* System to finance state-run companies
* Chavez bringing financial markets under state control
* Hopes to win-over middle-class voters
By Frank Jack Daniel
CARACAS, Nov 15 In what President Hugo Chavez
described as a blow for "vampire" capitalism, Venezuela will
next month open a state-run stock and bond exchange aimed at
financing public companies and wooing middle class voters.
The government's official gazette on Monday published the
law ordering the creation of the new market, which will be run
by the finance ministry.
In recent weeks, Chavez has accelerated his drive to
increase the hand of the state in all sectors of the economy
including finance, housing and food production. Oil and heavy
industry is already largely government run. [ID:nN12121425]
"The public securities exchange system has been born,"
Chavez said on his weekly TV show on Sunday in a speech
peppered with references to capitalist "vampires" and
"vultures." He said it will open in December.
"This is not the capitalist exchange, Dracula, this is the
socialist exchange. The state and the republic guarantee your
money and it will have a good yield."
Chavez already has his eye on 2012 presidential elections,
where he will need the support of some middle-class voters as
well as his poor base to win another 6-year term. He says the
exchange as well as recent moves against home-builders accused
of corruption will favor the middle class.
Savings opportunities in Venezuela are limited, with
negative real interest rates and inflation of 27.5 over the
past 12 months. As a result, Venezuelans are high spenders.
"When you get your three month bonus, don't spend it all,
let's organize, we'll invest it in the exchange," Chavez said.
Some Venezuelan workers receive a triple pay check at
Many Venezuelans are used to investing in government bonds
via private brokerages as a way of accessing dollar and
receiving high yields.
But this year the government has overhauled Venezuela's
capital markets, closing dozens of brokerages and creating a
new state-run currency exchange. [ID:nVENEZUELA]. Both moves
restricted investment opportunities for the middle class.
Lawmakers are expected to pass a law in the next few days
that would make it easier for Chavez to nationalize banks and
would force them to hand over 5 percent of profits for social
Chavez said the new exchange will be housed in the former
offices of Econoinvest, the country's leading brokerage which
the government shut earlier this year on charges of fraud.
State oil company PDVSA last week sought permission to
trade $3 billion of bonds on the public bourse. Chavez said
state companies such as telecoms giant CANTV could raise
capital on the market.
(Reporting by Frank Jack Daniel and Eyanir Chinea; Editing
by Diane Craft)