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Page last updated at 11:59 GMT, Wednesday, 26 August 2009 12:59 UK

Smugglers thrive as row hits trade

By Will Grant
BBC News, Cucuta, on the Colombian-Venezuelan border

Colombians fill up a car with smuggled gasoline in Cucuta, Colombia, in the border with Venezuela on 24 August 2009
The smuggling of petrol from Venezuela to Colombia has long been profitable

"Cucuta is dead," says Fernando, a Colombian textile trader who is planning to return to his home city of Medellin because work on the border with Venezuela has dried up.

"We bring in fabrics and jeans from Medellin to sell here and we've always done well out of it. But not any more. I'm taking my family back home where things are a bit better. Business here is over."

It is a sentiment echoed by many members of the business community on the Colombian side of the border with Venezuela, who say a range of problems in recent months has hurt them.

Chief among them, they say, is the dispute between President Hugo Chavez of Venezuela and his Colombian counterpart, Alvaro Uribe, over a decision by Bogota to allow the United States to use seven military bases on Colombian soil.

Elioro Viveros
The cane was cut and we got the export licence, but at that moment there was the dispute between the two presidents
Eliodoro Viveros
Sugar cane farmer

Recently President Uribe travelled to the region to hold talks with local business leaders and politicians to persuade them that his government had a plan in place to lessen the effects of a drop in trade with Venezuela.

It included reducing sales tax in Cucuta and improving road links to the rest of Colombia.

But not all the delegates were impressed. Liberal Party Senator Juan Fernando Cristo walked out of the meeting with Mr Uribe.

"President Uribe and the ministers and technocrats from Bogota don't understand this situation," he said as he left.

"They don't understand this border region, nor the people, and they don't understand how things work here. They come to Cucuta and talk about budgets and money and infrastructure and social investment. But they don't really have the solutions."

Losing out

Many of the products that Colombia exports to Venezuela are perishable, including milk, eggs, meat, rice and coffee.

After Venezuela moved to close the border, much of that produce went bad and had to be destroyed.

Local sugar cane producer Eliodoro Viveros took us down dirt roads in the small town of El Zulia to see one such damaged crop.

"The cane was cut and we got the export licence, but at that moment there was the dispute between the two presidents. Chavez shut the border and we lost all this," he said, motioning to the piles of blackened and useless sugar cane in the field behind him.

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"This has happened at least three times to members of our co-operative in the past few weeks."

Mr Vivieros says that the crops represented thousands of dollars' worth of profit for the farmers involved.

His co-operative is pinning its hopes on plans to build an ethanol plant in the region so that sugar cane producers are not so reliant on the Venezuelan market.

On the Venezuelan side of the frontier they are feeling the pinch too, but in different ways.

"Both countries are losing out," said Alexis Balsa, border affairs commissioner for Tachira state in Venezuela.

"Colombia may be losing out a little more economically, but in Venezuela we're experiencing food shortages because of all of this. President Chavez has decided to replace Colombia with Brazil or Argentina. That's going to be very damaging for this frontier region because international trade here could be reduced to zero."

There would be more job losses in the region too, he predicted.

Siphoned off

But while the legal trade of food, textiles, electrical goods and cars may be held up, illegal trade - especially in fuel - is thriving.

Smugglers fill up their tanks with cheap petrol in Venezuela, then drive over the border and siphon it off in Cucuta at huge profit.

Having paid a few cents a litre, they can sell it on for several dollars. An estimated 15,000 to 20,000 people make their living from the practice and there is a constant flow of vehicles, many of them taxi drivers, taking contraband fuel in one direction and contraband goods in the other.

Much of the trade is run by paramilitary and criminal gangs, but many are ordinary Venezuelans and Colombians making a quick dollar on the side.

People walk across an international beridge connecting Urena in Venezuela to Cucua, Colombia - photo from July 2009
Legal trade between the two nations was put at $7bn (4.2bn) in 2008

Juan, who did not want to use his real name, is one such driver.

"I do this at least once a day," he said, while heading towards Cucuta with a full tank.

On arrival in Colombia, he found a stall set up by the side of the road where he regularly sells his fuel.

A 20-year-old "pimpinero" - as those who siphon off fuel are known - takes the petrol from Juan's car by sucking it out of the tank with his mouth and a hose, seemingly oblivious of any potential health risks.

The transaction is successful and Juan leaves with about $7-worth of Colombian pesos for what cost him about 50 US cents in Venezuela.

Recently, Venezuelan Energy Minister Rafael Ramirez announced that Venezuela would not be renewing an agreement on subsidised fuel with Colombia.

"We're not prepared to subisidise the Colombian economy any longer," he said.

That move has made the smuggling of fuel more popular and profitable than ever.

Border reality

The Venezuelan government has announced new measures to clamp down on smuggling, including using GPS to track large fuel tankers and forcing drivers to give up their petrol as they cross the border.

An empty petrol station in Cucuta
People living along the border hope tensions will soon die down

But few in Cucuta expect that the authorities will succeed in shutting down the illegal industry.

"This has always been a popular trade and it's a good way to make money, but there are more and more people doing this since the argument between Chavez and Uribe," Juan says.

"This is the reality on this border."

It seems people on both sides of the border are concerned about the consequences, legal and illegal, of the argument between the two Latin American leaders.

"President Chavez and President Uribe are not going to be here for ever - or at least I hope not," says Senator Cristo.

"But the people of this region are going to be here for always. We must have a very good relationship with Venezuela and a very good relationship with Ecuador in the south.

"Chavez and Uribe need to understand that if they have a personal fight, they must not involve the population along the border."



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Country profile: Venezuela
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