Economics & Finance
Deficit is estimated at VEB 71
billion, according to the report on
financial impact attached to the Law on Special Contributions for Extraordinary
Oil Prices. More in Spanish: (El Universal, 02-26-2013; http://www.eluniversal.com/economia/130226/estiman-en-bs-71-millardos-deficit-del-gobierno-central)
Giordani calls for increased
agriculture production
Finance and Planning Minister Jorge Giordani says the
government can fight inflation by raising national production, particularly
foods, in order to meet demand arising from high liquidity. He says: "We can import, but we need to produce
whatever we can, and this is the effort we must make if we are to abate
inflation". More in Spanish: (Tal Cual, 02-26-2013; http://www.talcualdigital.com/index.html)
Central Bank of Venezuela expands
VEB 100-bill issue by 97%
Relentless price increases force consumers to use more a high
value bills and use fewer bills and coins for VEB 2 and VEB 5. Consequently, official
data shows that in 2012 the Central Bank printed more than 272 million VEB 100 bills
–a 97% increase over the number of bills printed in 2011 and three times more
than those issued in 2010. (El Universal, 02-25-2013; http://www.eluniversal.com/economia/130225/central-bank-of-venezuela-expands-veb-100-bill-issue-by-97)
Giordani claims outstanding social economic progress
"What we have achieved is an
outstanding progress. It is evident in all indicators. The (UN) millennium
goals, poverty reduction, Gini coefficience with the best incomes distribution
in Latin America. And this has to be preserved," says Sunday Planning
and Finance minister Jorge Giordani. (AVN, 02-25-2013; http://www.avn.info.ve/contenido/outstanding-social-economic-progress)
Commodities
Amuay Refinery recovery will take a
year, fuel imports to continue
According to plant operators and experts recovering Amuay
Refinery will take at least one year and it is operating at 52% capacity.
Consulting engineer Nelson Hernández says: "11 tanks were damaged and must be built, and this will take at least 6
months if we were to start today. In addition, infrastructure must be prepared
and cannot be expected to be ready by September. Everything indicates fuel
imports will continue unless rationing is undertaken - such as is being done in
electricity and possibly extending the use of chips to control gasoline sales".
US Energy Department data shows that after the Amuay accident PDVSA exports to
the US dropped around 40%, down to 38,000 barrels per day from 64,000 BPD, and
Venezuela that imports an average 108,000 BPD. More in Spanish: (El Nacional, 02-26-2013;
http://www.el-nacional.com/; El
Universal, http://www.eluniversal.com/economia/130226/la-refineria-amuay-opera-a-52-de-su-capacidad-instalada)
Venezuela, China negotiating contract to boost steel
production
Venezuelan aluminum producer CVG and Chinese company
Minmetals Engineering are analyzing a contract aimed at to develop two projects
to increase production at the SIDOR steel company in southern Bolivar state.
SIDOR president Rafael Gil Barrios said the first project is to increase operational
capacity and labor safety by recovering lines in the etching area at SIDOR's
hot rolled flat product and steel sheet plant. The second plan calls for installing
a new continuous casting machine to manufacture 550,000 tons of hot rolled
steel billets, used to manufacture seamless pipes required by the oil industry,
according to a SIDOR press release. (AVN, 02-25-2013; http://www.avn.info.ve/contenido/venezuela-china-evaluate-contract-boost-steel-production)
State-run basic industries raise prices
46.5%
Whereas private companies are being pressured by
Government to avoid increasing prices after devaluation, state-run industries
are adjusting prices along the lines of the new FOREX rate. Such is the case of
basic industries in Guayana, where prices have been increased by 46.5%. SIDOR
adjusted prices upwards, and the price of products purchased prior to
devaluation but not dispatched will be recalculated based on the new forex
rate, VEB 6.30 per US dollar. (El Universal, 02-25-2013; http://www.eluniversal.com/economia/130225/venezuelan-state-run-basic-industries-increase-prices-by-465)
Investigation sought into aluminum
trading in Guayana
Ricardo Menendez, Vice Minister for Economic Production asked the
Interior and Justice Ministry to undertake an intensive investigation "to the ultimate consequences" of
aluminum trading at the Guayana basic industries. In a press release he said:
"The matter is crucial in order to
rescue our basic industries". More in Spanish: (AVN, 02-26-2013; http://www.avn.info.ve/contenido/men%C3%A9ndez-solicita-investigaci%C3%B3n-comercializaci%C3%B3n-aluminio-guayana)
International Trade
An estimated 27.4% official imports were
bogus, says ECOANALITICA
Distortions are increasing ten years after FOREX
restrictions were put in place in Venezuela. Official imports at the official
exchange rate seemingly encourage overbilling and other types of cheating.
Total imports in 2012 were U$D 56.3 billion, of which U$D 15.4 billion (27.4%) were
fictitious according to estimates by ECOANALITICA consulting firm. Most of the
overbilling was done by government entities. Overbilling means showing a sale
price higher than the actual price, this obtaining currency allocation greater
than those needed to acquire goods. (El Universal, 02-23-2013; http://www.eluniversal.com/economia/130223/an-estimated-274-of-venezuelan-govt-imports-never-happened)
Venezuela imports over U$D 1 billion
in Brazilian beef
Fernando Portela, director of the Venezuela-Brazil Chamber
of Commerce, says Venezuela currently imports more Brazilian foods like beef,
chicken, roasted coffee and sugar. He says Venezuela and Brazil trade was U$D 6
billion in 2012. "Venezuela imported
and exported U$D 5.1 billions, there is an imbalance there, a large asymmetry
between the Brazilian export trades," he says, adding that the pattern
of imports from Brazil has changed over the past 10 years. "Today Venezuela imports more food from Brazil.
35% are food products and commodities such as live cattle almost reached U$D
400 million." More in Spanish: (El Mundo, 02-25-2013; http://www.elmundo.com.ve/Noticias/Economia/Politicas-Publicas/Venezuela-importa-mas-de-$1-000-millones-en-carnes.aspx)
Most Colombia trade went through
SITME
Venezuela-Colombia trade is reported at U$D 175 million at the start of
2013, with U$D 44 million in exports to Colombia and U$D 131 million in imports
from Colombia, according to Luis Alberto Russian, President of the
Venezuela-Colombia Integration Chamber. He says these figures do not reflect
the impact of devaluation, but adds that according to a recent poll of Chamber
members 54% reported using the now abolished SITME parallel system. More in
Spanish: (El Universal, 02-26-2013; http://www.eluniversal.com/economia/130226/mayoria-del-comercio-con-colombia-se-realiza-con-el-sitme)
Logistics
& Transport
Government approved acquisition of
machinery and equipment to improve port operations
Elsa Gutierrez, Minister for Aquatic and Air Transport and President of
the BOLIPUERTOS port authority has announced that the government approved the
acquisition of 100 machines and spare parts needed to improve port activity.
She said they would invest one million euros for parts and U$D 39.228 million
228 to purchase machinery and spare parts. Equipment is to be supplied by international
companies, such as: Liebher Werk Nenzing, Cargotec and Cargo Solutions INC
Equipment. More in Spanish: (Bolipuertos, 02-25-2013; http://www.bolipuertos.gob.ve/noticia.aspx?id=6827)
Politics
Despite homecoming, Chavez still out
of sight
From a billboard bearing his face, to a giant inflatable
doll and posters hawked on the street below, there is no shortage of images of
Hugo Chavez at the Caracas military hospital where he has been since returning
from Cuba. Yet there has been no sight of the 58-year-old Venezuelan
president since he came home - during the night and without photos or fanfare -
a week ago. His surprise return to Caracas raised supporters' hopes of a
recovery after December surgery in Havana that was his fourth operation in 18
months. But other than the government saying Chavez's breathing problem has
worsened, there have been no new details about the patient on the well-guarded
ninth floor. (Reuters, 02-25-2013; http://www.reuters.com/article/2013/02/25/us-venezuela-chavez-scene-idUSBRE91O0PK20130225)
Chavez opponents hold demonstration demanding answers
about president’s cancer
Hundreds of government opponents demonstrated Saturday to
demand answers about President Hugo Chavez’s condition while he remains out of
sight in a hospital, undergoing treatment more than 10 weeks after his latest
cancer surgery. The protesters also condemned the government’s most recent
economic measures, which have included a devaluation of Venezuela’s currency,
the bolivar. Some held signs with a photo of Vice President Nicolas Maduro and
a slogan saying the devaluation will mean “more
inflation.” Opposition leaders, though, mainly criticized the secrecy
surrounding Chavez’s diagnosis and treatment, saying many Venezuelans want the
government to be more forthcoming about the president’s condition. (The
Washington Post, 02-23-2013; http://www.washingtonpost.com/business/chavez-opponents-hold-demonstration-in-venezuela-demanding-answers-about-presidents-cancer/2013/02/23/0669a900-7e20-11e2-9073-e9dda4ac6a66_story.html;
Fox News, http://www.foxnews.com/world/2013/02/23/chavez-opponents-hold-demonstration-in-venezuela-demanding-answers-about/)
Maduro claims Chavez held 5-hour meeting with Cabinet
According to Vice President Nicolás Maduro, ailing President Hugo Chavez
discussed economic policy and national security with his Cabinet for five hours
yesterday at a military hospital in Caracas. Maduro went on public television
to say Chavez and his team worked on measures to fight inflation and guarantee
resources in bolivars and dollars for public spending, economic policy moves to
be announced over the coming weeks. “The
president was clear about the speculative attack on our currency and product
hoarding and said that we have to increase actions to fight the economic war
being waged by the bourgeois,” Maduro said. (Bloomberg, 02-23-2013; http://www.bloomberg.com/news/2013-02-23/venezuela-s-chavez-held-5-hour-meeting-with-cabinet.html;
El Universal; http://www.eluniversal.com/nacional-y-politica/130223/vp-maduro-says-he-met-with-chavez-for-more-than-five-hours; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=692847&CategoryId=10717)
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.
