OPEC Official Opening Speech By Hugo Chavez
Speech by Mr. Hugo
President of the Bolivarian Republic of Venezuela
II Summit of Sovereigns, Heads of State an Government of OPEC Member Countries
Caracas, Venezuela. Wednesday September 27, 2000
I will not be as brief as Mr. Bouteflika nor as long as when I have my radio and television addresses.
Your Excellency, Abdelaziz Bouteflika, President of the Democratic and Popular Algeria Republic; Your Excellency, Abdurraham Wahid, President of the Republic of Indonesia; Your Excellency, Mr. Seyyed Mohammad Khatami President of the Islamic Republic of Iran; Your Excellency, Mr. Olusegun Obasanjo President of the Republic of Nigeria; Your Royal Highness, Sheik Hamad Bin Khalifa Ben Hamed Al-Thani Emir of the State of Qatar; His Royal Highness, Abdullah Bin Abdulaziz Al Saud Crown Prince of the Kingdom of Saudi Arabia; His Royal Highness, Sheik Hamad Bin Mohammad Al Sharqui Emir of the Emirate of Fujairah United Arab Emirates; Your Excellency, Mr. Taha Yassin Ramadan Vice-president of the Republic of Iraq; Your Excellency, Mr. Mustafa Al-Karroubi Minister of the Revolutionary Council of the Socialist People's Libyan Arab Yamahiria; Your Excellency, Mr. Saud Nasser Al-Sabah Minister of Petroleum of the State of Kuwait; Mr. Rodríguez Araque, President of the OPEC; Your Excellency, Doctor Rilwanu Lukman, Secretary General of OPEC; Your Excellency, Saied Abdullah Director General of the OPEC Fund; Presidents of the National Public Powers of the Bolivarian Republic of Venezuela; Vice-president; Honorable Diplomatic Corp; Members of the varied outstanding delegations that accompany us today in the inaugural session of this II Summit; Heads of State and Government of the Organization of Petroleum Exporting Countries; Representatives of mass media of Venezuela and of the world; Marisabel, ladies and gentlemen:
In the name of Ala we give an invitation we will begin this important activity in the Muslim world. How wise that permanent inspiration and genuine offer to fill the challenges of the past of life of men and of people. To understand what should be our relations with the natural order of beings. I speak of unity of creation, people that indicate the place of humanity and of the human being in creation. Which indicates the importance of the exercise of moderation and reason and Khalifa, which establishes the grandeur of the world of the custodians of the poets and the welcome of creation. Unity, passion, common sense, guidance, values, important values to guide human nature, values that are also present in all the other spiritual conditions of mankind including ours inside and a beautiful doctrine of the redeeming price: peace on life and brotherhood to fight for justice as the only possible path to peace, genuine peace in the world.
At the beginning of this II Summit of Heads of State and Government of the Member of the OPEC very humbly allow me to invoke all the supplying values of God, of Ala with the hope that it may guide my deliberations, that they strengthen and lead and light our horizons.
You have come, you brothers from that great Arab Islamic world, a gigantic geopolitical area that open its arms from the Atlantic cost of Western Africa to the furthest corner of the East, that MacKinley called the region of the five seas: the Mediterranean Sea, the Black See, the Caspian, the Red Sea and the Arabian Sea.
You come here with the power of a millenary of a very deep civilization founded by Mahoma the Prophet, the fuel engine of heritage that impresses religion through the world at the very beginning of our era and to be more exact yesterday, you have arrived, you my brothers have arrived to this gigantic land, this beautiful country of Latin America and Caribbean, where some contemporaneous geopolitical currents have called the extreme west and which encompasses an immense vertical space from Rio Grande to the southern most corner of the Patagonia with the Atlantic and the Pacific and bearing within it a beautiful, warm Caribbean Sea.
You have arrived brothers to the new world, to this Caribbean Venezuela, Andean Venezuela, Atlantic and Amazonic Venezuela, which Simon Bolivar, the Liberator of America dreamt one day to be the height of the Universe and the anfictionic ......of the greatest region of the world as he would have said, less because of its natural wealth than because of its freedom and glory.
You have come my brothers, precisely to this land in times of revolution, in the hours of the resurrection of a brave people that today once again lead the fate in its own hands with the standards applied at Bolivar waving in the four winds, a people that open its hands to receive and deliver its heart to you to tell you in an infinite chorus that goes beyond the winds, welcome sons of Ala, followers of Mahoma, "Ahlamwa Sahlam", "Marhaba, "Al Salam Aleykum".
Caracas, the birthplace of the Liberator, it was precisely here in Caracas where the Statutes of the Organization of Oil Exporting Countries were approved, in January of 1961, I was barely born at that time. Having passed the resolutions of the conference of representatives in Bagdad , on the shores of the Tigris, the 14 of September of 1960, in the beautiful Bagdad in Mesopotamia. Forty years ago today and 13 days, with their moons and suns, with its days and nights as Gabriel Garcia Marquez would say, the Gabo of the Americas, the Bolivarian of this land and of this world.
The building of OPEC took time, but it began almost with the XX Century, in the heat of an irrationally oil exploitation which let to the sprinkling of economic models which were typically colonial. To give a clear idea of this terrible historic reality my brothers at least in the case of Venezuela, let us just take some information, some papers from the documents written by one of the founders of OPEC, the great Venezuelan Juan Pablo Perez Alfonzo, whom God have in heaven.
wrote in his memoirs that the first oil shipments left
Venezuela by the San Lorenzo terminal on Lake Maracaibo in
1917 and b 1928 Venezuela had become the first world net oil
exporter. Well, my brothers, the fiscal participation of the
country in those 12 years, got barely to 8 million dollars,
having produced a total of 266 million barrels and the
posted price at that time was 245 million dollars worth.
Today, 40 years later we must re-launch OPEC with the same spirit. Now in the midst of a world struggling to overcome underdevelopment, inequality and poverty. We heard the inspiring words and the example a few minutes ago of the President of Algeria, our brother, Adbelaziz Bouteflika in his wonderful address and I have to say to my brother that Venezuela, This Bolivarian Republic, feels honoured and our people feel honoured to take the flame from your hands, to take that flame to which you referred, that you bring from so far away, from the shores of the Mediterranean. The flame promoted by the warmth of our people of that area and the warmth of the people of Algeria and of all the peoples, Arabic peoples, Islamic peoples. Allow me, brothers, to invoke "Tauhid" and the unity of the past with the present and "Kalifa" as the custodian of our foundation heritage, to re-state, here in Caracas, 40 years later and 13 days, the objectives that led to the creation of our Organization.
I invite you to consider the Statutes of OPEC in its Articles I and II.
Article I reads: "The Organisation of Petroleum Exporting Countries OPEC from here will be nominated the Organisation created as an Inter-government Organisation of a permanent capacity consistent with the resolutions of the Conference of Representatives of the Governments of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, which met in Baghdad from the 10th to the 14th September of 1960 shall carry out its functions according to the provisions established as follows", and these provisions are set out in Article II which reads: (it has three parts):
The 1st, sub-paragraph (a) "The main objective of the Organisation shall be the co-ordination and the unification of the petroleum policies of member countries and the determination of the best means to safe guard the interest of both individuals and collective".
Today, in the II Summit, of course, we take up once again, we re-state and strengthen and re-launch this very principle objective of our Organisation, but as President Bouteflika also mentioned, it is also necessary that we adapt our Organisation to these new times that we are living in. To this world context were we are all living in, in this era of globalisation that is an opportunity, but which also entails terrible threat for our peoples, for our states and for our nations. To co-ordinate, to unify, to re-launch, from Caracas that main objective of our Organisation.
The 2nd Point, sub-paragraph (b) reads "The Organisation should arbitrate means to assure the stability of the prices in international oil markets with the objective of eliminating fluctuations which are harmful and unnecessary. How visionary those men who drafted those Statutes. This is what we are doing today, articulating all the possible means to seek the stability of prices because it is true that although we are not behind an unlimited rise of our oil prices, it is no less true that we are getting ready to close the gaps and to prevent the price of oil from plummeting to zero as we saw happen before our eyes. just a year and a half ago we saw this happen. The stability in a fair price for our oil for which we are re-stating the unity of principles of the Organisation, the unity of objectives and the political will at the highest level as today we expressed to America and to the whole world.
Lastly, the 3rd point reads, and it is also very important that we emphasise it "At all times due attention should be paid to the interest of the producing nations and to the needs to ensure a continuous income for producing countries, of an oil supply which is efficient, regular and economical." Allow me to underline these three words, oil supply which is efficient, regular and economical for the consumer nations and a profitability which is fair for the capitals of those who invest in the oil industry. There we find the three components that today we have to review in depth, producers, the intermediaries and the consumers. As clear as crystal we see indicated in these statutes our objectives and we are complying with them.
As we celebrate our 40th Anniversary, in spite of the many prevails and difficulties and the complaints against us in several times of the recent history; in spite of the inconsistencies, of the internal difficulties. In spite of all the ills that we might have suffered, we can say to the world that OPEC in these 40 years, the first 40 years, has discharged its objectives and today we are clicking up, we are re-launching to continue discharging more efficiently with our objectives and to update them; to join the new path and write the new history of this new century. This is exactly what we are doing here, specially during the last 20th months, a stage that we could call the resurrection of OPEC.
After a lengthy period of difficulties that constrained co-ordination, and prevented co-ordination of our policies and the safeguard of our interest, I want to underline the very fact that we were all silent, just for one minute, without anyone saying anything, without one word being said here, and we just looked at each other, and we saw who is here representing these 11 countries. If we recall, in the last 25 years it was impossible to hold a meeting like this one. In 40 years of OPEC, this is the second time that the Heads of State and Government can meet. Only that fact alone speaks loudly for the present and the future of our peoples. That fact alone calls for very warm applause that can reach Asia, Africa and Latin America, and can reach the ears and the conscience of our peoples.
We have to pay special recognition to these men in front of you, because notice that a month and quite a few days ago we organised a tour from the shores of the Caribbean to Africa, to the Middle East, to the region of the Five Seas, to Djakarta, beyond the Indian Ocean and we know the distances, we know the time and the difficulties. And yesterday they arrived in an orderly fashion, one after the other. I truly enjoyed together with my people welcoming you with open arms, but I think they also deserve special recognition. It is the sublime expression of the highest political will of unity. This is the great message we can express to the world. The great example that you have before you.
How much can we do from here on for the real unification of Asia, from Indonesia, that great Asian country, brother of OPEC?. How much can we do? Because we have the historical channel of communication that joins us, that historical unitary instrument, from here, from all our countries, we have to do far more to promote and to work for the reunification of Asian peoples. How much more can we do to impulse and promote the solid reunification of the peoples of the Middle East? Of the people, the Arabic peoples? How much can we do from here through OPEC for the reunification and the promotion of Africa?. How much can you do from your part of the world with the Millenium impulse, together with us in the process of the reunification of the people. We can do a great deal and I am very optimistic when I say that a great deal is what we will do in the years before us, in the decades before us. The XXI Century will be very different from the one we left behind, a century of famine and misery and death. The XXI Century should be the century of life, of unity of peace, of fraternity. Of the union of civilisations, as President Khatami said in Tehran and in the U.S. A meeting of civilisations, millenary civilisations. May God help us, but lets do our part, and , as we say in Venezuela, we play the part and we are ready to fight for it.
Also, our Statutes speak of the need to pay special attention to all suppliers, concessions, efficient, regular and economical terms that I already referred to, to consumer nations.
In the light of recent events, these last few months related to the supply of our oil, we can also be satisfied with our Organisation because we are precisely attending to these needs. Caracas today is the centre of attention of the world. The eyes of the world are upon us. Everyone is attentive to what we do, what we discuss and what we decide. We hope that we will be up to the expectations of all the brothers in the world. To this end it is necessary that we make a few considerations.
What does an efficient supply really mean? I invoque from the Islam "Tahid", unity to see the whole picture, to evaluate the efficiency fully, not in a biased way. I would like to give you an example. Blood supply, a blood transfusion, a blood donation, for instance will be efficient if it benefits those involved, but it won't be efficient, or it will no longer be efficient, if it might imperil the life of the donor. It would take him to his grave in spite of the fact that the recipient might leave the hospital in a very healthy condition. However, if that donation lead to the death of the donor that's not efficient. Efficiency has to be seen in its overall picture. The "tauhid", Islamic wisdom.
OPEC, on our part, we have been truly efficient in these 40 years, but only partially, only in parts. Efficient supply we said, involves a degree of security for those who supply that oil. In Venezuela, for instance, there was no comprehensive efficiency in this supply activity. It suffices to measure the degree of pollution in Lake Maracaibo, or the subsidence that we see on the coast of Lake Maracaibo, in the State of Zulia. Some folkloric personalities from that part of the world say that the by products of not only gasoline, fuel oil, gas oil and others that have polluted the waters of Lake Maracaibo are one of the by-products of oil. They are right, philosophically speaking of course, the result of the oil exploitation of almost one century and the Western Coast which is sinking before our eyes from so much oil we have produced where so many thousands of people live, complete towns have been sinking and sinking and there we are carrying out scientific studies. We will have to invest millions of dollars just to rescue that region.
Therefore we think that supply has not been, in the case of Venezuela, efficient, fully efficient and that is why, and Bouteflika also mentioned it, we have to retake these concepts and give it a more comprehensive vision and to re-launch our commitments. We have to continue to supply our oil to the world, but that world, as we said in the example, the world of consumers we have to show them that it is fundamental for the sustainability of life to maintain the ecological balance, for instance. We cannot continue polluting the water of our lakes, of our rivers, of our seas. We cannot continue destroying nature in a savage manner and, what do we leave to our grandchildren?
To our great grandchildren?. Lets think about them for just one minute. Think about them for one second. Someone said, some investigator mentioned recently that if the consumer model and exploiter model that today prevails in the world were to spread equally to all the inhabitants of the planet, we would still need ten planets like the planet earth to live. It is terrible unequal, life on this planet, and the unbalance that has been generated as the result of exploitation. Not only of oil, of all our commodities; all our natural resources. Industrialisation, often irrational has imperilled the life of the planet into the future. This is absolutely true . Therefore, here we have just one example to take the expression of Dr. Bouteflika, about the need to update to take up the objective and the concepts and paragons that led to the existence and have given life to OPEC.
Now, lets consider the other concepts. Because there is another part of efficiency, another side to efficiency which deals more with us, in the first place. It is the inward efficiency and together we can do far more than we have done. I am referring, and I will borrow a phrase from Dr. Arturo Uslar Pietri, a great Venezuelan. 16 years ago Dr. Uslar said, I think he was Minister to the Government of General Isaias Medina Angarita when he said these words: "we have to plant oil, we have to sow the seeds of oil". Venezuela has been unable to do that in 60 years, far more oil exploitation to use the oil resource. Not to destroy the other industrial, economic and social activities of a country, but at the leverage for a compressive development which is only beginning today in Venezuela. You brothers have done so in many ways in your countries, but together as we spoke in Doha we can do far more to promote agriculture in our countries, to promote tourism in our countries, to promote the diversified industries; the small and medium enterprise, cattle raising, fishery, the activities of life, education, health, the life of our peoples.
If we have done anything in the first 40 years of our existence, yes it is before your eyes, but I think that we could have done much more. It is never too late, lets begin anew. Lets find co-operation agreements as we have been discussing, so that together and using the revenues of our oil we can promote our peoples and lead them to the greatest level of happiness, stability and quality of life. Together we can advance far more, more quickly and with greater efficiency than we have done in the past. I am sure we will do this, as Walt Whitman would say, sure as the surest certainty.
Now, as we speak of regular supply, what do we mean? Well regular supply implies timely complying of our commitments with the regularity. OPEC has how many years supplying oil?. Almost a hundred years supplying oil to the whole world. Of course with great unequality in the industrialised world. They consume 20, 40 times more than in the world of the South. No matter wars and disasters, world wars, countries, natural disasters, we have been supplying. In this case, OPEC supplying over 40 years, regularly supplying in a timely way its oil to the world for its development or its sustainment to its promotion. No one can say we have denied anyone our oil, except I think it may have happened a few details here and there, but circumstantial affairs. We have never denied our oil to anyone nor will we do so.
In the economic arena, efficient supply, regular supply and economical supply. Everyone can say, you see I was right, they have to sell us cheap oil. No, I say, wait a minute, economical does not mean cheap. Giving away, no. Economy is a concept that contains reality. I will just touch on a few.
Economical. The price of any good, in this case it is oil, should have a relationship a personal relationship with its cost of production and we know that in the world there are more requirements placed on us in order to produce our oil. The reserves sometimes plumit, of course. It is not a renewable resource and we have to invest a great deal of money to explore and to find oil. To drill deeper and deeper . Any of you Ministers and petroleum technicians can tell us, off the top of your head, how much the cost of exploration has increased and has grown with sophisticated technology or to export offshore at great costs. To increase production and reserves because the population of the world continues to grow , so this has to be seen in that full dimension. We cant reform heavy oil, super heavy oil, extra heavy oil into lighter oil. In the case of Venezuela the greatest reserves are heavy crude and extra heavy crude. To exploit these heavy crudes we would have to invest great amounts of money.
For example, the Orinoco Oil Belts, someday, we have already begun at least exploration, but only taken the first steps. We will have to guarantee the production potential and the cost continues to rise. Not only the cost of production, the use and the exchange value.
As to the fair price for our oil, we have to wonder what is the price of energy produced compared to a barrel of oil? What can the countries that buy our barrel do with one barrel? What could they do to make this a more dramatic picture? Turn this around and say: What could they do without oil? How could they have reached the levels of development they enjoy today? What would they have done? What would they do today if we hadn't sold them our oil and if we didn't continue to sell them our oil? Use value. The development, the take-offs of the countries of the industrialised north is, of course, due to many factors, but in good measure it is due to the regular, efficient supply, continuous and permanent supply of oil that we have always complied with for the last 100 years. And in OPEC, for the last 40 years without interruptions.
Now the exchange value. What can we exchange for one barrel of oil? I have a few examples that might be of interest to you. I have to confess that I was very interested when I heard these examples that I'm going to share with you, drawn from different tables and studies. Do you know, for instance, that a barrel of oil (let's assign the average price for this year in Venezuela, $26.2 a barrel - this is the average for this year in Venezuelan oil. Let's take that as a point of reference, as a benchmark.) Do you know how much a barrel of unleaded gasoline is worth? Well, a barrel of unleaded gasoline costs $30.6, without considering the taxes, and with taxes it's worth $54.14 a barrel. That is to say, one hundred percent more than a barrel of oil is worth, in the case of Venezuelan oil. Do you know how much (and forgive me for this ad) a barrel of Coca Cola is worth? A barrel of Coca Cola is worth $74.7: 303% compared to a barrel of oil. A barrel of spring water, $94.37: 360%. A barrel of milk: $150. A barrel of ice cream: $1,105: 4,250% compared to our poor little barrel of oil. A barrel of good wine is worth, you know how much?, $1,370: 450% more. This is almost laughable, but let's tell the truth to the whole world. A barrel of shampoo - $2,056; a barrel of Tabasco sauce - $2,600; a barrel of tanning oil (when you go to the beach) - $5,365: the gigantic proportion of 620% compared to our poor little barrel of oil.
You know that the truth... Krishna Murta, the great Indian philosopher said this, the truth is that the only thing that joins us with all. If we are apart from the truth, we are disconnected and we lose our way. I invoke Krishna Murta and his Hindu wisdom to appeal to what Bolivar said from El Chimborazo. Let's tell men the truth but tell the whole truth. Let's not continue to manipulate and have lies, to confuse the men of the world. This is one truth and we have to tell the world this truth. Remy Martin, a cognac, $7,800 a barrel. Ambassador, let's tell the world the whole truth. Thirty thousand percent compared to one barrel of oil that we find it very hard to produce, and for the last 100 years we have exploited and sold to the world.
Justice, only justice. We cannot allow, brothers of OPEC, that once again, as has happened in other times of our history, we be indicated as guilty as those who are guilty for the imbalance of the world. The guilty are elsewhere. We are victims of the imbalances of the world economy. We are not at fault. Those at fault are to be found elsewhere.
Allow me, from here, to send in that same spirit of truth and tauhid, our greetings to the great consumer countries, members of G-8, and the European Union, from where we have received some messages, be they public messages, and even some private messages, via letters I won't read to you for ethical reasons, telephone calls. One time, a resident of a powerful country in the world called me up and I felt, I was amazed, a call from so far away? What is the price? And I picked up the phone and he tells me: Mr. President, I'm concerned over the price of the barrel of oil. And it wasn't even at $25 at that time, and they were already concerned. I share your concerns, Mr. President. And it's a good opportunity that we should have this talk. Why don't we talk about the external debt, which is scourge of the poor countries of the world? Why don't we speak about the terms of trade which are so unequal and savage, and the imposition of the economic systems which control the world, which Foster recently called in his new book "the economic dictatorship of the world"? Why don't we talk about those matters? Let's speak about these matters?
A free agenda. From Caracas we state this. Venezuela states this and I'm sure that I'm joined in what I say because we discussed it last night and will continue discussing it, my brothers Presidents, Heads of State. We're willing to discuss this with the world any time, anywhere, but on equal footing. Let's talk about this. Let's seek solutions to the common problems we share. Let's seek new paths. Our greetings, with all respect, faith, optimism and brotherhood, to the brothers of the world, and in particular to the presidents and leaders of the powerful countries of the world. We wish to co-operate with you. We wish to talk with you. We wish to seek solutions together. OPEC, strengthened and unified, shall increase its efficiency, its supply, and shall its regularity and shall seek, as we have always sought, fair prices, balanced prices for our oil, a vital resource for the world. In this we are responsible; we assume our responsibility.
In this world panorama, then, and with great expectation, we now inaugurate in this Bolivarian Caracas the II Summmit of Heads of State and Government of OPEC, after 25 years of that first historic summit in Algiers. His Excellency, the president of the Republic of Algiers, Mr. Abdelaziz Bouteflika, brought us so many memories, extraordinary memories of the spirit of that summit in Algiers. On that occasion, the Heads of State in Algiers declared the following: "Sovereigns and Heads of State, we emphasise that the cause of the current world economic crisis arises mainly from the deep inequalities in the economic and social process of the peoples." Twenty-five years ago, Algiers; today, Caracas, the year 2000. Unfortunately, we have to say that the causes, the reasons, not only have not vanished but they are even more prominent, as was expressed by almost all the Heads of State and Government, in the recent Summit of the Millennium in the United Nations. There, we set a goal to fight against poverty, to reduce it by half by the year 2015. A great question: How will we do this? And that's part of the dialogue we have to undertake: frank, deep, open, in the whole world. How will we change the history beyond words? Today, we will have far more to say. The crisis of today's world is not limited to the economic sphere, as was the case 25 years ago. Today, it's a global crisis. It has spread like cancer to the areas of ethics, of politics and society. The basic question, the great question in the whole world is how will we leave this crisis behind us, this universal labyrinth? Allow me to say, brothers on this path, that only the union of our efforts, that only the coming together of our peoples, of our cultures, of our economies, of our sovereign political wills can allow us to solve this very difficult enigma and to help the world, with humility, to seek solutions.
And that's what we're here for in Caracas, that is our purpose, in the birthplace of Simón Bolívar the Liberator. We invoke his thinking and his examples to claim, in one voice, "Let's join together and we will be invincible." It is now, from this II Summit, that we have to relaunch OPEC to the XXI century, adjusting it to today's reality, to the changes that we have seen in the world, and, in particular, to the magnitude of the challenges that we face.
Bouteflika mentioned the University of OPEC. Of course we support the idea of an OPEC University. An OPEC Bank? Of course we support the idea. Research and Technological Institute of OPEC? Of course we are compelled to support that idea, to launch it, to make this a reality as soon as possible, to increase our capacity to fight, to transform, to cope successfully with the enormous challenges before us.
Never in my life shall I forget a recent trip visiting the countries that you so honourably represent here, from the beautiful eastern coast of the Red Sea, travelling over the western part of the Persian Gulf with the splendid sun of Kuwait, the shining nights of Doja, the beauties of Abu Dhabi, the mountains and plains of Teheran, the rich Tigris Valley in Baghdad, a beautiful full moon over Djakarta, the Mediterranean dawn in Tripoli, the beautiful prairies of Nigeria, and the beating and heroic land of Algiers. All that immensity, all that beauty, all that wealth of feeling is summarised here in these legendary shores of the Venezuelan Caribbean, in these mountain ranges of the Indian America, and in the mysterious Amazon of the New World, in this valley of Bolivarian Caracas. And all these, my brothers, in the name of Allah, the merciful and most gracious, and in the name of God, merciful, the Father of Jesus, so that the II Summit of Heads of State and Government of the countries of the Organization of Petroleum Exporting Countries that I am honoured to declare inaugurated this afternoon bring happiness, peace and progress to all. Salam. Thank you, my brothers.