April 24, 2015

International Trade

 

Cargo that has arrived at Puerto Cabello

• Over 2,990 tons of doors, windows and upholstered wooden chairs from China for state agency CORPOVEX
• Over 580 tons of milk in 20 containers from Argentina for state agency CASA
• Over 400 tons of auto parts from China's Ica International and Chery Automobile for Corporation ZGT
• Over 247 tons of cheese, cottage cheese and other dairy products, from Argentina for CASA
• Over 121 tons of refined paraffin wax from China for Industria Cerera La Coromoto
• Over 108 tons of assorted merchandise, including apparel, lingerie, sheets, fabric, shoes, sandals and appliances from Panama's Colon Free Trade Zone.

Only three vessels are currently offloading at Puerto Cabello, two of them bearing bulk. More in Spanish: (Notitarde; http://www.notitarde.com/La-Costa/Mas-de-580-toneladas-de-leche-arribaron-al-puerto-de-Puerto-Cabello-2397718/2015/04/21/507507; http://www.notitarde.com/La-Costa/Llegaron-mas-de-400-toneladas-de-autopartes-al-puerto-local-2399780/2015/04/23/507863/)

 

 

Logistics & Transport

 

Arrest of former Aquatic and Air Transport Minister ordered over ferry acquisition

A warrant has been issued to INTERPOL for the arrest of former Major General Herbert García-Plaza, former Minister of Aquatic and Air Transport, for irregularities in the purchase of three ferries during his tenure. The three ferries were bought by the national port authority (BOLIPUERTOS) to cover the Puerto La Cruz-Margarita Island route, as authorized by former Minister Major General Hébert García Plaza, and were 12 years old. To repair them cost five times (€241.5 million) what they cost originally (€45.7 million). None was ever operational. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43621&idc=3¡; and more in Spanish: El Universal, http://www.eluniversal.com/nacional-y-politica/150422/ordenan-captura-del-exministro-herbert-garcia-plaza)

 

 

Oil & Energy

 

Venezuela oil delegation meets Qatar officials on OPEC tour

Oil Minister Asdrubal Chavez led a Venezuelan delegation in Qatar for meetings with local officials following similar talks in Iran and Saudi Arabia on an OPEC tour seeking ways to boost crude prices, according to a government statement. So far unable to nudge Saudi Arabia and its Gulf allies into supporting supply cuts, Venezuela is exploring various options to boost its position including a proposal to blend its heavy crude with OPEC allies' light grades. (Reuters, http://www.reuters.com/article/2015/04/22/qatar-venezuela-oil-idUSL1N0XJ1HZ20150422; El Universal, http://www.eluniversal.com/economia/150422/venezuelan-delegation-discusses-in-qatar-opecs-oil-output)

 

 

Commodities

 

Industry here are operating at 50% capacity

The National Council of Industries reports a drop to 50% operating capacity during the first quarter this year. 78% of industries report their inventories have diminished and they were unable to replace them.  More in Spanish:  (El Universal, http://www.eluniversal.com/economia/150422/sector-industrial-funciona-a-50-de-su-capacidad; El Nacional, http://www.el-nacional.com/economia/Industrias-producen-capacidad-instalada-hace_0_614338723.html)

 

Government debt with pharmaceutical labs rose US$ 500 million this year to US$ 4 billion, according to a source within the sector. He claimed the government had only allocated dollars three times so far this year but that they had not been enough. The source said all the dollars allocated were barely 5% of the total debt with each company. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43623&idc=2)

 

 

Economy & Finance

 

Central Bank swaps U$S 1 billion gold reserves with CITIBANK for FOREX

Venezuela's Central Bank has swapped almost US$ 1 billion in gold reserves for a loan from CITIBANK. Although details have not been made available, experts estimate CITIBANK is charging 6-7% for the swap. Gold reserves will remain in the Bank of England as a guarantee for the loan. It is reported that the funds are to be used for imports. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

Parallel government funds reported down by 44.3% in one month

Parallel FOREX funds held by the Venezuelan government have dropped 44.3% in one month, from US$ 15.8 billion to US$ 8.8 billion, according to the ECOANALITICA research firm. The National Development Fund now reports US$ 4.2 billion, from US$ 6.5 billion, down 35.3% in one month. PDVSA accounts had a fast descent from US$ 2,4 billion to US$ 6 million, down 75%. Other FOREX funds have dropped by 42%, from US$ 6.9 billion to US$ 4 billion. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

DEUTSCHE BANK insists in Venezuela default projection for 2016

DEUSTSCHE BANK insists Venezuela will default by 2016 since it estimates the deficit is too large to meet. "The market has generally discarded a credit event in 2015, but a default continues to be our base scenario for 2016...the financing gap would simply be too large to cover and distortions will probably evolve toward a more dangerous level". More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/banca/deutsche-bank-mantiene-escenario-de--default--para.aspx#ixzz3Y7o8jeOR)

 

Maduro says debt to be honored

President Nicolás Maduro says Venezuela has met its financial obligations despite current conditions and says "we have paid several billion dollars in debt. It is our obligation. He have not defaulted ever nor will we". More in Spanish: (AVN; http://www.avn.info.ve/contenido/maduro-reiteró-cumplimiento-responsabilidades-naciones-pesar-guerra-económica)

 

Maduro attacks FEDECAMARAS as it reports Venezuela owes foreign suppliers US$ 10 billion

President Nicolás Maduro has stepped up his attacks on the private business sector. Following a report by Jorge Roig, President of the nation's premier business organization, FECECÁMARAS, that Venezuelan importers and private companies have racked up arrears of around US$ 10 billion with international suppliers due to delays in the government's allocation of hard currency, Maduro immediately announced that no more dollars would be sold to FEDECÁMARAS, for they have allegedly masterminded the so-called "economic war" against his government by "manipulating product distribution". Over the last couple of days, Maduro has been threatening and intimidating the nation’s entrepreneurs with having a new enabling law enacted soon and sending all of them to prison. He announced that he is making final adjustments to a special "counteroffensive plan" through which he will "wipe the floor" with alleged destabilization plans, and that he will unveil the details on May 1. Nicolás Maduro's statements could imply that the flow of dollars sold to the private sector companies affiliated to FEDECÁMARAS could shrink even more. Specialists and advisors warned that such measure could seriously harm supply of goods and services in the country. The director of polling firm DATANÁLISIS, Luis Vicente León, believes Maduro's remarks were more political than practical. He says the attack on FEDECÁMARAS "seems like a political distraction strategy" in view of the upcoming parliamentary elections, but adds that this course of action "makes the crisis worse. To threaten productive sectors is the worst possible strategy". Roig called Maduro's threats a "show of bravado... which proves discretionary use of FOREX...is a political tool and not one for development". He made it clear that FEDECÁMARAS does not and has never sought FOREX as an institution, and said: "In Venezuela it is a crime to create jobs, in Venezuela those who have inventories are persecuted". Roig adds that the business sector is willing to engage in dialogue with the government, as long as threats against businesspersons stop. "A nation is not built by threatening business". (Reuters, http://www.reuters.com/article/2015/04/22/us-venezuela-business-idUSKBN0ND2GM20150422; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2384874&CategoryId=10717; El Universal, http://www.eluniversal.com/economia/150422/maduro-no-more-dollars-for-federation-of-chambers-of-commerce; http://www.eluniversal.com/economia/150423/analysts-forecast-more-shortages-in-venezuela-if-forex-cuts-continue; http://www.eluniversal.com/economia/150422/fedecamaras-a-country-is-not-built-by-threatening-businesspersons and more in Spanish: Infolatam: http://www.infolatam.com/2015/04/23/patronal-tilda-de-bravuconada-de-maduro-anuncio-de-vetar-divisas-a-privados/; El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/maduro-iniciara-el-1--de-mayo-un-plan-de--revolcon.aspx#ixzz3Y1yhseHf; http://www.elmundo.com.ve/noticias/economia/empresas/roig--fedecamras-nunca-ha-solicitado-dolares-como-.aspx#ixzz3Y7nn2WIz; http://www.elmundo.com.ve/noticias/economia/empresas/gobierno-y-fedecamaras-reavivan-tensiones.aspx; Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/maduro-anunciara-el-1--de-mayo-un-plan-de-revolcon.aspx; http://www.ultimasnoticias.com.ve/noticias/actualidad/politica/maduro-fedecamaras-no-hay-mas-dolares-para-ustedes.aspx; http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/roig-fedecamaras-nunca-ha-solicitado-dolares-para-.aspx, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/fedecamaras-rechazo-senalamientos-de-maduro.aspx; El Universal, http://www.eluniversal.com/nacional-y-politica/150422/presidente-promete-dar-un-revolcon-economico; Diario2001, http://www.2001.com.ve/en-la-agenda/95393/luis-v--leon---ataque-a-fedecamaras-luce-como-una-estrategia-de-distraccion-.html; http://www.2001.com.ve/en-la-agenda/95346/maduro---no-hay-mas-dolares-para-los-pelucones-de-fedecamaras-.html)

 

Government refusal to allocate FOREX will limit production, distribution, jobs

Industry believes President Maduro's saying he will not allocate FOREX to FEDECAMARAS - which comprises most of the nation's formal business - means he intends to suspend allocations to companies since the business organization itself uses no FOREX. Industrial leaders warn that without allocations they will be unable to acquire supplies, keep production lines operating, maintain employment or supply shelves. Pablo Olalquiaga, head of the Chemical and Petrochemical Industry Association, adds "if there is no domestic production the government will have to import more and use more FOREX for imports, and there will be no jobs created". More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

80% of Venezuelans unable to afford food basket

Inflation and high food prices are hitting the life quality of Venezuelans, who cannot fully afford the local basic food basket. According to the results the National Life Conditions Survey (ENCOVI), 80% of Venezuelans said they have not enough money to buy food items. This information was disclosed at the Simón Bolívar University (USB), which carried out the study along with the Central University of Venezuela (UCV) and the Andrés Bello Catholic University (UCAB). The cost of the Venezuelan basic food basket keeps growing as it rose 5.2% in March to VEB 15,200.62 (US$ 2,412.79), according to Labor Union's Center for Documentation and Social Analysis (CENDA). The most important rises were in food products such as beef (5.8%); milk, cheese and eggs (5.7%); and fish (7.4%). Out of eleven food items comprising the local basic food basket, 10 soared, including three with the highest rises: oleaginous and leguminous seeds (beans, 30.7%); sugar and sugary products (18.5%); and fats and oils with a 13.4% variation. (El Universal, http://www.eluniversal.com/economia/150423/eighty-percent-of-venezuelans-unable-to-afford-food-basket; and more in Spanish: El Universal, http://www.eluniversal.com/economia/150423/food-basket-up-52-in-march-in-venezuela)

 

 

Politics and International Affairs

 

Venezuela's population officially pegged at 30.825.782

The National Assembly has approved the population index set by the National Statistics Institute, setting the nation's total population at 30.825.782. More in Spanish: (Diario 2001, http://www.2001.com.ve/con-la-gente/95288/poblacion-de-venezuela-es-oficialmente-de-30-825-782.html)

 

US willing to consider Venezuela's agenda for restoring talks

US Secretary of State John Kerry says the US is willing to consider the steps sought by Venezuela in order to restore diplomatic bilateral talks. He said the US "remains open to work on our differences and try to find areas of common interest". More in Spanish: (AVN; http://www.avn.info.ve/contenido/eeuu-dispuesto-considerar-pasos-solicitados-venezuela-para-establecer-diálogo; El Universal, http://www.eluniversal.com/nacional-y-politica/150422/kerry-eeuu-sigue-abierto-a-dialogar-con-venezuela)

 

Spain doesn’t want to break off relations with Venezuela, FM Says

Foreign Minister Jose Manuel Garcia-Margallo says Spain has no intention of breaking off diplomatic relations with Venezuela, adding that he hopes for “democratic stability and economic prosperity” here.  He says: “We do not intend to continue this escalation, and it is not our purpose to break relations with Venezuela”. Madrid summoned the Spanish ambassador to Caracas for consultations after Maduro's "escalation of insults, calumnies and threats", accusing the Spanish government of "supporting terrorism" here and saying Spanish President Mariano Rajoy is part of  "a group of corrupt bandits and thieves". (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2384834&CategoryId=10717; El Universal, http://www.eluniversal.com/nacional-y-politica/150423/spain-we-do-not-intend-to-break-relations-with-venezuela; and more in Spanish: El Nacional, http://www.el-nacional.com/politica/Maduro-Espana-apoyar-terrorismo-Venezuela_0_614338762.html; El Universal, http://www.eluniversal.com/nacional-y-politica/150423/espana-llamo-a-consulta-al-embajador-antonio-perez)

 

Felipe González: I do not want to cause a conflict in Venezuela

Spain's former president Felipe González says he is willing to visit Venezuela in mid-May, despite the fact that the pro-government majority in the Venezuelan National Assembly has passed a motion declaring him persona non grata. He says he wants to have the opportunity to visit prisoners inside jail and to attend the oral trial as a technical advisor. Gonzalez points out that only the Executive Power, and not the Legislative Power, has the authority to declare someone persona non grata. González and hopes such declaration is not issued in the end. "I intend to go (to Venezuela), but I do not want to cause a conflict" he conceded. Former Latin American presidents Fernando Henrique Cardoso (Brazil), Ricardo Lagos (Chile), and Julio María Sanguinetti (Uruguay) have voiced their solidarity with González and advocate the right to help politicians "unfairly imprisoned." Gonzalez volunteered to advise the defense team of Venezuelan detained opposition leaders Leopoldo López and Antonio Ledezma. (El Universal, http://www.eluniversal.com/nacional-y-politica/150423/felipe-gonzalez-i-do-not-want-to-cause-a-conflict-in-venezuela; http://www.eluniversal.com/nacional-y-politica/150423/three-ex-presidents-voice-solidarity-with-felipe-gonzalez)

 

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.