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.

Tuesday, November 3, 2015

November 03, 2015

International Trade


Cargo that has arrived at Puerto Cabello:

  • Over 96.000 tons of chemicals for state oil company PDVSA.
  • 1,300 tons of steel parts for PDVSA
  • 30,000 metric tons of corn and 30,000 tons of rice from China
  • Over 30,000 tons of corn from Mexico
  • 500 containers of food: 34 rice, 83 milk, 44 margarine, 205 chicken and 205 beef, from Brazil for CASA.
  • 254 heavy duty tractor vehicles from Brazil for state agency FONDAS.
More in Spanish: (El Universal;; Bolipuertos,


Trade remains paralyzed at Colombian border

Some 2,641 tons of merchandise, valued at around US$ 6.4 billion are backed up in storage areas in bordering Colombia, according to the Colombia's International Trade Logistics Agents Federation (FITAC). The Federation reports additional cost iw close to US$ 7 billion. More in Spanish: (Notitarde,


Defense Minister General Vladimir Padrino has confirmed the purchase of 12 SUKHOI 30 fighter jets from Russia, for a total US$ 480 million. More in Spanish: (El Universal,


Maduro creates trade corporation with Eastern Caribbean

President Nicolás Maduro has announced the creation of "a powerful economic and trade area in all of the Caribbean". He spoke during his official visit to Saint Vincent and the Grenadines. The new organization is to be called the Eastern Venezuela Trade Corporation to direct trade with Saint Vincent and the Eastern Caribbean. More in Spanish: (El Universal,; Ultimas Noticias,; Notitarde,; El Mundo,; AVN;



Oil & Energy


Venezuela oil price tumbles further below US$ 40

Venezuela's weekly oil basket price fell further back below US$ 40 as oil prices around the world slipped and as the crucial U.S. market remained well supplied. 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 October 30 was US$ 38.64, down 83 cents from the previous week's US$ 39.47, when it had tumbled US$ 2.02. WTI in New York averaged US$ 44.76 -- down $1.24 -- for the week, while Brent crude traded in London averaged US$ 48.04 -- down 70 cents from the previous week. According to Venezuelan government figures, the average price in 2015 for Venezuela's mix of heavy and medium crude is now US$ 46.93 for the year. (Latin American Herald Tribune,; El Universal,


PDVSA to receive 935,000 barrels of Angola’s Girassol oil crude in its Bullenbay terminal in Curacao after granting the order to Norwegian STATOIL. (Veneconomy,; El Universal,



Economy & Finance


Venezuela is running out of cash and selling its gold

Venezuela is running out of money fast and has started selling its gold. The cash-strapped country could default by next year when lots of debt payments are due. Venezuela's reserves, which are mostly made up of gold, have fallen sharply this year as the country needs cash to pay off debt and tries to maintain its social welfare programs. Venezuela owes about US$ 15.8 billion in debt payments between now and the end of 2016. But it doesn't have enough to make good on its payments. Venezuela only has US$ 15.2 billion in foreign reserves -- the lowest amount since 2003. A lot of those reserves are in gold. Less than US$ 1 billion of Venezuela's reserves are in cash, and it has a couple billion in reserves at the IMF. The government won't say how much gold it currently has. In May, Venezuela had US$ 11.7 billion -- nearly 70% -- of its reserves in gold and it was fast dwindling. In February, it had US$ 14 billion in gold reserves. Both these figures are from the most recent government data. "It'll have to sell some of its gold reserves to make the debt payments," says Edward Glossop, emerging markets economist at Capital Economics. "[Cash] reserves are almost virtually zero.". Some say that the falling reserves are just another example of how poorly mismanaged Venezuela is under Maduro. "What kind of government does it take to bring a country with the largest oil reserves in the world to the brink of bankruptcy?" says Russ Dallen, managing partner at LATINVEST, a Miami-based firm that invests in Venezuela. (CNN Money,


Central Bank gold holdings dropped 19% between January and May

Venezuelan Central Bank gold holdings declined in value by 19% between January and May, according to its financial statements, likely reflecting gold swap operations and lower bullion prices. The nation holds a considerable portion of its monetary reserves in gold. (Reuters,


Is the government of Venezuela readying a new "Dakazo"? 

Back in November 2013, the Maduro regime decided to intervene distributors of household appliances as well as other related businesses and retail chains. They were forced to sell all their in-stock merchandise at prices below cost. The first to fall into the clutches of this operation was DAKA, one of the largest distributors of home appliances in the country (hence the name of Dakazo.) The tactic bore temporary fruit in the weeks that followed: it temporarily forced prices down and many were able to buy products beyond their financial reach, which had a positive impact on the municipal election result for the candidates of the ruling, United Socialist Party of Venezuela (PSUV). (Latin American Herald Tribune,


BBVA decided to exclude the results of its branch in Venezuela, the BBVA Banco Provincial from its global results since it claims the SIMADI exchange rate distorts the result and the comparison with the previous year. (Veneconomy,


Price law in Venezuela is designed to control distribution

After amending the Law on Fair Prices the Venezuelan government intends to deal once and for all with distribution of all food items in Venezuela, says President Nicolás Maduro. The move is intended to make the business sector implement the maximum price of public sales and the fair price, in addition to the prohibition of markup and cost estimates at the parallel exchange rate. (El Universal,


Venezuelan industries barely surviving

Venezuelan industries find themselves in a "desperate struggle for survival" says Juan Pablo Olalquiaga, President of Industrial Confederation (CONINDUSTRIA). But, he adds, despite adversity, the country's manufacturing sector "is determined to move forward to maintain production and preserve jobs". Since 1999 - the year when the current regime came to power -the industrial sector in Venezuela "has been falling slowly but steadily, heading toward a virtual standstill," for a variety of reasons, says Olalquiaga. In 1998 the manufacturing sector's share of the gross domestic product (GDP) stood at 17.4%; in 2012 it fell to 13.9%; in 2013 it stood at 13.7%; and in the third quarter of 2014 at 13.4%, according to figures provided by CONINDUSTRIA. If corrective actions are not implemented to address all of the failure causes "all the jobs in the industrial sector are at risk of being lost," says Olalquiaga. According to official figures from the National Statistics Institute (INE), there were at least 11,117 industrial facilities in full production in Venezuela at the end of 1998, employing 449,636 workers. By 2007 the number of industries dropped to 7,093 and employment declined to 345,168. (El Universal,



Politics and International Affairs


Maduro says he won't hand over revolution

President Nicolas Maduro has warned that he will not allow a defeat in December legislative elections derail his government even as his socialist party faces the possibility of losing control of the national assembly for the first time in 16 years. While the he says he will accept the results of the election, whatever the outcome, he’s not willing to “surrender the revolution.” “I would govern with the people, always with the people and the civil-military union,” Maduro said on state television, in response to a question on how he would govern in the event the opposition takes control of congress. “In such a scenario, Venezuela would enter one of the most turbulent and poignant stages of its political life.” (Bloomberg,


NUEVO HERALD reports growing discontent with Maduro regime within military barracks

Miami's NUEVO HERALD daily reports there is growing discontent with the Maduro regime in Venezuelan barracks, particularly among lower level officers and troop members hurt by economic problems and criminal activity in the nation. More in Spanish: (El Nacional,


CNE claims it's system is the most audited in the world

Tibisay Lucena, President of the National Electoral Council (CNE), has charged that a "very small" political group is willing to "seize power" using anti-democratic arms if it does not get voter's support in the upcoming parliament vote on December 6. She alleged that political "laboratories" are accountable for a smear campaign aimed at questioning and disregarding the electoral results. She stressed that Venezuela's electoral system "is safe, it is the most audited system in the country, the region, and the entire world". (El Universal,


Uruguay’s Electoral Court, which presides over the UNASUR’s Electoral Council has warned that the “sense” of the regional bloc’s observation mission for the Venezuelan legislative elections on December 6 is “at risk.” In an official document, Uruguay's Court considers that “in case it were not possible to set up the mission in time and form,“ it should not be carried out to preserve the South American group of nations record “ favoring democratic exercise in the region.” (Veneconomy,


Opposition to bring international guests to parliamentary elections

Jesús Torrealba, Executive Secretary of the opposition Democratic Unity Conference (MUD), says it is "ironic" that National Elections Board chairperson Tibisay Lucena has said former Latin American heads of state that have expressed concern over conditions for upcoming parliamentary elections are "ignorant in election affairs"; and announced the MUD will bring its own guests, "former members of parliaments, diplomats and former presidents who will not be scared off by someone in a hood or a uniform". More in Spanish: (El Universal,


Maduro will bring legal action against Obama decree in the US

President Nicolás Maduro says his government will bring suit in the United States against a decree by his US counterpart Barack Obama which terms Venezuela an "unusual and extraordinary" threat against the US. More in Spanish: (El Universal,; AVN;; Ultimas Noticias,


Recession weakens Venezuela's UNASUR leadership

Venezuela no longer can hold leadership over South American nations on the basis of financial and trade agreements. Economist Víctor Álvarez, a former minister for Trade and Industry under the late Hugo Chávez, says "Venezuela no longer has the capacity to exercise leadership within UNASUR....due to having mismanaged oil wealth. We don't even have enough to pay our partners in the group, and that is why there is scarcity." More in Spanish: (El Nacional,


Apologetic Venezuelan prosecutor says country's justice system ruled by fear

A Venezuelan state prosecutor who helped put prominent opposition leader Leopoldo Lopez behind bars said he apologized to the jailed man's parents by phone this week after fleeing the country to avoid pressing the government's trumped-up case. "I'm ashamed. I broke up a family," Franklin Nieves said in Miami, as he accused the Venezuelan socialist government of pressing him to use false evidence to convict Lopez. "In Venezuela fear rules; that's the way the law is," he said. Antonieta Mendoza, Lopez's mother, said she forgave Nieves because of her Catholic faith but did not trust him. Nieves said he had begun the process of filing for political asylum in the United States but has had no contact with U.S. officials since his arrival last week. Venezuela's chief prosecutor has denied her office put pressure on officials to use false evidence in the Lopez trial. He has received a mixed reception in Miami where some Venezuelan exiles say he deserves forgiveness while others say he should have resigned from the case before it went to trial. Nieves says he hopes his revelations will force the government to overturn Lopez's conviction. "The appeal judges have a opportunity to make history and annul this case and free Leopoldo," he said. (Reuters,



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.

1 comment:

  1. Nowadays it's easy to take loan in India, even then I will suggest before taking it, gather all information regarding loans. For detailed information, visit gold loan with minimum interest rate .