Venezuelan Foreign Asset War: Monómeros

The intervention of a Venezuela owned company in Colombia has become an embarrassing chapter of the Venezuelan political crisis and the strategic war to control our foreign assets

Photo: Monómeros Colombo Venezolanos

Monómeros Colombo Venezolanos S.A. is an agro-industrial company located in Colombia owned by Petroquímica de Venezuela S.A. (Pequiven), a Venezuelan state company. It was founded in 1967, with Colombian and Venezuelan capital (held by IFI­, Ecopetrol, and IVP), up until 2006, when Pequiven acquired 100% of the company

Why is it a valuable asset for Venezuela?

It’s valuable to Venezuela because it generates important revenue and has the capability to supply the current needs of the Venezuelan agro-industry. Monómeros is one of the top 1000 largest companies in Colombia and one of the most profitable in the Caribbean, according to the rankings published by the Superintendencia de Sociedades de Colombia. Its main products are fertilizers which supply 40% of Colombian farmers and 70% of coffee growers. Because of this, it’s considered a key element to ensure food safety in Colombia. Also, it exports products to 50 countries across the world. It has the capacity to produce 1.3 million tonnes of organic and inorganic substances used in large-scale sowing. It produces feed for animals and livestock, as well as supplies for the medicine, food, soft drinks, soap, paper, detergent, cement, and paint industries; such as nitric acid, sulphuric acid, sodium sulfate, cyclohexanone, plaster, sodium carbonate, sulfur, caustic soda, phosphoric acid, ammonia, methanol, and ammonia water. The company has its own docks in Barranquilla and it operates two petrochemical facilities, one Río Grande de la Magdalena mouth and the other in Buenaventura. In 2020, in spite of the COVID-19 pandemic, it sustained over 15,000 jobs and its profits reached 32,000 million Colombian pesos (8.3 million US dollars), more than triple compared to 2019.

What did the Colombian government do with Monómeros recently?

This company was controlled by the Maduro administration until 2019 –under Ronald Ramírez, a man linked to companies owned by Alex Saab—, and then, per the Guaidó caretakership, recognized by the country hosting Monómeros, control went new “ad hoc” board of directors appointed by the interim government: Jon Bilbao, Yadid Jalaff, and Carmen Elisa Hernández. On September 7th, 2021, the Colombian government decided to take control of Monómeros, through an intervention by the Superintendencia de Sociedades de Colombia (Supersociedades) “within its attribution framework of inspection, monitoring, and control” provided in the local law.

How did the Venezuelan government and opposition react to this course of action by Colombia?

Nicolás Maduro rejected the intervention claiming that it constitutes a flagrant assault on a Venezuelan state asset, and said the event was sabotage to the dialogue process with the opposition which is taking place in Mexico, since one of the two partial agreements signed with the opposition in the first round of negotiations established that they would look for ways to protect Venezuela’s foreign assets. He also said “Monómeros has to go back to its owners, to its parent company, Pequiven, so all products from Monómeros go back to Venezuela and contribute to the integral economic recovery of our country.” A few days later, on September 13, Carmen Elisa Hernández resigned as president of Monómeros. She was part of the ad hoc board of directors appointed by Juan Guaidó in 2019. 

Maduro, of course, wants the regime to have access to Monómeros and its profits to control them as they do with all other PDVSA companies, the difference being that Monómeros is operating a lot better than any other company held by the state.

This is exactly what the opposition wants to prevent. Julio Borges, appointed by the National Assembly elected in 2015 as commissioner in Foreign Relations for the “interim government,” proposed transferring Monómeros and other Venezuelan assets abroad to a trust fund to protect them both from creditors and the Maduro administration. “We want assets to be handled by the most professional managers and be supervised by an international body, like the Inter-American Development Bank. And remove the direction by the Venezuelan opposition from these companies and assets. This makes us lose focus, political parties aren’t supposed to run those companies, neither Monómeros nor CITGO. We have to remove politics from there and protect the assets from Maduro and creditors,” he pointed out.

Maduro will bring this topic to the dialogue taking place in Mexico. Prosecutor Tarek William Saab has already launched a new investigation against Juan Guaidó for allegedly “usurping functions, treason, conspiracy, asset theft, and criminal association,” regarding the events surrounding Monómeros. Guaidó, on his part, announced that he will request a new external audit of Monómeros and assured the company’s ownership still lies with Venezuela. After Carmen Elisa Fernández’s resignation, he also declared they would restructure the board of directors and recover the asset “from a very important ally such as Colombia.”

Who controls Monómeros now?

The company is still intervened by the Superintendencia de Sociedades de Colombia, for the time being. Julio Borges and Juan Guaidó don’t seem to be on the exact same page: while one is focused on the trust fund, the other talks about restructuring the ad hoc board of directors.

It’s worth remembering that when Monómeros was under chavista control, the Venezuelan farmland didn’t have supplies. With measures like the confiscation of the fertilizer and pesticide giant Agroisleña in 2010, the government began monopolizing all agricultural supplies. Farmers had to go through a State filter of the new Agropatria, which included the involvement of military companies Agrofanb and Agrosur. Within a decade, agricultural production dropped to less than half in basic items like corn and sugarcane, with serious consequences on Venezuelan food safety. Before Guaido’s ad hoc board of directors took over Monómeros, the company had been supplying the diminished Pequiven with urea, nitrogen, and about 5,000 tonnes of NPK fertilizer, until Colombia and Venezuela closed down their borders in 2015. Since then, agro-chemical scarcity has become much worse.

Why was Monómeros intervened by the Superintendencia de Sociedades?

The ad hoc board of directors appointed by Juan Guaidó in 2019 denounced irregularities by the former chavista management, among them, closing contracts without proper bidding processes and handing over millions in dividends while registering losses. “Among the reasons stated by Supersociedades, the asset was seized because of its inability to access foreign exchange markets as the result of being on the OFAC list, which prevents them from financing procurement and forcing them to depend on credit by foreign suppliers. At least 85.4% of supplies used by the company are imported by providers Nitron and Mosaic. Among the possible options out of this situation, one of the most talked about, is the possibility of having the State bank support the company so it can cover all its commitments,” Colombian newspaper Portafolio reported.

Will Monómeros be discussed at the Mexico negotiations?

At the time of publication, the topic hasn’t been included in the dialogue’s agenda, but it could be added as part of points number 3 (“Lifting of sanctions and recovery of assets”) or 6 (“Protection of the national economy and social protection measures for the Venezuelan people”) of the MOU signed, so long as both parties agree to it.