Venezuela's state-owned oil company Petroleos de Venezuela SA (PDVSA) will use loans and contracts to promote a new business model called "social production", Oil Minister Rafael Ramirez told Venezuelan radio and television on Sunday.

Under the scheme, companies will fund social programs, share profits with workers and use some of their profits to help create more companies that work in the same way, said the oil minister at the weekly "Hello, President" show hosted by Venezuelan President Hugo Chavez.

The PDVSA said in a statement published on its website that it would invest 100 million US dollars in the plan.

Chavez said that the new businesses would remain private property, but would work in a "collective" style.

"Capital itself is not bad," said Chavez. "What is bad is capitalism... when capital is concentrated in the hands of the few and used to exploit the rest."

The social model would discontinue the US model, which "asks us to abandon our industrial and development polices so they can invade us with their products," said Chavez, who frequently criticizes the United States.

Soaring oil prices have boosted the income of both the PDVSA and Venezuela as a whole. Chavez has used the money to offer cheap fuel to his neighboring states and finance related grand energy projects.

Source: Xinhua