Perks at Venezuela’s Failing Oil Giant Still Include Yoga and Guitar Lessons

(Bloomberg) -- Versión en Español

Workers are starving, equipment is crumbling and output is languishing near record lows at Venezuela’s state oil producer. Yet yoga, guitar and dance lessons continue.

Petroleos de Venezuela SA’s cultural arm is offering those classes to all employees along with workshops on operating a socially responsible business. The center is run by the oil minister’s wife, and its main venue is La Estancia -- an 18th-century coffee plantation in a leafy section of Caracas.

The lush oasis of colonial architecture, where bromeliads sprout from tree trunks and peacocks roam, highlights the disconnect between Venezuela’s bureaucratic elite and the rest of the nation. While activities at La Estancia are open to all PDVSA employees, the company’s rank and file often have trouble finding enough to eat.

Many PDVSA workers have joined a mass migration to neighboring countries to escape the worst humanitarian disaster in Venezuela’s modern history, the result of a combination of price controls, expropriations, mismanagement and corruption. La Estancia also welcomes the general public, which is grappling with a currency collapse and the lack of public services, food and fuel.

“The pain is felt by the people, but not the people at the top,” said Russ Dallen, Miami-based managing partner at Caracas Capital Markets. “If they were not in charge with an iron grip, they’d be in jail. They have access to dollars so they can live a good life while the rest of the country starves or leaves.”

U.S. Sanctions

U.S. President Donald Trump’s administration has placed sanctions on PDVSA in an effort to squeeze Venezuela’s main source of revenue and oust the regime of Nicolas Maduro. While that has made the state producer financially delinquent, the company is somehow managing to keep the show going at La Estancia in Caracas as well as three other locations.

PDVSA’s collapse has occurred under the watch of Manuel Quevedo, a former housing minister and active general who had no experience in the oil industry when he took the helm two years ago. He’s also the nation’s petroleum minister as well as the current president of the Organization of Petroleum Exporting Countries.

His wife, Mary, has embraced her role at La Estancia -- traditionally run by the spouse of PDVSA’s head. She has also been spotted with her husband on trips to Vienna for OPEC meetings.

A spokesman for PDVSA said the company has no comment on La Estancia. A press official at the cultural center declined a request to make Mary Quevedo available for an interview.

Maduro Regime

Maduro, meanwhile, has defied the odds and remained in office, in a region where growing public unrest has forced a president to resign in Bolivia, crippled Chile, and threatens to disrupt Colombia. Part of his durability can be attributed to the cohesion among loyalists at the top of the military and public administration.

“The Maduro regime is benefiting from illegal sources more than anything else,” said Moises Rendon, director of the Future of Venezuela Initiative at the Center for Strategic and International Studies. “In a way, we transitioned from an oil-dependent regime to a crime-dependent regime, and sanctions are not the tools to disrupt that activity.”

Nobody responded to an email seeking comment sent to the Communication Ministry, which represents Maduro.

To be sure, La Estancia’s role has diminished along with oil revenue. During the boom years, it financed urban renewal projects in downtown Caracas and rebuilt parts of Venezuela’s cultural and architectural heritage. In 2016, the last time PDVSA reported its yearly finances, its spending on social development fell 89% to $977 million.

Still, La Estancia’s Twitter account is active, with frequent posts on everything from art exhibits to workshops and dance lessons. On Sunday in Caracas, it hosted Gaita, a lively genre of Venezuelan folk music popular around Christmas that features a four-stringed guitar known as the cuatro.

On Saturday, its branch in the Paraguana refining district hosted yoga lessons under a shaded patio with a view of the Caribbean. The area was once home to the largest fuel-making operation on the planet that is now facing mechanical difficulties and industrial decay.

In a country suffering from a lack of basic medical supplies and pharmaceutical products, the yoga class was advertised as a way to “relax and prevent degenerative diseases.”

©2019 Bloomberg L.P.

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