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, December 29, 2015

December 29, 2015

International Trade


Japanese Chamber President says companies to spur projects in Venezuela

According to Erwin Miyasaka, the President of the Venezuelan - Japanese Chamber (CAVEJA), Japanese companies are contemplating to resume commercial projects in Venezuela in 2016, particularly in the areas of energy, petrochemicals, the automotive industry and technology. "We hope to take in many off track activities in the Energy Cooperation Committee set up by both nations," he says. "Biannual meetings provide a forum for sharing common interests and open up a whole world of opportunities." In Miyasaka's opinion, Venezuela is one of the few attractive countries to invest in the region. "Even with prices of US$ 40 a barrel the business of hydrocarbons and derived products is profitable on the basis of domestic costs," he says. "With the current Organic Law of Hydrocarbons, according to experts in the field, there would be no need to change." (El Universal,



Economy & Finance


Guerra says economy could further deteriorate in 2016

Economist José Guerra, recently elected as an opposition legislator to the National Assembly, says the nation is undergoing an economic tragedy due to a severe contraction along with inflation that is destroying wages. He says GDP shrank 11%, inflation rose 200% and food prices increased 250% as scarcity of regulated food reached 80%. “All of this lead to a 40% drop in wages and pensions, only a nation devastated by war has such statistics. The Central Bank’s monetary policy played a large role in price trends, by financing the deficit by printing money.” More in Spanish: (El Nacional,


2015 was the worst economic crisis in 100 years

According the ECOANALITICA think tank, 2015 has seen the worst economic crisis in a century, due to scarcities and lower buying power, which have diminished the quality of life for middle and lower class Venezuelans as a result of FOREX cuts for private imports and individuals which hurt food subsidies as well as remittances, Internet operations, travelers and students. FOREX allocations to these activities dropped 66% from US$ 137.5 million daily in January-November 2014 to US$ 46 million daily in the same time frame during 2015. More in Spanish: (El Nacional,


Majority in the National Assembly will call for economic reform

Re-elected legislator Julio Borges says the role of the majority in Parliament is to demand that the government take steps on the economy to meet the needs of Venezuelans. He said “the regime must decide if it will be a part of those changes the nation is demanding, or if it continues paralysis”. More in Spanish: (El Mundo,


PSUV economists say 6.30 FOREX dollar rate must disappear

Economists within the pro-government United Socialist Party (PSUV) met recently to seek proposals for the government on economic policy. One of their suggestions was to modify exchange policy, and legislator Jesus Faría spoke of an option to reach a single exchange rate by doing away with the 6.30 rate. Other economists called this rate “unsustainable”. More in Spanish: (Ultimas Noticias,


International reserves rose US$ 1.830 billion

According to Central Bank data published December 23rd, Venezuela’s total FOREX reserves rose US$ 1,830 billion to US$ 16.518 billion, up to October levels. More in Spanish: (El Mundo,; Ultimas Noticias,



Politics and International Affairs


Opposition will call for “change in government” if National Assembly work is blocked

Re-elected legislator Julio Borges, coordinator of the PRIMERO JUSTICIA party, supported statements by Henry Ramos Allup, Secretary General of ACCIÓN DEMOCRÁTICA, also re-elected to the National Assembly, on “changing the government” in six months, and specified that seeking the constitutional means for it will depend on whether the government “sabotages the changes for which millions of Venezuelan’s voted for”. Ramos has written that the coalition will “honor” all proposals made during the campaign among them “the commitment to seek within the six months following the inauguration of the new National Assembly a constitutional, democratic, peaceful and electoral way to change the government”. He added that the coalition proposals were “signed and ratified by all of those who are part of democratic unity, and they are still in force and unscathed and we will honor them”, and said no matter will be prioritized because they are all “dramatically urgent”. Earle Herrera, a re-elected pro-government legislator, says his side is prepared in case the opposition wants to invoke constitutional means against the President, such as a referendum to revoke his mandate: “The Constitution…has answers for each of the constitutional options the opposition calls for”, he says. Ramos and Borges are currently the leading contenders to preside the incoming National Assembly. More in Spanish: (El Universal,


Opposition seeks to elect new National Assembly president by consensus

The leaders of parties within the Democratic Unity Conference (MUD) that have elected legislators are meeting to discuss a proposal by PRIMERO JUSTICIA to seek a consensus on rules to guide the work of the full opposition caucus, including choosing Assembly authorities and committees. If no consensus is reached, it seems probable the new authorities, including the President, will be elected through a vote on January 3rd. After the New Assembly takes office on January 5th, the coalition will announce its agenda. In a statement published on the Internet, the group again called for “freeing political prisoners, the return of exiles and the end of persecution against thousands of students and young people”. The statement emphasizes that “what is at stake is the viability of the nation itself, beyond the stability of a government”. (El Nacional,; Ultimas Noticias,


Audits discard fraud claims in December 6th elections

Two audits carried out after the December 6th elections show the system performed correctly with few election infractions, which throws out fraud arguments alleged by authorities. More in Spanish: (El Nacional,


Supreme Tribunal endorses outgoing National Assembly decisions

The Constitutional Chamber within the nation’s Supreme Justice Tribunal has decided that all decisions taken by the outgoing National Assembly during the special sessions called by outgoing Assembly President Captain Diosdado Cabello, are legal and there is no limitation on the matters they can decide. In this way they intend to reinforce the appointment of 13 new Tribunal justices despite charges that their designation is unconstitutional. More in Spanish: (El Nacional,


Designation of Supreme Tribunal justices published

On December 23rd, the official Gazette published the designation of 13 Supreme Tribunal justices made by a simple majority of the outgoing National Assembly during a special session. The new members of the powerful Constitutional Chamber are Calixto Ortega, Luis Damiani-Bustillos, and Lourdes Suárez-Anderson. More in Spanish: (El Universal,; Ultimas Noticias,


Venezuelans in U.S. linked to US$ 1 billion in PDVSA bribes

The U.S. accused two men of taking part in a US$ 1 billion bribery scheme to secure contracts with Venezuela’s state oil company and linked one of the duo to a former head of Venezuelan military intelligence wanted for alleged cocaine trafficking. Roberto Rincon-Fernandez, a Venezuelan national, was ordered held without bail on charges of conspiring to launder money and violating the Foreign Corrupt Practices Act in connection with Petroleos de Venezuela SA, according to an order signed Dec. 19 by U.S. Magistrate Judge Nancy K. Johnson citing an indictment.  Abraham Jose Shiera-Bastidas, a Venezuelan living in Florida, was jailed in Miami on the same charges. The bribes included monetary gifts, travel, hotel reservations, meals, liquor, car rental, a yacht, a US$ 14,000 stay at the Fontainebleau Hotel on Miami Beach, and other gifts to obtain “business on behalf of Rincon’s and Shiera’s companies,” according to the joint indictment filed in Miami. In her order to keep Rincon behind bars, Johnson said he “has significant assets which could fund a fugitive life-style” and there’s a “serious risk” he could flee. Rincon, with homes in Aruba and Spain, has a “close personal friendship” with retired Venezuelan General Hugo Carvajal, who was arrested in Aruba on Rincon’s private aircraft and later released, according to the order. Carvajal – recently elected to the National Assembly on the government party ticket - is wanted in the U.S. for drug trafficking and Aruba has declined to extradite him, according to Johnson’s order. The case is U.S. v. Rincon-Fernandez, 15-cr-654, U.S. District Court, Southern District of Texas (Houston). (Bloomberg,


Venezuela reached homicides record in 2015

According to the Venezuela Violence Observatory (OVV) non-government organization, violent deaths in this nation were up to 27,875 this year, a 12% increase over last year – up to 90 for every 100,000 inhabitants, which makes Venezuela one of the most violent nations in the Hemisphere. At mid-year the government was admitting to only 66 homicides per 100,000 inhabitants. More in Spanish: (Infolatam,


Venezuela ceases mediator role in talks with Colombia’s ELN

Venezuela has allegedly abandoned its role as a mediator in the rapprochement efforts that have been under way for two years between the Colombian government and the guerrilla National Liberation Army (ELN) intended to start a peace process similar to that taking place since 2012 in Cuba with the Revolutionary Armed Forces of Colombia (FARC). The digital edition of Colombian newspaper El Tiempo reported that "according to sources close to the rapprochement," the government of Venezuelan President Nicolás Maduro has "decided to freeze its mediation". (El Universal,


Two hurt when Venezuelan police chopper crashes in Colombia

Both occupants were injured when a helicopter of Venezuela’s national police crashed just across the border in the northern Colombian province of La Guajira, Colombia’s defense minister said. The aircraft crashed onto a parking lot in the village of Paraguachon in the Colombian municipality of Maicao, but did not catch fire, Luis Carlos Villegas said.
According to the minister, the two crew members flying the Bell helicopter were injured and were taken to medical centers in Venezuela. “Our presence at the site was a humanitarian effort to see if the crew members were being well looked after, and through diplomatic channels we will proceed to establish with the Venezuelan government what should be done with the helicopter wreckage that is left on this side of the border,” the minister told reporters. (Latin American Herald Tribune,


Samper: Changes of course in Argentina, Venezuela are normal in democracy

Ernesto Samper, Secretary General of the Union of South American Nations (UNASUR), says political changes in Argentina and Venezuela are a "normal change in direction" within a democratic system, and he refused claims that the region is in the middle of ideological confrontation. "There is no need for drama over these changes," he added. (El Universal,


Fourth CELAC Summit to be held in Quito on January 27, 2016

The Fourth Summit of the Community of Latin American and Caribbean States (CELAC) will be held on January 27 next year in Quito, Ecuador. Cuban Vice-Foreign Minister Abelardo Moreno said that the 33 countries comprising the CELAC would seek to establish new ways to reduce inequality in the region. "There are great expectations. CELAC is our mechanism for political agreement, which has consolidated upon the summits held so far," Moreno said. (El Universal,



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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