Economics & Finance
Government occupies private construction companies in order to reconstruct Venezuela's rain-affected area
The Bolivarian Government temporarily occupied six private construction companies which have machinery to dredge, channel and construct dikes in order to assist in the reconstruction of the southern area of the Maracaibo Lake, in western Venezuela, heavily affected by torrential rains in late December 2010 and early 2011. The order would enter into force this Tuesday and it would be valid for 90 days, according to Interior Relations and Justice Minister Tareck El Aissami, who said “the idea is to join efforts to fulfill the goal of meeting the emergency, since in this area continues raining, rivers bursting their banks and dikes breaking, which cause serious floods.” (AVN, 03-29-2011; http://www.avn.info.ve/node/50583)
DATANÁLISIS: About 42% of Venezuelans have altered consumption patterns
Venezuelans' consumption patterns have been hit by recession and declining purchasing power. The latest Consumer Perspective survey, conducted in February by polling firm DATANÁLISIS, reported that 42.1% of respondents said they had to adjust their purchasing patterns due to the economic downturn and falling purchasing power.
Within the 42.1%, around 20% reduced the amount of goods purchased; 15% stopped buying a specific products (for instance, ice cream or soft drinks) and 7% tried to use certain products for a longer period of time, said Carlos Jiménez, managing partner at DATANÁLISIS, during the Updated Perspectives 2011 forum. (El Universal, 03-30-2011; http://english.eluniversal.com/2011/03/30/about-42-percent-of-venezuelans-change-consumption-patterns.shtml)
Within the 42.1%, around 20% reduced the amount of goods purchased; 15% stopped buying a specific products (for instance, ice cream or soft drinks) and 7% tried to use certain products for a longer period of time, said Carlos Jiménez, managing partner at DATANÁLISIS, during the Updated Perspectives 2011 forum. (El Universal, 03-30-2011; http://english.eluniversal.com/2011/03/30/about-42-percent-of-venezuelans-change-consumption-patterns.shtml)
Oil, pasta and flour industry record operating losses
The disparity between production costs and regulated prices of pasta, oil and pre-cooked corn flour has crushed the profitability of those industries, thus threatening the production of those items and related products. Pablo Baraybar, the president of the Venezuelan Chamber of Food Processing Industries (CAVIDEA), said that international prices of wheat have increased by 253%, while the government authorized an increase of only 33% in pasta prices. (El Universal, 03-30-2011; http://english.eluniversal.com/2011/03/30/oil-pasta-and-flour-industry-record-operating-losses.shtml)
Venezuelan oil workers victimized by Ponzi scheme broken up by US authorities in Connecticut
The fallout from the biggest white-collar federal prosecution in Connecticut is being felt a continent away in Venezuela, where the government had invested hundreds of millions of dollars from a state oil workers' pension fund with a now disgraced financier. U.S. prosecutors say Francisco Illarramendi, a Venezuelan-American, used unregistered hedge funds in Stamford, Conn., as cover for a massive Ponzi scheme with exclusively overseas clients. Venezuela's government is taking steps to recover what it can from the employee retirement fund for Petróleos de Venezuela, or PDVSA, which contributed about 90 percent of the total investment. The South American country's oil minister, Rafael Ramirez, said the government is sending lawyers to join proceedings in the U.S. (Newser, 03-30-2011;
Commodities
Venezuelan exports of crude oil sank by 16.2% in February
According to the numbers audited by an independent firm, exports of Venezuelan crude oil and byproducts plunged 2.17 million barrels per day (BPD) versus the month before, the Ministry of Energy and Petroleum reported,
Numbers were affected by a 21% drop in shipments of conventional crude oil, amounting to 1.35 million BPD. Upgraded oil from the Orinoco Oil Belt averaged 436,329 BPD, a slight increase relative to the prior month, yet still below capacity. (El Universal, 03-29-2011; http://english.eluniversal.com/2011/03/29/venezuelan-exports-of-crude-oil-sink-by-162-percent-in-february.shtml)
Numbers were affected by a 21% drop in shipments of conventional crude oil, amounting to 1.35 million BPD. Upgraded oil from the Orinoco Oil Belt averaged 436,329 BPD, a slight increase relative to the prior month, yet still below capacity. (El Universal, 03-29-2011; http://english.eluniversal.com/2011/03/29/venezuelan-exports-of-crude-oil-sink-by-162-percent-in-february.shtml)
Venezuela cancels oil data certification by independent agency
Venezuela said on Tuesday it was no longer publishing oil production and export data certified by an independent auditor in a move that will likely add to skepticism over the OPEC member's assessment of its vital crude sector. The socialist government of President Hugo Chavez routinely provides higher figures for the main export by South America's biggest crude producer than those provided by bodies including OPEC and estimates from industry experts. (Reuters, 03-29-2011; http://www.reuters.com/article/2011/03/29/venezuela-oil-idUSN2927108720110329)
Growing doubts about PDVSA's accounts
In a context where the state-run oil company Petróleos de Venezuela (Pdvsa) and the Ministry of Finance have to pay high interest rates for borrowing in the world market, Pdvsa decided to terminate an agreement with Inspectorate Venezuela SCS. The independent consulting firm had been hired to audit its oil export and production data.
Although the figures provided by Inspectorate were reticently viewed by investment fund analysts because they do not totally agree with Pdvsa's production levels reported by the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA), the government decided to close this information source, and Pdvsa did not provide any explanation. Therefore, there is a growing perception in the market about the lack of transparency in the Venezuelan state-owned oil company. (El Universal, 03-31-2011; http://english.eluniversal.com/2011/03/31/growing-doubts-about-pdvsas-accounts.shtml)
Although the figures provided by Inspectorate were reticently viewed by investment fund analysts because they do not totally agree with Pdvsa's production levels reported by the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA), the government decided to close this information source, and Pdvsa did not provide any explanation. Therefore, there is a growing perception in the market about the lack of transparency in the Venezuelan state-owned oil company. (El Universal, 03-31-2011; http://english.eluniversal.com/2011/03/31/growing-doubts-about-pdvsas-accounts.shtml)
Venezuela sees max $2.5 billion arbitration bill
Venezuela calculates it will pay no more than $2.5 billion to EXXON MOBIL and CONOCO PHILLIPS in looming arbitration rulings over oil nationalizations, Energy Minister Rafael Ramirez said. Venezuela also expects oil prices to remain unstable because Western military intervention in Libya has raised the possibility of conflict spreading in North Africa, the OPEC member's minister said in an interview for the Reuters. (Reuters, 03-31-2011; http://www.reuters.com/article/2011/03/31/us-latam-summit-ramirez-idUSTRE72U4FR20110331)
PDVSA to invest USD$4 billion in Puerto La Cruz plant
Venezuelan Oil Minister Rafael Ramirez said state oil company Petróleos de Venezuela, S.A. will invest more than USD$4 billion in a plan to convert heavy crudes into lighter ones at its Puerto La Cruz refinery. The refinery’s upgrader will convert heavy and extra heavy crudes from the Orinoco Belt into lighter products including naphta and diesel, Ramirez said. (Bloomberg, 03-30-2011; http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aDVocgeGjiug)
Widespread power outages again plague Venezuela
Widespread power failures hit Venezuela this week, leaving eight states including oil-producer Zulia without light for hours and causing chaos on the Caracas metro in a new headache for President Hugo Chavez. Staggered blackouts will also be imposed on several areas of the capital for maintenance until Friday, the city's state-owned power company said in a statement. Experts predict irregular services will continue in the coming months. Hours-long blackouts hit the eight states on Tuesday when the main power station in Zulia failed after a suspected rebel bomb on a Colombian gas pipeline that feeds it. (Reuters, 03-30-2011; http://www.reuters.com/article/2011/03/30/venezuela-blackouts-idUSN3017730520110330)
Logistics & Transport
Venezuelan Government says it will allocate over USD$22 billion for railway network
The President of the state-run railways institute (IFE). Franklin Perez Colina says an investment close to USD$ 22.25 billion will boost expansion of the National Railway Development Plan, through agreements signed with Cuban, Italian and Chinese companies. Perez detailed that the stretch Barquisimeto Yaritagua (central-west Venezuela) is currently going through rehabilitation works. The task is in charge of the Cuban-Venezuelan company FERROLASA. He said that construction of the first stage of the stretch that goes from La Encrucijada to San Diego is expected by 2012, which is focused on the development of the North-Coastal axis in the country. (AVN, 03-30-2011;
Politics
Chávez- Santos meeting pursues trade deal
Venezuelan President Hugo Chávez and Colombian President Juan Manuel Santos will meet on Friday in Cartagena to try to reach a new agreement on bilateral trade at the height of Venezuela-Colombia political relations. (El Universal, 03-31-2011; http://english.eluniversal.com/2011/03/31/chavez--santos-meeting-pursues-trade-deal.shtml)
President Santos satisfied with Venezuela relations
On the eve of a meeting with Hugo Chávez, Colombian President Juan Manuel Santos claimed progress in his country's relations with Venezuela since August 2010, especially in the field of security cooperation. The Government of Venezuela "has been performing and has been delivering up people" sought for trial in Colombia, Santos said, citing AFP. (El Universal, 04-01-2011; http://www.eluniversal.com/2011/04/01/santos-satisfecho-con-relacion-con-venezuela.shtml)
Cristina Fernández and Hugo Chávez signed bilateral agreements
Argentina's President Cristina Fernández met in Buenos Aires with her Venezuelan counterpart Hugo Chávez, and signed a joint declaration plus a half dozen cooperation and trade agreements. (El Universal, 03-29-2011 http://english.eluniversal.com/2011/03/29/cristina-fernandez-and-hugo-chavez-sign-bilateral-agreements.shtml)
National Assembly approved USD$6.16 million for a project with Argentina
The National Assembly approved an additional credit of USD$6.16 million to be transferred to the state-run company Corporación Venezolana de Alimentos (CASA), in order to support a new cooperative food agreement between Venezuela and Argentina. The amount will be go to technical assistance and training by the Argentinean Industrial Technology Institute for 21 “agribusiness social properties” in central and western Venezuela. The agribusiness units are involved in cereals, vegetables, fruits, dairy products, beef and fish, among others. (AVN, 03-30-2011; http://www.avn.info.ve/node/50790)
Chavez seeks to strengthen UNASUR for integral regional development
Upon his arrival in Uruguay, President Hugo Chavez urged Latin American peoples to strengthen the Union of South American Nations (UNASUR), an international organization that created in order to foster development in the region. “We have to talk about it now within UNASUR. We have just passed the constituent treaty. UNASUR already has a life of its own, but it is still a child. We have to feed it, strengthen it and we have to consolidate that great space from the Caribbean to the Patagonia,” said to journalists. (AVN, 03-30-2011; http://www.avn.info.ve/node/50775)
Mujica to boost Venezuelan entry to MERCOSUR
Uruguay's president, Jose "Pepe" Mujica told his Venezuelan counterpart, Hugo Chavez, that it is the "concern of Uruguay" to push "as far as possible," for accession by Venezuela to the Southern Common Market (MERCOSUR). Mujica described President Chavez as as "an old friend" and said Venezuela´s incorporation - pending formal approval by the Paraguayan Congress - will "contribute in part to mitigate the asymmetries in the inner block". (El Universal, 03-31-2011; http://www.eluniversal.com/2011/03/31/mujica-impulsara-ingreso-venezolano-al-mercosur.shtml)
Paraguay will priorize Venezuela's MERCOSUR entry
The Paraguayan Minister of Foreign Affairs, Jorge Lara, said the entry of Venezuela into MERCOSUR is a priority, adding that the government will insist with the opposition majority in the Senate to ratify the accession. For the Paraguayan government the important thing is to strengthen the regional bloc, said the chancellor. (Tal Cual, 01-04-2011; http://www.talcualdigital.com/ediciones/2011/04/01/default.asp)
Venezuela, Bolivia plan new economic complementation framework
Venezuela and Bolivia began conversations on commercial and economic complementary agreements that aim to “sweep away the old neoliberalism and develop cooperation based on a frame of our own to bring happiness, quality of life and equality to our peoples,” said the Venezuelan Foreign Minister Nicolas Maduro at the inauguration of the First Integration Bilateral Commission, in Cochabamba, Bolivia. Maduro highlighted that Caracas and La Paz are trying to strengthen exchange mechanisms such as the Unitary System of Regional Compensatory Payments (Sucre) and the promotion of complementary alliances to “build sovereignty and independence on our material, spiritual, political and organization foundations.” (AVN, http://www.avn.info.ve/node/51028)
Report highlights Venezuelan failure to fulfill international obligations
NGO Control Ciudadano (Citizen's Control) recently submitted a report to the United Nations High Commissioner for Human Rights and the UN Human Rights Council apropos their Universal Periodic Review. The report ascertains Venezuela’s compliance with fundamental rights and liberties. (El Universal, 03-29-2011; http://english.eluniversal.com/2011/03/29/failure-to-fulfill-international-obligations-is-highlighted.shtml)
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