Venezuelan Daily Brief

Published in association with The DVA Group and The Selinger Group, the Venezuelan Daily Brief provides bi-weekly summaries of key news items affecting bulk commodities and the general business environment in Venezuela.

Tuesday, July 31, 2012

July 31th, 2012

Economics & Finance

Market points to Venezuela as riskier than Spain
Although Spain is the epicenter of the euro zone, the market considers Venezuela more likely to default.
CDS (Credit Default Swap) is the thermometer that measures the risk of insolvency and operates as insurance in global financial markets which bondholders purchase to shield themselves from noncompliance at maturity. Based on the price of the CDS, Venezuela is now placed as the third riskiest country in the world, only after Cyprus and Argentina, while Spain ranks fifth.
(El Universal, 07-30-2012;

Finance Ministry plans VEB 18.2 bond issues this quarter
The Planning and Finance Ministry plans to issue VEB 18.2 billion in bonds during this quarter. According to a press release they say the strategy "will further propel financial markets and support the Central Bank in managing monetary policy". More in Spanish: (El Universal, 07-31-2012;

Experts anticipate higher inflation
Inflation has being contained so far through controls on the economy, but they have failed to eliminate the problem.
Experts say the scenario in which the private sector agrees under pressure to keep prices down suppresses is merely a temporary situation which hides real inflation. More in Spanish: (Tal Cual, 07-30-2012;

Industrial production slows to 1.3% growth rate
Public spending has accelerated economic growth rates, but private industry is showing very weak signs. According to Central Bank numbers industrial production for the first third of this year has grown only by 1.3%, which is down from 5.24% for the same period last year. Experts say this is due to difficulties in accessing foreign exchange, unfair competition from cheap imports bought through an overvalued currency and a hostile environment. More in Spanish: (El Universal, 07-31-2012;

Basic industries are operating in the red
Deputy Julio Borges says production at basic industries has fallen by 25% and warns that the information is based on figures published by the Central Bank of Venezuela and released this year by the Planning and Finance Ministry. He says SIDOR's production has dropped by 40%, VENALUM by 17% and BAUXILUM by 14%, among others. More in Spanish: (Tal Cual, 07-30-2012;

Expropriations have created a vast government industrial infrastructure
It is a government priority to establish state control over the means of production, particularly in the food production area. Over the past 10 years it has developed a considerable agribusiness infrastructure, in some areas as important as the private sector. This structure has been developed mainly through interventions, expropriations and direct acquisition of processing plants, storage centers and distribution networks. The government now controls 62.2% of the food supply, including 119 agribusiness industries, 52% of the gathering and storage of raw material, and over 22,000 outlets throughout the country, although distribution depends mainly on imports. More in Spanish: (El Universal, 07-31-2012;


PDVSA-YPF pact announced
Upon his arrival at Brasilia, President Hugo Chavez said the Venezuelan state oil company PDVSA will sign an agreement with its Argentine counterpart YPF. He claimed alliances with state oil companies in Brazil and Argentina "will lead to the creation of a PETROSUR". More in Spanish: (AVN, 07-31-2012;ávez-anuncia-firma-convenio-energético-estatal-argentina-ypf)

PDVSA increases US fuel purchases by 65%, crude sales to US drop by 12.8%
According to numbers from the US Department of Energy, fuel exports to Venezuela in January-May 2012 increased by 65% over the same period last year, for a total 37,600 BPD. The report also shows PDVSA dispatches to the US, basically crude oil. Fell by 12.8% PDVSA imports over 1.9 million liters of gasoline per day. More in Spanish: (El Nacional, 07-31-2012;

El Palito refinery expansion project will take 3.5 years to complete
PDVSA has signed engineering, procurement and construction contract to expand the El Palito refinery, with the TFY&V group, which is made up by Japan's Toyo Engineering Construction, Foster Wheeler Italy, Spanish partners and Venezuela's Y&V. The project aims to reach international quality standards and optimize crude oil from the Orinoco oil belt. The project will take almost 50 months to complete and would increase crude oil processing capacity from 140,000 to 280,000 BPD. More in Spanish: (El Nacional, 07-31-2012;

China Fund to finance new SIDOR plant
The Orinoco Iron and Steel Industry (SIDOR) plans to build a new plant to process 870,000 of semi prepared material for he oil industry and housing construction, thanks to a U$D 250 million investment from the China-Venezuela Fund. The project is due for completion by the end of 2014. More in Spanish: (AVN, 07-31-2012;á-nueva-planta-recursos-del-fondo-pesado-chino-venezolano; El Universal,

International Trade

MERCOSUR experts meet to discuss Venezuela's accession dates
MERCOSUR technicians are meeting in working groups in Brasilia to define dates for Venezuela's gradual accession, by adopting the Common Foreign Tariff and the Common Nomenclature. Venezuela still uses the system of the Community of Andean Nations, from which pulled out in April 2011. According to the protocol of adhesion, adopting the regulations will be carried out "gradually within four months since the date of the entry into force." (AVN, 07-30-2012;

Venezuela's auto industry seeks exclusion from MERCOSUR
Local business has alerted the government of the risks of entering MERCOSUR, and the auto industry is the most highly concerned. The association of auto parts manufacturers (FAVENPA) has written to Foreign Minister Nicolas Maduro, asking that the auto industry be excluded from Venezuela's entry as a full member of MERCOSUR. They also urged the government not to negotiate rules of origin and tariff advantages in this area. The automotive industry argues that Venezuela has a plan in place since 2007 to increase production and reach 50% locally supplied parts in auto assembly by 2013. They say there is no way the Venezuelan auto industry can compete or avoid being displaced by industries in Argentina and Brazil because of the enormous differences in scale. The domestic auto industry argues it will require a transition of five to ten years to increase local competitiveness. More in Spanish: (El Universal, 07-31-2012;

Expert says MERCOSUR entry will favor foreign companies
Eduardo Porcarelli says "there will be an increase in the variety and prices of products available to consumers". He warns this will have a serious impact on domestic production which could lose domestic markets due to higher production and distribution costs internally, as well as price regulations. More in Spanish: (El Nacional, 07-31-2012;

Venezuela purchases 20 aircraft from Brazil
Government sources say Venezuela's official airline CONVIASA will purchase 20 EMBRAER Model E190 aircraft this week. The contract will be signed this week, during President Chavez's visit to Brasilia. More in Spanish: (Ultimas Noticias, 07-31-2012;

Logistics & Transport

More scales needed at Puerto Cabello
Puerto Cabello, the country's main sea terminal, has only two scales for weighing at the entrance and two for the output process, which results in delays in processing bulk products. Durvelle Jonathan, second vice president of the government CASA Transportation Center, says there should be at least five for entry and the same number for output, especially at least 80% of bulk cargo comes to this port. More in Spanish: (Notitarde, 07-30-2012;


Chavez in Brazil for MERCOSUR summit
President Hugo Chavez is in Brasilia to attend a meeting of the Common Market of the South (MERCOSUR), where Venezuela's accession to the bloc will come into effect. He is also expected to meet with his counterparts from Argentina, Cristina Fernandez, Uruguay's Jose Mujica and Brazil's Dilma Rousseff. (AVN, 07-30-2012;; El Universal,

Formation of the Bolivarian Militia speeds up
According to experts consulted and documents obtained by El Nuevo Herald reveal the important role the militias would have under the political-economic model leading to a totalitarian regime President Chávez has designed for Venezuela and whose implementation would take full force as of next year if he is re-elected in the October 7 presidential elections. His militia would have some 125,000 troops already. (Veneconomy, 07-30-2012;

Israeli Ambassador says Venezuela's should be of concern to MERCOSUR
Israel's ambassador to Uruguay, Dori Goren says the entry of Venezuela into MERCOSUR "should be a major concern for member countries" because "there are plenty of Iranian agents operating terror networks on the continent with coverage provided by Venezuela." More in Spanish: (El Mundo, 07-30-2012;; El Universal,

Friday, July 27, 2012

July 27th, 2012

Economics & Finance

Exchange controls to remain despite MERCOSUR entry
President Hugo Chávez says Venezuela will continue to have full freedom to set its monetary, exchange and tax policy upon its entry into the Common Market of the South (MERCOSUR). After a meeting with Brazilian senior authorities, he emphasized that the trade bloc is not a supra-national scheme set to impose domestic policy related issues. "We have full freedom to keep exchange control, Cadivi (Foreign Exchange Administration Board) and mechanisms, such as Aladi (Latin American Integration Association) and many other mechanisms," he remarked. (El Universal, 07-26-2012;

Venezuela's socialist model clashes with MERCOSUR, according to Carlos Larrazabal, President of the National Council of Industries (CONINDUSTRIA). "Many restrictions placed by MERCOSUR totally contradict socialist guidelines and policies" established in the First National Socialist Plan for 2007-2013, he says. More in Spanish: (El Universal, 07-27-2012;

Shortage is in the lowest level
According to the DATANALISIS polling firm, the level of food shortages was at its lowest level this year dropping 1.2 percentage points over the previous survey to reach 13.8%. According to measurements, no product was in the serious shortage category (over 40%) and nine items were placed in the level of scarcity significant (between 11% and 40%). More in Spanish: (Últimas Noticias, 07-23-2012;

"The priority is to have food, even if it is imported", says General Carlos Osorio, Minister for Nutrition, who also claims the government has over 22,000 sales outlets throughout the country, and serves over 16 million people. More in Spanish: (El Universal, 07-27-2012;

Venezuela hit with U$D 600 million of new arbitration claims
The administration of President Hugo Chavez faces new demands for compensation worth at least U$D 600 million at the World Bank after companies rushed to present their claims before the South American nation pulled out of the arbitration system. Spain’s Valle Verde Sociedad Financiera SL and Barbados- based companies Blue Bank International & Trust Ltd and Transban Investment Corp. filed separate claims to the bank’s International Centre for Settlement of Investment Disputes, said DLA Piper LLP, the law firm representing the investment firms. Miami-based DLA Piper partner Pedro Martinez-Fraga says: “The decision to file, sometimes it’s precipitated by knowing that you won’t have that remedy anymore.” (Bloomberg, 07-26-2012;


PDVSA loses U$D 2.19 billion in gasoline subsidies
Most Venezuelans are convinced that they live in a rich country with the largest oil reserves in the world, and are prone to think that energy prices mainly gasoline-should be cheap. (El Universal, 07-23-2012;; The Washington Post, 07-20-2012,

Oil sales to the US drop to 11%
Venezuelan oil exports to the United States slipped back again in the first half of 2012, according to preliminary data collected by the statistical arm of the US Department of Energy. The information supplied by the US government points out that in January-June 2012, approximately 823,000 barrels per day (bpd) of crude oil were shipped to US ports. This volume is 11% lower than the exports counted in the first half of 2011, which averaged 925,000 bpd. (El Universal, 07-26-2012;

Analyst says Venezuela will boost MERCOSUR'S energy capability.
According to Venezuelan expert Miguel Jaimes, the nation´s entry to MERCOSUR will add the largest proven and certified oil reserves on earth, as well as the eight largest gas reserves: 297.57 billion barrels of oil and 196 billion cubic feet of gas. He also says Venezuela's electricity generating potential is over 25.000 megawatts. More in Spanish: (AVN, 07-27-2012;ética-mercosur)

Zulia power generation system expanded, according to the government
President Chavez has inaugurated the Bajo Grande thermoelectric power plant, with 100 megawatts-generating capacity in Zulia state. (AVN, 07-22-2012;

Butene plant opened in western Venezuela
President Hugo Chavez inaugurated a plant to process organic chemical compound 1-butene at Petrochemical Complex Ana Maria Campos, in the Sur del Lago region of the western state of Zulia. The plant is to provide the compound necessary to ensure a total coverage of plastic manufacturing process in the country. 1–Butene (C4H8) is a colorless, flammable, liquefied gas with a slightly aromatic odor which may be used in the production of plastics, lubricants, mercaptans, flavors and fragrances. (AVN, 07-22-2012;–butene-plant-western-venezuela)

Iran builds oil tanker for Venezuela, demonstrating shipbuilding capabilities
Iran’s official news agency is reporting the country has finished building an oil tanker for Venezuela, a key ally. The IRNA report says the project means Iran has joined countries with capability of building oil tankers. It comes as Iran considers building nuclear-powered freighters and oil tankers. That could provide a reason to increase the level of its uranium enrichment for fuel. The West suspects Iran is aiming at building nuclear weapons. Iran denies that. (The Washington Post, 07-24-2012;

Logistics & Transport

29 ships remain at bay in Puerto Cabello
Ships continue arriving at the port of Puerto Cabello, primarily bearing basic foodstuff. According to Port authority reports, 21 ships are at dock: 11 bear in bulk products and in transit time remains at 21 days. More in Spanish: (El Carabobeño, 07-27-2012;; Notitarde,

Restrictions to continue on US air carriers
US carriers will continue to be restricted by Venezuelan authorities, who met with airline carriers to reiterate a policy adopted weeks ago. More in Spanish: (El Universal, 07-27-2012;


Venezuela is now out of ICSID
On Wednesday, July 25th, Venezuela's withdrawal from the International Center for Settlement of Investment Disputes, or ICSID, went into effect. (AVN, 07-25-2012;; El Universal,

... also withdraws from regional human rights court
President Hugo Chavez says Venezuela is withdrawing from the regional human rights court that Latin America's leftist leaders have increasingly criticized as a pawn of Washington. Allies of Venezuela including Bolivia, Ecuador and Nicaragua have accused the Inter-American Court of Human Rights of improperly weighing in on disputes still being heard in domestic courts and working to undermine leftist governments. (Reuters, 07-25-2012;; The Washington Post, 07-24-2012;

UN fears "devastating" effects from Venezuela's withdrawal from IACHR
The Office of the United Nations High Commissioner for Human Rights (OHCHR) says Venezuela's pullout of the Inter-American Court of Human Rights, Inter-American Commission on Human Rights (IACHR Court) would be "devastating" for the international organization. Spokesperson Rupert Colville told Efe that the move "will be not good for Venezuela either." (El Universal, 07-26-2012;

Chavez signals preference in US presidential race, comparing his rival to Romney
Hugo Chavez has signaled a preference in the U.S. presidential campaign by comparing Mitt Romney to his own challenger. Chavez, who is up for re-election a month before U.S. President Barack Obama, has in recent weeks expressed a clear preference for the man currently in the White House. In a campaign speech Saturday night, Chavez equated the agenda of his challenger, Henrique Capriles, with that of Romney, saying both men represent the callously selfish capitalist elite. (The Washington Post, 07-22-2012;

REPSOL should reach friendly deal with Argentina over YPF, says Chavez
President Hugo Chavez indicated that Spain's REPSOL SA come to a "friendly" agreement with Argentina's government as both parties remain in dispute over the recent nationalization of Argentine oil and gas company YPF SA (YPF). "I advise them to think it through very carefully," Mr. Chavez said in comments carried on state television, following a meeting with Argentine Planning Minister Julio de Vido. In May, Argentina's government expropriated 51% of YPF from its majority shareholder, REPSOL, after President Cristina Kirchner accused the Spanish company of under investing and using YPF's generous dividends to fund operations in other countries. (Fox Business, 07-24-2012;

Friday, July 20, 2012

July 20th, 2012

Economics & Finance

Venezuelan economy to contract 3.5% after elections in 2013, after expansion during elections
Guest economists attending the FEDECÁMARAS Annual Meeting estimate that after the October 7 presidential elections spending dynamics “obviously driven by the elections” will post a significant reduction. They warn this drop will continue in 2013 and will result in an important deceleration of the economy. The Ministry for Planning and Finance projects annual expansion of 7% this year, closing around 7% for this quarter, led by construction, trade, manufacturing and finance. (Veneconomy, 07-18-2012;; more in Spanish: El Mundo, 07-19-2012,

Government has used up 90% of authorized credit for this year, according to a report by the Ministry of Planning and Finance which shows 90% of the originally authorized indebtedness, VEB 56.3 billion out of VEB 62.9 billion had been used by July 13th. More in Spanish: (El Universal, 07-20-2012;

Non-oil exports hit 60-year low
Non-oil private exports this year will end at a record low, according to Francisco Mendoza, a former president of the Venezuelan Association of Exporters (AVEX), who says: "This year we will go under the floor of less than U$D 1 billion in exports, which had not happened in Venezuela since the 1960's". The activity continues to decline due to serious obstacles faced by Venezuelan domestic manufacturers. "The outlook is pretty gloomy; competitiveness is becoming increasingly complex due to recently enacted laws, the situation (of delays) in ports, and the shortage of foreign exchange." (El Universal, 07-18-2012;

Private investment-to-GDP-ratio may be boosted to 20%
Jorge Botti, President of the Federation of Trade and Industry Chambers (FEDECÁMARAS), says it is possible to raise the private investment-to-GDP-ratio to 20%. He says that since the 1970's private investment in Venezuela has fallen steadily. "Private investment in Peru and Colombia exceeds 20%. Under similar circumstances, we could raise the production capacity of industries," Botti said during the 68th General Assembly of Fedecámaras. (El Universal, 07-18-2012;

Venezuela has the least transparent budget in Latin America, according to the Latin American Index for Budgetary Transparency (ILTP). Costa Rica, Ecuador and Mexico have the most transparent budgets in the region. More in Spanish: (Notitarde, 07-20-2012;


PDVSA, CHEVRON reach U$D 2 billion financing deal
State oil company PDVSA says it has reached an agreement with CHEVRON to secure U$D 2 billion in financing to boost oil production at PETROBOSCAN, a joint venture between the two companies. Since the end of 2010, the Energy Ministry has been pressuring some 20 joint ventures between PDVSA and foreign energy partners to find extra funding to raise output. The socialist administration of President Hugo Chavez has threatened to cancel the ventures' permits if they fail to hike production. PDVSA said CHEVRON would provide the funds to PETROBOSCAN at a rate of Libor plus 4.5%, and the last payment would be made in 2025. The agreement includes preliminary accords to make outstanding payments to PETROBOSCAN, PDVSA said. (Reuters,; The Washington Post,; Fox Business,

RUSORO adds another action against Venezuela at the ICSID
Russian-Canadian mining company RUSORO has filed a request for arbitration against the Bolivarian Republic of Venezuela following the nationalization of RUSORO's assets in the country, a move that has resulted in significant loss, according to the firm. The company commenced the arbitration at the International Centre for Settlement of Investment Disputes (ICSID), despite Venezuela's withdrawal from the organization, where the country faces a dozen lawsuits for up to U$D 45 billion. According to workers at RUSORO, production there has dropped since the government´s takeover. (El Universal, 07-18-2012;; Reuters;; and more in Spanish: El Universal, 07-20-2012;

The coke is still there: According to Víctor Hernández, from Anzoátegui’s Engineers’ Association (CIANZ), coordination to withdraw the coke from the Jose premises has been a total “disaster.” Displaying evidence, he said that in May 2012, PDVSA ended the contracts signed with Cuferca and TYC to handle and export the residues from the yards of the José Antonio Anzoátegui Industrial Complex and reassigned it to Energy Coal, which has also done nothing. (Veneconomy, 07-18-2012;

PDVSA sells more to Latin America than the U.S.
The yearly statistical report by the Organization of Petroleum Exporting Countries (OPEC) released this week said that Venezuela's oil exports to Latin America exceeded shipments to the United States last year. The data provided by OPEC, based on information provided by the Ministry of Petroleum and Mining indicate that exports in 2011 were on average 2.3 million barrels per day and the volume (just over 1 million barrels per day) were sent to Latin American countries. More in Spanish: (El Nacional, 07-19-2012;

Agricultural product imports rose 105.4% in 5 months for a total over U$D 2.14 billion, according to official statistics from the Institute for National Statistics. This is double the amount imported for these products during the same time frame last year. Rice imports rose by 435.8%, for 423,493.67 tons. More in Spanish: (El Nacional, 07-20-2012;

Logistics & Transport

Minister Elsa Gutierrez announced a new dock at the Port of Guanta
The Minister for Air and Water Transport, and President of National Port Authority (BOLIPUERTOS), CA. Elsa Gutierrez, announced the construction of a seventh pier at the marine terminal, for PDVSA machinery. She said:
"The pier will be 34 meters wide and will work primarily to facilitate the import of machinery for the growth of the oil industry in the east". More in Spanish: (Bolipuertos, 07-19-2012,


Chávez leads most polls, PREDIGMÁTICA gives Capriles a 4% lead
Two and a half months into the presidential elections, incumbent candidate Hugo Chávez leads the polls, according to Datanálisis (15.3 points ahead) and Hinterlaces (17 points ahead) but his health evolution, the elevated number of undecided voters or opposition candidate Henrique Capriles’ campaign could alter this situation, according to analysts. The PREDIGMATICA polling firm says results of a more recent June study of 1,600 polled reflects support for Henrique Capriles at 47.7% and President Chavez at 43.7%. (Veneconomy, 07-18-2012; and more in Spanish: Últimas Noticias, 07-20-2012;

Venezuela condemns Syria bombing, warns against intervention
Venezuela condemned the bombing in Damascus that killed the Syrian defense minister and President Bashar al-Assad's brother-in-law, urging foreign powers against military intervention. Socialist President Hugo Chavez has helped undermine sanctions against Syria by shipping diesel fuel to the embattled country, and has described the conflict there as an international conspiracy backed by Western powers. (Reuters, 07-18-2012;

Tuesday, July 17, 2012

July 17th, 2012

Economics & Finance

SITME drives financial profits
Statistics from the Banking Superintendent show that this year's first semester has been highly profitable for financial organizations: profits are VEB 12.838 billion, which is an 132% jump from the same period last year. Analyst Francisco Faraco explains that "a large part of the increase in bank profits is from commissions on SITME operations". SITME is a system where companies use financial institutions to purchase foreign currency denominated bonds at the Central Bank, and then resell them abroad in order to obtain dollars. The report shows that SITME traded U$D 5.2 billion during the first semester this year, and bank commissions can be up to 3% on each transaction. More in Spanish: (El Universal, 07-17-2012;

Fiscal and exchange rate adjustments predicted for 2013
International investment bank analysts believe 2013 will bring about difficult but inevitable economic adjustments, depending on the price of oil and the fiscal and exchange adjustments that will take place even if there is a new government. Boris Segura, of Japan's NOMURA Securities, says high government officials are already analyzing variables that must be considered for an adjustment, such as exchange rates, export volume and the price of oil. More in Spanish: (El Mundo, 07-17-2012;

Venezuela bonds closed on the rise averaging 0.40 and 0.30 points
There has been special interest in the PDVSA 2021 after several market experts called it the most attractive bond on the Venezuela and PDVSA curve. It rose 0.50 points yesterday as the highest riser of the day. Venezuelan bonds closed positively, with a 0.40 point price variation, and PDVSA bonds varied 0.30 points. SITME traded U$D 40.42 million, mainly in PDVSA 2021 and Venezuela 2025. More in Spanish: (El Mundo, 07-17-2012;

Excessive indebtedness increases danger of devaluation
According to Mexican economist Luis Pazos, controls, excessive indebtedness and uncontrolled use of oil industry resources are policies that are recurrent in Latin America, and that when countries such as Mexico take this route they have encountered supply problems, inordinate price increases and corruption. He said excessive indebtedness evolves into devaluation and high inflation; and that an excess in state intervention and nationalism benefit officials more than citizens. More in Spanish: (El Mundo, 07-17-2012;

Food now 23 times more expensive than 1998
Julio Borges, National Coordinator for Primero Justicia and Deputy to the National Assembly, insists that the Government has not been successful with their economic policies, which is reflected in the decline of food production.
According to Borges, as the country continues to import over 70% of what it consumes there is no way to fight inflation and wondered: "How can the President talk of independence, if we import almost everything we eat"? He adds: "According to Central Bank data accumulated inflation in foodstuffs through June 2012 was more than 27%, and when one calculates inflation for these last 14 years we can see food prices are 23 times more expensive than 14 years ago". More in Spanish: (Tal Cual, 07-16-2012;


OPEC certified Venezuela still has largest reserves
OPEC exports rose 40% in value in 2011 against the previous year, oil producing nations GDO rose 18% according to their latest report, prepared before a new rise in oil supplies this year could further strengthen their incomes. Earnings reported in the OPEC Yearly Statistic Report for 2012 reflect increased prices and stable production growth for many member nations last year. Proven reserves remained basically unchanged, and Venezuela continues to be the nation with highest reserves. More in Spanish: (Ultimas Noticias, 07-17-2012;; El Mundo,; El Universal,

Venezuelan oil down 10 cents; averages U$D 92.77
The Venezuelan oil basket averaged this week U$D 92.77 per barrel, according to the Ministry of Petroleum and Mining's Twitter account. The price slipped back 10 cents from U$D 92.87 last week, due to volatility and mixed results in the main hydrocarbons markets. (El Universal, 07-13-2012;

Uranium discovered in the Essequibo region
Canada based firm U3O8 has discovered "large quantities of uranium" during drillings it has been carrying out for over a year at the Kurupung Batholith project, in the Mazaruni district in western Essequibo territory which is disputed between Venezuela and Guyana. It is not confirmed whether Guyana consulted Venezuela when it granted these drilling rights, as required by the 1966 Geneva Agreement between both nations. ARGUS Metals said in may that it expected to start drilling for gold and uranium in an area northeast of the disputed territory, In February 2004 President Chavez said he would not opposed projects in the Essequibo in "water, communications, energy and agriculture, that would benefit its population". More in Spanish: (El Nacional, 07-17-2012;

International Trade

Nicaragua guarantees milk and beef supply
Ariel Bucardo, Nicaraguan Minister for Agriculture and Forestry has stated that his country will continue exporting beef and milk to Venezuela for the remainder of 2012. The agreement requires delivery of 36,000 metric tons of beef and 24,000 tons of milk. Nicaragua also supplies Venezuela with black beans, cheese, powdered milk and coffee. The Minister says agreements have been fully met and will continue to do so. More in Spanish: (Tal Cual, 07-17-2012;

Logistics & Transport

New container terminal to be built at Puerto Cabello
Minister Elsa Gutierrez, President of the National Port Authority, signed the final agreement with the China Harbour Engineering Company for building a new container terminal. The project is due for final delivery within 36 months. More in Spanish: (Bolipuertos, 07-16-2012;


Chavez: Venezuela is no threat, calls Obama a "good guy"
President Hugo Chavez denied on Friday that Venezuela was a threat to anyone, after U.S. presidential hopeful Mitt Romney criticized Barack Obama for playing down the risk posed by the socialist leader. Obama told a Spanish-language television station in an interview screened this week that Chavez's actions over recent years had not had a serious impact on the national security of the United States. Romney said Obama's comments were "stunning and shocking" and showed a pattern of weakness in the Democratic president's foreign policy. In an interview with a local Venezuelan television station on Friday, Chavez dismissed the allegations he posed any danger. "The Venezuela of today is no threat to anyone," he said. (Reuters, 07-14-2012;

DATANALISIS show Chavez with lead over rival Capriles; C21 shows them neck and neck
Pollster firm DATANALISIS June poll shows President Hugo Chavez maintaining a 15% lead over opposition challenger Henrique Capriles in the run-up to the October 7 election. It has 46.1% of voters backing Chavez and 30.8% supporting Capriles, and shows 23% undecided. However, other recent polls show that the probability of political change has increase significantly over the last month. While polls vary widely, those giving President Hugo Chavez a large lead of around 10% points, all have a large percentage of undecided near the 30% level. The only pollster that has been showing levels of undecided near the 10% number are those of CONSULTORES 21, a pollster which has been quite accurate in the past. In the last poll, taken in the second half of June, the Chavez lead essentially collapsed, and the difference, which had been widening, basically collapsed to 0 in the second half of June. (Yahoo, Reuters, 07-16-2012;; El Universal,

Cardoso says Brazil's influence slips by not opposing Chavez
Former Brazilian President Fernando Henrique Cardoso says Brazil looses influence within South America by not opposing Hugo Chavez's leadership. He also criticized the way Venezuela was brought into MERCOSUR following the political crisis in Paraguay. More in Spanish: (El Universal, 07-16-2012;