Routes Around the World: Albanisa – Venezuelan Oil and Replacing Old U.S. School Buses

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STN correspondent Anson Stewart continues his recap after taking a break from updating us on his school bus adventures around the world. This installment centers on a bus replacement program in Managua, Nicaragua that is ushering out 20- and 30-year-old U.S. school buses in favor of new Russian coach models, and how it is all tied to Venezuelan oil.

After my excellent meeting with the general director of Managua’s Transport Regulatory Agency, he graciously arranged for me to visit the facilities of Alba Transport (shared with Alba Equipment), where the city’s old buses amarillos (yellow buses) were being decommissioned. Here’s what opposition newspaper “El Nuevo Diario” had to say about the Alba companies and a reporter’s attempt to investigate Alba Transport:

“The private firm doing business as Alba of Nicaragua, Ltd., Albanisa, tied to the presidential family, constitutes only the name and face of an emporium of businesses that offer all type of services, making itself into a new economic power in the country…The mother company or head of the octopus was formed in 2007 with the oversight of President Daniel Ortega and his Venezuelan partner and provider, Hugo Chávez…But from it also extend Alba Caruna, Alba Equipment, Alba Security, Alba Generation, Alba Ports, Alba Deposits, Alba Wind Power, Alba Food, Alba Transport, Alba Tenosa, and ‘at least two more which are being formed,’ indicated informants.

“‘El Nuevo Diario’ arrived at the facilities of Alba Equipment…and, as we approached, the guards of Alba Security came out to meet us, and after making phone calls and making us uncomfortable, indicated that we could not wander around the site. Right there, in the gates of the two ‘Little Albas [Transport and Equipment],’ we asked if [Alba Transport’s Director Freddy] Acevedo could be found, but the guards, now warned by the gray-haired man, did not respond to more questions and asked us to leave ‘to avoid problems.’…To these facilities were brought the 130 buses donated by the Russian Federation to Alba-Caruna, to open the windows, put in radiators, and change the brake system, i.e. adjust them to the climate and needs of the country.”

When I arrived at the front gate, I was also greeted with a bit of suspicion by the Alba Security guards. They took a bit to confirm my identity (a Japanese reporter writing for a U.S. school bus magazine – I highlighted my Japanese heritage rather than my “Yankee imperialist” heritage for the Sandinistas) and that I had an appointment with Director Acevedo. In the meantime, I saw a couple of buses skidding around in the compound, presumably testing their newly acclimatized brakes.

Director Acevedo gave me a great tour of the Alba Transport facility. Sitting in a lot were 104 dilapidated former U.S. school buses, between 20 and 30 years old, waiting to be disassembled. Oil and other contaminants were drained in a process authorized by the national environmental oversight agency, then the buses were scrapped. I saw a couple of 18-wheelers with FSLN (governing Sandinista party) flags on the dashboard hauling away the scrap metal during my visit. There were also a few buses painted bright pink, which Director Acevedo said were used for entertaining children.

albanisa1I also enjoyed seeing the other side of the equation, brand new Kurgansky Avtobusny Zavod buses that had just arrived from Russia. Alba Transport had handed the first batch of these buses over to operators but quickly realized that modifications were necessary.

The buses were delivered to seven of the36 routes of urban collective transit, the majority of which are affiliated with the governing party, at a cost of $25,000 per bus. Transport sector sources affirmed that the cooperatives are unhappy with the buses, because each one needs to be held back a certain time for for problems related to acclimatization, “but the bill has to be paid on time.”

albanisa6After seeing some of the maintenance facilities for the new Kavz buses, Director Acevedo and I returned to his office. At his desk (complete with a small FSLN flag), we discussed the importation of used buses. School buses generally enter the country by boat through Puerto Corinto, but it is now illegal to import buses manufactured before 1996. The director expressed his hope that within two years, all of the old school buses would be off of Managua’s streets.

albanisa3Such an ambitious replacement plan could only happen with continued aid, like that which Venezuela gives to Nicaragua through Albanisa. While Albanisa is largely under the control of Nicaraguan President Daniel Ortega, ALBA is a larger economic effort in Latin America to combat U.S.-style neoliberal economic policies. Much of ALBA is driven by Venezuelan oil, as described in the same article from El Nuevo Diario:

“Alba Caruna, which until a few years ago was a small credit cooperative, today is essentially the state bank and receives 25 of the 50 percent of the Alba Fund, which originates from the payment of the oil invoice that Nicaragua pays for the importation of Venezuelan crude.

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Nicaragua imports Venezuelan petroleum through Petronic, which pays the the bill to the account of Albanisa, which, in its turn, pays 50 percent of the bill to the Venezuelan PDVSA. They transfer the other 50 percent to the Alba Fund (25 percent for social projects in all of the Alba countries) and the other 25 percent is transferred to Alba Caruna. During the past year, Venezuela’s help aid to Nicaragua reached $457 milion, according to source at the Central Bank of Nicaragua. Of this total, $146 million (30 percent) was for Alba Curuna.

This aid has benefited Sandinista farmers through rural agriculture products and city-dwellers through the new buses and fare subsidies. As the Sandinista Vision magazine describes,

albanisa4The Bolivarian Alliance for the People of Our America (ALBA) has, for the last three years, been a blessing for Nicaragua to get out of the social, economic, and structural problems left by the neoliberals who governed the country for more than sixteen years, leaving a high percentage of extreme poverty, illiteracy, and misery, among so many other ills.

In what conditions would we Nicaraguans be if the Government of Reconciliation and National Unity, headed by President Daniel Ortega, could not count on the resources to face the world economic crisis and the12-hour blackouts which we were suffering in the recent past?

An exceptional credit to Albanisa is that which is known as the Modernization of Collective Transport in Managua, which arose due to the strikes which occurred in May of 2008…A new contract signed with the Russian Federation will permit 225 more buses to enter the country, conditioned for the tropical climate and a little bigger, all with the end of modernizing the transport of the capital. The social fare project which Commander Ortega maintains to benefit more than 800,000 capital residents who utilize public buses, will continue to the end of this year. ‘Many citizens are now accustomed to paying 2.50 Cordobas for the fare which at best would cost 5.00 Cordobas if it were not subsidized,’ said Jorge Martínez, President of Alba Caruna.”

albanisa5So, my trip to visit a bunch of rusty old school buses from the United States ended up including brand new Russian buses bought with Venezuelan oil and a debate about whether this evolving economic arrangement was a blessing or an octopus.

 

STN’s Stewart is a graduate of Swarthmore College and a recipient of a 2010 Thomas J. Watson Fellowship, a grant to study abroad. Stewart’s project is “School Bus Migrations: Recycling Transit in the Global South.” Follow his blog and see more photos from his journey.