FEDECAMARAS SPEAKS OUT AGAINST CONSTITUTIONAL

C O N F I D E N T I A L CARACAS 002140 SIPDIS SENSITIVE SIPDIS HQ SOUTHCOM ALSO FOR POLAD TREASURY FOR MMALLOY NSC FOR JCARDENAS AND JSHRIER COMMERCE FOR 4431/MAC/WH/MCAMERON E.O. 12958: DECL: 11/06/2017 TAGS: PGOV ECON VE SUBJECT: FEDECAMARAS SPEAKS OUT AGAINST CONSTITUTIONAL REFORM Classified By: Acting Economic Counselor Shawn Flatt for reasons 1.4 (b ) and (d). ¶1. (SBU) Fedecamaras, Venezuela's premier umbrella business association, has added its voice to those opposed to Chavez' proposed constitutional reforms. During a meeting on November 2, Jose Manuel Gonzalez, President of Fedecamaras, handed the Ambassador a paper discussing Fedecamaras' position. Also on November 2, Gonzalez gave a short speech at a press conference outlining the association's reasons for opposing the reform. In the paper and speech, Gonzalez attacked the proposed reforms as undemocratic and illegal, arguing, like many others, that they constituted a "new coup by the state against democracy in Venezuela." ¶2. (SBU) Gonzalez based his critique in part on economic grounds, noting that the proposed reforms will only exacerbate Venezuela's economic problems, including inflation, scarcity, unemployment, and corruption. In a separate paper available on its website, Fedecamaras specifically attacked the proposal to undo the autonomy of the central bank, calling it "contrary to equilibrium in the money market and to a sane economy." In his paper and speech, Gonzalez also attacked the proposed reforms on political grounds, noting, for example, that they threatened to reverse decentralization and to concentrate power in an authoritarian and autocratic state governed by a president who wanted to perpetuate his hold on power. Making passionate reference to the protests organized by university students, Gonzalez called on all Venezuelans "to come out against the reform, rejecting it, denying it, and impeding its approval." ¶3. (C) Comment: It is not likely that Fedecamaras' position will change the thinking of the Chavista base. It is nevertheless one more noteworthy voice raised against the proposed reforms. Fedecamaras' categorical rejection of the proposals is also illustrative of the increasingly polarized atmosphere in which the campaign to adopt or reject the reforms will be carried out over the coming weeks. DUDDY