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, July 10, 2015

July 10, 2015

International Trade


Cargo that has arrived at Puerto Cabello:

  • Over 1,602 tons of whole powdered milk, beef and soy oil in 59 vans  from Nicaragua for state agency CASA
  • Over 1,022 tons of whole powdered milk in 40 containers, from Argentina
  • Over 936 tons of coffee in 42 containers from Honduras for state agency Cafe Venezuela
  • Over 313 tons of corn seed in 10 containers for state agency CORPOVEX
More in Spanish: (NOTITARDE;



Logistics & Transport


Food industry warns control system faults prevent normal food distribution

CAVIDEA issued a press release in which it insists that the persistent faults of the Comprehensive Agro-food Control System (SICA), are preventing normal transport and dispatch operations of both raw material and finished products. Companies accumulate up to five days of inventories in their plants and distribution centers due to the system’s faults. (VENECONOMY,


INSEL Air will open a new route Curacao-Puerto Ordaz next July 15. There will be two weekly flights: Wednesdays and Sundays, with return trips on Tuesdays and Saturdays. (VENECONOMY,



Oil & Energy


Gasoline is sold at international prices at gas stations in Táchira state, near the border with Colombia, since last Monday, July 6. Prices range from Bs.50 to Bs.83 per liter, so customers have complained filling tanks with the 30 liters allowed cost over Bs.1,500. Official sources have provided no information. (Veneconomy,


President of Pdvsa says Orinoco Oil Belt is developing

Eulogio del Pino, President of state-run oil company Petróleos de Venezuela (PDVSA) says development of the Orinoco Oil Belt (FPO) "Hugo Chávez Frías" is in full swing. He highlighted efforts undertaken by the government to foster production plans in the Orinoco Oil Belt, located in the southern area of Guárico, Anzoátegui, and Monagas states, where an average of 1.34 million barrels per day of crude are drilled. (El Universal,


PDVSA says it will create 19 joint ventures for the development of the Orinoco Oil Belt.

Fourteen of these companies will manufacture critical material needed in the Belt such as pipes, elbow joints, drill bits and oil re-bars. The remaining five companies will service fields; among other tasks, directional drilling, sand control, etc. (VENECONOMY,; El Universal,





Agricultural guilds seek US$ 250 billion in FOREX

Erick Hartkopf, President of the Venezuelan Chamber of Vendors of Spare Parts, Heavy Equipment and Agricultural Equipment (CAVEDREPA) is asking Agriculture Vice-Minister, Rear Admiral José Gregorio Aguilera, for an estimated US$ 250 billion in FOREX required by 50 importers and vendors of spare parts, heavy equipment and agricultural equipment. He made a request to take into account small and medium-sized enterprises affiliated to CAVEDREPA and the Federation of Cattle Raisers and Farmers of Venezuela (FEGAVEN), which are closer to growers but lack the "muscle" to take part in auctions. (El Universal,



Economy & Finance


Venezuela pulls US$ 1.5 billion more from its IMF reserves

Venezuela withdrew close to US$ 1.5 billion from an IMF holding account in June, according to the fund's website, improving the liquidity of the nation's currency reserves, which have steadily declined since last year's oil market rout. Venezuela holds reserves with the International Monetary Fund in an instrument known as Special Drawing Rights (SDR), a basket of international currencies made up of the euro, Japanese yen, pound sterling, and U.S. dollar. The operation last month converted SDR reserves into more liquid holdings that could be used to import products or make debt service payments. It did not change the total amount of reserves that Venezuela holds, which this week slipped below US$ 16 billion for the first time since 2003. This comes on top of the US$385 that Venezuela quietly borrowed from the IMF in April.  That means that Venezuela has now borrowed US$2.3 billion from the IMF.  In 2009 as countries around the world were reeling from the worldwide economic crisis, the IMF decided to provide member nations a total of US$250 billion in SDRs to shore up international liquidity.  At that time, the IMF made about US$ 3.578 billion in SDR's available to Venezuela, which it is now borrowing at an extremely favorable rate of interest (currently 0.05%, which is better than the over 30% that Venezuela is paying on some of its bonds).  Even so, on Sunday President Nicolas Maduro took to the airwaves lauding the Greek referendum results, saying "Today Greece has told the financial terrorists of the International Monetary Fund, the European Central Bank and the European elite that they don't kneel down to anyone.... the people of Greece that have said NO to the International Monetary Fund and the vampires of the international banking system." As of June, its balance of SDRs stood at an equivalent to US$ 1.28 billion at last month's average exchange rate of 1.4 SDRs per dollar. Most of Venezuela's foreign reserves are held in gold. (Reuters,; Latinvest,; Veneconomy,; El Universal,; and more in Spanish: Infolatam,


Maduro  says "oil prices dropped US$ 4 in two days but Venezuela will not stop"

President Nicolás Maduro has said "oil prices dropped US$ 4 in two days but Venezuela will not stop...let us learn how to walk on our own feet...enough depending on the's over...whatever it takes...we must show that productive socialist work is superior to any other form of work"- More in Spanish: (El Universal,


Venezuela bid to review US$ 46 million Tidewater award rejected

Venezuela's request to review a US$ 46 million compensation claim it has been ordered to pay to oil service company Tidewater was rejected and the stay on the award's execution lifted, a World Bank tribunal said in a decision posted on its website. The country had sought a revision "based on what it describes as an error in the tribunal's damages calculation," an International Center for Settlement of Investment Disputes' (ICSID) tribunal said in its decision. In its rejection, the tribunal said the award had "taken into account the totality of the evidence presented to it in determining the appropriate level of compensation to be awarded, based upon a discounted cash flow analysis." (Reuters,


Venezuela inflation seen hitting triple-digit levels as crisis deepens

Venezuela's inflation has reached its highest level since the country started measuring the indicator over 60 years ago, according to calculations by private economists who are seeking to make up for a lack of official figures on prices for this year. Inflation is evident in the streets, however, as consumers struggle with wads of near-worthless bills, the largest of which can no longer even buy a chocolate bar. Prices rose 108% in the 12 months ending in May, according to the average of estimates by nine analysts consulted by Reuters, topping the 103 percent rate of 1996 that followed an economic shock package. (Reuters,


Venezuela’s largest bill buys 16 U.S. Cents after 30% plunge

Venezuela’s largest bank note of 100 bolivars is now worth about 16 U.S. cents on the black market, following a 33% plunge in the past month. The currency weakened to 616 per dollar Thursday, meaning the greenback fetches 100 times more bolivars in the black market than it does at the primary official rate, according to data compiled by foreign-exchange website Venezuela has maintained strict currency controls since 2003, pushing people and businesses to illegal street trading when they can’t obtain government approval to purchase the U.S currency at the legal rates. The bolivar has tumbled 88% in the unofficial markets over the past year amid the fastest inflation in the world and as President Nicolas Maduro’s administration prints more currency to pay budget expenses. “The bolivar has gone parabolic in its collapse,” says Russ Dallen, the head trader at brokerage Caracas Capital Markets. “Two things are happening: less dollars are coming into the economy from the falling price of oil, and the Venezuela central bank is printing money like there is no tomorrow.” (Bloomberg,


Venezuelan bankers asked financial authorities to issue a Bs.500 bill due to the speed at which inflation is accelerating but the Venezuelan Central Bank (BCV) has been reluctant to do so. Instead, it has increased 89% circulation of Bs.100 bills in a year. (Veneconomy,


Venezuela proposes ALBA join the BRICS bank

President Nicolás Maduro says the Venezuelan government will propose the Bolivarian Alliance for the Peoples of Our America (ALBA) to join the bank of the BRICS bloc (Brazil, Russia, India, China, and South Africa), with the purpose of consolidating a new financial architecture benefiting Latin America and the Caribbean. He added that Latin America and the Caribbean, following the lead of the BRICS development bank, should consolidate their own economic mechanisms, such as the Bank of the South and the Reserve Fund of the South, institutions that could foster the development of the nations of the continent based on complementarity and cooperation. (El Universal,



Politics and International Affairs


Poll shows that over 84% of Venezuelans believe the nation is in bad shape

According to the latest DATANALISIS poll, over 84% of all Venezuelans believe the nation is in bad shape, and are mostly concerned over inflation and scarcities, which now rank above crime as the top worries. The figure includes a majority of people who describe themselves as "chavistas". More in Spanish: (Infolatam,


Maduro: Guyana's aim is to provoke Venezuela

President Nicolás Maduro says the stance adopted by the government of Guyana vis-à-vis a border dispute over the territory of the Essequibo should foster national union for Venezuela to claim its legitimate right and to fight against provocations in all aspects. He said some sectors of the Venezuelan opposition have also joined such national union advocating Venezuela's territorial rights, thus leaving political differences aside. (El Universal,


National Assembly President Cabello: CARICOM is a target

Captain Diosdado Cabello, President of the National Assembly has criticized the government of Guyana and its President David Granger, saying Granger was seeking to destroy the Caribbean Community (CARICOM). "We will never waive, under no circumstances, the right we have over the Essequibo," says Cabello. He added that Granger was "acting like a leader of the Venezuelan opposition," plotting with oil transnational companies attacking integration. (El Universal,


VenEconomy: About the wave of violence in Venezuela

Víctor Maldonado, head of the Caracas Chamber of Commerce, says Venezuela ranks No. 1 in all lists on the topic at global level with 2.85 deaths per hour; he also says that Venezuelans are living under a self-inflicted curfew that begins at sunset and lasts through dawn. He adds that the country is suffering the effects of a complex system of illicit activities, increasingly organized and in constant conflict, fighting one another for the control of the national territory and the monopoly of the resulting profits from those activities. (Latin American Herald Tribune,


Maduro hopes that the US will recognize a "chavista Venezuela"

President Nicolás Maduro has called the new diplomatic channel established with the United States a "great achievement" in bilateral relations. He says the joint agenda includes a review of the size and functions of embassies, joint efforts in PETROCARIBE, and supporting peace and prosperity in Haiti. More in Spanish: (El Universal,


The trial hearing of Metropolitan Caracas Mayor Antonio Ledezma’s has been postponed again for next July 28, allegedly due to the impossibility to transport some of the other defendants in the case from their prison centers. (Veneconomy,



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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