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.

Friday, March 1, 2013

March 01, 2013

INCLUDED IN THIS ISSUE are two special reports: The US State Department Venezuela 2012 Crime and Safety Report; and "The permanent crisis in Venezuela" by Ambassador Jaime Daremblum who is a Hudson Institute Senior Fellow and directs the Center for Latin American Studies."

Economics & Finance

Venezuela is the only petro-state with debt 50% more than GDP
Based on statistics from the International Monetary Fund, Venezuela's debt by the third quarter of 2012 - before devaluation - was 51% of the gross domestic product (GDP). It is estimated that after devaluation this percentage could rise to 70%. (El Universal, 02-28-2013;

Scarcity in Venezuela resembles wartime situations
According to a study of 182 countries by MIT Professor Roberto Rigobón, scarcities in Venezuela are similar to those afflicting nations at war or undergoing a natural catastrophe. He says that only 17% of the basic food basket can be found in Caracas due to problems in distribution and to price controls. More in Spanish: (El Nacional, 03-01-2013;; El Universal,

Government admits it is "very hard" to fight inflation
Vice President Nicolas Maduro told the National Assembly it is "very hard to defeat inflation" and announced there will be action soon against FOREX "speculators".  He pointed to three anti-inflationary actions needed: increased production, fighting price "speculation" as well as the "poor use of FOREX". More in Spanish: (Últimas Noticias, 03-01-2013;

Maduro estimated 62.5% of national income went to social plans from 1998 to 2012, as he told the National Assembly that out of U$D 883 billion that came in, U$D 551.639 billion were invested in health, education, culture, nutrition, sports and others. More in Spanish: (AVN, 03-01-2013;

Government investigates U$D recipients through Sitme
The Government has ordered audits on companies that received US dollars through the recently eliminated Transaction System for Foreign Currency Denominated Securities (SITME), which allowed companies to acquire US dollars through a bond sale market. (El Universal, 02-28-2013;

New taxes are among instruments included in the fiscal overhaul the National Assembly’s Finance and Economic Development Committee is working on, according to its chairman Deputy Ricardo Sanguino. (Veneconomy, 02-27-2013;


Gasoline subsidy cost estimated at U$D 16 billion
Oil and Mining Minister Rafael Ramírez refers to the "irrational" use of fuel, but has pledged the price of gasoline will remain unchanged. However, Pedro Luis Rodríguez, who coordinates IESA's International Center on Energy and Environment, has estimated the cost of keeping such low gasoline prices was U$D 16 billion last year. More in Spanish: (El Universal, 03-01-2013;

Oil derivate imports from the US rose 174%, exports dropped 45% due to accidents at the Amuay and El Palito refineries, according to data from the US Energy Department. Products imported include 34,000 BPD of refined gasoline for immediate motor use. More in Spanish: (El Universal, 03-01-2013;

PDVSA to invest U$D 25 billion in domestic oil production
Energy and Oil Minister, Rafael Ramirez, says state oil company PDVSA will invest U$D 25 billion in domestic oil production this year, to find new oil fields in the east of the country, continue gas re-injection projects and supervise development of the Orinoco Oil Belt. (AVN, 02-27-2013;

Officials claim Amuay refinery will be back to normal in April
Asdrúbal Chávez, vice-president of the Refining and Commercialization Office of Venezuelan state-run oil company Pdvsa, and Jesús Luongo, general manager at Paraguaná Refining Complex (CRP), say the Amuay refinery in northwest Venezuela, will be at optimum operation level –the same it had prior to the explosion in August 2012- by April, after completing repairs in atmospheric distillation unit number five, which has been out of service since the blast. Referring to Amuay's flexi-coke unit, Luongo said commissioning is scheduled for March 15, but stressed that "it is very complicated" and may take between 7-10 days to boost unit capacity to 64,000 bpd. (El Universal, 02-28-2013;

Food imports rose 366% between 1999 and 2012, says IESA Professor and agribusiness expert Carlos Machado Allison. He says purchases abroad in the agro-food sector rose from U$D 75 per person before 1999 to over U$D 250. (Veneconomy, 02-27-2013;

International Trade

VENAMCHAM says bilateral Venezuela-US trade dropped 31.76%, despite a 42.84% increase in imports from the US. More in Spanish: (El Nacional, 03-01-2013;

Weatherford sees U$D 60 million Q1 loss from Venezuela devaluation
Oilfield services company Weatherford International Ltd said on Wednesday the devaluation of Venezuela's currency would cost it U$D 60 million in the first quarter, for which it is already forecasting lower-than-expected profits. The Venezuela loss for Weatherford was greater than the combined impact on Baker Hughes Inc and Halliburton Co - bigger rivals with less exposure to the country, which this month devalued the bolivar by 32%. (Reuters, 02-27-2013;


Poll shows 56.7% believe Chavez will recover
DATANALISIS President Luis Vicente León says the latest polls show most Venezuelans feel there is no power vacuum despite the absence of President Chavez. He said 56.7% believe Chavez remains ill but will recover; 14% say he will not recover, another 13% believe his health is getting worse; 2.8% think he is dead, 1% believes he was never ill; and 12.5% say they do not know or do not respond. 46% believe he is not currently making decisions. More in Spanish: (El Universal, 03-01-2013;

Vice president says Chavez battling for health and life; president out of sight
Vice president Nicolás Maduro is now saying that President Hugo Chavez is fighting for his life as he continues to undergo treatment more than two months after his latest cancer surgery. Maduro went on television to say that Chavez “is battling there for his health, for his life, and we’re accompanying him.” The vice president has used similar phrasing in the past; saying on Dec. 20 that Chavez “is fighting a great battle ... for his life, for his health.” (The Washington Post, 02-28-2013;; Fox News,

OAS's secretary general says "it is time to make decision" in Venezuela, calling the judiciary a problem
José Miguel Insulza, Secretary-General of the Organization of American States (OAS) is saying "It is time to make decision" in Venezuela, in referring to the lengthy convalescence of President Hugo Chávez.
Insulza also said the key problem in Venezuela is the judiciary.
(El Universal, 02-28-2013;

"Get better, but understand the country is also ailing
Students from different universities in the country remain in Chacao near the Supreme Court’s executive office. They demand the government “tell the truth” about Chávez’ health and the TSJ Chief “restitute the Constitution.” Yesterday, at least 15 students were injured due to brutal repression by National Guard troops. (Veneconomy, 02-27-2013;;

Prosecutors bring influence peddling charges against opponent of President Chavez
Venezuelan prosecutors have brought charges of influence peddling against a prominent opponent of President Hugo Chavez. Prosecutors claim Leopoldo Lopez accepted donations from the state-run oil company in 1998. The donations were purportedly authorized by the politician’s mother when she was working for Petroleos de Venezuela SA. Lopez allegedly used the donations to form an organization that later became one of Venezuela’s most popular political parties. A grant was made by PDVSA to Primero Justicia long before it became a political party. (The Washington Post, 02-28-2013;

Government commission to investigate “state terrorism” crimes in Venezuela between 1958 and 1998
The government has named a commission to investigate “state terrorism” crimes it attributes to administrations that alternated in power between 1958 and 1998. The group will be comprised of Attorney General Luisa Ortega and other pro government officials. Maduro told people attending the ceremony on the capital’s central square that the perpetrators of state terrorism “never imagined that justice would reach them.” (The Latin American Herald Tribune, 02-27-2013;

US could have a role in Venezuelan transition, according to Roberta Jacobson, Assistant Secretary of State of Latin America, who told a the House Western Hemisphere Committee that she believes "there is a role the US can play" in promoting free and fair elections. More in Spanish: (El Universal, 03-01-2013;

ALBA Foreign Ministers meet in Caracas
Foreign ministers from the Bolivarian Alliance for the Peoples of America (ALBA) are meeting in Caracas to discuss various items in the global agenda, according to Foreign Minister Elías Jaua. The group has evaluated a new transaction system which recently created "Sucre" currency for trade operations between member states. Foreign Ministers attending expressed support for President Chavez in his battle with cancer. (El Universal, 02-28-2013;; and more in Spanish: AVN;; El Nacional,; El Universal,

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.


Venezuela 2012 Crime and Safety Report

Overall Crime and Safety Situation

The U.S. Department of State rates the criminal threat level for Caracas as CRITICAL. In 2010, Caracas became the deadliest capital in the world with the highest murder rate in the world, averaging one murder every hour. Much of Caracas’s crime and violence can be attributed to mobile street gangs and organized crime groups. Caracas continues to be notorious for the brazenness of high-profile, violent crimes such as murder, robberies, and kidnappings. Armed assaults and robberies continue to be a part of everyday life. Every Caracas neighborhood is susceptible to crime. Reports of armed robberies occur regularly, day and night, and include the generally affluent residential sections of Chacao, Baruta, and El Hatillo, where host government, business leaders, and diplomats reside. Studies and reports cite a variety of reasons for the critically high and constant level of violent criminal activity in Caracas including: a sense that criminals will not be penalized; poorly paid and often corrupt police; an inefficient politicized judiciary; a violent and overcrowded prison system; overworked prosecutors; and the presence of up to 25 million illegal weapons in the country.

Crime Threats

Crime is by far the principal threat in Caracas, affecting both locals and foreigners. According to the Venezuelan government, the murder rate in Caracas was 91.71 per 100,000 inhabitants in 2011. However, according to the Venezuela Violence Observatory, a non-governmental organization (NGO), the murder rate in Caracas in 2011 was 200 per 100,000 inhabitants, one of the highest rates in the world. Nationwide, at least 19,336 people were killed in 2011, an average of 53 per day. Venezuela had a murder rate of 67 per 100,000 inhabitants in 2011. That compares to 32 per 100,000 last year in neighboring Colombia (22.7 per 100,000 people in Bogotá), 14 per 100,000 in Mexico, and 14 per 100,000 in São Paulo, Brazil’s largest city. Venezuela had more murders than Mexico (18,601 murders in 2011), which has four times the population (Mexico’s population: 113.4 million, Venezuela’s population: 28.8 million). Most violent crimes in Caracas, especially murder and kidnapping, involve firearms. There is no evidence to indicate criminals and gang-related activities specifically target U.S. citizens.

Crime in Venezuela can be attributed to several factors: impunity from prosecution, a dysfunctional judicial system, poverty, retribution, politics, gangs and drugs. Caracas suffers from areas of extreme poverty, which provide gangs and criminal elements with an environment conducive to crime and is subsequently difficult to police. The majority of violent crimes in Venezuela take place in areas of extreme poverty; however, due to their proximity to affluent areas/neighborhoods and the extremely low cost of gasoline, it is relatively easy for gangs and criminal elements to infiltrate these areas as well. Police are unable to protect less affluent neighborhoods, and as a result, crime is quite common, and criminals operate with impunity.

The majority of crimes that tend to dominate Caracas are "express" kidnappings, carjackings, robberies, and home invasions. Recently, there has been an alarming up-tick in organized gangs’ targeting travelers using the Simón Bolivar International Airport (CCS).

Home invasions involve large groups of heavily armed criminals who take over houses or apartment complexes and rob the owners and occupants. Home or apartment complex invasions are usually well planned and involve the use of a person on the inside or a scam (such as impersonating police, delivery personnel, or utility company personnel) to gain access. These attacks do not appear to target any one location or person specifically; police report that criminal gangs randomly target a location because of the perception that the occupants are wealthy. Home invasions have occurred in buildings where U.S. Embassy employees reside. Levels of gratuitous violence are on the increase, and the majority of criminals use lethal weapons in the course of carrying out their activities.

The majority of victims of robberies who have resisted criminal demands have been seriously injured as a result. Therefore, it is common practice in Caracas not to resist an attempted robbery. The best defense to these types of criminal gangs is not to open your doors to anyone that you are not expecting and do not know. It is important to instruct your family members, domestic staff, and apartment-complex vigilantes (guards) not to open the doors or accept deliveries from strangers. The Embassy recommends that apartments have functional alarm systems and strong deadbolt locks on all exterior doors.

Road Safety

Incidents of reported carjackings and car robberies remain a common occurrence in Caracas. In 2010, 27,977 vehicles were stolen in Venezuela, making it the second most common crime behind physical assault in the country. Statistics on car robberies in 2011 are not available. The Embassy has received reports of carjackings and robberies in areas near the Embassy. They often occur during peak traffic hours and at entrances and exits of major roadways. Perpetrators target four-wheel-drive models for carjackings. Armed bandits have stopped and robbed multiple travelers along the Caracas-La Guaira road, which connects the capital region with La Guaira port and Simón Bolivar International Airport, approximately 20 miles north of downtown Caracas.

Traffic jams are common in Caracas (regardless of the hour) and are frequently exploited by criminals. Armed motorcycle gangs often operate in traffic jams and tend to escape easily. Be particularly vigilant when stopped in traffic jams. Cases of armed robbery by motorcyclists and theft of other motorcycles have increased and may result in death if the victim does not comply.

If possible, avoid leaving your vehicle on the street when parking. Park inside a residential compound, in a parking lot with an attendant, or at least within view of the location you are visiting. When parking within a shopping facility lot, be sure to park as close as possible to the store entrance and away from dumpsters, bushes, or large vehicles. Be sure to lock your doors, close windows, and hide shopping bags and gifts/valuables in the trunk, out of sight. If there are no secure parking areas, select a well-lit and non-isolated spot as close to your lodgings as possible and, if possible, away from trucks, buses, dense shrubbery, or small buildings that might conceal thieves.

Driving regulations are similar to those in the United States, although many drivers do not obey them. Defensive driving is an absolute necessity. Motorcyclists weave in and out of lanes, so caution is advised. Outside the major cities, night driving can be dangerous because of unmarked road damage, repairs in progress, unlighted vehicles, and livestock. It is a common practice to ignore red traffic lights in the evening. Even in urban areas, road damage is often marked by a pile of rocks or sticks left by passersby near or in the pothole or crevice, without flares or other devices to highlight the danger. Many roads are unsafe, as rock slides are common. Traffic fatalities are common. Stopping at National Guard and local police checkpoints is mandatory. Drivers should follow all National Guard instructions and be prepared to show vehicle registration, proof of insurance, and passports. Vehicles may be searched.

If you are involved in a traffic accident, Venezuelan law requires that you do not move the vehicle until the traffic police arrive on the scene. It is recommended that you do not leave the scene of an accident unless you feel you may be in danger.

Political Violence

Historical Perspective

The threat of political violence remains an ever-present possibility. Civil disruptions are common in Venezuela and even small and seemingly peaceful rallies can rapidly deteriorate into violence without warning. Political marches and demonstrations are frequent in Caracas and around Venezuela. Harassment of U.S. citizens by pro-government groups, Venezuelan airport authorities, and some segments of the police occurs but is limited. Venezuela’s most senior leaders, including President Chavez, regularly express anti-American sentiment. The Venezuelan government’s rhetoric against the U.S. government and American culture and institutions has affected attitudes in what used to be one of the most pro-American countries in the hemisphere.

Regional Terrorism and Organized Crime

Cross-border violence, kidnapping, drug trafficking, smuggling, and cattle-rustling occur along the 1,000-mile long Venezuela-Colombia border. Some kidnap victims have been released after ransom payments, while others have been murdered. In many cases, Colombian terrorists or local guerrillas are believed to have been the perpetrators. Because of this threat, unofficial in-country travel by Embassy employees within a 50-mile area along the entire Venezuela/Colombia border is generally prohibited and only undertaken with the approval from the Chief of Mission. The State Department warns American citizens not to travel within this same area. U.S. citizens who elect to visit areas along the border region could encounter Venezuelan military-controlled areas, may be subject to search and arrest, and may be at increased risk from the Colombian-guerrilla terrorist threat.

International and Transnational Terrorism

The Embassy is unaware of any large-scale terrorist attacks carried out on Venezuelan territory.

Colombia's National Liberation Army (ELN) and the Revolutionary Armed Forces of Colombia (FARC) are designated by the Secretary of State as Foreign Terrorist Organizations. Both groups use Venezuela as a safe haven.

The State Department has stated that the Lebanon-based terrorist organization Hezbollah is using Venezuela mainly for fundraising. However, Venezuelan media reports suggest Hezbollah is also active in training, money laundering, and arms trafficking.

Civil Unrest 

Travelers should be aware that violence, including exchanges of gunfire and tear gas, has occurred at political demonstrations. Demonstrations tend to occur at or near university campuses, business centers, and gathering places, such as public squares and plazas. Marches generally occur on busy thoroughfares and attempt to disrupt traffic significantly. Most major tourist destinations, including coastal beach resorts like Margarita Island, have not been affected by protest actions. However, the city of Merida has been the scene of frequent demonstrations, some of them violent, including the use of firearms and tear gas. Travelers are advised to take common-sense precautions and avoid large gatherings and demonstrations, no matter where they occur.

There were reports of minor criminal activity during the Venezuelan parliamentary elections that took place on September 26, 2010. Presidential primary elections took place in February 2012, and the presidential election will be held on October 7, 2012.

On March 26, 2011, approximately 100 protesters demonstrated in front of U.S. Embassy Caracas against the U.S. involvement in Libya. Some protestors defiled Embassy property and physically assaulted two members of the Embassy staff; there was one minor injury.
Industrial and Transportation Accidents

As the economic and commercial center of the country and the most populated city, Caracas sees its share of industrial and transportation incidents. Vehicle accidents involving hazardous chemicals on the major highways are not common but do occur, causing roadways to be closed for significant periods. Due to mountainous terrain, Venezuelan roadways employ multiple large tunnels. When accidents occur inside these tunnels, the flow of traffic is often blocked for hours until emergency response services can clear the accident.

Pursuant to United States law, the Transportation and Security Administration (TSA) is required to conduct technical security visits to all international airports from which U.S. and foreign airlines provide direct service to the U.S. With host-government collaboration, TSA reviews airport operations using standards established by the International Civil Aviation Organization. TSA last visited the Caracas airport in January 2005 and those of Maracaibo and Valencia in November 2004. In September 2008, the Department of Homeland Security (DHS) decided to post public notices at U.S. airports stating that TSA had been unable to assess the safety and security standards of Venezuelan airports; it also required carriers to notify passengers in writing of the situation.

Due to government-mandated foreign exchange controls and artificially low, regulated ticket prices, domestic Venezuelan airlines have financial problems and may not be able to procure replacement parts and pay for regular repairs. Industry analysts estimate that of the 96 aircraft in the domestic fleet, only 43 are in service. Delays and flight cancellations are common in the domestic airline industry. When traveling with a Venezuelan airline carrier, travelers should review the airlines' safety records prior to use. Some serious incidents have occurred in recent years. For example, on March 22, 2010, a light airplane crashed due to engine failure in the northern residential area of Guarapiche, leaving seven dead. On August 23, 2011, a Laser Airlines flight was forced to return to the airport due to electrical problems in the cabin. On September 26, 2011, an Aeropostal passenger plane sustained substantial damage in a hard-landing accident at Puerto Ordaz Airport. Upon landing, the airplane touched down brusquely, causing both engine mounts to break from the fuselage. No serious injuries were reported. In another incident that same day, an Acerca Airlines DC-9 made an emergency landing after smoke was detected in the cabin.


Kidnappings -- whether traditional, express, or virtual -- are a growing industry in Venezuela. Because groups that specialize in these crimes operate without fear of incarceration, entrepreneurial criminals operate freely. Statisticians and police have openly stated that only 20-30 percent of all kidnappings get reported to the police. In 2009, reported kidnappings more than doubled from the previous year; an alarming 9.2 incidents of kidnapping per 100,000 inhabitants in Venezuela were reported.

Express kidnappings are a serious problem in Venezuela. Express kidnappings involved criminals forcing their victims to extract daily cash limits from ATM machines or credit cards until the card was shut off. Draining bank accounts was done while driving the victim around the city for several hours. However, changes in Venezuelan law restricting daily withdrawal amounts made this practice less lucrative. It has become more common for criminals to drive victims around for several hours to disorient them and allow time for family and friends to arrange ransom payments. There are reports of ransoms ranging from a few thousand dollars to US$50,000. As opposed to traditional long-term kidnappings, express kidnappings last less than 48 hours. The Venezuelan government does not report kidnapping statistics, but kidnap-for-ransom rates in Caracas have risen significantly in recent years. According to data released by the Venezuelan government’s Scientific, Criminal, and Forensic Investigation Agency (CICPC), 1,150 people were held hostage in 2011 in Venezuela. However, CICPC has openly stated that only 20 percent of all kidnappings get reported to the police. The NGO Venezuelan Violence Observatory claims that 9,000 to 16,000 kidnappings occur annually. Five abductions took place in Caracas every day during the last quarter of the 2011, police sources said. In March 2012, the U.S. Embassy in Caracas sent guidance to American citizens on how to react in express kidnapping situations.

Another common practice is for kidnappers to follow potential victims into building garages and kidnap them at gunpoint. Kidnappings of U.S. citizens and other foreign nationals from homes, hotels, unauthorized taxis, and the airport terminal do occur and are more frequently being reported to the Embassy.

Use ATMs located inside banks or hotels, rather than those on the street.

Both “virtual kidnappings” and “inside kidnappings” have been reported to the Embassy. U.S. citizens should be alert to their surroundings and take necessary precautions. Virtual kidnappings involve scam surveyors who collect contact information on minors that is then used to call parents for ransoms without the children actually being taken. “Inside kidnappings” involve domestic employees being paid large sums of money for keys and information to enter and kidnap children for ransom.

Drug and Narcoterrorism

The presence of Colombian narcoterrorists along the border region is of particular concern. Cross-border violence -- to include kidnapping, drug trafficking, and smuggling -- occurs with impunity. Venezuela is a major drug-transit country. Lack of international counternarcotics cooperation and a shift in the trafficking patterns in Venezuela has enabled a growing, illicit drug transshipment industry. Venezuela has become one of the preferred routes for trafficking illicit drugs out of Colombia. While the majority of narcotics continue to pass through Venezuela to the U.S., a rapidly increasing percentage has begun to flow toward Europe. U.S. intelligence reports an increase of nine percent in cocaine volume departing Venezuela to other countries, from 130 metric tons in 2010 to 143 metric tons in 2011. The U.S. was the biggest importer of drugs in 2011, accounting for nearly 94 percent (134,394 metric tons). The movement of drugs has fueled the growth of crime and violence throughout Venezuela, evidenced by the continuing growth of violent crimes by organized criminal groups.

Police Response

Police support varies, both at the national and municipal levels. Police authorities cite a lack of resources, under-staffing, payroll issues, and lack of response by the judicial and correctional systems among the key reasons why response times are delayed and a significant number of criminals go unpunished. While municipal police are often tasked with responding to crimes, the national police are responsible for investigating and prosecuting the cases. Challenging infrastructure problems and prolific corruption within law enforcement and the judicial system continue to be important factors in crime response and prevention. Venezuelan law enforcement entities look for creative policing strategies to overcome these obstacles, e.g. community policing base stations, motorcycle and bicycle patrols, and augmented traditional foot and vehicle policing. The Minister of Justice announced that police were involved in 15 to 20 percent of crimes in 2009, the last year figures were reported.

A study released in February 2010 revealed that 91 percent of all homicides reported go unpunished. The small chance of being arrested for committing murder may be responsible for the increase in violent crime. According to police contacts, armed robberies and assaults increased by 20 percent and 18 percent, respectively, during the first two months of 2012, compared with 2011 figures.

Tips on How to Avoid Becoming a Victim

Visitors should practice common-sense preventative security techniques, just as they would in any large metropolitan city in the world where crime is prevalent.

Below are some of the more important tips visitors should follow to avoid becoming a potential crime victim.
•           Do not carry or wear valuable items (such as jewelry and watches) that will attract the attention of thieves.
•           Do not physically resist any robbery attempt. While this is a personal decision, statistics show that resistance is more likely to lead to severe consequences such as injury or death.
•           Using public transportation is strongly discouraged, as buses and the subway pass through high-crime areas and are susceptible to robberies. In 2010, several public buses were stopped and robbed while on the road between Caracas and Simón Bolivar International Airport. All the occupants on board were robbed, and the drivers were killed. Criminals have begun to target subway platforms as well.
•           Avoid using international credit cards while in Venezuela. Credit card fraud and scams have been reported to the Embassy, even at respected local restaurants and major hotel chains in Caracas. If travelers have to use a credit card, ensure that the credit card stays in your sight and remember to monitor the billing activity on that card for several months after you return home.
•           Only use legitimate radio-dispatched taxis at designated taxi stands or have your hotel call one for you directly. Also, most centros comerciales (malls) have taxi stands, which have usually been reliable.
•           Be aware of the street environment and avoid contact with those who may be looking for potential crime targets. Seek a safer location. Go into a store, bank, or simply cross the street and alter your route.
•           Do not withdraw large amounts of cash from banks or ATM machines. If you need to withdraw a large sum of money, request a check. The Embassy has received reports of people who were targeted and robbed as they exited local banks.
•           Use well-traveled, well-illuminated streets. Plan your routes before you leave for your final destination.

Corruption at the Simón Bolivar International Airport is rampant. Both arriving and departing travelers have been victims of personal property theft and muggings. The Embassy has received multiple, credible reports that individuals wearing what appear to be official uniforms or other credentials are involved in facilitating or perpetrating these crimes. All travelers should be wary of all strangers, even those in official uniforms or carrying official identification, and should not pack valuable items or documents in checked luggage. Documents and valuable personal items should be kept in carry-on luggage. The Embassy has also received multiple, credible reports of victims of “uniformed” airport officials attempting to extort money from travelers as they go through the normal check-in and boarding process for departing flights. Furthermore, the embassy has received reports that known drug trafficking groups work from the airport. Local media reports indicate officers of the Venezuelan National Anti-Drugs Office (ONA) and CICPC routinely arrest travelers attempting to smuggle illegal drugs. Travelers should not accept packages from anyone and should keep their luggage with them at all times.

The road between the Simón Bolivar International Airport and Caracas is a notoriously dangerous road. Visitors traveling this route at night have been kidnapped and held captive for ransom in roadside huts that line the highway. Because of the frequency of robberies at gunpoint, travelers are encouraged to arrive to and depart from the airport only during daylight hours. If not possible, travelers should use extra care both in and outside the airport at night.

In October 2011, an Avianca Airlines flight crew was en route to the airport from the Marriott Playa Grande Hotel at approximately 5:30 a.m. As the shuttle was approaching the international terminal, three armed individuals boarded and demanded that the driver keep driving and circle the airport. The crew was robbed of jewelry, money, and electronic devices. Afterwards, they demanded that the driver let them off at a pedestrian bridge and escaped to the nearby neighborhood called Barrio Aeropuerto.

Areas to Avoid and Best Security Practices

Pickpockets and grab artists operate in greater Caracas. However, they are mostly active in the historic city center downtown: around the Plaza Simon Bolivar, near the Capitolio, in the Sabana Grande area, in the Parque Los Caobos, and at crowded bus and subway stations.

The crime threat in Caracas is critical due to the violence and frequency of criminal activity throughout Venezuela. Crime continues to be the principal threat to locals and visitors. Armed street robberies are common in Caracas and most cities in Venezuela. Victims have been robbed at gunpoint while walking on the street and while driving. The high volume of vehicular traffic, combined with the poor conditions of roads, has created major traffic problems within Caracas. Armed bandits patrolling the streets on motorcycles prey on potential victims waiting at traffic lights or stuck in heavy traffic. Keeping windows rolled up and doors locked and keeping valuables out of sight (to include iPods, cell phones, Blackberrys) are the best defenses against this type of random criminal activity.

The poor neighborhoods that cover the hills around Caracas are extremely dangerous. These areas are seldom patrolled by police and should be avoided.



By Jaime Daremblum
February 25, 2013

According to a leading Spanish newspaper, Hugo Chávez's doctors have told his family that the cancer-stricken autocrat will not recover from his illness and will not be able to resume the Venezuelan presidency. Perhaps that's why his return to Venezuela was a relatively subdued affair. Chávez reportedly arrived from Cuba—where he has now received four surgeries—in the pre-dawn hours on Monday, February 18. "There were no television images or photographs of him descending from the presidential plane in a track suit and greeting officials on the tarmac, as there were in the past," observed New York Times correspondent William Neuman, "raising questions about whether the government was seeking to keep a severely weakened president out of public view." For that matter, Bolivian president (and Chávez acolyte) Evo Morales was not able to meet with Chávez during his February 19 visit to Caracas.

Chávez came home to a nation in crisis—a crisis largely of his own making. To be more precise: There is no single crisis in Venezuela; there are multiple, interrelated crises that have transformed an oil-rich society into a dysfunctional, violent, inflation-plagued country with major food shortages and one of the highest murder rates in the entire world. Venezuela is a place where athletes are in danger of catching a stray bullet during their games. (Seriously: That actually happened to a Hong Kong baseball player in August 2010.) As Nick Allen of the Daily Telegraph recently pointed out, Venezuela now has more homicides than the United States and the European Union combined, even though its population is about 28 times smaller.

Between 2011 and 2012, its already sky-high murder rate rose by another 9 percent, and its annual number of murders rose by 12 percent, according to the independent Venezuelan Observatory of Violence. Its capital city of Caracas has been "the deadliest capital in the world" since 2010.

Here's how journalist David Frum described his 2010 trip to Venezuela: "My visit began with a briefing at the U.S. Embassy. 'You've been to Afghanistan?' Yes. 'You've been to Iraq?' Yes. 'Well, congratulations. This is the most dangerous place you've ever been.'" Indeed, Venezuela is a true gangster's paradise: a nation that has emerged as a major cocaine hub, with a ruling regime that has empowered drug kingpins, has maintained longstanding ties to the Colombian FARC, and has purchased some 100,000 Russian assault rifles.

Not surprisingly, Venezuela has a disgracefully overcrowded and violent penitentiary system. Last month, a prison riot in its fourth-biggest city (Barquisimeto) left several dozen people dead and more than 100 injured. According to the Associated Press, the jail where this violence occurred was built for roughly 850 prisoners but was holding approximately 2,400 at the time of the riot. Afterwards, Venezuelan authorities evacuated the facility and discovered 106 guns, including "revolvers, shotguns, submachine guns, and assault rifles used by the military." They also discovered upwards of 8,000 ammunition rounds.

Venezuela's security crisis has worsened its economic crisis. Under Chávez-style socialism, the government routinely seizes broadcasting stations, banks, food factories, and other private property. In the Heritage Foundation's 2013 Index of Economic Freedom, no country scores worse for property rights than Venezuela—even Cuba (!) scores higher in that category.

As you might imagine, the South American nation has been suffering from massive capital flight, which is why the regime long ago implemented draconian currency controls. Its fiscal profligacy has produced runaway inflation and a huge budget deficit. Yet Caracas dramatically ramped up money creation and government spending ahead of Venezuela's October 2012 presidential election, to help guarantee another term for the ailing Chávez. The numbers really are quite astounding: "In 2012 alone," notes former Venezuelan trade minister Moisés Naim, "the money supply expanded 62 percent while public spending grew 52 percent."

Now the regime is trying to close its enormous deficit and avoid a sovereign default. Thus, on February 8, Venezuela announced a 32 percent devaluation of its national currency, prompting citizens to rush out and buy a range of domestic appliances and other imported goods before the prices went up. Harvard economist Francisco Monaldi has predicted that the devaluation could increase Venezuelan inflation by 30 percent this year, and also slash real incomes by 20 percent. Obviously, this would hurt the poor more than anyone else. Inflation is already running at 22 percent, and "about 70 percent of products consumed in Venezuela are imported or assembled from raw material shipped from abroad," according to Bloomberg News.

In other words, Chávez's designated successor, Vice President Nicolás Maduro, may soon face an economic challenge of historic proportions. Maduro will inherit an economy that ranks sixth from the bottom in the World Bank's 2013 Ease of Doing Business Index, and that ranks dead last for paying taxes. The Latin Business Chronicle has reported that Venezuela requires 70 tax payments each year, "the highest number in Latin America and more than double the regional average of 29."

The country's economic and security crises would be easier to solve if Venezuela were still a real democracy. But it patently is not. Chávez and his allies have been building an elected dictatorship for more than a decade: trampling press freedom, persecuting their critics, packing the supreme court, and granting the president autocratic powers. Yet even by Venezuelan standards, the shenanigans of the past two months have been truly outrageous.

Government officials insist that Chávez is still officially the president—even though he was unable to attend the inauguration ceremony scheduled for January 10 and was not sworn in by either the national assembly or the supreme court, as the Venezuelan constitution demands. (Incidentally, that constitution was written by Chávez loyalists in 1999.) If Chávez's absence really is temporary, the constitution says that Maduro must formally become president until Chávez can return to the job. If his absence is permanent, the constitution says that the speaker of the national assembly, Diosdado Cabello, must become president and must call an election within 30 days. Yet neither Maduro nor Cabello has been made president, and no election has been called. Venezuelan officials are thus openly defying their constitution. They are behaving like the old Soviet apparatchiks who would secretly plot leadership transitions behind closed doors.

A constitutional crisis, an economic crisis, and a security crisis: Add them all together, and Venezuela is experiencing a permanent societal crisis that will outlive its dying autocrat.

Ambassador Jaime Daremblum is a Hudson Institute Senior Fellow and directs the Center for Latin American Studies.

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