Issue 176: TNCs Sail On Ð WTO or Not


by Brewster Kneen, with thanks to Ralph Nobles in San Francisco and Jorge Hinestroza in Venezuela


Picture this. A village of 1700 souls on the edge of a nationally and internationally recognized valuable wetlands in the west of Venezuela taking on Cargill, reputedly the world largest private company. The issue: Cargill's attempt to turn the wetlands into huge salt evaporation ponds to produce solar salt for the Venezuelan petrochemical and plastics industries. Cargill is already among the top three salt companies in the world. The region in Venezuela where Cargill is active is to the west of Caracas and the long thin coastal region where the severe flooding and mudslides took place.

It is a repeat of Cargill's performance in India in 1992/3. In India, Cargill lost to the small-scale salt producers, the peasant farmers and others. We trust it will lose in Venezuela as well.

In 1995 Cargill de Venezuela formed a joint venture with Petroquimica de Venezuela SA to produce salt by acquiring a 70% interest in Productora del Sal (Produsal), a Venezuelan company in which Petroquimica already has a substantial interest. Plans called for Produsal to complete construction of a salt-production facility at Los Olivitos in the state of Zulia expected to produce 800,000 tons of salt annually. Petroquimica is a wholly owned subsidiary of Petroleos de Venezuela. source: WSJ:26/9/95

Since 1995 the villagers of Anc¢n de Iturre have been resisting Cargill's efforts to develop salt production in the area.

The Los Olivitos Marsh is a coastal wetland of 33,000 hectares of mangroveswamps, littoral lagoon (estuary), salt marshes, sandy beaches, and dunes lyingwithin the Maracaibo estuary, located between the Gulf of Venezuela (SouthernCaribbean Sea) and Lake Maracaibo. 15,000 hectares of the Olivitos estuary hasalready been declared a Wildlife Refuge and Fishing Reserve under Venezuelan lawand in 1996 this wetland was included in the list of Ramsar sites, that is, a wetland of international importance according to the Ramsar Agreement.

The Los Olivitos marsh receives the waters of El Tablazo Bay on the west and the waters of the Caribbean (Gulf of Venezuela) to the north. It is also fed by the freshwater of the Cocuiza and Palmar Rivers. It is an important resting, feeding and nesting place for many species of birds, as well as being an important trophic area and nursery zone for several commercial fish species, crustaceans, and other aquatic organisms. The mangrove areas of Los Olivitos and San Carlos supply 50% of the catch of Zulia state, most of it coming from the artisan fishery, and Zulia state actually exports white shrimps and blue crabs to the United States.

Through Produsal, Cargill intends to supply all the salt required by the El Tablazo Petrochemical Complex, where Petroquimica de Venezuela (Pequiven) uses salt as a primary material for chlorine production and the manufacture of PVC. Large amounts of salt are also used in the nearby oil field operations in Lake Maracaibo and vicinity.

About three years ago Produsal expropriated about one-third of Los Olivitos wetlands, built a 17- kilometer dike and converted the marshlands to salt ponds to produce about 300,000 tones of salt per year. Now it seeks to increase production to 800,000 to one million tonnes or more. Obviously this would eliminate the traditional small-scale salt works and threaten, if not destroy, the mangrove swamps and the fishery in the Los Olivitos lagoon ecosystem, upon which the people of Anc¢n de Iturre and the neighbouring villages of Bella Vista, Los Jobitos, Sabaneta de Palmas, and Punta de Palmas depend for food and some cash income.

Cargill's 1993 attempted project in India is described in detail in Invisible Giant:
"Encouraged by India's new economic liberalisation, Cargill Southeast Asia obtained approval from the government's Foreign Investment Promotion Board to set up a 100 per cent export-oriented unit to produce one million tonnes of high-quality sun-dried or solar industrial salt a year" [in Kandla Port, Gujarat State], reported the Financial Times of London in mid-1993. Even though it was already producing 5 million tonnes of salt a year at its plants in Western Australia and California, Cargill was seeking new production sites because these sources were not expected to meet future demand."
"Local opposition to the Cargill project took the form of a protest march beginning in surrounding villages and timed to arrive at Kandla Port on May 17th, 1993, the anniversary of Mahatma Gandhi's salt march to the sea in the same state more than 50 years ago."
"In September, 1993, Cargill made a tactical retreat from salt in India. Its press release read: "Cargill today advised the Horourable Court at Kandla in Gujarat that it is no longer interested in building an export-oriented salt works in the Kandla Port Trust area." A Cargill spokesman said that political opposition had played no role in Cargill's withdrawal from the salt project. "It would be a mistake to conclude that we have been deterred by the erroneous and politically motivated claims made by some people regarding this project," he added." Invisible Giant , Cargill and Its Transnational Strategies, Brewster Kneen, Pluto Press, 1995, is available from The Ram's Horn for $16 postpaid in Canada, US$16 postpaid elsewhere

El Tablazo Bay lies northeast of Maracaibo City and is now considered part of Lake Maracaibo. Originally, Lake Maracaibo was almost entirely closed to the sea by a bar which provided an effective obstacle to big oil tankers entering the lake, but this obstacle was overcome by dredging out the bar. The continuous dredging is one of the most important pollution sources in this area due both to the movement of sediment and the increasing salinity of the lake itself. In the past it was not salty because the rivers brought enough fresh water into the lake to keep the sea water out.

The inhabitants of Anc¢n de Iturre have long lived in harmony with the marshes, taking fish from Los Olivitos without damaging the natural resource. The dike that Cargill built three years ago, diverting the rivers that formerly brought fresh water and nutrients to the marshes, has had disastrous consequences for the fish and other organisms living in the marshes. Fishers who used to catch around 1,000 kg per boat three years ago now get just half of that or less.

However, an even greater and more imminent danger than an extension of the dikes is the plan of Produsal to install a pipeline to discharge bittern (amaragos in spanish), a highly-alkaline toxic by- product of salt production, directly into Lake Maracaibo.

Each ton of salt produced generates a metric ton of toxic bittern. Cargill knows very well what the harmful effects of this will be. Twenty-eight years ago Leslie Salt Company, now part of Cargill Salt, commissioned a scientific report titled "Report on Proposed Discharge of Bittern to San Francisco Bay". (March 31, 1972) The report describes the toxicity of bittern and points out that salt production by solar evaporation produces one ton of bittern for each ton of salt produced. The same report indicates that bittern must be diluted at least 100-to-1 with fresh water before losing lethality. Current environment regulations in San Francisco Bay require that Cargill Salt dilute its bittern discharge at least 300-to-1 and then release it only during an extra-strong ebb tide and at locations where there will be strong mixing and tidal dispersion. These conditions are so stringent that bittern is currently not discharged but is stored in diked bittern ponds.

Being well aware of the vital role of the marshes, a year ago the men, women and children of all the fishing families of Los Olivitos stopped the installation the bittern pipeline by placing themselves in the way of the construction machinery. Fortunately no one was injured. But they achieved even more than halting construction of the pipeline, because a municipal representative notified the National Guard about the protest and Guard officials came to monitor the demonstration. While at the site, they had the opportunity to conduct a close inspection of the pipeline and found that the size of the pipe exceeded the permitted diameter and capacity as authorized by the environmental authorities. Not only had Produsal (Cargill-Pequiven) obtained illegal permission to install the pipeline but they were installing a larger pipe (13") than that specified by the illicit license (10"). It became obvious that corrupt Ministry of Environment officials had authorized the work illegitimately and that Produsol was doing whatever it pleased anyway.

At that point Produsal retreated and the Environmental Ministry cancelled the permit and assured the villagers that a public hearing would be held before a new permit was issued. No hearing was called and in mid-April a hundred fishermen and their families from Anc¢n de Iturre gathered in Maracaibo to request that Produsal's General Manager and a regional officer meet with the community representatives. The community chairwoman, Lic.Yuleida Huerta, who herself comes from a fisher family and is a teacher in a rural school located near to Anc¢n de Iturre, and the fishermen submitted the following demands:

1) The creation of a committee composed of representatives of Produsal, Ministry of the Environment and the community, to investigate the consequences of Cargill's production methods.
2) The total elimination of the discharge of bittern, a toxic by-product of solar salt production (bittern discharge is not allowed into San Francisco Bay from Cargill's salt operations there).
3) Development of a bittern waste treatment system to protect El Tablazo and Carribbean waters. Cargill must apply the same strict care for protecting La Cienage de Los Olivitos Wildlife Refuge as it is required to use to protect the Don Edwards San Francisco Bay Wildlife Refuge.
4) Dismantling of Produsal's pumping system which takes water directly from the lagoon within the Refuge.
5) Removal of the obstacles that stop the water flow from Cocuiza and El Palmar rivers into the Refuge.
6) The development and adoption of an ecosystem plan and programs to protect the Cocuize and El Palmar river basins. (Very important for the health of the Refuge.)

In April, Yuleida Huerta also wrote a letter to the people in the San Francisco Bay area who share concerns about Cargill's salt operations. "Today, through these lines, I am able to express the bitter sadness of just thinking about what uncertain future is expected for the children and grandchildren of these wonderful and humble fishermen of this community, who live the horror of seeing how infernal machines extract the rich water containing hundreds of species, in the form of tiny eggs, larvas, and young fishes, from our lagoon in order to convert it into huge piles of salt. This represents the death of our lagoon and hunger and poverty for us."

Although the promised hearing never did take place, all remained quiet until just before Christmas when Produsal crews reappeared (on December 22nd) with a new pipeline permit and again laid out tubing on the public lands of the Refuge. Feeling betrayed by the Environmental Ministry that had issued a new permit without a public hearing, the angry villagers of Anc¢n de Iturre, now joined by residents of the neighboring villages of Belle Vista, Jobitos and Punta de Palmas, formed a 1000-strong protest and demanded both a meeting with Produsal representatives and that the pipes be taken back to salt company property.

The Produsal engineer that came to talk to the people disregarded their demand and even teased the crowd. When Yuleida gave Produsal a deadline for removing the pipeline, the response of the engineer was to make fun of her. When the time limit was up, the people began to burn the pipeline, reducing almost half a kilometre of the hated pipe to puddles of molten PVC.

Meanwhile, at some distance out of reach of the stones that "rained" abundantly an amazed group of elegant managers of the company watched.

When a Produsal truck with a policeman and armed Produsal security guards appeared and shots were fired toward the crowd, the historically peaceful fishermen became enraged and proceeded to upset and burn the truck as well.

Some members of the National Guard that arrived a little later asked with amazement how it was possible that Produsal had tried to discharge bittern in a recognized Refuge and they even shared some of the food that the fishermen prepared for the protesters.

When the National Guard authorities invited the community leaders to tell them what happened, Yuleida said that they were going to declare their responsibility for the events described above because the people of Anc¢n de Iturre are tired of the deceit and traps of Produsal and the government.

Produsal has now charged Yuleida with riot and the National Guard has been ordered by the public prosecutor to investigate the case. Our lawyers, wrote Jorge Hinestroza on January 2nd, are already on the case and think that Produsal has made a lot of legal mistakes and that the company lawyer mishandled the situation. "So we feel very safe. Anyway, as we say, 'we will turn the cake over,' and Produsal will regret it. This case will probably also provoke a real scandal against Cargill itself. Meanwhile, it has already aroused a lot of support from the other communities that know Yuleida as an upright leader. I would have liked to have been there when Yuleida and the other five accused fishermen went to the National Guard office to attend the citation. A crowd of neighbours from Anc¢n and others communities went with them, and the officials were amazed by the unprepared demonstration. Produsal must be wondering if it should continue this senseless persecution. Cargill is increasing the defiance of the rest of the fishermen in different communities."

We'll let you know how it turns out.