May 22, 2015

International Trade

 

Cargo that has arrived at Puerto Cabello:

• 13,090 tons of beef and chicken from Brazil for state agency CASA
• 1,768 tons of whole milk powder from Brazil for state agency CASA
• 1,117 tons of margarine from Brazil, also for CASA

Cargo that has arrived at Maracaibo Port

• 23,400 tons of wheat for MONACA

Eight ships are currently offloading, two bulk cargo and another containers. More in Spanish: (Notitarde; http://www.notitarde.com/La-Costa/Llegaron-15-mil-toneladas-de-alimentos-2419184/2015/05/19/513175/; http://www.notitarde.com/La-Costa/Buques-con-alimentos-esperan-muelle-2420166/2015/05/20/513343/; Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=9535)

 

 

Logistics & Transport

 

Domestic air carriers to increase fares 400%

Captain Jorge Alvarez, head of the Venezuelan Chamber of Air Transport Companies’ (CEVETA). Venezuelan aeronautics officials authorized AVIOR, ASERCA, LASER, VENEZOLANA, RUTACA and ALBATROS an average 15% increase in domestic routes “immediately and gradually.” The National Tourism Council (CONSETURISMO) says the rate increase is 400%. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43967&idc=3; and more in Spanish:

 (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/conseturismo-confirmo-ajuste-de-hasta-400-en-bolet.aspx#ixzz3arIHGGTz)

 

 

Oil & Energy

 

Exxon reports oil find in disputed area in Guyana is "significant", Guyana seeks rapprochement with Venezuela

ExxonMobil reports a "significant" oil find in waters disputed by Venezuela on the Guyana coast. The company says it discovered over 295 feet of sandy oil reserves in the Stabroek area - which is around 120 miles from Guyana in waters claimed by Venezuela. Recently elected Guyanese President David Granger met with the Secretary General of CARICOM and the Brazilian and Venezuelan ambassadors and underlined the importance of PETROCARIBE to Guyana. More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/exxon-hallazgo-de-crudo-en-aguas-disputadas-con-gu.aspx#ixzz3alUHTUCA; El Mundo, http://www.elmundo.com.ve/noticias/petroleo/industria/exxon--hallazgo-de-crudo-en-aguas-disputadas-con-g.aspx; Notitarde; http://www.notitarde.com/Economia/Acercamiento-entre-Guyana-y-Venezuela-2419027/2015/05/19/513182/; El Universal, http://www.eluniversal.com/nacional-y-politica/150520/venezuela-solicita-al-presidente-guyanes-tratar-controversia)

 

Blackout hits Falcón, Carabobo, Miranda, and Yaracuy states; El Palito Refinery shut down

Venezuela's state-run National Electric Corporation (CORPOELEC) reported that a failure in Planta Centro power substation has cut electricity supply in Falcón state (northwest Venezuela). El Palito Refinery shut down after the blackout, workers told Reuters - but has started operations again. (El Universal, http://www.eluniversal.com/economia/150520/blackout-hits-falcon-carabobo-miranda-and-yaracuy-states; Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43971&idc=4; El Universal, http://www.eluniversal.com/economia/150520/operations-at-el-palito-refinery-come-to-a-halt-due-to-power-outage; and more in Spanish: El Economista, http://eleconomista.com.mx/industria-global/2015/05/20/pdvsa-reinicia-operacion-refineria-tras-apagon; El Mundo, http://www.elmundo.com.ve/noticias/petroleo/pdvsa/falla-en-planta-centro-afecta-refineria-el-palito.aspx; El Nacional; http://www.el-nacional.com/)

 

 

Economy & Finance

 

Venezuelan international reserves dropped 26.2% over the last 45 days, as a result of low oil prices, according to a report from BANCTRUST. Reserves went from US$ 24.2 billion at the end of February to US$ 17.8 billion in mid-May. The investment firm’s analysts estimate the cash flow deficit at US$ 10.7 billion, taking into consideration the average price of the Venezuela’s oil export. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43957&idc=2)

 

Parallel exchange rate is soaring

The parallel exchange rate went from 350 to 392 bolívares to the U$ yesterday, and then went past 400 for the first time. ECOANALÍTICA director Asdrúbal Oliveros predicts "this will continue unless the government takes action" (El Nacional; http://www.el-nacional.com/)

 

Pros and cons of dollarization analyzed

A recent report by ODH Análisis Venezuela indicates that dollarizing the economy would end inflation but would imply a severe drop in personal income that would make Venezuela the second lowest in the region after Cuba. Venezuela would go from being the fifth largest economy in Latin America to the 22nd. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

Bonds down after Goldman-Sachs projections on oil

Sovereign and PDVSA bonds dropped an average 2.25 points after a report from Goldman-Sachs on the future price of oil. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/mercados/bonos-caen-por-proyecciones-de-goldman-sachs-sobre.aspx#ixzz3afiuIjNK)

 

NOMURA says oil prices are not high enough to cover Venezuelan imports and debt

A report by Asia's NOMURA says current oil prices "are not high enough to finance imports and pay debts". It adds that Venezuela is further hampered by lack of access to financial markets and low foreign direct investment. NOMURA adds - in reference to falling Central Bank reserves - that "the fact that the vaults storing the grandmother's jewels are close to being exhausted does not help". It says the possibility of reform seems remote. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

UN report says Venezuela's economy could grow 1% in 2016

An UN economic report estimates Venezuela's economy could grow 1% next year. More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/onu-estima-que-economia-venezolana-crecera-1-en-20.aspx#ixzz3afgmqzFE; El Mundo, http://www.elmundo.com.ve/noticias/economia/banca/onu-estima-que-economia-venezolana-crecera-1--en-2.aspx; http://www.elmundo.com.ve/noticias/economia/banca/onu--empeoran-previsiones-para-la-economia-latinoa.aspx)

 

 

Politics and International Affairs

 

Parliament head Cabello denies drug accusations - is backed by Maduro, the Supreme Tribunal and legislature

The Venezuelan government's second most powerful figure, Captain Diosdado Cabello, has denied any involvement in the drug trade after U.S. media reports that he and other officials were under investigation for trafficking and money laundering. Stories in the Wall Street Journal and New York Times outlined long-simmering accusations from the United States that the governments of President Nicolas Maduro and his predecessor, Hugo Chavez, have facilitated cocaine shipments. In an unprecedented move, Gladys Gutiérrez, head of Venezuela's Supreme Tribunal, called press reports lacking "any credible or possible basis" and says the are "seeking to illegitimately discredit Venezuelan institutions". She opened the way to penalize anyone who repeats the information, saying "as we know, when lacking veracity they bring sanctions within our legal system". Concurrently, pro-government legislators at the National Assembly passed a resolution expressing solidarity with Cabello and will join the suit brought by him against local media that have reflected international reports. Lawyers here call the high court's statement unique in Venezuelan history that was made without considering the facts or following a trial, and believe it is tantamount to an anticipated sentence on Cabello's suit against 22 local newspaper executives for publishing the news. (Reuters, http://www.reuters.com/article/2015/05/20/us-venezuela-usa-probe-idUSKBN0O42O720150520; El Universal, http://www.eluniversal.com/nacional-y-politica/150521/venezuelan-top-court-terms-unfounded-accusations-against-cabello; and more in Spanish: El Universal, http://www.eluniversal.com/nacional-y-politica/150520/an-aprueba-desagravio-en-solidaridad-con-cabello;  http://www.eluniversal.com/nacional-y-politica/150521/tsj-carece-de-basamento-acusacion-contra-cabello; El Nacional; http://www.el-nacional.com/)

 

Spain's Felipe González calls on Venezuela to investigate Cabello, plans visit in June

Spain's former president Felipe González called the reaction by the Venezuelan regime "logical" and said Cabello must be presumed innocent until proven otherwise, but added that the government here should react by "carrying out its own investigation to find out what is true". He added that the only way out of the "delicate" situation here is "a dialogue to restore all the conditions for democratic tolerance within the constitution". González was expected to travel this week to Caracas, as part of his initiative to defend detained dissenter leaders Leopoldo López and Antonio Ledezma; however, he put off his travel until a new trial hearing against López was re-scheduled. (El Universal, http://www.eluniversal.com/nacional-y-politica/150521/ex-president-felipe-gonzalez-plans-visit-to-venezuela-in-june; and more in Spanish: Infolatam: http://www.infolatam.com/2015/05/21/venezuela-debe-investigar-acusaciones-contra-cabello-dice-felipe-gonzalez/)

 

Sanctioned government officials sue Capriles, Táchira Governor disqualifies imprisoned opposition candidate

Internal Affairs, Justice and Peace Minister Major General Gustavo González-López reports that the seven officials sanctioned by the US are suing Miranda’s Governor Henrique Capriles Radonski over "false accusations", and that Capriles “will have to explain in a court of law why he called seven Venezuelan officials of dignity, corrupt and parasites (enchufados).” He was referring to the seven government officials sanctioned by the US government. At the same time, Táchira Governor José Gregorio Vielma Mora said Daniel Ceballos, former San Cristóbal Mayor and recently elected the MUD candidate to the legislative elections in last Sunday’s opposition primaries would have been banned from holding public office for a year, for failing to submit his sworn declaration of property when he swore in as Mayor of San Cristóbal. Capriles responded by saying "it is an honor for me that a group of those plugged in are evading their responsibilities by attacking me" and added "if telling the truth brings on lawsuits, let there be many". (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43959&idc=1; http://www.veneconomy.com/site/index.asp?ids=44&idt=43969&idc=1; and more in Spanish: More in Spanish: El Nacional; http://www.el-nacional.com/)

 

Opposition favored to win legislature, 87% intend to vote despite distrust of CNE

A study by the Political Studies Center's Electoral Integrity Project shows despair over the nation's situation has increased, as well as mistrust of the National Elections Council, but there is citizens are highly disposed to vote as a way out of the crisis. 87% of those polled plan to vote in parliamentary elections "whatever goes on". 64% distrust the National Elections Council. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

Maduro meets with US special envoy to Colombian peace talks

President Nicolás Maduro has met here with Bernard Aronson, US special envoy to Colombian peace talks, according to Venezuela's Foreign Affairs Minister Delcy Rodríguez. US President Barack Obama appointed Aronson first special envoy to Colombian peace talks held in Havana between the government of Colombia and the Colombian Revolutionary Armed Forces (FARC). No statements were made after the meeting. (El Universal, http://www.eluniversal.com/nacional-y-politica/150521/maduro-meets-with-us-special-envoy-to-colombian-peace-talks)

 

STRATFOR: Disbanding the Venezuelan mafia

Festering within the Venezuelan government are a number of powerful individuals who were propelled into positions of influence during the administration of former President Hugo Chavez and who have used that influence to shape the economy into a mangled instrument that suited their personal interests. Shortages are eventually going to reach a critical point as the country's financial cushion deflates, creating the potential for more serious unrest. If Maduro has any chance of carrying the country through this crisis, he will have to start by dislodging those who are distorting critical parts of the economy through their elaborate corruption schemes. Maduro may not be able to purge powerful figures on his own, but there is a possibility they could be sacrificed as part of a bargain with Washington — beginning the process of routing the government and the economy of its most destructive elements and delivering a message that the criminal networks distorting the economy are not impenetrable. The United States is in no way the whole answer to Venezuela's problems or a substitute for the structural reforms needed to repair the economy, but it may be able to offer Maduro a partial solution. (Stratfor: https://www.stratfor.com/geopolitical-diary/disbanding-venezuelan-mafia)

 

Brazil's Rousseff, Uruguay's Vázquez concerned over Venezuela, Insulza decries international inaction

Brazil's President, Dilma Rousseff, and her Uruguayan counterpart, Tabaré Vázquez, have emphasized that the current crisis in Venezuela needs to be overcome in a peaceful, constitutional manner. Both presidents voiced their "concern" over Venezuela's situation in the context of an official visit of President Vázquez in Brasilia. Former OAS Secretary General José Miguel Insulza says that organization has not dealt with the case of Venezuela adequately, called it one of the most difficult and painful situations he has had to deal with "because member nations have not wanted to act on it" in order to more openly promote dialogue. "I very much regret that there has been no will to face the situation directly, that we have not paid attention to a country that is clearly going through a crisis, where the international community is not doing all that it could". (El Universal, http://www.eluniversal.com/nacional-y-politica/150521/brazils-rousseff-uruguays-vazquez-concerned-over-venezuela; and more in Spanish: El Nacional; http://www.el-nacional.com/)

 

Chile's legislature asks Bachelet to withdraw Ambassador to Venezuela

Chile's House of Representatives has passed a resolution asking President Michelle Bachelet to withdraw that country's Ambassador to Venezuela over the situation undergone by several political prisoners here. The vote passed with 66 votes in favor, 26 against and 10 abstentions. More in Spanish: (Diario 2001, http://www.2001.com.ve/en-el-mundo/98022/parlamento-chileno-pide-retirar-a-embajador-en-venezuela-.html)

 

Prosecutor General seeks arrest of those implicated in Bank of Andorra Bank scandal

Venezuela's Prosecutor General Luisa Ortega says her office has ordered the arrest of all those implicated in the Bank of Andorra money laundering scandal, but says she cannot reveal their identity "because they have not yet been caught". Last week Norman Puerta, former head of Venezuela's anti narcotics agency in 2005-2006, turned himself in to local authorities after been sought by INTERPOL for money laundering. More in Spanish: (Infolatam, http://www.infolatam.com/2015/05/20/fiscalia-venezolana-pide-la-captura-de-implicados-en-caso-de-banca-de-andorra/)

 

ILO will investigate violation of labor rights in Venezuela

Venezuela is on the list of countries that will be examined by the International Labor Organization, after it termed the situation of labor rights here "serious" following reports on unjustified firings, penalizing protest and imprisoned workers. More in Spanish: (El Nacional; http://www.el-nacional.com/)

 

Venezuela, Palestine sign agreements

Venezuela and Palestine have signed important agreements seeking to strengthen ties between both nations, says President Nicolás Maduro. He explained the two countries signed cooperation agreements in areas such as agribusiness. Maduro also called the Palestinian cause the most noble cause humanity could fight for, and said Palestine can always count on Venezuela's solidarity. (El Universal, http://www.eluniversal.com/nacional-y-politica/150521/venezuela-palestine-sign-rapprochement-and-cooperation-agreements)

 

Plane from Venezuela carrying cocaine crashes into Caribbean Sea

A plane that took off from Venezuela loaded with cocaine crashed on Wednesday into the Caribbean Sea, off the Colombian coast, as it tried to avoid military aircraft that tried to force the pilot to land, according to the Colombian Air Force. In the area where the two-engine plane HAWKER 800 crashed, off Puerto Colombia, Atlántico Department, units of the Colombian Armed Forces found the body of a man, a Mexican passport, the wreckage of the aircraft, and cocaine packages, Reuters reported. (El Universal, http://www.eluniversal.com/nacional-y-politica/150520/plane-from-venezuela-carrying-cocaine-crashes-into-caribbean-sea)

 

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.