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; http://www.veneconomy.com/site/index.asp?ids=44&idt=31347&idc=2; more in Spanish: El Mundo,
07-19-2012, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/cifras-preliminares--muestran-un-alto-crecimiento-.aspx)
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;
http://www.eluniversal.com/economia/120720/gobierno-ha-colocado-90-de-la-deuda-prevista-para-este-ano)
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$D 1 billion in
exports, which had not happened in Venezuela since the 1960's". The
activity continues to decline due to serious obstacles faced by Venezuelan
domestic manufacturers. "The outlook
is pretty gloomy; competitiveness is becoming increasingly complex due to
recently enacted laws, the situation (of delays) in ports, and the shortage of
foreign exchange." (El Universal, 07-18-2012; http://www.eluniversal.com/economia/120718/venezuelan-non-oil-exports-hit-60-year-low)
Private investment-to-GDP-ratio may
be boosted to 20%
Jorge Botti, President of the Federation of Trade and
Industry Chambers (FEDECÁMARAS), says it is possible to raise the private
investment-to-GDP-ratio to 20%. He says that since the 1970's private
investment in Venezuela has fallen steadily. "Private investment in Peru and Colombia exceeds 20%. Under similar
circumstances, we could raise the production capacity of industries,"
Botti said during the 68th General Assembly of Fedecámaras. (El Universal, 07-18-2012; http://www.eluniversal.com/economia/120717/businesspeople-private-investment-to-gdp-ratio-may-be-boosted-to-20)
Commodities
PDVSA, CHEVRON reach U$D 2 billion
financing deal
State oil company PDVSA says it has reached an agreement
with CHEVRON to secure U$D 2 billion in financing to boost oil production at PETROBOSCAN,
a joint venture between the two companies. Since the end of 2010, the Energy Ministry
has been pressuring some 20 joint ventures between PDVSA and foreign energy
partners to find extra funding to raise output. The socialist administration of
President Hugo Chavez has threatened to cancel the ventures' permits if they
fail to hike production. PDVSA said CHEVRON would provide the funds to PETROBOSCAN
at a rate of Libor plus 4.5%, and the last payment would be made in 2025. The
agreement includes preliminary accords to make outstanding payments to PETROBOSCAN,
PDVSA said. (Reuters, http://www.reuters.com/article/2012/07/18/us-venezuela-chevron-idUSBRE86H1MT20120718;
The Washington Post, http://www.washingtonpost.com/business/industries/venezuelas-oil-company-says-chevron-corp-plans-to-invest-2-billion-in-boscan-oil-field/2012/07/18/gJQAD2wduW_story.html;
Fox Business, http://www.foxbusiness.com/news/2012/07/18/venezuela-pdvsa-terms-finalized-with-chevron-for-2-billion-financing-deal/)
RUSORO adds another action against
Venezuela at the ICSID
Russian-Canadian mining company RUSORO has filed a
request for arbitration against the Bolivarian Republic of Venezuela following
the nationalization of RUSORO's assets in the country, a move that has resulted
in significant loss, according to the firm. The company commenced the
arbitration at the International Centre for Settlement of Investment Disputes (ICSID),
despite Venezuela's withdrawal from the organization, where the country faces a
dozen lawsuits for up to U$D 45 billion. According to workers at RUSORO,
production there has dropped since the government´s takeover. (El Universal,
07-18-2012; http://www.eluniversal.com/economia/120718/rusoro-adds-another-action-against-venezuela-at-the-icsid;
Reuters; http://www.reuters.com/article/2012/07/18/venezuela-rusoro-idUSL2E8II1SA20120718;
and more in Spanish: El Universal, 07-20-2012; http://www.eluniversal.com/economia/120720/tras-nacionalizacion-decayo-produccion-aurifera-de-rusoro)
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; http://www.veneconomy.com/site/index.asp?ids=44&idt=31346&idc=4)
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; http://www.el-nacional.com/)
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, http://www.bolipuertos.gob.ve/noticia.aspx?id=5712)
Politics
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; http://www.veneconomy.com/site/index.asp?ids=44&idt=31360&idc=1 and more in Spanish: Últimas
Noticias, 07-20-2012; http://www.ultimasnoticias.com.ve/noticias/tuvoto/noticiaselectorales/predigmatica-pone-a-capriles-radonski-4-puntos-por.aspx)
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; http://www.reuters.com/article/2012/07/19/syria-bombing-venezuela-idUSL2E8IJ0YB20120719)
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