The State-Owned Companies identified by Transparency Venezuela amount to 905
Transparency Venezuela updated the registry of State-Owned Companies, EPE, available on the open data platform Vendata, and now amount to 905 entities. The revision allowed the incorporation of companies dependent on the governments, companies domiciled outside of Venezuela and those in which the Venezuelan State participates even without having a majority shareholding.
The information indicates that of the 905 SOEs identified, 595 are in the hands of the National Executive with headquarters in Venezuela, 89 are outside the country and 218 are in the hands of the governorates. Likewise, the registry pointed out that there are at least 23 companies in which the Venezuelan State has a minority stake.
Despite the fact that in recent years some State-Owned Companies have been sold or liquidated, such as the Red de Abastos Bicentenario, these SOEs remain in the database as a historical record. Their records were updated, although they are no longer counted in the total of EPEs. Also not included in the total are the cases of state-occupied companies whose ownership remains private, of which 11 were identified.
In updating the SOE database, information related to the negotiation processes that have been carried out in recent years with the private sector was also incorporated. These data are available in the “Operation status” and “Current situation” categories. Until now it has been verified that there are 30 companies in which private parties participate, while another 60 are possible candidates for negotiation.
The monitoring of the SOEs allowed us to notice that, of the total number of registered companies, 53% have public complaints of corruption, bad practices and/or inefficient management. No sector escapes the problem. In the agri-food sector, recent scandals at Lácteos Los Andes stand out, as well as reports of irregular management in sugar mills, such as Pio Tamayo; and overpriced purchases of products for CLAPs.
The cases of corruption in hydrological companies and in Corpoelec explain the serious deficits in water and electricity services in many states of the country, problems to which is added the lack of fuel and gas due to corruption in Petróleos de Venezuela. The EPEs of the health sector such as Farmapatria, Quimbiotec, Espromed Bio and Profármacos have had accusations of abuse of power, as well as those of land and sea transport and Ventel.
The basic companies that once fully supplied the domestic market and exported derivatives of metallurgical production, are linked to cases of embezzlement, clientelism, embezzlement and irregular purchases and sales. The sources of these and other accusations are in the category "Public complaints of corruption, bad practices and inefficient management" of the database.
Of the total number of State-Owned Companies identified so far, the number in the hands of regional rulers stands out. Despite the critical financial situation of some governorates, they have at least 218 companies in their possession, of which 26 were created between 2015 and 2020.
The Sucre state government is the one with the largest number of companies (17), followed by Barinas, which has 16, and Portuguesa, with 15. Táchira was left with only 2 companies, because before its current governor, the command of many companies was transferred to national power, a situation that was repeated in the cases of Anzoátegui, Mérida and Nueva Esparta states. The predominant sector in the regional SOEs is agri-food (27%), followed by the construction sector (16%) and the gas, financial, mining and transport sectors.
Among the findings of this new review of the SOE database, it also highlights the identification of 19 companies linked to Petróleos de Venezuela SA, which were mentioned in the company's restructuring proposal document (10 companies from Pdvsa Agrícola, the National Transport Company, Pdvsa Servicios Inmobiliarios, SA, Pdvsa Servicios, SA, Servicios Unidos Petroleros, SA PPM Ltda, Cinco SA, CV Shipping Pte. Ltd, Panavenflot Corp. and Venfleet Ltd).
According to the registry, there are 179 companies attached to PDVSA in which the Venezuelan State has a majority shareholding, and 20 in which it participates without a majority. It is noteworthy that those domiciled outside of Venezuela have a presence in 36 countries.
This business network, managed without complying with the control provisions established in the regulations for decentralized entities for business purposes, has great risks of corruption that have materialized. According to him corruptometer, 92 of 236 cases of administrative irregularities correspond to the management of oil in Venezuela, which represents 81% (USD 42.321 million) of a total of USD 52.098 million involved in mismanagement of public funds.
Corruption investigations with Venezuela's main state agency have crossed borders. In courts in Florida, United States, for example, a rigged loan contract for PDVSA that left losses of more than USD 1.200 million. In El Salvador, an investigation for money laundering was opened against Alba Petroleos (Albapes), in which PDV Caribe, a subsidiary of PDVSA, has a majority. Likewise, the National Court of Spain opened a judicial macro-cause to try to clarify at least three corruption plots with the Venezuelan state company.
All SOEs must proactively publish their budgets, quarterly executions, management reports, achievement of goals, shareholding composition, authorities and information on their purchasing and acquisition processes, among other obligations (art 9 and 10 of the Law against Corruption). But none of this is true in Venezuela.
The database presented is still under construction, it cannot be considered definitive in a country where secrecy prevails, decisions are made according to political-electoral situations and the economic context is pressing changes regarding private participation in sectors that were previously considered strategic. .