April 05,2013

Economics & Finance

March inflation rose 2.8%, food prices up 3.3%, shortages at 20%

March inflation stood at 2.8%, for a cumulative total of 7.9% in Q1-20132. The Central Bank's shortage indicator was 20% for March. More in Spanish: (El Mundo, 04-04-2013; http://www.elmundo.com.ve/Noticias/Economia/Politicas-Publicas/La-inflacion-de-marzo--registro-una-variacion-de-2.aspx; El Universal, http://www.eluniversal.com/economia/130404/maduro-recibe-informe-sobre-alta-escasez-en-alimentos-basicos; More in Spanish: Últimas Noticias; http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/alimentos-echaron-un-brinco-en-marzo.aspx)

Price of imports up 7.4% in two months

After devaluation, wholesale prices for imported products rose 7.4% in January-February–the highest increase since 2003; and retailers must transfer this increase to consumers. Since government agencies cut down sales of FOREX, demand for dollars shot up, raising replacement costs in a considerable portion of the economy and causing a hike in prices of imported products. (El Universal, 04-03-2013; http://www.eluniversal.com/economia/130403/imported-products-up-74-in-two-months-in-venezuela)

Commodities

Venezuela's oil output averages 2.77 million BPD

Venezuela's lowest oil output in 2012 was recorded in the last quarter, and the trend continued in January-February this year. Data from by the Organization of Petroleum Exporting Countries (OPEC) and other oil-related organizations such as the Joint Organizations Data Initiative (JODI) show Venezuela's oil output in the fourth quarter of 2012 averaged 2.785 million barrels per day, based on data furnished by Venezuela directly to OPEC. Further, production in January-February 2013 averaged 2.757 million bpd. Based on this information, the oil production averaged 2.77 million bpd over the last five months, as reported by OPEC. (El Universal, 04-04-2013; http://www.eluniversal.com/economia/130404/venezuelas-oil-output-averages-277-million-bpd)

International Trade

Venezuela will implement MERCOSUR technical glossary today, Brazil and Argentine extend grace period

Venezuela today starts implementing the MERCOSUR technical glossary, according to the nation's National Tax and Customs Service (SENIAT).  "The new tariff includes the 10,025 items in the MERCOSUR Common Tariff and adds another 1,872 items to reflect specific national interests". Venezuela has been able to obtain a longer grace period for the automotive industry and sugar, which will be negotiated bilaterally with Brazil and Argentina, in four phases, according to Trade Minister Edmee Betancourt. More in Spanish:  (AVN, 04-05-2013; http://www.avn.info.ve/contenido/venezuela-adopta-este-viernes-nueva-nomenclatura-arancelaria-del-mercosur; El Universal, http://www.eluniversal.com/economia/130405/modifican-arancel-de-aduanas-por-ingreso-pleno-al-mercosur and El Mundo, http://www.elmundo.com.ve/Noticias/Economia/Internacional/Brasil-y-Argentina-daran-mas-tiempo-a-Venezuela-pa.aspx)

PDVSA spent U$D 978 million on food imports in 2012

PDVSA's 2012 Annual Report shows U$D 978 million were disbursed to pay for food imports abroad through its subsidiary BARIVEN. The amount is 4.2% of their U$D 22.9 billion investment plan for 2012. More in Spanish: (El Nacional, 04-05-2013; http://www.el-nacional.com/)

Politics

Opposition complains about military, laughs at acting President seeing Chavez in a bird

Venezuela’s presidential campaign on Wednesday veered between warnings of military meddling in the April 14 vote and opposition mirth at the acting president’s suggestion that the spirit of Hugo Chavez visited him as “a little bird” while he prayed. Opposition lawmaker Alfonso Marquina presented a complaint to Venezuela’s elections council, demanding it sanction officers who have publicly backed Nicolas Maduro, who has been acting president since President Hugo Chavez’s death on March 5. Marquina has alleged that Defense Minister Diego Molero and National Guard Gen. Antonio Benavides plan to use military resources to intimidate voters, especially those dependent on government services, to cast ballots for Maduro. Opposition candidate Henrique Capriles and his supporters have lambasted top-ranking military officers, including Molero and Benavides, for publicly backing Maduro in the April 14 election. But just one day after Chavez died, Molero said the military would follow instructions left by Chavez. He did not elaborate. (The Washington Post, 04-03-2013; http://www.washingtonpost.com/world/the_americas/venezuelas-opposition-high-ranking-officers-endorse-nicolas-maduro-in-violation-of-the-law/2013/04/03/26f73edc-9c7d-11e2-9219-51eb8387e8f1_story.html; ABC News, http://abcnews.go.com/International/wireStory/venezuela-opposition-military-sides-18872868#.UV39aZOTzHR; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=734418&CategoryId=10717;  Fox News, http://www.foxnews.com/world/2013/04/03/venezuela-opposition-high-ranking-officers-endorse-nicolas-maduro-in-violation/)

Capriles would oust Cubans from Venezuela's military

Opposition Presidential candidate Henrique Capriles Radonski has announced that if he wins in elections scheduled for April 14th he will order the departure of Cuban military officers within Venezuela's armed forces. "There will be no foreign interference within our Army", he said. He previously said he will not give away "a single drop of oil" to "fund political projects in other countries". More in Spanish: (INFOLATAM, 04-05-2013; http://www.infolatam.com/2013/04/05/venezuela-capriles-dice-que-si-gana-sacara-a-militares-cubanos-del-ejercito/)

Maduro will militarize electric system, threatens national riots if defeated

Acting President Nicolás Maduro told supporters the opposition had "infiltrated" their ranks. He said he will personally order the military high command to "militarize all electric installations nationwide and devise a special plan for protection against sabotage", as he said the opposition has a plan to cause a "general blackout". During the same speech, Maduro asked for people to vote for him, otherwise "we would have another 27 February sooner than you think", in reference to the 1989 riots quelled by the Armed Forces. More in Spanish: (INFOLATAM, 04-04-2013; http://www.infolatam.com/2013/04/04/venezuela-maduro-denuncia-sabotaje-electrico-y-amenaza-con-sacar-soldados-a-la-calle/)

Maduro's "little bird" and Election Board security breach dominate campaign

Acting President Nicolás Maduro keeps repeating a "happy" story of a little bird appearing to him, while opponents ask that he should be given a "mental examination". Maduro has insisted "I spoke of something very simple that happened to me yesterday, yes, it happened, it happened and I am happy it happened, it is my spirituality, and I felt like sharing it with the people". Opposition leader Leopoldo López is calling for Maduro to be given an "evaluation" to determine his "mental balance". At the same time, opposition Presidential candidate Henrique Capriles Radonski has demanded that Election Council President Tibisay Lucena respond to a charge that a United Socialist (PSUV) pro government party expert named Oscar Martínez was caught in possession of confidential codes that control starting up polling machines. Election Council member Vicente Díaz, close to the opposition, confirmed the "security breach", but emphasized if could not change voting results. More in Spanish: (INFOLATAM, 04-04-2013)

Elections Council VP claims electoral system is impregnable

National Elections Council Vice President Sandra Oblitas claims Venezuela's electoral system is absolutely inviolable, impregnable and incorruptible. She accused some political sectors of trying to confuse the population. "We have to be careful with statements and their tone because, beyond all things they say, the system is impregnable and even technicians of political organizations themselves confirm it day to day in the different audits," Oblitas said. She spoke in reference to statements by secretary general of the opposition coalition MUD, Ramon Guillermo Aveledo, who charged that a technician of the United Socialist Party of Venezuela had a key to access to electoral machines. (AVN, 04-04-2013; http://www.avn.info.ve/contenido/venezuela039s-electoral-process-impregnable; El Universal, http://www.eluniversal.com/nacional-y-politica/130404/electoral-body-venezuelan-voting-system-as-a-whole-is-invulnerable; http://www.eluniversal.com/nacional-y-politica/130404/chavezism-opposition-signed-election-audit-record-without-objection)

Insulza regrets Venezuela's failure to invite OAS to A14

OAS Secretary General José Miguel Insulza has expressed regret that the Venezuelan Government has not invited the multilateral organization to observe Presidential elections to be held next April 14. He also expressed concern about the inability of both Government and opposition to engage in dialogue. Venezuela's OAS Ambassador Roy Chaderton contends he did invite Insulza personally, but not OAS observers. (El Universal, 04-03-2013; http://www.eluniversal.com/nacional-y-politica/130403/insulza-regrets-venezuelas-failure-to-invite-oas-to-a14 and more in Spanish: El Universal; http://www.eluniversal.com/nacional-y-politica/130405/chaderton-dice-que-el-cne-si-invito-a-insulza-a-elecciones)

Brazil’s former president Lula da Silva supports ruling party candidate in Venezuela’s vote

Brazil’s former president, Luiz Inacio Lula da Silva, has voiced his support for ruling party candidate Nicolas Maduro ahead of Venezuela’s presidential election. Silva says he believes Maduro would be capable of accomplishing goals set by late President Hugo Chavez. Chavez and Silva were close political allies, and their two countries share close trade ties.  Silva says in the video he doesn’t want to meddle in Venezuela’s domestic affairs, but notes that Chavez singled out Maduro as his chosen successor before his death last month. (The Washington Post, 04-02-2013; http://www.washingtonpost.com/world/the_americas/brazils-former-president-lula-da-silva-supports-ruling-party-candidate-in-venezuelas-vote/2013/04/02/57ab4ef6-9ba6-11e2-9219-51eb8387e8f1_story.html; Fox News, http://www.foxnews.com/world/2013/04/02/brazil-former-president-lula-da-silva-supports-ruling-party-candidate-in/)

Venezuela ready to pay UN back dues, regain the right to vote

A high source within Venezuela's Foreign Ministry anonymously says the nation "understands its responsibility" to honor international commitments, and is "working with the UN to pay its back dues". Venezuela's voting rights at the UN were suspended due to a back debt of U$D 5.113 million in dues. More in Spanish: (El Universal, 04-05-2013; http://www.eluniversal.com/internacional/130405/venezuela-se-dice-dispuesta-a-honrar-su-deuda-con-onu)

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.