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.

Wednesday, November 11, 2015

November 09, 2015

International Trade


Cargo that has arrived at Puerto Cabello:

  • 30,000 tons of white corn from Mexico for state agency LOGICASA
  • 30,000 tons of sugar from Brazil for state agency CORPOVEX
  • 40,000 TM of steel for Petróleos de Venezuela S.A. (PDVSA)
  • 1,027 head of cattle from Nicaragua, 42,000 tons of powdered milk, 170,000 tons of black beans and 30,000 tons of rice from Brazil, all for state agency CASA
More in Spanish: (El Universal,; El Mundo,; Bolipuertos,;;;



Oil & Energy


Oil Minister talks about renegotiating PDVSA debt, says joint venture partners must finance entire projects

Oil Minister and PDVSA President Eulogio Del Pino has said that  a company that has honored its engagements as we have, I think is in a position to speak to the main bond propose a change in short term debt accruals" to make them easier to bear. He also said that all of PDVSA's partners in joint enterprises must hold not only their own portion of project financing "but also that portion (of financing) accruing to PDVSA (60%)". He said whatever financing is obtained must be "in the name" of the partner, with much lower interest rates than PDVSA can get on the open market. This way the state oil company will benefit from its partners' better credit ratings. More in Spanish: (El Mundo:


...but BARCLAY's says PDVSA bond restructuring is not attractive to investors

A report to clients from BARCLAYS Capital indicated a PDVSA bond restructuring may not be attractive to investors. It emphasized that in the absence of economic policy changes, a restructuring arising from to "financial difficulties" could undermine investors interested in the process. More in Spanish: (El Mundo,; El Nacional,


Venezuela oil price rises but stays below US$ 40

Venezuela's weekly oil basket price recovered from the previous week's low, but stayed below US$ 40 as oil prices around the world bounced on recovering economies and output falls in Brazil and Libya. 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 November 6 was US$ 39.90, up US$ 1.26 from the previous week's US$ 38.64. WTI in New York averaged US$ 46.63 -- up US$ 1.67 -- for the week, while Brent crude traded in London averaged US$ 49.09 -- up US$ 1.05 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$ 46.78 for the year. (Latin American Herald Tribune,; Veneconomy,;


Venezuela seen as major beneficiary of Obama's Keystone XL snub

President Barack Obama’s rejection of TransCanada Corp.’s proposed Keystone XL pipeline could give Venezuela’s ailing economy a lifeline. With the world’s largest oil reserves, the country produces heavy crude that’s similar in consistency to the one coming from Canada’s oil sands, and its economy relies largely on shipping it to the same U.S. Gulf Coast refineries that Keystone XL was meant to supply. (Bloomberg,


Maduro will travel to Saudi Arabia for ASPA Summit

President Nicolás Maduro is going to Riyadh, Saudi Arabia, to take part in the Summit of South American and Arab Countries (ASPA). During the summit he will repeat the need to convene a presidential summit with Organization of Petroleum Exporting Countries (OPEC) members and non-members, in order to establish strategies to defend the oil market. More in Spanish:  (AVN;





Government is considering joint ventures in gold mining

Oil and Mining Minister Eulogio Del Pino has announced that his office is considering inviting the private sector to take part in joint ventures to recover domestic gold production, and are evaluating areas destined for government exploration, and those suitable for private participation in order to present a proposal to President Maduro. More in Spanish: (Ultimas Noticias,



Economy & Finance


Venezuela is running out of cash & 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. (Latin American Herald Tribune,

.....withdraws US$ 467 million from its savings at IMF

Last month Venezuela withdrew .US$ 467 million from its savings in the International Monetary Fund (IMF), according to data supplied by the organization. This is the third operation of such kind this year in the middle of economic recession in Venezuela following the plunge of its oil income. The IMF website showed data that indicates that Venezuela cashed money from its special drawing rights (SDR) to have more liquid position of its international reserves and use such funds to pay debt and finance imports. Venezuela counts its position in SDRs as part of international reserves, which had dived to their lowest level in 12 years, in the middle of crumbling oil prices. After this recent withdrawal, in addition to a couple withdrawals made earlier, in April and July, one for US$ 1.8 million, Venezuela's position in SDRs shrank by nearly US$ 806 million, according to latest data. (El Universal,


....and is reported to be in talks with China for a currency swap

Venezuela's Central Bank is in conversations with its Chinese counterpart over a possible currency swap that would allow the nation to boost its dwindling international reserves, two sources familiar with the talks told Reuters. The arrangement, which one source said could total around US$ 3 billion, would provide financing for Venezuela to import Chinese goods or maintain part of its reserves in yuan, leaving more dollar reserves available to meet foreign bond payments amid investor concerns of a potential default. The sources did not know which side initiated the discussions, which began at least 10 months ago, but said the parties have not reached an agreement. That is in part because it is not immediately evident how China would benefit from holding bolivars. (Reuters,


Venezuela has paid US$ 27 billion in foreign debt service in two years, according to President Maduro, who says US$ 13.5 billion were paid out this year and an equal amount last year, despite "economic warfare" and a "financial blockade" by the opposition and foreign banks, which "makes his blood boil", and denied there will be a default. More in Spanish: (Notitarde;; El Mundo,


Industrial production is down more than 75% to date this year

Juan Pablo Olalquiaga, President of the nation's National Council of Industries (CONINDUSTRIA) says the drop in inventories due to limited FOREX access had led to a drop in industrial productivity. He says there was a 75% drop during the first semester, and the decline will increase by the end of the year, causing "the end of contracts with small and medium business, and a loss of jobs". More in Spanish: (El Nacional,



Politics and International Affairs


The campaign for legislative elections will officially begin next Friday, November 13 at 6 A.M., and will end at midnight on December 3, as per a recent decision by the National Election Board. (Veneconomy,


National Elections Council to sign agreement for UNASUR election "escorts"

Sandra Oblitas, Vice President of the National Elections Council (CNE) has announced that the institution will soon draw up the agreement to ensure attendance of a group of international election "escorts" from the Union of South American Nations (UNASUR) at upcoming legislative elections on December 6th. "Experts, academicians, legislators" are coming, she said. For his part, Jesús Torrealba, Executive Secretary of opposition Unified Democratic Conference (MUD) coalition says that the technical electoral mission approved by the Union of South American Nations (UNASUR) that will visit Venezuela will be "radically different" from UNASUR missions sent in previous elections. He said the opposition does not yet know who will head the group after a debate within UNASUR, but added "this is good news, because UNASUR used to be a monolithic bloc, applauding anything the regime would say, and there are now nuances. This is a very important fact, beyond who takes which position".  (El Universal,; and more in Spanish:  (El Universal,


Shifting goal posts help pro-regime candidates in parliament vote

Venezuela is projecting a drastic set of migration patterns in months leading up to the pivotal Dec. 6 parliament vote: to take one parliamentary seat away from affluent anti-government areas of Caracas and add one to the working-class Socialist Party bastion of in the Tuy valley region outside the capital. Government critics say there is no evidence of such an improbable population shift. Critics say the government has shuffled districts, devised confusing ballots to help its candidates and declared states of emergency in border regions to crimp opposition campaigns. There are also long-running complaints over Socialist Party campaigns using state resources, and inadequate international observation. They also accuse Socialist Party allies - such as the MIN - of posing as opposition forces on the ballot to sow confusion and drain votes from the opposition coalition. Ismael Garcia, a 28-year-old parking lot attendant with no evident political experience, was registered at the last minute as a MIN Unity candidate. His name will appear side-by-side on the ballot next to an opposition candidate with more than 30 years of political experience: a man also named Ismael Garcia. Even after the changes, the Socialist Party faces a tough election. Nationwide polls show voters are more than twice as likely to back opposition candidates than those of the Socialist Party, according to surveys between July and September. (Reuters,


Capriles blames Maduro for attack by armed gang

Miranda state governor and former Presidential candidate Henrique Capriles has blamed President Nicolás Maduro for an armed attack made on him during a tour of Yare municipality in his own state "by a small group of armed pro-regime people, presumably supported by pro-regime (local) mayor Saúl Yánez". "Things have changed, Nicolás Maduro. Not even by shooting at me in my own state will you stop your oncoming defeat", he wrote on Twitter. More in Spanish: (Infolatam,


Venezuela says U.S. military plane violated airspace

The Venezuelan Defense Ministry has claimed that a U.S. DASH-8 military aircraft violated its maritime airspace and the armed forces of Caracas said they detected “unusual” air activity by other U.S. “intelligence equipment” based in Curaçao. The U.S. Coast Guard DASH-8, “equipped with an electro-optic system that allows the detection of thermal energy to create images, violated our airspace over the territorial waters created by Los Monjes,” a Caribbean archipelago, said Defense Minister Gen. Vladimir Padrino. He said that the violation occurred last Friday and that the complaint “was transmitted to the Foreign Ministry for the appropriate action.” (Latin American Herald Tribune,; Reuters,; El Universal,


Venezuelans rank fifth in political asylum requests to the United States this year, according to NGO Refugee Freedom Program’s Director Julio Henríquez. Last year, Venezuela ranked 10th. Henríquez said it was impressive to see how Venezuelans went from being tourists in the United States to politically persecuted. (Veneconomy,; El Universal,


Maduro to address UNHR Council this Thursday

President Nicolás Maduro will speak to the plenary of the United Nations Human Rights Council next Thursday. A special meeting of the Council will be held "as a matter of courtesy" at the request of the government of Venezuela.
(El Universal,


Maduro regrets meeting with Colombia's Santos has been postponed

President Nicolás Maduro has revealed that due to scheduling problems a planned meeting with his Colombian counterpart Juan Manuel Santos to deal with the border closing has been postponed until next year. He added that if it is necessary to keep the border closed for two years, "so be it". More in Spanish: (Infolatam,


Once again, Venezuela’s Ombudsman is held by migration authorities, this time in Panama

Tarek William Saab was again held for questioning by migration authorities. This time it happened in Panama when he was to board a plane to Uruguay to attend a meeting of the Latin American Federation of Ombusdmen. Last month, he was held for questioning at the Airport of Mexico City because he has an Interpol Type I alert issued by the United States. (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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