[1] Venezuela's rural areas have seen substantial economic disinvestment, governmental neglect, depopulation, and abandonment ever since oil wealth was discovered in the early 20th century; as a consequence Venezuela now has an urbanization rate of more than 85%—among the highest in Latin America—and is, despite its vast tracts of highly fertile soil and arable land, a net food importer.

The plan was created for several pressing reasons: to stimulate the agricultural sector in Venezuela in order to provide food security to the country (the only net food importer in Latin America) and more economic activity, to break up the concentrated economic power of the latifundios (75–80% of land owned by 5% of landowners, 2% owned 60% of farmland;[citation needed] 60% of agricultors do not possess any land [2][better source needed]) and redistribute wealth to the poor in Venezuela, and to discourage urbanization, which creates heavy burdens on city services in the slums of Caracas and other Venezuelan cities.

[citation needed] Underutilized or unused private corporate and agricultural estates would now be subject to expropriation after "fair-market" compensation was paid to the owners.

[citation needed] Three institutions were created to carry out the land distribution program: the Instituto Nacional de Tierras ("National Land Institute"), which oversees land tenancy; the Instituto Nacional de Desarrollo Rural ("National Rural Development Institute"), which oversees aid to farmers, including technical expertise and equipment, and the Corporación de Abastecimiento y Servicios Agrícolas ("Agricultural Corporation of Supplies and Services"), to help with marketing.

[4] In 2010, Venezuela tied with Chad and Zimbabwe for 2nd worst property rights in the world according to the International Property Rights Index[citation needed] from Americans for Tax Reform, a conservative U.S. advocacy group.