VZCZCXRO1562
RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV
DE RUEHCV #0531/01 0682058
ZNR UUUUU ZZH
R 092058Z MAR 07
FM AMEMBASSY CARACAS
TO RUEHC/SECSTATE WASHDC 8092
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHWH/WESTERN HEMISPHERIC AFFAIRS DIPL POSTS
RUCPDOC/DEPT OF COMMERCE
RUEHRC/DEPT OF AGRICULTURE USD FAS
RUEATRS/DEPT OF TREASURY
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 04 CARACAS 000531 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
TREASURY FOR KLINGENSMITH AND NGRANT 
COMMERCE FOR 4431/MAC/WH/MCAMERON 
NSC FOR DTOMLINSON 
HQ SOUTHCOM ALSO FOR POLAD 
 
E.O. 12958: N/A 
TAGS: CVIS CASC ECON SOCI VE
SUBJECT: VENEZUELA'S BRAIN DRAIN: SEARCHING FOR A PLAN B, 
THE CONSULAR DIMENSION 
 
REF: CARACAS 256 
 
CARACAS 00000531  001.2 OF 004 
 
 
------- 
SUMMARY 
------- 
 
¶1. (SBU) Over the last two months, President Chavez has 
heralded a "deepening of the Bolivarian Revolution" with a 
series of actions, including nationalization of key 
industries, new threats to foreign investors, aggressive 
attacks on private industry, and granting himself the power 
to legislate by decree.  The revolutionary direction of the 
BRV, combined with related deterioration of the security 
situation and increasing shortages, have encouraged large 
numbers of Venezuelans with the capability to leave to 
actively develop what they call "Plan B:" emigration from 
Venezuela.  Post, various EU embassies with large immigrant 
communities here, and Australian and Canadian organizations 
have all experienced an important up-tick in visa 
applications, both NIVs and IVs, and in citizenship claims. 
The deteriorating political and economic situation in Caracas 
has gotten to the point that significant numbers of 
Venezuela's educated middle and upper classes have decided to 
take positive steps to leave Venezuela.  Should these 
individuals actually decide to execute Plan B, one effect 
will be a freer hand for Chavez in moving toward the 
centralized authoritarian state he desires. 
 
---------------- 
AMERICA DREAMING 
---------------- 
 
¶2. (SBU) Applications for non-immigrant visas (NIVs) and 
immigrant visas (IVs) have grown substantially in recent 
years (see table below).  The demand for consular services 
spiked following President Chavez' declarations at the start 
of his Presidential term on January 8 (reftel).  By January 
10 the consular section's call center for visa appointments 
was receiving over 900 calls daily (up from an average of 300 
daily) and was quickly overwhelmed by the unexpected increase 
in volume.  For the month of January, appointment requests 
were up over 100 percent as compared to December 2006.  The 
following table shows the total non-immigrant and immigrant 
visa caseload during each of the fiscal years. 
 
              FY 2004  FY 2005   FY 2006 
 
NIV           107,967  127,320   137,472 
 
IV            1,309    1,649     2,235 
 
SOURCE: Consular Workload Statistics System (CIVSS) 
 
¶3. (SBU) Due this spike in demand, as of February 27, the 
average waiting time for an NIV applicant in Caracas is 107 
days, almost double what it was at the end of December 2006 
and Caracas now has one of the longest waiting times for 
tourist visa applicants in the hemisphere.  The Consular 
Section's NIV refusal rate has also increased in recent weeks 
as the disintegrating political and economic situations have 
become evident in the applicant pool.  The number of 
applicants who have not traveled within the last 10 years and 
have poorly articulated travel plans has also increased 
significantly, which for many consular officers implies that 
these applicants are more interested in securing a visa for 
future security rather than for a particular trip. 
 
¶4. (SBU) At the same time that more people are trying to 
apply for non-immigrant visas, the American Citizen Services 
(ACS) section has also seen a jump in activity, with passport 
applications increasing from 5 per day to a record of 37 
passport applications processed on January 26.  ACS has been 
receiving American Citizens who have not contacted the 
Embassy in decades, now keenly interested in obtaining new 
passports for themselves and for previously un-registered 
children (including many adults).  There are also increasing 
numbers of concerned Amcits e-mailing and calling ACS seeking 
to ensure that they are properly documented and asking for 
details on Embassy "evacuation plans."  One 93-year old U.S. 
citizen has been living in Venezuela since 1938 and recently 
 
CARACAS 00000531  002.2 OF 004 
 
 
came into the Embassy for the first time to register his 60 
year old children as Amcits.  One interpretation of this is 
that the situation in Venezuela has not been as bad in the 
past 68 years as it is perceived to be now. 
 
¶5. (SBU) Embassy Caracas' IV e-mail box has been flooded with 
stories similar to the following: "I am a U.S. citizen 
married to a Venezuelan woman for over 15 years and we have 
three children, all U.S. citizens.  Up until now I had never 
really considered relocating to the U.S., but in light of 
recent events I have become increasingly worried and am now 
seriously considering moving my family to the U.S." 
 
------------- 
JUS SANGUINIS 
------------- 
 
¶6. (U) Venezuela has historically been an immigration 
destination and as the Portuguese Consul General recently 
noted to EconOff, "even if it doesn't look it, Venezuela is a 
rich country."  Spain, Portugal and Italy have the largest 
expat populations in Venezuela, though most of these 
communities are thoroughly established, going back anywhere 
from 50-150 years.  Venezuela does not recognize dual 
nationality and placed heavy pressure on immigrants in the 
1960s and 70s to renounce their European citizenship, but 
today many Venezuelans are rediscovering their rights to EU 
passports. 
 
¶7. (SBU) Probably the largest recipient of Venezuelan 
visitors and prospective immigrants (after the United 
States), Spain's consulate in Caracas is processing between 
800 to 1000 people daily.  A recent article from Galicia 
noted that Venezuela was now the largest source of 
immigrants/ returnees to Spain (having recently surpassed 
Argentina) and compared it to the spike seen in 2002 during 
the general strike.  One reading holds that the difference is 
that in 2002 and 2003, Venezuelans were emigrating for 
immediate economic reasons, whereas now most people seeking 
assistance at the Spanish consulate want to leave due to the 
degradation of political and economic liberties. 
 
¶8. (SBU) The Italian Consulate here receives 340 passport 
applications daily (up by almost 100/day in recent months) 
and the Portuguese are close behind, issuing on average 300 
passports daily (also up about 50 percent this month).  For 
her part, the Italian consul attributed most of the increase 
to U.S. requirements for travelers with passports issued as 
of October 26, 2006 to have biometric data in order to use 
the Visa Waiver Program (VWP), noting that "most of our 
applicants want Italian passports to go to Miami."  The 
Venezuelan document agency, ONIDEX, takes months to process a 
passport application and routinely refuses to process the 
applications of opposition members and signatories to the 
2004 recall referendum.  These delays have caused many to 
seek to obtain a second passport simply as a means of having 
a travel document, which is preferable to the USD 230-280 
bribe reportedly required for "expedited service" at ONIDEX. 
 
-------------------- 
IMMIGRATE BY NUMBERS 
-------------------- 
 
¶9. (U) For professional Venezuelans ineligible for an EU 
passport, the preferred immigration destinations in recent 
years have been Australia and Canada, both of which offer 
points-based immigration programs.  These programs allow 
applicants to qualify for visas based on their English 
ability, education, work experience and overall "value" to 
the respective country's economy.  Australia does not have a 
diplomatic mission in Venezuela, but through the Southern 
Cross Alliance (SCA), Venezuelans can apply for Australian 
IVs through the mail.  The process, which can take up to a 
year and cost USD 7,000, combines English language tests with 
interviews and an evaluation of the applicant's education and 
work experience.  The local SCA representative said that 
applications had been up in recent years, and that 
approximately 1,000 Venezuelans immigrated to Australia in 
¶2006.  The latest seminars on the topic, after Chavez' 
December reelection, were hugely oversubscribed and 
 
CARACAS 00000531  003.2 OF 004 
 
 
apparently turned surrounding roads into parking lots -- to 
the extent that they may not be welcome back for their next 
seminar. 
 
¶10. (SBU) Most of the Venezuelans planning to emigrate to 
Australia are young professionals (they have to be under 44 
years old) and the SCA representative said that he had many 
clients currently employed with blue chip, international 
firms, like Proctor and Gamble and Johnson and Johnson.  They 
also received many inquiries from CANTV and Electricidad de 
Caracas (EDC) employees after Chavez announced plans to 
nationalize those companies.  These individuals want to avoid 
what happened to many professionals at PDVSA, who were first 
fired for their political leanings and then could not obtain 
Australian IVs because they had not worked in the past six 
months (a requirement for the visa) by the time their 
applications were prepared. 
 
¶11. (SBU) Additional destinations investigated by Venezuelans 
eager to prepare their escape include Costa Rica and Panama, 
which both offer residency programs for immigrants that 
purchase property or invest in their countries.  Other South 
American nations are an option if family members or corporate 
relationships can provide opportunities for jobs in 
multi-national corporations and work visas.  A prominent 
lawyer told EconCouns that, while he did not contemplate 
leaving, he was looking to establish residency for his wife 
and children in Panama.  As the market for good legal counsel 
is very lucrative, he said that he would stay in Venezuela as 
long as he could. 
 
----------------------------- 
IT'S THAT GIANT SUCKING SOUND 
----------------------------- 
 
¶12. (SBU) There is increasing evidence, both numerical and 
anecdotal, that some middle and upper class Venezuelans are 
already leaving Venezuela.  Consular officers in Caracas 
already refer to Weston, FL as "little Venezuela."  Catholic 
Church officials estimate that there are as many as 200,000 
Venezuelans now living in the United States.  As is seen in 
much of the developing world, flight of the professional and 
middle classes will only retard the country's economic and 
political development.  As a microcosm, the "new" PDVSA is a 
pale comparison of its "old" predecessor.  Once one of the 
leading state-owned oil companies, PDVSA is now a bloated, 
corrupt, inefficient extension of the state faced with 
declining production and constant refinery troubles -- 
related no doubt to a clear lack of competent personnel. 
 
¶13. (SBU) Venezuela's educated and professional classes are 
the most tempted by offers abroad.  The Canadian provincial 
government of Alberta is recruiting petroleum engineers, as 
are the Saudis and other petroleum exporting countries.  A 
recent conversation with the human resources services firm 
Manpower illuminated the increasing difficulty in attracting 
executives and professionals to Venezuela, noting the 
deteriorating security situation as the principal cause. 
They also worry about the exodus of recent college graduates 
from Venezuela, though were hopeful that this trend was 
temporary.  According to them 40,000 people had left 
Venezuela in recent years for Spain, but of those already 
8,000 had returned. 
 
¶14. (SBU) Chavez does not seem perturbed by this turn of 
events and has repeated invitations to his opponents to go to 
Miami if they are unhappy here.  Some commentators are 
beginning to pick up on this trend and a recent editorial in 
"El Diario de Caracas" warned of a future without skilled 
Venezuelans.  Former opposition consensus Presidential 
candidate Manuel Rosales recently exhorted Venezuelans to not 
emigrate, but rather remain in the country to defend it. 
While the brain drain is hurting Venezuela, it may in turn be 
helping Chavez by hollowing out the groups that have opposed 
him. 
 
¶15. (SBU) The parallel exchange rate spiked after Chavez' 
proclamations in January (reftel) and many attribute part of 
the continuing high demand for dollars to increased capital 
flight as people have begun to move funds out of the country 
 
CARACAS 00000531  004.2 OF 004 
 
 
while still possible.  Rumblings of new laws to tax wealth, 
take away second homes, and prevent children from traveling 
abroad without express government approval all add to the 
pervasive anxiety and fear amongst the middle and upper 
classes and hasten the desire to emigrate. 
 
 
------- 
COMMENT 
------- 
 
¶16. (SBU) The dramatic image of thousands of Venezuelans 
scrambling to nail down their "Plan B" speaks to a pervasive 
sentiment among Venezuela's middle and upper classes that 
things have reached a turning point here.  For many, the 
change came with Chavez's re-election in December and was 
reinforced by the Marxist rhetoric of recent weeks.  That 
said, many are just preparing their exit rather than actually 
using the escape hatch.  The economic situation remains 
decent, with windfall oil profits fueling massive government 
spending.  These "good times," though, are tempered by 
spiraling violent crime and continual BRV encroachment on 
private businesses and citizens.  As has been the case of 
immigrants for centuries, many will leave in the hopes of 
giving their children better opportunities.  Should these 
thousands of educated, talented Venezuelans actually leave, 
one effect will be a freer hand for Chavez to create the 
centralized authoritarian state he desires. 
 
¶17. (SBU) The brain drain will hurt U.S. companies here as 
they lose their most skilled and marketable workers and 
Venezuela already is becoming a no-go zone for many expats 
due to a security concerns and an ever-degrading 
infrastructure.  Embassy Caracas is experiencing this 
phenomenon, having recently seen several of its locally 
employed staff (LES) emigrating and with many more LES 
actively whispering their plans to depart.  END COMMENT. 
 
 
BROWNFIELD