The Wall Street Journal
Colombian Cos In Venezuela At Risk With Chavez Threat
Jul 30--Venezuelan President Hugo Chavez's warning to suspend trade with Colombia, repeated several times over the past year and a half, is somewhat worrisome, but his threat of expropriating assets of Colombian companies is causing greater concern.
Late Tuesday, Chavez froze diplomatic relations with Colombia and threatened to shut the border for trade between the two countries. Moreover, he threatened to expropriate Colombian companies' assets in Venezuela.
"It is not easy for Colombia to find a market that absorbs $6 billion (of our exports), but it is certainly not easy for Venezuela to find another partner that will supply products with good quality and price," Colombian Trade Minister Luis Guillermo Plata said Wednesday.
Venezuela is Colombia's second-largest market for exports, after the U.S. But a rupture in trade flows would likely be far more problematic for Venezuela - which imports manufactured goods and about two-thirds of the food that it consumes - than for Colombia.
Chavez's move follows accusations from officials in Bogota that Swedish-made rocket launchers sold to Venezuela were found in the hands of the Revolutionary Armed Forces of Colombia, or FARC, a Colombian rebel group that's also listed as a terrorist organization by the U.S. and the European Union.
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