December 07, 2015

International Trade

 

Cargo that has arrived at Puerto Cabello:

• 11700 tons of powdered milk
• 3600 tons of chicken
• 3240 tons of beef
• 1512 tons of black beans
• 792 tons of margarine, and
• 540 tons of bone free pork,  all from Brazil, for state agency CASA

More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=34002; Notitarde, http://www.notitarde.com/La-Costa/Bolipuertos-descargo-863-contenedores-con-alimentos-2571492/2015/12/07/744147/)

 

Guyana expects Mexico to replace Venezuela as its largest rice customer

Guyanese Prime Minister Moses Nagamootoo says his government expects to shortly close a deal for Mexico to replace Venezuela as their largest export market. (El Mundo, http://www.elmundo.com.ve/noticias/economia/internacional/guyana-espera-que-mexico-reemplace-a-venezuela-com.aspx#ixzz3tiohsKO9)

 

 

Oil & Energy

 

Ahead of elections, Venezuela oil price crashes to 6 year low

Venezuela's weekly oil basket collapsed further this week, hitting a 6 year low as oil prices around the world continued falling on ample production and slowing demand. 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 December 4 was US$ 34.05, down 88 cents from the previous week's US$ 34.93. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2401319&CategoryId=10717)

 

 

Economy & Finance

 

Venezuela bonds up on election

Bonds from Venezuela rose across the curve after an opposition election win in the oil-rich but crisis-hit country. (Reuters, http://www.reuters.com/article/emerging-markets-idUSL8N13W1SO20151207#ujXmrewdd1HISAA8.99)

 

Business asks the new Assembly to promote more investment here
Francisco Martínez, head of Venezuela's main business federation, FEDECÁMARAS, says "the new National Assembly must take prompt action to bring in a change in the political, economic and social system. The nation has voted for more enterprise, more work and more productivity". He added that changes must be directed at creating more jobs, decent salaries, productive land, full shelves, where "savings" are possible. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/gremios/empresarios-proponen-a-la-nueva-an-fomentar-mayor.aspx#ixzz3tioB0kFH; El Universal, http://www.eluniversal.com/economia/151208/empresarios-piden-correctivos-economicos)

 

 

Politics and International Affairs

 

Venezuela opposition thrashes "Chavismo" to win 2/3 of legislature

Venezuela's opposition has trounced the ruling Socialists to win the legislature for the first time in 16 years and gain a long-sought platform to challenge President Nicolas Maduro's rule. Fireworks were set off in celebration in pro-opposition districts of Caracas when the results were announced, while government supporters dismantled planned victory parties. Maduro quickly acknowledged the defeat, the worst for the ruling "Chavismo" movement since its founder Hugo Chavez took power in 1999, but blamed his defeat on a campaign by business leaders and other opponents to sabotage the economy. Ecstatic opposition leaders vow to use their new majority in Venezuela's legislature to free jailed opponents of the government but also said they would not move to dismantle popular welfare policies.  Aware that victory owed more to public discontent with Maduro than love for the opposition, coalition head Jesus Torrealba urged Venezuelans to bury their differences.  Torrealba said the opposition needs to "reinvent itself" to face the crisis Venezuela is suffering. "Uniting in resistance is not as uniting in ruling. Uniting in opposition is not as uniting to legislate. We have a huge responsibility. What happened yesterday (Sunday) was an electoral tsunami, a great vote of confidence, but a vote of confidence is very different from a blank check," he pointed out. (Reuters, http://www.reuters.com/article/venezuela-election-idUSL1N13W08T20151207#lH7o6XcXMCWhpv7W.99; http://www.reuters.com/article/venezuela-election-idUSL1N13W0E820151207#gmG8QlFeD6EUC5vL.97; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2401343&CategoryId=10718; El Universal, http://www.eluniversal.com/nacional-y-politica/151207/mud-uniting-in-resistance-is-not-as-uniting-in-ruling)

 

JP MORGAN: Venezuela: A resounding victory, but no quick fix

Venezuela’s opposition won a resounding victory in the December 6 elections for the National Assembly, adding a check and some balance on Chavismo’s longstanding political hegemony, and breathing oxygen into medium-term scenarios for regime change. The CNE announced that turnout was 74.25%, quite high for a parliamentary election, and favorable to the opposition given the large numbers of disaffected former Chavistas. Maduro showed no contrition about the stagflationary results of the government’s economic policies, sticking to the narrative that the government has been the victim of an “economic war” of "sabotage" by domestic and international economic elites. This tone suggests the government will stay true to its macroeconomic policy narrative rather than take ownership of any policy adjustments. The opposition would seek to have the government take responsibility for adjustment measures, most visibly FX devaluation and unification, trying to avoid blame for supporting “neoliberal” policies. Assuming no near-term adjustments, the economic situation is bound to continue to be dire, potentially introducing social tension into the mix once it becomes evident that the high-profile political event has failed to deliver any immediate, tangible improvements on day-to-day economic struggles. (JP MORGAN Economic Web Note: ATTACHED)

 

Big challenges lie ahead for a delicate winning alliance in Venezuela

The fragile coalition which managed to come together to achieve victory over the Chavista government now faces the test of trying to stick together and use its newly won congressional authority to address the country’s deep economic problems and political rifts. The opposition now has the two-thirds majority needed to call a constitutional convention, remove Supreme Court justices or carry out other important measures that could exert enormous pressure on the leftist government of President Nicolás Maduro. Opposition legislators can remove the vice president, cabinet members and the directors of the Central Bank, and press ahead with investigations of corruption. While there are many different parties and leaders in the opposition, they generally agree on basic economic principles like the promotion of private enterprise and foreign investment. Opposition leaders are keenly aware that if Maduro was forced out in the coming months — a goal voiced by many in the opposition — there would probably be a new election to succeed him. Several of those leaders consider themselves contenders.  The most telling split in the opposition is between a radical wing, led most prominently by the jailed Leopoldo López, a former mayor, and a more moderate wing, led primarily by former Presidential candidate and Miranda Governor Henrique Capriles. Capriles and López have long been rivals within the opposition movement, and López’ leadership of the more aggressive anti-government strategy only highlighted the rift between them. At a post election press conference, Capriles said “It wasn’t just Venezuela that won yesterday, a policy won and that policy was ours.”  He said that it was urgent to focus first on economic issues.  But many opposition leaders talked forcefully after the landslide victory of moving quickly to seek Maduro’s removal from office — perhaps through a recall election, changes to the Constitution or by forcing him to resign. “Given the seriousness of the crisis obviously we have to stay united,” Capriles said. But he added that the group’s unity had been affected in the past by “individual projects, by egos, and a misunderstanding of the reality that people were living.” In the wake of the election it was not just the opposition that was thinking about potential strains on its unity. Chavismo has been riven by increasingly deep divisions since the death of Chávez in 2013 and those will only be exacerbated by the election debacle. In the coming months, many analysts believe, there could well be pressure within Chavismo to cut a deal with the opposition, possibly putting pressure on Maduro to step down, which would trigger new elections. The knives were already out for the president on Monday. A popular Chavista blog featured a column calling for his resignation and that of the National Assembly leader, Diosdado Cabello. The writer, Javier Antonio Vivas, said that the people had sent Maduro a message that his administration was “dreadful, sectarian, corrupt and vulgar.” He accused the politicians of murdering Chávez’s revolution and said that if they did not quit, the people would kick them out “before Chávez is erased from the historical, political and social thinking” of Venezuelans. (The New York Times, http://www.nytimes.com/2015/12/08/world/americas/big-challenges-lie-ahead-for-a-delicate-winning-alliance-in-venezuela.html)

 

US congratulates Venezuela on democratic election, no change in relations anticipated

The United States congratulated the people of Venezuela for making their voices heard in a peaceful and democratic way on Election Day.  "We urge Venezuelan electoral authorities to continue to tabulate and publish voting results in a timely and transparent fashion. Venezuelan voters expressed their overwhelming desire for a change in the direction of their country. Dialogue among all parties in Venezuela is necessary to address the social and economic challenges facing the country, and the United States stands ready to support such a dialogue together with others in the international community." (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2401344&CategoryId=10717)

 

Argentina's Macri discards ousting Venezuela from MERCOSUR

Argentine President-elect Mauricio Macri's incoming government will not seek to suspend Venezuela from South America's MERCOSUR trade bloc, backtracking from earlier comments after Venezuela's ruling Socialists took a beating in Sunday's parliamentary elections. Macri had said he would seek Venezuela's suspension from Mercosur because of accusations of rights abuses committed by President Nicolas Maduro's government, saying he would trigger the bloc's democratic clause to do so. "The democratic clause is applied to facts, and the facts were yesterday's election. I think that today we can say that the elections have worked as established by the democratic framework and it appears that the results, which have been recognized by President Maduro, are a majority for the opposition," Argentina's foreign minister-designate, Susana Malcorra, said. (Reuters, http://www.reuters.com/article/us-argentina-venezuela-mercosur-idUSKBN0TQ22N20151207#lwsIkRkDjuWoxSgd.97; El Universal, http://www.eluniversal.com/nacional-y-politica/151207/argentinas-macri-not-to-request-democratic-clause-against-venezuela)

 

OAS SC forecasts "future of peace" in Venezuela after congress vote results

Luis Almagro, Secretary General of the Organization of American States (OAS), has predicted a "future of peace" for Venezuela after the opposition won in the parliament vote here. He further voiced his wish for the beginning of a process of "talks" and "national reconciliation" in Venezuela. (El Universal, http://www.eluniversal.com/nacional-y-politica/151207/oas-sc-forecasts-future-of-peace-in-venezuela-after-congress-vote-resu)

 

China expects Venezuela to retain stability after parliament vote results

China, one of the main trade partners and investors in Venezuela, is confident that the country will maintain the stability after the parliament vote. "We hope they (Venezuela) may retain stability and development in the country," a spokesperson from the Chinese Foreign Ministry said during a press conference. (El Universal, http://www.eluniversal.com/nacional-y-politica/151207/china-expects-venezuela-to-retain-stability-after-parliament-vote-resu)

 

Colombia's Santos congratulates Venezuela on "calm, transparent vote"

Colombian President Juan Manuel Santos has congratulated Venezuela for holding "a calm, peaceful and transparent election," where the triumph of the opposition has put an end to 16-year Chavista hegemony. "Colombia is pleased by this important step in the Venezuelan democracy, and we wish those necessary talks between the government and the opposition, represented today in the Executive and Legislative, (Powers) may be held constructively," the Colombian Head of State added. (El Universal, http://www.eluniversal.com/nacional-y-politica/151207/colombias-santos-congratulates-venezuela-on-calm-transparent-vote)

 

Bolivia's Morales calls to reflect on electoral results in Venezuela

Evo Morales, President of Bolivia, remarked that the results of the legislative election here should foster a reflection on the defense of leftist political processes. "Results (in Venezuela) should convene a deep reflection to figure out how we can defend our democratic revolution (...) where there is a process of economic liberalization, we need to hold a debate for the sake of humankind," he said. (El Universal, http://www.eluniversal.com/nacional-y-politica/151207/bolivias-morales-calls-to-reflect-on-electoral-results-in-venezuela)

 

Felipe González asks for talks toward a reconciliation

Former Spanish President Felipe González asked the Venezuelan government and the opposition coalition Unified Democratic Unity to open a "national dialogue" to favor reconciliation, face the economic crisis and restore peace in the country. In reference to the parliament vote held on Sunday, December 6, González termed the opposition triumph as "resounding". (El Universal, http://www.eluniversal.com/nacional-y-politica/151207/felipe-gonzalez-requests-venezuelas-maduro-talks-for-reconciliation)

 

 

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.