Economics &
Finance
Reserves fall to five-year low before
vote
Venezuela’s international reserves fell to near their
lowest level in five years as the government boosts spending ahead of next
month’s presidential election. The
central bank said reserves fell U$D 300 million between Sept. 13 and Sept. 14
to U$D 25.2 billion, nearing the lowest since July 30, 2007, according to
figures released today by the central bank. Reserves dipped to U$D 25 billion
on May 31, and were below U$D 25.2 billion two days in June. (Bloomberg,
09-20-2012; http://www.bloomberg.com/news/2012-09-17/venezuela-s-currency-reserves-fall-to-five-year-low-before-vote.html;
El Universal; http://www.eluniversal.com/economia/120920/venezuelas-international-reserves-fall-usd-26-billion-in-two-months)
2012 budget exceeds its U$D 93
billion cap
Venezuela's 2012 budget initially was set at U$D 69.2
billion, yet new liabilities and government demands have forced the government
to approve additional funding, increasing the budget by 36% (to U$D 94.4
billion). Since January, the National Assembly has approved AN additional U$D
25.1 billion, and last Tuesday it authorized yet another U$D 1.9 billion. (El Universal, 09-20-2012; http://www.eluniversal.com/economia/120919/venezuelas-2012-budget-surpasses-the-usd-93-billion-cap)
Elections ignite investor enthusiasm
Interest has risen in Venezuelan sovereign debt bonds as
Presidential elections draw closer and several polls show opposition candidate
Henrique Capriles gaining. Capriles has pledged to correct fiscal imbalances
and carry out reforms. Brian Coulton, an investment strategy official at Legal
& General Investment Management in London says "Venezuela is being watched very closely. Investors have become
enthusiastic with signs that the opposition is gaining ground". More
in Spanish: (El Nacional, 09-21-2012; http://www.el-nacional.com/)
CADIVI allocates less FOREX to
business
A study by the Venezuelan American Chamber of Commerce
shows that currency allocated to major firms has slowed down over the past
weeks, particularly in food, personal care, home products and the automotive
industry. VENAMCHAM General Manager Carlos Tejera reports that 68% of firms in
consumer products from all sectors report fewer approvals by the currency
board. More in Spanish: (El Nacional, 09-21-2012; http://www.el-nacional.com/)
Cheap credit fails to drive industry
The government is forcing the banking system to grant low
interest credits to industry, agriculture, tourism and small business, but
according to a study by ECOANALITICA results are beneath expectations. More in
Spanish: (El Universal, 09-21-2012; http://www.eluniversal.com/economia/120921/fracasa-el-credito-barato-como-impulso-a-la-industria)
Government claims unemployment down
from 8.3% to 7.9%
since last year, in a report by the National Statistics Institute. More in
Spanish: (AVN, 09-21-2012; http://www.avn.info.ve/contenido/desempleo-bajó-83-79-entre-agosto-2011-2012;
El Universal, http://www.eluniversal.com/economia/120921/disminuye-tasa-de-desempleo-y-cierra-en-79-en-agosto)
Debt repayment will impact public
finances
In 2013, Venezuela must to pay U$D 9 billion in foreign currency bond
maturities, according to Angel García Banchs, President of the ECONOMETRICA
consulting firm. Although international market conditions may allow Venezuela
to issue new bonds in order to pay maturities, García says that when the US
monetary policy changes, maturities will be increasingly difficult for the next
five years. (El Universal, 09-20-2012; http://www.eluniversal.com/economia/120920/payment-of-debts-to-hit-venezuelas-public-finances)
Commodities
Government sees refinery fire out soon
A fire caused by lightning at Venezuela's
146,000-barrel-per-day El Palito refinery ignited two naphtha storage tanks.
The incident revived painful memories of last month's
disaster at the 645,000-bpd Amuay plant, the country's biggest oil refinery,
when a gas leak caused an explosion that killed 42 people, injured dozens and
damaged 1,600 homes. Asdrúbal Chavez, Vice-President of Refining, Trade and
Supply of state oil company PDVSA (and a cousin of President Chavez), says the
fire, is currently affecting one naphtha storage tank only, adding that the
situation is "completely under
control." He also said other refinery facilities are operating
normally. President Chavez says the fire will be extinguished shortly and ruled
out sabotage. (Reuters, 09-20-2012; http://www.reuters.com/article/2012/09/20/venezuela-refinery-idUSL1E8KK5EJ20120920;
El Universal, 09-20-2012; http://www.eluniversal.com/economia/120920/pdvsa-daily-operations-continue-despite-fire-in-refinery;
Bloomberg, http://www.bloomberg.com/news/2012-09-20/pdvsa-working-to-extinguish-fire-at-el-palito-naphtha-tank.html;
The Washington Post, http://www.washingtonpost.com/business/fire-at-venezuelan-oil-refinery-likely-sparked-by-lightning-officials-say/2012/09/20/0310c0a2-032f-11e2-9132-f2750cd65f97_story.html;
El Universal, 09-20-2012; http://www.eluniversal.com/economia/120920/authorities-fire-at-el-palito-refinery-may-be-put-out-in-the-next-hour;
and more in Spanish: El Universal, 09-21-2012; http://www.eluniversal.com/economia/120921/pdvsa-espera-controlar-hoy-incendio-en-refineria-el-palito)
Venezuela and China agree to
increase cement production
The Government and the Catic Beijing Chinese firm have signed an
agreement to increase production at the Cementos Andino plant in Trujillo
state, from 750,000 to 1.2 million tons per year. The plant is expected to
double production over 16 months after a U$D 239.76 million investment. More in
Spanish: (AVN, 09-21-2012; http://www.avn.info.ve/contenido/venezuela-y-china-suscriben-acuerdo-para-aumentar-producción-cementos-andino;
El Universal, http://www.eluniversal.com/economia/120921/empresa-china-ampliara-produccion-de-cemento-andino)
International Trade
Logistics
& Transport
Nine cargo food ships waiting at
anchor in bay
There are 25 ships waiting at anchor in areas A and B of the bay of
Puerto Cabello for entry into the local docks. The number increased since last
Monday. Nine freighters: Day Dream Believer, Bassic Ocean, Marataha Promise,
Emely Balket, Ijsselborg, Basic Brave, Pamir, Tampa and Tao UBC Brave are
bearing food in bulk loads as yellow corn, paddy rice, malt and sugar. More in
Spanish: (El Carabobeño, 09-20-2012; http://www.el-carabobeno.com/impreso/articulo/32338/-nueve-buques-con-cargas-alimenticias-esperan-fondeados-en-baha)
Politics
Henrique Capriles met with Colombian
President Juan Manuel Santos
Colombian President Juan Manuel Santos met with
Presidential candidate Henrique Capriles Radonski, in his office at the Bogotá
Presidential Palace. At the meeting, President Santos reaffirmed Colombia's
neutrality toward the Venezuelan elections, hoped for a massive and peaceful
participation of the Venezuelan people, and addressed the need to continue
harmonious efforts to foster Colombia-Venezuela relations. (El Universal, 09-20-2012; http://www.eluniversal.com/nacional-y-politica/120920/president-santos-remains-neutral-in-venezuelan-presidential-election)
Chavez cites telephone tracking poll
showing him 14.7% points above Capriles
According to the alleged DATANALISIS telephone tracking
poll, President Chavez now has a 43.8% vote intention, against 29.1% for
Capriles. The report is said to show that on the basis of 1200 telephone calls
to people somewhat certain and very sure they will vote, 8.8% did not answer
and 14.4% said they "didn´t know", which amounts to 23.2% potential swing
votes. The President reported these results on national television but did not
clarify how he obtained them. More in Spanish: (El Universal, 09-21-2012; http://www.eluniversal.com/nacional-y-politica/120921/segun-sondeo-chavez-esta-147-puntos-sobre-capriles)
Cardinal Urosa calls on Venezuelans
to vote "bravely" on
October 7th, and
Caracas Archbishop Jorge Cardinal Urosa also called voting a "serious moral obligation",
and called on Venezuelans to vote massively on October 7th, "according to their own conscience". He added: "Only God will know for whom we vote. Reject improper threats." More in Spanish: (El Universal, 09-21-2012; http://www.eluniversal.com/nacional-y-politica/120921/urosa-llama-a-los-venezolanos-a-votar-con-valentia-el-7-0)
Cancer? What cancer? Chavez's health
off radar as vote nears
Just months ago, it was the issue dominating Venezuela
and its presidential campaign. Now Hugo Chavez's bout with cancer is barely
mentioned as his Oct. 7 re-election bid approaches. Once-frenetic rumors about
Chavez's health have cooled to almost nothing while voters prepare to decide
who will lead Venezuela - and control its vast oil reserves - for the next six years.
Chavez, a socialist firebrand known for lambasting the U.S. "empire," faces market-friendly
challenger Henrique Capriles, a 40-year-old lawyer and state governor who has
vowed to end the seizure of private businesses and create jobs by attracting private
investment. (Reuters, 09-19-2012; http://www.reuters.com/article/2012/09/19/venezuela-election-cancer-idUSL1E8KHDI020120919)
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