Archive for August 27th, 2011

The Fonden Papers Chapter II: Visiting Pajaritos and getting the Fonden Papers

August 27, 2011

About two weeks ago I told the story of Deputy Carlos Ramos of the National assembly who provided us with an excel spreadsheet of the projects financed by Fonden after I wrote to him. The sequence of how this spreadsheet came about was somewhat unclear, the Congressman saying that there was some US$ 29 billion, give or take a billion simply missing. He made this discovery when he added all of the numbers provided by the Minister of Finance and realizing the total was different, the Minister saying US$ 69 billion had been approved for projects, but the addition of the numbers totaling only about US$ 40 billion.

Quico at Caracas Chronicles then decided to call the Deputy’s assistant to see if we could obtain the original information. But it just so happens that XXIst. Century Socialism, uses XIXth. or XXth. Century tools. There isn’t a scanner to turn the 30 or so pages turned in by Minister of Finance Giordani to the National Assembly into digital form, thus, unless Quico, who lives 2,448 miles away from Caracas, could drop by and pick them up, he (and we) were out of luck. Fortunately, the Devil had to go to Caracas and could go get the papers.

Thus began my trek to the Pajaritos building. The building (pictured above) is actually called the Jose Maria Vargas building, but nobody calls it that, everybody calls it Pajaritos, the name of the “Esquina” (corner) where the building is. I made the mistake of showing up five minutes past noon, which meant that I could not enter the building. (The building is shared by the administrative offices of the Judiciary and the National Assembly, each has its own reception, which opens into the same hall, you can get into the Judiciary at any time, but not to the Assembly between noon and 1:30 PM)

I called Deputy’s Ramos office and they told me they would come down and give me the info we had requested. Waiting there was an experience in itself, I could not go in, but the guy in the mortuary suit that controlled the people allowed a few ladies, buddies and officials to go through. While I waited (He asked me three times what I was doing standing around there, I studied the dozens of people who showed up looking for help. Quite an experience, from Guajiro indians to students wanting to talk to their Deputy, mostly to see if they could get some money (preferably cash).

Finally, the extremely efficient assistant of the Deputy came down and gave me a folder with copy of all the material. You can find the projects all here. Essentially, the story is that Deputy Ramos, as a member of the Comptroller’s Commission, requested on April 6th. that Giordani give him a full list of projects approved not only for the development fund Fonden, but also for the Chinese fund, the Fondo Chino. On April 28th. Minister Giordani sends the info to the head of the Comptroller’s Commission, Hector Navarro and on August 2nd. Deputy Ramos sent Giordani a letter asking about the fact that there seems to be some US$ 29 billion missing from the project list.

The problem is that, as you can see in the link, Minister Giordani provided the complete list of 140 projects, giving the name, the Ministry, the amount awarded, the amount disbursed over the years and the amount disbursed in 2010 (Which is actually the only thing the Deputy was asking for) But Giordani sent all of of the info, and when you add up the total amounts approved and disbursed historically, the information provided says that projects were awarded some US$ 69.446 billion (down to the cent as Quico shows) of which US$ 66.057 billion has been disbursed and US$ 9.621 billion was disbursed in 2010.

Except…that if you create an Excel spreadsheet put all 140 numbers and add it all up, the total is “only” US$ 29 billion short, as discovered by Deputy Ramos. Now the Deputy is asking for even more information, including who got the contracts for each project.

It’s interesting to note that the total givenĀ  by Giordani is roughly what was contributed by the Venezuelan Central Bank, under the screwed up concept of excess reserves, and PDVSA, whose contributions are now set by law, as shown in the Table below, where I have used all public sources from the BCV, Fonden and PDVSA to come up with the grand total of US$ 69.80 billion contributed to Fonden.

We can speculate all we want: Were projects removed from the list? Was the total simply faked? Was this intentional? Was it sloppiness? Can they provide the information or they just don’t have it? Is the money somewhere else? Is the money missing?

But no matter what, the point is the same, US$ 29 billion is currently “missing” or unaccounted for from the parallel fund Fonden, which is managed by Chavez and Giordani at will and in an extremely discretionary fashion. (They used part of the money to buy a new Embassy in Russia, for example)

This would be a scandal in any country in the world, but apart from Deputy Ramos and a couple of nutty bloggers, it just seems to have not even induced a yawn in Venezuelan politics.

Hopefully, we will help bring the issue more into the spotlight.

And again, kudos to the Deputy and his efficient and diligent assistant!