to each have won a slice of power with a Cabinet shuffle that breaks up the control one man held over Venezuela's oil and economy.

After months of foreshadowing a big announcement, Maduro gave a sweeping presentation late Tuesday in which he sidelined his most powerful minister, Rafael Ramirez, divvying out his authority to appointees favored by different sectors in the coalition government.

Ramirez, a fixture of the South American country's 15-year socialist revolution, leaves his multiple roles of oil minister, president of the state-run oil giant PDVSA and top economic adviser. His departure strengthens the wing with close ties to Maduro's mentor, Hugo Chavez: Asdrubal Chavez, an engineer and cousin of the late president, steps in as oil minister; the populist leader's son-in-law, Jorge Arreaza, keeps his appointed role as vice president.

The military, a historical arbiter of political disputes in Venezuela, also scored a victory. Current Finance Minister Rodolfo Marco Torres, a low-profile army general, will take over Ramirez's job as top economic policymaker.

Even the technocrats, whom international investors are counting on to pursue more pro-business polices, came out ahead. Stanford-educated engineer Eulogio Del Pino was named head of PDVSA. Del Pino has sat on the PDVSA executive board for more than a decade, and most recently served as vice president of exploration and production. On Wednesday, analysts hailed him as a highly competent oilman.

Ramirez, who had led PDVSA for 10 years, was designated foreign minister and given a newly created position of vice president for political sovereignty.

Few Venezuelans expected such a dramatic demotion for Ramirez, who looked on long-faced as the president thanked him for his past service in front of an audience of top military and civilian officials at the presidential palace.

Ramirez's loss of responsibility for the world's largest oil reserves and 95 percent of Venezuela's export earnings means investors who had been hoping that recent economic pain would spur a pro-business tilt will lose a potential ally.

The past months have seen an increasingly public power struggle between hardcore leftists in the Chavista movement and more pragmatic leaders like Ramirez, who backed an unpopular plan to raise gas prices -- currently the world's cheapest -- and unify three official exchange rates that have been fueling the bolivar's freefall in the black market.

Managing his own party has been a central task for Maduro. While Chavez held together a wide-ranging coalition by force of character and charisma, his less popular successor has struggled to project the same kind of leadership.

With the Cabinet changes, Maduro sought to demonstrate control while also accommodating the competing actors that make up his administration, said Dimitris Pantoulas, a political and business consultant based in Caracas.

"Maduro's government is a collective one, with important political actors and groups inside it," he said.

In the same late-night, three-hour speech, Maduro announced "five big revolutions" that also seemed to play to constituencies, including a knowledge revolution involving students and teachers, and a revolution involving missions to help the poor.

Many observers were surprised the president didn't roll out economic reforms or indicate how he planned to stop the country's economic freefall. Jorge Roig, who heads the Venezuelan Federation of Chambers of Commerce, applauded the new energy and oil company appointments, but said the announcement was difficult to read.

"What we still don't know is if there will be a new game plan; that's what Venezuelans are waiting for," he said.

In the end, Maduro may have calculated dramatic economic moves were too costly politically -- at least for now. Opposition protests in the spring left 43 dead by the official count; Venezuela's bolivar has lost more than half its value in the illegal black market during his 16-month presidency, and essential items such as soap and sugar have become impossible to find with any regularity. Recent polls show that support for Maduro has slipped below 40 percent.

On the streets of downtown Caracas Wednesday, commuters were unimpressed with the shake-up.

"For me, the changes were no changes at all; it was just take something from here to put it over there," said school teacher Moises Ferrer.

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Associated Press writer Joshua Goodman contributed to this report from Bogota, Colombia.


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