April 13, 2012

Economics & Finance

Currency Board promises to expedite currency allocations for controlled products

The local Currency Board (CADIVI) has promised to expedite dollar allocations for producing and importing the 19 items controlled by the Cost and Price National Superintendent (SUNDECOP). CADIVI's President

Manuel Barroso met with representatives of companies providing the products. More in Spanish: (El Universal; http://www.eluniversal.com/economia/120413/prometen-facilitar-divisas-para-rubros-controlados)

Exchange controls to continue for political reasons

Aristobulo Isturiz, first Vice President of the National Assembly, says exchange controls are "a political move" and are to continue "until the revolution becomes irreversible. We cannot eliminate exchange controls here because otherwise Chavez would be overthrown". He added controls must remain in place until the strategic goals of the second socialist plan for the nation are achieved. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/control-de-cambio-continuara-como-medida-politica.aspx)

Commodities

Venezuelan government decreed the transfer of exploitation Rights of two oil fields, Bachaquero Tierra and Lagunilla Tierra, in Zulia state, to a joint venture “to be set up between the Venezuelan Oil Corporation (CVP, after its initials in Spanish) and GAZPROMBANK Latin America Ventures". It will be valid for the next 25 years. (Veneconomy, 04-11-2012; http://www.veneconomy.com/site/index.asp?ids=44&idt=30096&idc=4; El Universal; http://www.eluniversal.com/economia/120411/two-venezuelan-oil-fields-transferred-to-joint-venture-with-gazprom)

VENALUM shutting down more production cells

The VENALUM aluminum plan has shut down 177 cells in less than two months, while only 336 cells remain connected out of a total 905 which are its total potential. This is only 37.1% of total capacity. Company staff fears that the lack of supplies and operational backlog will lead to the total disincorporation of P-19 cells that account for 1.2 daily tons of aluminum. A long story of disinvestment, neglect by the government and amateur management have led to a huge deficit in available funds, delays in purchasing supplies and labor instability. More in Spanish: (Correo del Orinoco, 04-12-2012; http://www.correodelcaroni.com/index.php?option=com_content&view=article&id=200932:venalum-apago-151-celdas-en-menos-de-dos-meses&catid=75:laboral&Itemid=114; El Universal; http://www.eluniversal.com/economia/120413/siguen-apagando-celdas-de-produccion-en-venalum)

SIDOR improving steel production

Records show 188,000 tons of liquid steel were produced in March, the highest figure in eight months, and 41% above February's production, which was 55,000 tons. More in Spanish: (Ultimas Noticias; http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/sidor-levanta-cabeza-en-produccion-de-acero.aspx)

Farmers: Price increase will encourage production

The National Confederation of Agricultural Producers (FEDEAGRO) says that price adjustments on products such as corn, rice, sorghum, soybean and sunflower authorized last week by the Government were positive and that the availability of inputs and the full recognition of costs would contribute to halt declining production. (El Universal, 04-11-2012; http://www.eluniversal.com/economia/120411/farmers-price-increase-will-encourage-sowing-of-cereals; Veneconomy, 04-11-2012; http://www.veneconomy.com/site/index.asp?ids=44&idt=30093&idc=3)

International Trade

RUSORO to sue Venezuela at ICSID if there is no "reasonable agreement"

The honeymoon appears to be eroding with the Russians. There is considerable uncertainty about the fate of the assets of the mining company here. According to the president of RUSORO in Venezuela, Andrea Padovani, no agreement has been reached so far on the formation of the joint venture with the Venezuelan Government or on a reasonable amount of compensation for the mining assets that the company has in the country. More in Spanish: (El Mundo, 04-11-2012; http://www.elmundo.com.ve/noticias/petroleo/mineria/rusoro-demandara--a-venezuela-ante-el-ciadi-si-no-.aspx)

Venezuela: Latin America’s most expensive iPhone

Venezuela, not Brazil, can boast of having the most expensive iPhone prices in Latin America, according to a Latin Business Chronicle analysis of prices from Apple and local wireless operators.

The analysis compared prices offered through Apple’s Brazil and Mexico stores with prices offered by operators in Bolivia, Chile, Colombia, Costa Rica Ecuador, Guatemala, Peru, and Venezuela. (Latin Business Chronicle; http://www.latinbusinesschronicle.com/app/article.aspx?id=5609)

Politics

Chavez ahead in presidential race even as he fights cancer, prays for life

With less than six months left until Election Day, President Hugo Chavez has hardly hit the campaign trail. Instead, he has been consumed with his fight against cancer, repeatedly traveling to Cuba for treatment and publicly vowing to defeat his illness. Chavez’s struggle against the disease has become his main rallying cry and could serve as a political asset if his health holds through the October vote. So far, what appears to be a serious life-or-death crisis hasn’t dented his political support. To the contrary, one recent poll showed Chavez with a lead of 14% points over rival Gov. Henrique Capriles. The poll by the firm DATANALISIs had a margin of error of 2.5%. Eduardo Gamarra, a Latin American studies professor at Florida International University in Miami, said compassion elicited by Chavez’s illness “has naturally played to his advantage in the electoral process.” (Washington Post, 04-12-2012; http://www.washingtonpost.com/world/the_americas/hugo-chavez-ahead-in-venezuela-presidential-race-even-as-he-fights-cancer-prays-for-life/2012/04/12/gIQArzT7CT_story.html)

Obama says: "we want free and fair elections in Venezuela"

US President Barack Obama says he want to see "elections that are free and fair and that respect the will of the people", in Venezuela; and added that "as all sovereign nations, it must establish its own destiny, but it is the Venezuelan people who must decide their course democratically". More in Spanish: (El Universal; http://www.eluniversal.com/internacional/120413/barack-obama-queremos-elecciones-libres-y-justas-en-venezuela)

Chavez to attend the Cartagena Summit for less than a day

According to the Summit organization, Chavez will arrive in Cartagena this afternoon to attend the VI Summit of the Americas and will return to Caracas tomorrow morning, a day ahead of the end of the meeting. Uruguay's President José Mujica arrived last night in Caracas to meet with President Chavez and may continue on to Cartagena with him. More in Spanish: (El Universal, 04-13-2012; http://www.eluniversal.com/internacional/120413/chavez-va-por-menos-de-un-dia-a-la-reunion-de-cartagena; AVN; http://www.avn.info.ve/contenido/presidente-mujica-llegó-venezuela-para-reunirse-hugo-chávez)

Guyana asks UN to disregard Venezuelan objections on maritime platform

A delegation headed by Guyanese Foreign Minister Carolyn Rodrigues-Birkett travelled to the United Nations to present their case for an extension of the nation's maritime platform for an additional 150 miles. During her presentation the Foreign Minister requested that Venezuela's objections should be disregarded. More in Spanish: (El Universal, 04-13-2012; http://www.eluniversal.com/nacional-y-politica/120413/guyana-niega-en-la-onu-disputa-con-venezuela)

Venezuela kidnapping rate triples Mexico's in 2011

The rate of reported kidnappings in Venezuela was three times that of Mexico in 2011. There were 1150 incidents, which is 3.8 kidnappings per 100,000 people. Mexico reports a rate of 1.1 and neighboring Colombia's rate is 0.7 per 100,000. Only fractions of kidnapping cases are reported. More in Spanish:  (El Universal, 04-13-2012; http://www.eluniversal.com/sucesos/120413/tasa-de-secuestros-en-venezuela-triplico-la-de-mexico-en-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.