Economics & Finance
Venezuela Central Bank Predicts 2% Growth in 2011
The Governor of the Venezuela Central Bank, Nelson Merentes, has said Venezuela's GDP is expected to rise by more than 2% this year, ending a recession that began as Venezuela’s oil prices reached their lows -- $32.91 -- in early 2009. "Venezuela is going to grow in coming years significantly. The expectation is about 2% -- is likely to be more than that," said Merentes. According to the Venezuela Central Bank, in the fourth quarter of 2010, Venezuela’s GDP rose by 0.6% as Venezuela’s basket of heavy and medium crudes hit $84 in December. (Latin American Herald Tribune, 03-02-2011; http://www.laht.com/article.asp?ArticleId=388452&CategoryId=10717)
Venezuela accumulated inflation stands at 4.5 percent so far this year
Venezuela's nationwide consumer price index (NCPI) rose 1.7 percent in February. According to a report released by the Central Bank of Venezuela (BCV) the increase is significantly lower than inflation in January this year (2.7 percent) and slightly higher than inflation in February 2010 (1.6 percent). The accumulated change in Venezuela's CPI in the second month of 2011 stood at 4.5 percent versus 3.3 percent in the same period of 2010. Inflation for the 12-month period through February was 28.7 percent. (El Universal, 03-03-2011; http://english.eluniversal.com/2011/03/03/venezuela-accumulated-inflation-stands-at-45-percent-so-far-this-year.shtml)
Request for treatment with Colombia based on complementarity
In advance of a scheduled economic and trade meeting between the governments of Venezuela and Colombia, the Venezuelan Exporters' Association (AVEX) asked national government authorities to "execute an agreement or a treaty with the neighboring country based on the principle of complementarity." The bilateral meeting is meant to set the terms and conditions of the exchange of commodities between Venezuela and Colombia once Venezuela's pullout from the Andean Community of Nations (CAN) comes into effect. The organization submitted a presentation to deputies of the Latin American Parliament (PARLATINO) on behalf of its 103 member companies, representing 21 sectors. (El Universal, 03-02-2011;
Venezuela's central gov't debt at USD 71.7 billion in 2010
Last week Minister of Planning and Finance Jorge Giordani claimed to the National Assembly (AN) that the Government of Venezuelan had a responsible borrowing policy. However, official numbers show that domestic and external debt rose to USD 71.7 billion last year. According to data issued by the Ministry of Finance, the balance of debt rose by 20 percent in the 12 months of 2010, because central government debt totaled USD 59.8 billion in December 2009. (El Universal, 03-01-2011; http://english.eluniversal.com/2011/03/01/venezuelas-central-govt-debt-at-usd-717-billion-in-2010.shtml)
Officially authorized foreign exchange transactions fell by 19.4% during 2010
The Securities Transaction System Foreign Exchange (SITME), authorized 19.4% fewer foreign currency exchanges in 2010, which was one of the reasons for the decline in production due to lower availability of foreign exchange for imports of both raw materials and finished products. More information in Spanish. (Entorno Inteligente, 03-03-2011; http://www.entornointeligente.com/articulo/1095132/Sitme-autoriza-194-menos-que-en-2010)
Experts predict Venezuela will face food supply difficulties
Specialists in the area believe that higher food import dependency, coupled with the rise in international prices for agricultural items and declining domestic production, increases Venezuela’s vulnerability. Alejandro Gutierrez, a professor at the University of the Andes, warned that if domestic food prices remain unchecked there will be more shortages. He said that the country should shift agricultural policy to ensure that they increase production of strategic items to which Venezuela was self-sufficient as rice, maize, sugar cane, beef and coffee. More information in Spanish. (Entorno Inteligente, 03-02-2011; http://www.entornointeligente.com/articulo/1094840/El-pais-registra-precaria-situacion-alimenticia)
Commodities
Sales of construction materials plummeted in 2010
Construction activity in Venezuela declined 7.1% in 2010, with the shortage of construction materials as one of the main factors behind the fall. The Central Bank of Venezuela (BCV) acknowledged in its quarterly reports that the contraction of the sector was a result of a lower availability of inputs for the sector. According to data provided by cement companies, steelmakers and quarries, sales of construction materials declined between 10 and 28 percent in 12 months. (El Universal, 03-02-2011; http://english.eluniversal.com/2011/03/02/sales-of-construction-materials-plummet-in-2010.shtml)
PDVSA Gas, Belgazstroi form JV for gas projects in Venezuela
PDVSA Gas, a subsidiary of Venezuelan state oil company Petróleos de Venezuela (PDVSA), and Belorussian gas company BELGAZSTROI yesterday signed a joint venture agreement, to carry out gas projects in Venezuela. The two companies signed a memorandum of understanding in November 2010 on their partnership. The JV is named VENEZUELAGAZSTROI, and includes technology transfer, technical expertise, and construction of plants and pipelines as well as certification of Venezuelan gasification companies. (ADP News, 03-03-2011; http://adpnews.info/?nid=c41190547e7763a6)
PDVSA to increase Anzoátegui terminal oil shipment capacity
Venezuela's state oil company Petróleos de Venezuela (PDVSA) is expanding its Jose Antonio Anzoátegui oil terminal in order to increase the terminal's crude oil shipment capacity by 100,000 barrels per hour, the company said yesterday. PDVSA is building a new floating facility to connect the oil storage tanks to the tankers and plans to build also two 42-inch underwater pipelines. The new facilities will be able to service ships ranging in size from 45,000 to 320,000 deadweight tones. (ADP News, 03-03-2011; http://adpnews.info/?nid=90c72a909fda914a)
Venezuelan PETRODELTA 2P reserves rose 24% Y/Y in 2010
The proven and probable oil reserves (2P) of Venezuelan oil company Petrodelta increased by 24% year-on-year to 103.6 million barrels of oil equivalent (boe) in 2010, according to US oil company Harvest Natural Resources Inc, which holds 32% in Petrodelta. Petrodelta's proven reserves alone increased by 8% to 50 million boe. In turn, the proven, probable and possible reserves (3P) totaled 220.6 million boe, down 2% from 2009. The reserve additions are attributed to recent successful drilling and the extension of Block 5, a previously unproven fault block in the El Salto field, the largest of six fields operated by Petrodelta. (ADP News, 03-03-2011; http://adpnews.info/?nid=4976ac1104655619)
Politics
Chavez offers to mediate the Libya War, while Qaddafi Attacks
The Arab League said it is weighing an offer by Venezuela’s Hugo Chavez to mediate in Libya’s civil conflict, while his ally Muammar Qaddafi struggles to break out of his Tripoli base and regain rebel-held parts of the country. The Arab League is holding discussions with Venezuela on sending mediators to Libya, said Hesham Youssef, chief of staff for the group’s Secretary General Amr Moussa, in a phone interview today. He didn’t give details and said Venezuela is also in talks with other countries. Chavez and Qaddafi have spoken about the proposal, Venezuelan Information Minister Andres Izarra said in a March 2 Twitter posting. Oil fell from a 2 1/2-year high on the peace initiative. (Bloomberg, 03-03-2011; http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a5LwVF060ZVQ)
Inter-American Court judge terms political exclusions as shackles from the past
Article 105 of the law governing the Comptroller General's Office in Venezuela was termed as "shackles of the past" and "a legal involution" by the Inter-American Court of Human Rights. The regulation allowed Comptroller General Clodosbaldo Russián to disqualify more than 800 officials and former officials in recent years, among them former mayor of Chacao municipality (eastern Caracas) Leopoldo López, on alleged corruption charges. The remarks were made on Tuesday by Argentinean judge Leonardo Franco, during the first session of a two-day public hearing examining an order given by the Venezuelan government to block López, an opposition leader, from running for public office until 2014. (El Universal, 03-02-2011; http://english.eluniversal.com/2011/03/02/inter-american-court-judge-labels-political-ban-as-shackles-of-the-past.shtml)
Chávez says bilateral agreements seek to satisfy needs of the peoples of Venezuela and Colombia
The 13 cooperation agreements were signed Thursday night by the governments of Venezuela and Colombia, are intended primarily to meet the needs of the peoples of both countries, according to Venezuelan President Hugo Chávez. "We're focusing the two governments, two countries, both capabilities in meeting the needs of the people: housing, medicines and food," he said. The 13 agreements will be governed by production linkages, training and technical existence and installation of Colombian companies in Venezuela. (AVN, 03-04-2011;
The following brief is a synthesis of the news as reported by a variety of media sources. As such, the views and opinions expressed do not necessarily reflect those of Duarte Vivas & Asociados and The Selinger Group.
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