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, April 4, 2014

April 04, 2014

International Trade

Inbound cargo at Puerto Cabello
  • 25.000 tons of Argentine soybeans for Consorcio Oleaginoso Portuguesa.
  • 4.292 tons of Brazilian meat from JBS and Minerva for CASA.
  • 3.000 tons of construction material for PDVSA Industrial.
  • 1.975 tons of frozen meat (special cuts) has arrived from ALBALINISA, Costa Rica for CASA and over 670 tons from Comercial San Martín for CASA.
  • 684 tons of milk and cream milk from CENTROLAC for CASA
  • 284 tons of frozen chicken from Seaterliang for La Productora y Distribuidora de Alimentos.
  • 267 tons of coffee from ALBALINISA for Café de Venezuela.
  • 212 tons of auto parts for FORD Motor.
  • 136 tons of green peas from Prime Seeds Internacional for Comercializadora Agrícola Domínguez.
  • 78 tons of paper for Stock Papelero
  • Also ceramics, garlic, tires, cables and lamps.

Venezuelan imports from Colombia rose 28% in January-February, driven by fuel imports
Colombia's National Statistics Department (DANE) says Venezuelan imports from Colombia rose 28% in January-February, to U$D 430.5 million, as compared to U$D 336.2 million in the same time frame of 2013. The largest item is fuel, for U$D 200 million, an increase of 179%. More in Spanish: (El Mundo,

Venezuela sends machinery, supplies to strengthen Haitian agriculture
The Venezuelan government has dispatched a ship bearing machinery and supplies to strengthen Haiti's agriculture. National Armed Force commander Gilberto Pinto Blanco says 80 tractors, 30 milking machines and  breeders will be shipped in three phases. He told media another vessel will depart in four days. (AVN,

Oil & Energy

PDVSA to get U$D 625 million in funding from SUELOPETROL
Oil and Mining Minister Rafael Ramírez says an agreement has been reached with SUELOPETROL for financing U$D 625 million in the PETROCABIMAS project. He says PDVSA has received U$D 11 billion in resources from transnational oil corporations so far, but would not say how long the process would take. (El Universal,

Agreements have been signed to compensate oil service companies expropriated in 2009
Economic Affairs Vice President Rafael Ramírez has signed an agreement to compensate oil service companies expropriated in Zulia state in 2009. Companies to be indemnified for their property are Z&P, Atlántida Internacional, Ecope, Marítima Costa Azul, Vinccler and Zulia Towing. Ramírez said "other companies are missing" and now under review. More in Spanish: (La Verdad,


Government tackles food shortage with ID card system
Battling food shortages, the Venezuelan government is rolling out a new ID system that is either a grocery loyalty card with extra muscle or the most dramatic step yet towards rationing in Venezuela, depending on who is describing it. President Nicolás Maduro's administration says the cards to track families' purchases will foil people who stock up on groceries at subsidized prices and then illegally resell them for several times the amount. Critics say it's another sign the oil-rich Venezuelan economy is headed toward Cuba-style dysfunction. Registration begins at more than 100 government-run supermarkets across the country. Patrons will register with their fingerprints, and the new ID card will be linked to a computer system that monitors purchases. A local consumer watchdog, the National User and Consumer Alliance, invoked the specter of Cuba's struggling economy and called the ID program rationing by another name. It predicted that Venezuelans without cards would soon be barred from shopping at state supermarkets. (The Guardian:

CNH’s IVECO suspends Venezuela truck making on FOREX difficulties, auto makers in crisis
 CNH, the commercial-vehicle producer spun off from carmaker FIAT in 2011, said its IVECO unit halted production in Venezuela after currency devaluation caused “difficulties” with importing parts. “IVECO is reluctantly suspending, with immediate effect, its manufacturing operations in the country,” Amsterdam-based CNH said today. The truck maker will “resume manufacturing when market conditions improve and stabilize.” The move to suspend manufacturing follows FORD's decision in January to scale back production in the region because of the currency shortage. The Dearborn, Michigan-based carmaker said yesterday that it’s taking a first-quarter charge of about U$D 350 million because of a change in how it values the Bolivar. FORD said Venezuelan production was slashed 75% in the fourth quarter, and manufacturing will remain at that lower rate this year as car sales plunge. GM is taking a U$D 400 million charge because of Venezuela currency losses.  GM South America reported that it made U$D 327 million in 2013 before the U$D 400 million charge. FORD is only operating 3 days a week and TOYOTA and CHRYSLER have already stopped Venezuela operations.  February auto sales in all of Venezuela were 817 new units, down from 8,058 new units sold in February 2013. IVECO employees 400 workers in Venezuela to build trucks and bus chassis, the company said today. It produced 1,700 vehicles in the country last year. (Bloomberg:

Newsprint from Colombia undergoes delays at the border
The first of two trucks bearing 52 tons of newsprint sent by Colombian newspapers to their beleaguered colleagues in Venezuela was finally allowed to continue on after being held up for hours by the National Guard. The second truck should be authorized to proceed shortly. The Colombian Association of Newspaper and Media Editors loaned the 52 tons of newsprint from Canada to Venezuelan newspapers El Nacional, El Impulso and El Nuevo País in order to provide operations for 15 days, following a refusal by the Maduro government to provide FOREX for newsprint imports by opposition publications. More in Spanish: (El Universal,; and

Economy & Finance

A fiscal reform is in the works
President Nicolás Maduro says his government will enact a fiscal reform, in order to improve the country's budget execution and tax collection. He remarked that the reform would be "egalitarian and fair". Deputy Ricardo Sanguino, Chairman of the National Assembly's Finance and Economic Development Committee says "we are heading for a less regressive system", and that there is now increase foreseen in the sales tax or any other rate. "Those who make more will pay more", he said. (El Universal,; and more in Spanish: (El Nacional;; and El Mundo,

Venezuela may slowly move toward open currency market.
Venezuela may move toward an open currency market after more than a decade of exchange controls, according to Ricardo Sanguino, Chairman of the National Assembly's Finance and Economic Development Committee. "The trend in the medium and long term could be that we have an open market for currency without the application of an exchange rate anchor," he said. El Mundo Economia y Negocios. (Reuters,

FOREX reserves up by U$D 453 million in Q1 2013
International reserves rose by U$D 453 million to U$D 21.934 billion in Q1 2014, but remain 20% below the same period in 2013. More in Spanish: (Ultimas Noticias,

Data verification blamed for delays in FOREX allocation to participants in the new SICAD 2 system
According to Central Bank Board member Armando León, the delay in delivering actual FOREX to parties taking part in the new SICAD 2 system is due to verification that must be carried out by banks in order to determine the origin of funds and match income to FOREX acquisition. More in Spanish: (El Mundo,

CENCOEX temporarily loosens requisites for FOREX allocation
The National Foreign Trade Center (CENCOEX) has loosened some of the requirements companies must meet in order to acquire FOREX. Guarantee funds can now be provided in Bolivars, and not in US dollars, as originally stipulated. More in Spanish:  (El Universal;; Agencia Venezolana de Noticias;; Ultimas Noticias,

Labor strife causes 35% drop in productivity
According to estimates by FEDECAMARAS, Venezuela's main business grouping, around 35% of the nation's productivity is hurt by labor strife, not counting other problems such as lack of raw material and fewer companies. FEDECAMARAS President Jorge Roig says some industries are practically paralyzed. He reported that the chemical industry is working at 20% capacity, metal related industries are around 40% capacity, plastics at 50% and the food sector is at 60% capacity. "It's the perfect storm. We have all three problems at once: Not enough companies, no raw materials and labor strife", he said. (El Universal,
Exchange offices are 85% paralyzed ever since family remittances to Colombia were suspended, along with changed conditions for sending funds abroad. More in Spanish: (El Universal,


Bishops say regime seeks totalitarian rule, Vatican still awaits invitation to mediate
Venezuela’s organization of Roman Catholic bishops is accusing the government of seeking totalitarian-style rule, comments that potentially could complicate the Vatican’s offer to facilitate talks between the socialist government and its opposition. The Conference of Venezuelan Bishops is calling on President Nicolas Maduro to halt his crackdown on critics who have been protesting in the streets for seven weeks. The conference president is Bishop Diego Padron accused Maduro of attempting to criminalize dissent. The statement comes a few days after the Vatican said it was willing to facilitate talks between the two sides. Maduro indicated he would accept such talks, but the position of the various groups that constitute the opposition remains unclear. The Vatican is still waiting for a formal invitation to serve as mediator or as a third of good faith in the dialogue between the regime and the opposition, according to Monsignor Padrón. (The Washington Post; Fox News,; and Veneconomy,

UNASUR committee returns next week
Ecuadorian Foreign Affairs Minister Ricardo Patiño has confirmed that the UNASUR Foreign Minister's Committee (Brazil, Colombia, Ecuador) will be back in Caracas April 6-7 to continue working towards dialogue between the parties in conflict. (Veneconomy,; El Universal,

Democratic Unity Conference seeks mediator for Elections Board selection
As the National Assembly takes the first steps toward replacing 11 Supreme Court justices and 3 Election Board Directors whose terms have been expired for several months, there are no opposition legislators on the committees set up to do so by the Assembly. A request by opposition legislators to postpone setting up the committees for one week was ignored. The Democratic Unity Conference will seek international mediation, chosen "by mutual agreement" and asks that mediators participate in the process. Neither side has sufficient votes to replace justices and election authorities whose terms have expired. If the necessary votes are not reached after three sessions of the National Assembly, candidates can be selected by a simple majority in a fourth session, according to Article 8 of the Supreme Court Law. More in Spanish: (El Nacional:

Amnesty International reports dozens of Venezuela torture accounts
Amnesty International has received dozens of accounts of torture allegedly carried out by government security forces in Venezuela since protests that have left at least 37 dead broke out in February. “We’ve received reports from detainees who were forced to spend hours on their knees or feet in detention centers,” Amnesty wrote in a report, adding that other Venezuelans said they suffered sexual abuse and threats of murder. “Inhuman and degrading treatment inflicted on detainees appears to be intended to punish them for their involvement, or suspected involvement, in the protests,” Amnesty said. (Bloomberg,; El Universal,

Street barricades a deadly protest, Caracas "war zones" multiply
The barricades in Caracas and a swath of Venezuela cities aim to disrupt, frustrate and ultimately trigger a popular revolt. But like the broader, mostly peaceful anti-government movement they grew out of, the tactic has so far failed to sow wider unrest. However, protests have grown stronger, as has repression by the National Guard; and strife has spread to additional areas of Caracas, such as Terrazas del Ávila and the working class neighborhoods pf ¨ Píritu and La Parrilla, in Petare. Offices at the Housing Ministry in Chacao were burned by hooded individuals passing for protesters. (The Washington Post; Fox News,; and more in Spanish: El Nacional;

Vargas Llosa to visit Venezuela to back anti-Maduro groups
The Peruvian Nobel Prize winning author, Mario Vargas Llosa, has said that he will travel to Venezuela to lend his support to opposition groups. He accused President Nicolas Maduro of trying to install a "Cuban-inspired dictatorship" in Venezuela, and said that all Latin American countries would be under threat if Maduro succeeds. (BBC)

Deputy Machado asks Brazilian senators to look closely at the Venezuelan crisis
Opposition Deputy María Corina Machado went before the Brazilian Senate's Foreign Affairs Committee to denounce "brutal repression" by a "rogue regime," as she described the Maduro government. Machado was invited by the Committee to discuss the crisis in Venezuela. During the meeting, she asked Brazil to "not close their eyes" to the repression "Venezuelan people" are suffering. (El Universal,

Brazil, Chile reply to Machado criticism, defend UNASUR's work
Brazil and Chile defended the work of the Union of South American Nations (UNASUR) in promoting political dialogue in Venezuela, after opposition Deputy María Corina Machado questioned the reliability of the regional bloc's role in the Venezuelan peace process. In reply, Brazilian Foreign Minister Luiz Alberto Figueiredo, and his Chilean counterpart, Heraldo Muñoz, said jointly that UNASUR's work has generated "trust" in the bloc and the organization was simply trying to push forward dialogue for reconciliation. (El Universal,

Maduro article published by The New York Times
Nicolás Maduro appears to have been so irked by the article by Leopoldo Lopez that was published by The New York that he sent an op-ed piece under his own signature to the daily that was published this Wednesday. Maduro defends his regime with half truths and flagrant lies, and demonizes protestors on the streets of Venezuela for the last 51 days. He repeats his desire to enter talks with the US Government and warns that if sanctions proposed in the US Congress take place the poor would be the hardest hit. "Now is the time for dialogue and diplomacy", says the article. (Veneconomy,; The New York Times and The New York Times; BBC,; and more in Spanish: 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.

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