September 01, 2015

International Trade

 

Cargo that has arrived at Puerto Cabello:

• Over 400 containers with basic supply products, including milk, beef, cooking oil, coffee, medicine and construction material for government agencies such as Café Venezuela, CASA and Fundación Misión Barrio Adentro.
• Over 400 steel bridge structures from China for the Land Transport and Public Works Ministry
• 38 tons of tires in 3 containers from Ecuador.

More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=31728)

http://www.bolipuertos.gob.ve/noticia.aspx?id=31725; Notitarde; http://www.notitarde.com/La-Costa/Arriban-a-Puerto-Cabello-38-toneladas-de-cauchos-provenientes-de-Ecuador-/2015/08/30/614317/)

 

 

Oil & Energy

 

Russia's Putin, Venezuela's Maduro to discuss oil price stabilization

Russian President Vladimir Putin and his Venezuelan counterpart Nicolas Maduro will discuss "possible mutual steps" to stabilise global oil prices during a visit to China this week, according to a Kremlin aide. Putin and Maduro will attend a military parade in Beijing marking 70 years since the end of World War Two in Asia. Kremlin aide Yury Ushakov said the steps would be discussed as part of Moscow's cooperation with OPEC. He did not give any further details. The price of oil, Russia's chief commodity export, have halved since last year to trade below US$ 50 per barrel, helping send the Russian economy into recession. (Reuters, http://www.reuters.com/article/2015/08/31/russia-venezuela-oil-idUSL5N11632N20150831; El Universal, http://www.eluniversal.com/nacional-y-politica/150831/maduro-and-putin-to-discuss-possible-steps-to-stabilize-oil-prices)

 

Venezuela oil price falls to new 2015 low

Venezuela's weekly oil basket price fell to a new low for 2015 as oil prices slipped in international markets on worries of an economic slowdown in China and stock market crashes spread around the world before stabilizing toward the end of the week. According to figures released by the Ministry of Energy and Petroleum, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending August 28 was US$ 36.48, down US$ 3.14 from the previous week's US$ 39.62. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395414&CategoryId=10717)

 

Adjustment of gasoline price back on the table

The issue of a minimum adjustment of the gasoline price closer to international prices gains momentum.
This would prevent the drainage of approximately 150,000 liters of gasoline per day, which are subsequently bought by Ecopetrol and injected in the Colombian economy, according to pro regime oil expert David Paravisini.
"The decision about the adjustment is not at all easy. Although that debate is going on inside the government, it is right that President (Nicolás) Maduro disclosed it," Paravisini said. (El Universal, http://www.eluniversal.com/economia/150831/adjustment-of-gasoline-price-gets-its-strength-back)

 

Commodities

 

Insuring a car in Venezuela costs 529% more this year than in 2014

Insurance policies have suffered a significant increase depending on the car’s model, as a result of the high cost of new automobiles and the scarce offer in the market. Consequently, the number of insured vehicles has dropped 40%. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45294&idc=2)

 

 

Economy & Finance

Maduro in China to seek financial support

President Nicolás Maduro has arrived in China along with General Rodolfo Marco Torres, his Vice President for Economic Affairs, and other officials, in an effort to obtain additional financial support for his regime.  Ricardo Menendez, Vice President for Planning and Knowledge, has claimed talks are aimed at developing infrastructure here, while Alejandro Grisanti, chief analyst at Barclay's Capital, indicates talks will center on renewing pending funding agreements based on oil deliveries and future payments. "We expect the disbursement of US$ 5 billion, which have been announced, but for reasons unknown have not yet been disbursed", he says. If Maduro manages to get a renewal of the Large Scale Fund, he could get an additional US$ 10 billion for 2015-2016. He has also visited Vietnam to seek larger trade. (Reuters, http://www.reuters.com/article/2015/08/28/us-venezuela-china-idUSKCN0QX2I720150828; El Universal, http://www.eluniversal.com/nacional-y-politica/150831/venezuela-vietnam-initial-bilateral-cooperation-agreement; and more in Spanish: El Nacional; http://www.el-nacional.com/; AVN; http://www.avn.info.ve/contenido/presidente-maduro-arriba-china-para-establecer-alianzas-estrat%C3%A9gicas-para-desarrollo-com%C3%BAn; AVN; http://www.avn.info.ve/contenido/cooperaci%C3%B3n-entre-venezuela-y-china-garantiza-desarrollo-proyectos-favor-del-pueblo; http://www.avn.info.ve/contenido/venezuela-y-china-afinan-acuerdos-materia-vialidad-y-energ%C3%A9tica; El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/venezuela-y-china-instalan-subcomision-cientifica-.aspx#ixzz3kTtly1Yi)

 

Crackers in Caracas

This month Venezuela’s currency, the bolívar, passed a melancholy milestone: its value on the black market is now a hundredth of what it is supposed to be at the main official exchange rate. The government insists that there are 6.3 bolívares to the dollar, but it will cost you 630 to buy one from a willing seller. As the country’s stock of hard currency shrinks and the central bank prints money to plug a huge budget deficit, the bolívar’s collapse is accelerating. It is worth a thousandth of what it was in 1999, when Hugo Chávez came to power. The country may be on the verge of hyperinflation. Most economists reckon that the inflation rate is already 120% a year (the central bank stopped publishing price data, so no one is sure). Some expect it to reach 200% by the end of 2015. The government uses a labyrinthine system of price and exchange controls to shield Venezuelans from soaring prices. But these make matters worse. Price ceilings have devastated local production; factories are operating at half-capacity and more than two-thirds of food is imported. Affordable goods are in short supply. The “spiral of inflation and poverty” will be resolved only when Maduro reforms the economy by reducing the deficit, overhauling the state-owned oil company and eventually dismantling exchange controls. With parliamentary elections due in December, and the government trailing in the polls, he is likely to balk at the short-term pain such measures would cause. He is caught between a left-wing faction, which thinks that the economy needs still more controls, and a military-based mafia that profits from arbitrage under the current rigged system. (The Economist, http://www.economist.com/news/americas/21659764-government-prints-money-hyperinflation-looms-crackers-caracas)

 

Bloomberg View: How Hugo Chavez trashed Latin America's richest economy

When Hugo Chavez first took office as Venezuela’s president in 1999, the country wasn’t exactly anybody’s economic model. Great oil riches had been squandered, repeatedly. Inflation was a recurrent problem -- it had topped 100% in 1996. The economy wasn’t growing much. Almost half the population was below the country’s poverty line. Still, Venezuela was Latin America’s most affluent country, thanks to all that oil. Its government finances were in tolerably good shape, also thanks to oil. Now, Venezuela’s economy is a disaster. The government stopped releasing regular economic statistics in December. The latest estimate from the Troubled Currencies Project run by Steve H. Hanke of the Cato Institute and Johns Hopkins, meanwhile, is that inflation is really 808%. Food shortages have become a problem, a debt default seems almost certain, and a complete economic collapse isn’t out of the question. Chavez began calling his approach governing "Socialism of the 21st Century." But it was more akin to what political scientist Terry Lynn Karl dubbed "petrolization" -- making the spending of oil money your government's main purpose, even after the oil money starts to run out. This has left the country in an impossible situation. Chavez isn’t around anymore, but this is clearly his crisis. He took a country that was muddling along, and put it on course to become a basket case. There are worse kinds of rulers than that -- those who massacre their own people or lead their nations into hopeless wars. But in terms of basic macroeconomic management Hugo Chavez has to go down as one of the most disastrous leaders the world has seen quite in a while. (Bloomberg, http://www.bloombergview.com/articles/2015-08-27/how-hugo-chavez-trashed-latin-america-s-richest-economy)

 

 

Politics and International Affairs

 

Maduro accuses Colombia of plotting his assassination with Santos' consent

President Nicolás Maduro has charged there are plans to assassinate him that have "the consent, the blind eye" of the Colombian government headed by Juan Manuel Santos. "They are attacking us from Bogotá, I have proof that I will show of how there is a campaign to kill me from Bogotá ... unfortunately with the consent and the blind eye of the Colombian government", he said during his tour of Vietnam. He added that President Santos "is allowing himself to be led by his advisors, he is losing his common sense". To date, Maduro has denounced 17 alleged assassination plots against himself. More in Spanish: (Infolatam, http://www.infolatam.com/2015/08/31/maduro-acusa-a-colombia-de-querer-asesinarle-con-permiso-de-santos/)

 

OAS turns down emergency meeting, as Venezuela insists on direct dialogue with Colombia

Colombia fell just one vote short of getting the OAS to call an emergency meeting of regional Foreign Ministers to discuss the border conflict between Venezuela and Colombia. 17 nations voted to call the meeting, 11 abstained, 5 voted against the initiative, and Dominica was absent. Roy Chaderton, Venezuelan President Maduro's envoy to the OAS, claimed during the meeting that Venezuela is open to direct dialogue with Colombia to solve border issues. More in Spanish: (Agencia Venezolana de Noticias; http://www.avn.info.ve/contenido/venezuela-reitera-di%C3%A1logo-directo-colombia-como-v%C3%ADa-para-enfrentar-problem%C3%A1tica-fronteriza; El Universal, http://www.eluniversal.com/nacional-y-politica/150901/oea-descarta-discutir-tema-colombo-venezolano; AVN; http://www.avn.info.ve/contenido/oea-rechaza-propuesta-convocar-cancilleres-problemas-frontera-colombo-venezolana; El Nacional; http://www.el-nacional.com/)

 

UNASUR calls meeting of foreign ministers council at Colombia´s request

Former Colombian President Ernesto Samper, now Secretary General of the Union of South American Nations (UNASUR), says he is coordinating a meeting of foreign ministers, as requested by Colombia, to address the border crisis with Venezuela. Samper is coordinating the meeting along with the Ministry of Foreign Affairs of Uruguay, which holds the pro-tempore presidency of UNASUR until April 2016. (El Universal, http://www.eluniversal.com/nacional-y-politica/150831/unasur-arranges-foreign-ministers-council-requested-by-colombia)

 

8,250 Colombians leave Venezuela due to border crisis

More than 8,250 Colombians have left Venezuela since the border crisis between the two countries began 10 days ago, with some deported and others going voluntarily, according to the latest figures from the Colombian government.
The border has been partially closed by the Venezuelan government for the past 10 days. Officials at the Colombian unified command post on the border told EFE that 1,097 people have been deported by Venezuela, while some 7,162 left the neighboring country out of fear of the tense situation. Meanwhile, at least 2,333 Colombians are staying in shelters set up to receive them. In the Colombian city of Cucuta, which connects with San Antonio in the Venezuelan state of Tachira, the government has concentrated most of the humanitarian aid for returning Colombians, who arrive with the few belongings they are able to carry in their race to leave Venezuela. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395411&CategoryId=10717)

 

Colombia to grant citizenship to Venezuelans with Colombian relatives

Colombian Minister of Foreign Affairs María Angela Holguín announced that the Colombian government will grant Colombian citizenship to Venezuelans who have been separated from their families as a result of deportations ordered by the Venezuelan government, or the voluntary return of Colombian migrants to their home country. "Venezuelans wanting to come living with their Colombian husbands, wives, or with relatives, will have access to the Colombian nationality," Holguín explained in the bordering city of Cúcuta, where there are thousands of Colombians that have been deported or have left Venezuela voluntarily. (El Universal, http://www.eluniversal.com/nacional-y-politica/150831/colombia-to-grant-citizenship-to-venezuelans-with-colombian-relatives)

 

US offers to help Venezuela-Colombia 'Worsening humanitarian situation'

The Department of State has noted its continuing concern over the situation along the border between Venezuela and Colombia, expressed support for efforts by Colombia and Venezuela to resolve the dispute diplomatically, and welcomed initiatives to address the situation in appropriate multilateral fora. "We stand ready to work with both countries and other regional partners to find a peaceful, humane, and enduring solution. As we do so, we urge that special attention be paid to the worsening humanitarian situation along the frontier. We respect the importance of secure borders and safe and orderly migration. However, we also believe that deportations should take place in accordance with international law, respecting the human rights of all involved, and in coordination with the receiving country. We also believe that refugees with recognized protection concerns should not be deported." (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395416&CategoryId=10717)

 

Venezuela calls European Union position on border conflict "hypocritical"

The Venezuelan government said the communiqué by the European Union (EU), which asserted that the order issued by the Venezuelan government to shut down the border between Colombia and Venezuela and the expulsion of thousands of Colombian immigrants jeopardizes the stability of the bordering region is "immoral and hypocritical".
"Venezuela rejects the immoral and hypocrite communiqué (...) conveying, with no grounds or evidence, serious accusations against our country in relation with the sovereign decision of adopting measures to fight Colombian paramilitary groups, drug trafficking, and systematic attacks on the Venezuelan economy," said the Venezuelan foreign office. (El Universal, http://www.eluniversal.com/nacional-y-politica/150831/venezuela-calls-hypocrite-eu-stance-over-border-conflict)

 

UN sends mission to analyze Guyana-Venezuela conflict as Venezuela fails to get CARICOM support

United Nations Secretary General, Ban Ki-moon, has dispatched a mission to Guyana in order to find a new mechanism to settle the Guyana-Venezuela border dispute. The mission was sent after Guyana formally indicated that after "25 years of the Good Offices Process, no solution to the border controversy had been found," hence, "it is time to invoke another means of settlement". The current government of Guyana has said that the border dispute on the land border established in 1899 by an arbitration tribunal should be settled at the International Criminal Court (ICC). Guyana's Foreign Minister Carl Greenidge says: "Venezuela recently went all over the Caribbean seeking support from CARICOM members, but did not get it...all member countries including its President Freundel Stuart, of Barbados, ratified deep and unflinching support for Guyana and its position". (El Universal, http://www.eluniversal.com/nacional-y-politica/150829/un-sends-mission-to-analyze-guyana-venezuela-conflict; and more in Spanish: El Nacional; http://www.el-nacional.com/)

 

Prosecutor General formally charges Leopoldo López and imprisoned students

Venezuela's Prosecutor General's office has finally presented formal court charges against Leopoldo López and four imprisoned students, largely based on his Twitter account messages before and during the February 12th demonstration. Two of the students were charged with public instigation, collusion, arson and damages. Showing no evidence, the Prosecutor's office said the teenagers that damaged its headquarters received flammable material from the students. (El Nacional; http://www.el-nacional.com/; Agencia Venezolana de Noticias; http://www.avn.info.ve/contenido/mp-cerr%C3%B3-acusaci%C3%B3n-contra-leopoldo-l%C3%B3pez-instigaci%C3%B3n-p%C3%BAblica-y-asociaci%C3%B3n-para-delinquir; El Universal, http://www.eluniversal.com/nacional-y-politica/150901/fiscalia-ya-presento-alegatos-finales-en-el-juicio-contra-lopez)

 

Dozens of Venezuelans shot by police amid crime crackdown

Concerns are rising over a recent crime-fighting initiative that aims to take back neighborhoods overrun by gangs. The program, officially rolled out in July as Operation Liberate the People, has already seen police shoot and kill more than 80 suspected criminals. There have been no reports of police injuries or deaths during the crackdown. Human rights groups accuse security forces of carrying out summary executions. But many here also say the government is right to take a more militarized approach to fighting crime. Venezuelans broadly support iron-fist policing. And it's the poor— those more likely to be caught in the crossfire— who most want to see greater use of force, according to national polls. President Nicolas Maduro has not spoken about the issue. National Assembly speaker Lieutenant Diosdado Cabello addressed concerns about police killings generally in July, saying opposition groups were trying to score points by undermining what he said was an effective approach. Venezuela has the world's second-highest murder rate, after Honduras, according to the United Nations. Virtually everyone here has been touched by violence, and a culture of impunity means most killings go unsolved. While police generally acknowledge when they kill someone, it is not always clear that the slaying was committed in self-defense. The U.N. Committee Against Torture has called on the country to investigate an emerging pattern of extrajudicial killings. On Monday, two international human rights groups, Human Rights Watch and Freedom House, expressed concern about the number of fatal shootings during this summer's pacification operations. Analysts say the anti-crime initiative appears to be a bid to drum up support ahead of December elections, while Venezuelan police increasingly are under attack themselves, with an average of one officer killed every day, often for their weapons. Venezuelan police say they are scared to leave their stations. Last spring, they held a street march demanding better protection and harsher punishment for criminals. (Associated Press, http://news.yahoo.com/dozens-venezuelan-shot-police-amid-crime-crackdown-040408127.html)

 

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.