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, May 31, 2016

May 31, 2016

International Trade


Cargo that has arrived at Puerto Cabello:

  • 30.000 tons of raw sugar
  • 60.000 tons of paddy rice
  • 60.000 tons of baker wheat
  • 10.000 tons of crude soybean oil
  • 30.000 tons of cake of soy
More in Spanish: (Bolipuertos,; Notitarde,; Agencia Venezolana de Noticias;; El Universal,; Ultimas Noticias,


Trade with Colombia down another 20%

Data from the Colombia’s National Statistics Department (DANE) indicate trade between Colombia and Venezuela during Q1 2016 was only US$ 311 million, down 20% from US$ 389 million last year. (El Universal,



Logistics & Transport


Airlines suspend more flights to Venezuela as economic crisis worsens

Venezuela has for years seen airlines reduce capacity to this country as they struggled to repatriate revenue. Now, two more airlines are calling it quits altogether. LATAM Airlines Group SA, Latin America’s largest carrier, said Monday that it would cut all flights to Caracas by August. LATAM also highlighted economic conditions, saying it wouldn’t resume flights when things improved. A day earlier, Deutsche LUFTHANSA AG had said it would suspend its three weekly flights to Venezuela next month “until further notice.” The German airline’s spokesman, Andreas Bartels, pointed to the challenge of repatriating revenue from Venezuela and a sharp drop in ticket demand -- especially among business travelers -- with the nation mired in its third year of a deep recession. Venezuela owes Lufthansa over US$ 100 million in ticket revenue. Carriers have struggled for years to transfer back profits from Venezuela, leaving billions of dollars trapped in bolivars -- the local currency. The International Air Transport Association (IATA) has been pushing Caracas to free trapped airline revenue. (Bloomberg,; Reuters,; El Universal,; Reuters,; El Universal,



Economy & Finance


Venezuela’s oil income drops to under US$ 100 million per month

The drop in oil prices, the weight of foreign debt service cost, and lower production levels have drastically closed the stream of oil dollars that used to flow into Venezuela’s state coffers, lowering real income contributions to mere drops. Experts report that PDVSA contributions to Central Bank accounts are now below US$ 100 per month, after costs and debt service. This is in contrast to US$ 2-3 billion the company used to contribute two years ago. Russ Dallen, managing partner at Caracas Capital Markets, explains that “the numbers do not work”, leading the Maduro regime to sell off its few remaining foreign assets and spend reserves on importing around US$ 1 billion in food each month. Maduro himself has acknowledged the gravity of the situation, and said: “If we look to January 2010, income was US$ 1.790 billion; it was US$ 2.463 billion in January 2011; it was US$ 3 billion in January 2014; US$ 815 million in January 2015; and in January 2016 we only have US$ 77 million”.  More in Spanish: (El Nuevo Herald:


Economic czar hints at FOREX release

Economic Affairs Vice President Miguel Pérez Abad has seemed to hint that FOREX operations will soon be liberated. He told media “we will soon release, set in motion, the FOREX system, particularly that which is of highest interest to the domestic economy, the supplementary exchange system”. He added that the “exchange rate relies on the market behavior and it acknowledges other stockholders, not only the government, because it is twofold: capture foreign currency, manage foreign currency to accomplish two fundamental goals, such as import substitution and promote exports.” However, expert economist Henkel García, of ECONOMÉTRICA, clarified that Pérez Abad did not promise to fully liberate the exchange rate, “what he meant was that DICOM would soon be implemented, something which has not yet happened…what he is talking about is that the new system would really be one of free access”. (El Universal,; and more in Spanish: El Nacional,



Politics and International Affairs


OAS head Almagro seeks emergency meeting on Venezuela

The head of the Organization of American States (OAS) has called for an urgent meeting to see if crisis-hit Venezuela's socialist government had breached democratic rules, which could lead to a process of suspension. Luis Almagro, a former Uruguayan foreign minister, has called Venezuelan President Nicolas Maduro a "petty dictator," accusing him of disrupting democracy by blocking the opposition-controlled congress and putting loyalists in the Supreme Court. A statement from the Washington-based OAS said Almagro was invoking the body's Inter-American Democratic Charter and had requested a meeting of the permanent council between June 10-20 to analyze the situation in Venezuela. Venezuela views the OAS as a pawn of hostile U.S. policy, and Maduro has dismissed Almagro as a turncoat working for its ideological adversaries in Washington. A two-thirds vote in the 34-nation OAS' General Assembly would still be needed to suspend Venezuela. Caracas has lost the support of diplomatic heavyweights Brazil and Argentina following their recent shifts to the right. But it still enjoys strong support from small Caribbean and Central American nations, including those who benefit from preferential oil and fuel sales, which could ensure it a numerical advantage in any vote. (Reuters:


National Assembly President to ask for the floor at OAS meeting

Henry Ramos Allup, President of the National Assembly, says he will request the floor at the Permanent Council of the Organization of American States (OAS) to raise the issue of the current crisis here. Ramos says initiatives by OAS Secretary General Luis Almagro are “invaluable”. (El Universal,


UNASUR sponsored efforts toward a dialogue here appear to be failing

The Union of South American Nations (UNASUR) has been promoting talks between the Venezuelan regime and its opponents, using the good offices of former Presidents José Luis Rodríguez Zapatero (Spain); Leonel Fernandez (Dominican Republic) and Panama (Martín Torrijos). A statement by UNASUR Secretary General Ernesto Samper says the talks are designed to strengthen the economy, preserve the rule of law, democracy and national sovereignty. Exploratory talks were held with both sides – separately - in the Dominican Republic last week, but Venezuela’s Foreign Minister Delcy Rodríguez went on media to falsely report both sides had met, which drew a wave of criticism. Opposition representatives called Rodríguez a liar and said that past UNASUR efforts have failed. They stressed that they did meet with UNASUR representatives to emphasize their four key conditions for entering into talks: Immediate freedom for political prisoners, a democratic solution this very year, respect for the National Assembly, and official recognition of the domestic humanitarian crisis. The Democratic Unity coalition (MUD) further said that any effort towards a dialogue is not viable if these demands are not accepted. For its part, the government priority is to block or delay a recall referendum against President Nicolas Maduro. Given the high level of polarization and confrontation for more than 15 years there are no bridges between the government and the opposition here. Civil war talk prevails on both sides, with “chavistas” accusing the opposition of coup-mongering and being the allies of imperialism; and the opposition refusing to recognize any legitimacy in the regime. UNASUR Secretary General Ernesto Samper reported the separate meetings and said they would continue.  (Bloomberg,; El Universal,; and more in Spanish: (Infolatam: Noticias,;; America Nuestra:; El Universal,


Roman Catholic hierarchy says UNASUR is not adequate to promote talks here

Venezuela’s Roman Catholic hierarchy is willing to lend its good offices for talks needed to meet the national crisis, and believes the Union of South American Nations (UNASUR) is not adequate as a facilitator for contacts that began last week in the Dominican Republic. The bishops believe that “UNASUR can do little to promote talks, it lacks the strength to further a dialogue, and is not an adequate participant since the government had a lot to do with its formation. In addition, at other times UNASUR efforts came to nothing. A strong player is needed, or several international organizations, that are accepted as valid by both sides”.  More in Spanish: (El Nacional,


Elections Council calls off key meeting with opposition representatives

Miranda state governor and opposition leader Henrique Capriles reported that the National Elections Council (CNE) called off a scheduled meeting with opposition representatives to discuss the requested recall referendum. He called for new demonstrations to demand action by the CNE, which he accused of stalling. More in Spanish: (El Universal,


Kerry welcomes bid to spur talks between Venezuela, opposition

U.S. Secretary of State John Kerry spoke to former Spanish Prime Minister José Luis Rodríguez Zapatero on Thursday to welcome the efforts he is leading to facilitate dialogue between the government of Venezuela and members of the Venezuelan opposition. Kerry said the United States stands ready to help Zapatero, alongside former Dominican President Leonel Fernandez and former Panamanian President Martín Torrijos, in their efforts. (Reuters,; El Universal,


Mexico calls for inclusive talks in Venezuela

The Mexican government welcomed “the first encounters for talks” between the Venezuelan government and the opposition and made an appeal for an “inclusive” dialogue. The Mexican Ministry of Foreign Affairs says it hopes the initiative will help “Venezuelans find a solution to the tough situation in their country.” (El Universal,


Argentina could seek MERCOSUR meeting on situation in Venezuela

Argentina’s Foreign Affairs Minister Susana Malcorra has announced that her government is calling for a meeting of foreign ministers of the Southern Common Market (MERCOSUR) to tackle the current situation in Venezuela. Malcorra said that the democratic clause of the economic bloc is likely to be enforced in Venezuela, but reiterated that “the only solution” to the situation here requires “talks” between the government and the opposition. (El Universal,


Argentina, Chile and Uruguay appeal for an urgent political dialogue in Venezuela

Argentina, Chile and Uruguay in a joint statement released on Friday issued “an urgent call for an effective political dialogue and a genuine civic understanding among all political and social actors called for political dialogue in Venezuela” and offered to help with a “national reunion” of the political and social forces of the country, The appeal was made extensive to the government, the National Assembly, under opposition control, and all political and social groups. (Mercopress:


Opposition lawmakers report on Venezuela’s crisis in Paraguay

Opposition legislators from Venezuela met with the head of the Paraguayan Chamber of Deputies, Hugo Velásquez, to report that Venezuela is facing “a humanitarian crisis” because the government “has destroyed the country’s productive apparatus.” The delegation told journalists that Venezuela “lacks basic products” and that nationals “are going through an inconceivable situation verging on atrocity,” Efe reported. (El Universal,


Washington Post Editorial: The agony of Venezuela continues

Numerous governments, including the Obama administration, last week called for political negotiations in Venezuela to head off an incipient and potentially catastrophic breakdown of political and economic order. Former Spanish prime minister José Luis Rodríguez Zapatero traveled to Caracas with other statesmen to urge President Nicolas Maduro and opposition leaders to start talking. But Maduro was otherwise occupied. At the end of the week, he ordered tanks, aircraft and soldiers to patrol the country, claiming — not for the first time — that he was trying to head off a U.S. invasion. Thus does the delusional heir of Hugo Chávez drag a country of 30 million people, with the world’s largest oil reserves, over a cliff. By most measures, Venezuela is already a failed state: Amid crippling shortages of food, medicine, power and water, every societal ailment is soaring. Inflation is headed toward 700%, and the murder rate is probably the world’s second-highest, after El Salvador’s. According to the New York Times, deaths of infants under a month old in public hospitals are 100 times more common than three years ago, while a coalition of nongovernmental organizations says at least 200,000 people with chronic illnesses lack the medications for them. An April poll, reported by the Miami Herald, showed that 86% of Venezuelans said they bought “less” or “much less” food than they used to, while only 54% said they ate three times a day. No wonder there have been numerous reports of mobs sacking food warehouses, as well as dozens of instances of vigilante lynching of suspected thieves. Thanks to Maduro and the corrupt and incompetent coterie that surrounds him, this chaos is likely to grow steadily worse.  Calling for “political dialogue” is one way to respond to this unfolding crisis. Yet Maduro and other top regime officials, many of them implicated in drug trafficking or other major crimes, have repeatedly failed to respond seriously. It’s time for more pressure to be put on them, such as through sanctions by the Organization of American States under its democracy charter. (The Washington Post:


Venezuela drifts into new territory: hunger, blackouts and government shutdown

Step by step, Venezuela has been shutting down. This country has long been accustomed to painful shortages, even of basic foods. But Venezuela keeps drifting further into uncharted territory. In recent weeks, the government has taken what may be one of the most desperate measures ever by a country to save electricity: A shutdown of many of its offices for all but two half-days each week. But that is only the start of the country’s woes. Electricity and water are being rationed, and huge areas of the country have spent months with little of either. Many people cannot make international calls from their phones because of a dispute between the government and phone companies over currency regulations and rates. COCA-COLA FEMSA, the Mexican company that bottles COKE in the country, has even said it was halting production of sugary soft drinks because it was running out of sugar. There is often little traffic in Caracas simply because so few people, either for lack of money or work, are going out. Last week, protests turned violent in parts of the country where demonstrators demanded empty supermarkets be resupplied. And on Friday, the government said it would continue its truncated workweek for an additional 15 days. The growing economic crisis has turned into an intensely political one for President Nicolas Maduro, who looks increasingly encircled. American officials say the multiplying crises have led Maduro to fall out of favor with members of his own socialist party, who they believe may turn on him, leading to chaos in the streets. (The New York Times:


Harrowing scenes of Venezuela on the brink of collapse – in photos

The lines outside Venezuelan supermarkets can stretch for hours, snaking down sidewalks and right-angling around corners. Each one is like a hissing fuse. Will they explode? Venezuela withers away a little more each week. Another food staple or medicine or industrial part goes missing, bringing the breaking point closer. The national guard troops policing the supermarket lines grip their riot shields and truncheons tighter, looking ever more jittery. It all is a waiting game. The government of President Nicolas Maduro is waiting for a rise in oil prices to save it from catastrophe. It is waiting for rainfall to rescue its hydroelectric plants and end the rotating blackouts that have cut the work week for state employees from five days to two. The government is holding on to hopes of another loan from China, or any other creditor willing to lend it a little breathing room. Venezuela’s political opposition is also watching the fuse, and sometimes trying to fan it, but its street protests look small beside the food lines. The opposition took control of parliament in December, but that didn’t matter. Maduro disregards their laws, their votes, their condemnations and warnings. They’re bystanders too, for the most part. For how much longer? The waiting game goes on. Venezuela’s neighbors are playing it, too, wondering if the crash can be softened and how far it may ripple. U.S. officials think the end is close. But all manner of experts and outsiders have been saying that about Venezuela for a while now, and the lines just get longer. The weariness looks like exhaustion in these images from Venezuelan photographer Alejandro Cegarra. His pictures show the Caracas park where he played as a kid, now in ruins, and a nearby McDonald’s, empty of customers because runaway inflation means a Happy Meal costs nearly a third of an average monthly wage. There is no shortage of street crime and violence in this dystopia. While Cegarra found plenty of battle-clad guardsman to keep the supermarket lines in formation, the cop in a nearby park was a cardboard cutout. Venezuela is running on an empty tank. The government can’t stop the slide, and the opposition can’t stop the government. All that’s left to do is wait until something gives. (The Washington Post:


Spain to monitor situation of its nationals living in Venezuela

Spain will closely monitor the situation of the nearly 200,000 Spanish nationals living in Venezuela in view of the deteriorating conditions in the Andean nation, Deputy Prime Minister Soraya Saenz de Santamaria said Friday.
She cited the “very significant deterioration” of public safety in Caracas and other cities and said Spaniards living in Venezuela are suffering from the same shortages of basic necessities affecting the rest of the population. (Latin American Herald Tribune,


Is the Venezuelan regime committing genocide by omission?

Oliver Sánchez, an 8-year-old child who participated in a demonstration because he was not receiving the chemotherapy procedure he required due to the lack of appropriate medicines, has passed away. Sánchez had Leukemia and, in his last days, he was rushed from one hospital to another because any of them ensured medical attention because of the lack of supplies. He died after 10 days of intensive care in a private clinic. At the same time, patients of Hospital Vargas in Caracas have to buy everything (even their own drinking water), while the company that used to provide food to that public health center stopped doing so simply because the Government does not pay. (Latin American Herald Tribune,


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.

Thursday, May 26, 2016

May 26, 2016

International Trade


World City organization reports US-Venezuela trade shrank by 48.09% in Q1 2016

According to World City trade between Venezuela and the United States dropped almost 50% during the first quarter this year. World City President Ken Roberts says “Venezuela had US$ 23.880 billion in trade with the US in 2015 and the total for the first quarter this year was US$ 3.250 billion. During an event organized by the Florida International Bankers Association and the Latin America Banking Federation, Roberts said “The numbers are overwhelming, and anyone who reads know what is happening there. Venezuela is a disaster”. More in Spanish: (El Nacional,



Oil & Energy


Venezuela nominates Ali Rodriguez as next OPEC Secretary General

Venezuela has nominated the country's former energy minister, Ali Rodriguez, as the next secretary general of the

Organization of the Petroleum Exporting Countries (OPEC), to succeed Abdullah al-Badri, who was elected acting secretary general in December until the end of July after serving full terms. Rodriguez previously served as secretary general of OPEC in 2001-2002. (Reuters,


Maduro says Venezuela, Trinidad & Tobago will boost energy cooperation

After a meeting with Keith Rowley, Prime Minister of Trinidad & Tobago, Venezuela’s President Nicolas Maduro announced that the two countries had signed an agreement that will enable both nations to develop shared gas fields. He added that there is a plan to establish a US$ 50 million revolving fund to promote an increase in trade between the two countries. (AVN,





Venezuela to rejoin global group fighting conflict diamonds

Venezuela expects to rejoin the global watchdog established to stop trade in conflict diamonds as it seeks to resume diamond exports, its central bank director said on Tuesday. "We are certain we will rejoin this year," says Jose Khan. He also said Venezuela was a tiny exporter of around 3,000 carats a month until, unable to verify the legitimacy of its diamonds, it stopped issuing export certificates in 2005 and unilaterally removed itself as an active participant in the Kimberley Process in 2008. After its withdrawal, it was not officially allowed to export diamonds, although some smuggling continued in subsequent years, traders told Reuters. (Reuters,



Economy & Finance


Venezuela sells more gold, borrows from IMF

Venezuela shipped 11,948 kilograms of gold to Switzerland in April for a total value of US$ 466.3 million, after shipping 12 metric tons of gold in March, 12 metric tons in February and 36 metric tons in January.  According to the Swiss government, in the last four months, Venezuela has shipped 72 metric tons of gold worth US$ 2.63 billion to Switzerland so far in 2016. According to our best estimates, April’s gold sales mean that Venezuela is now down to US$ 7.3 billion in gold, now just half of the US$ 14.5 billion it had at the start of 2015. The sad thing is that the gold was not enough and last month Venezuela also had to turn to the world’s lender of last resort, the International Monetary Fund (IMF). According to April IMF statistics, Venezuela borrowed US$ 374 million (266 million SDR) from its Special Drawing Rights (SDR) account at the IMF.  While that is the first SDR borrowing by Venezuela this year, Caracas has now quietly borrowed US$ 2.734 billion in total since if first drew SDR from the IMF in April of last year.  Venezuela counts its Special Drawing Rights as part of its reserves.  The country cut its gold reserves by 16% in the first quarter, following a 24% reduction in 2015, according to data from the International Monetary Fund. Meanwhile, Venezuela’s foreign reserves hit a new decade low of $12.10 billion last week, less than half of what they were just last March. (Bloomberg,; Reuters,; El Universal,; Caracas Capital Markets:


Maduro advisor is reported to be pushing  for a PDVSA default

According to sources close to state oil company PDVSA, President Nicolas Maduro’s economic advisor, Alfredo Serrano Mancilla, of Spain, is seeking to overrule local economic authorities in order to impose a hostile bond swap in PDVSA which would be tantamount to a default. Serrano has invited Alejandro Vanoli, who headed up Argentina’s Central Bank under Cristina Kirchner, to help him convince Maduro. The proposal is the opposite of the strategy pursued by PDVSA President Eulogio del Pino, who is working on a rescheduling of company debt. More in Spanish:
(El Nacional,



Politics and International Affairs


National Assembly demands referendum schedule from the National Elections Board

Venezuela’s legislature has passed a resolution demanding that the National Elections Board publish the schedule for the recall referendum sought by the opposition, and named a special committee of legislators to take the resolution to the electoral authority, More in Spanish: (El Universal,


OAS Secretary General Almagro will deliver report on Venezuela next week, backs referendum

OAS Secretary General Luis Almagro announced he will present his report on Venezuela next week “at the very latest”, a sign that he will probably call a meeting of the full 34-member nation organization soon to discuss the situation here under Article 20 of the Democratic Charter. The unprecedented step will open up a process of meetings and votes that could lead to resolutions and diplomatic moves which could end up suspending Venezuela as a member state. Two thirds of the member states must approve such a step, which was only taken after the coup in Honduras in 2009. If he does, he will be the first Secretary General to call for such action against the will of the government in question. Almagro has previously said that the recall referendum promoted by Venezuela’s opposition to recall President Nicolas Maduro us the “only solution” here. He also said that the recall vote “does not belong to Maduro or (Henrique) Capriles. It belongs to the people. These people need to resolve their own situation and they want to make a decision.” Almagro had also announced his report will include “food and medicines shortages, the cases of corruption that may exist, human rights situation and freedom of expression, and a way for Venezuela to move ahead.” (El Universal,; and more in Spanish: (Infolatam:;


Argentina and Brazil seek “conciliation” in Venezuela

There is a drastic change in MERCOSUR, the South American Common Market. Argentina and Brazil are hoping Venezuela finds a “way towards reconciliation”. During a visit to Argentina, Brazil’s new Foreign Minister José Serra has said “Venezuela is in a critical shape”, after meeting with his Argentine counterpart, Susana Malcorra. He termed the political crisis here “a significant situation for Latin America”; and added: “We are attentive. Brazil and Argentina are interested in the possibility of a mediation”, and expressed support for initiatives by Pope Francis and Spain’s former President José Luis Rodríguez Zapatero. More in Spanish: (Infolatam:


Spain offers to head a humanitarian aid fund for Venezuela

Spain’s Foreign Minister José Manuel García-Margallo says there is a “gigantic political crisis in Venezuela” and a “deadlocked situation” since a Supreme Tribunal that was “altered at the last moment” by the outgoing legislature is systematically declaring all decisions by the National Assembly as unconstitutional. He added that Spain has offered to head a humanitarian aid fund for Venezuela’s “extraordinarily needy” population and that “the political crisis makes the economic crisis worse”. “The economic crisis has become a gigantic humanitarian crisis”, he says.  García-Margallo reported scarcity is at 82% and the health system is in a “state of war”; adding that the opposition here “has scrupulously moved through constitutional means to shorten the term of office” of President Nicolas Maduro, and that Spain’s position is that the deadlock needs to be broken and make way for talks that lead to national climate and getting Venezuela out of “economic misery”. He also reported that his government has offered support to Albert Rivera, leader of Spain’s opposition “Citizens” party during his visit to Venezuela. Rivera travelled to Venezuela to support talks between the government and the opposition but was barred from meeting with jailed Caracas mayor Antonio Ledesma. Rivera addressed the Domestic Policy Committee of the opposition controlled National Assembly. (Latin American Herald Tribune,; and more in Spanish: Infolatam:;  El Universal,


Cuban Foreign Minister expresses “solidarity” with Maduro

Cuban Foreign Minister Bruno Rodriguez has brought President Nicolas Maduro a message of solidarity from Cuban President Raul Castro. Rodriguez spoke on Venezuelan state-run television and expressed “Cuba’s full solidarity, which is the message from Raul, the embrace of Fidel and the Cuban people, which is what I’ve brought to Caracas.” (Latin American Herald Tribune,



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.

Tuesday, May 24, 2016

May 24, 2016

Oil & Energy

PDVSA eyes US$ 2.5 billion debt issue to pay service firms

State oil company PDVSA is preparing to issue US$ 2.5 billion in promissory notes to settle unpaid bills to services companies, according to industry sources and documents seen by Reuters. PDVSA has already issued at least US$ 310 million in debt securities as part of a broader effort to prevent crucial oil services providers from downing their tools for lack of payment, Reuters reported this month. The company has hired little-known, Miami-based financial services firm CP Capital to structure 3-year notes with a one-year grace period that will have the same status as PDVSA's global bonds, according to documents obtained by Reuters. The operation creates additional financial obligations for a company already facing doubts about its capacity to meet ballooning bond payments amid low oil prices, a collapsing socialist economy, and chronic shortages reminiscent of the Soviet bloc. (Reuters,


Venezuela oil price up for 6th straight week

The price Venezuela receives for its mix of medium and heavy oil rose for a sixth consecutive week as oil prices around the world continued strengthening. According to figures released by the Ministry of Petroleum and Mining, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending May 20 was US$ 37.87, up US $2.59 from the previous week's US$ 35.28.  According to Venezuelan government figures, the average price in 2016 for Venezuela's mix of heavy and medium crude is now US$ 28.70 for the year to date. (Latin American Herald Tribune,


Maduro to continue PETROCARIBE’s cooperation with Jamaica

President Nicolas Maduro met with Jamaican Prime Minister Andrew Michael Holness in the island’s capital city, Kingston. There, Maduro reiterated his government would continue funding that country through multi-state oil alliance PETROCARIBE. (El Universal,


PDVSA reportedly is selling assets and pulling out of Argentina

An Argentine group called GMM has made an offer to buy of PETROLERA DEL CONO SUD, a PDVSA subsidiary which owns 95 service stations and storage tanks at Dock Sud. Local subsidiary denied the sale, but it is reported it has funding available only through the end of this year. More in Spanish: (La Nación:





Coca Cola production halts for lack of sugar

The Venezuelan bottler of Coca-Cola has halted production of sugar-sweetened beverage due to a lack of sugar. Production of sugar-sweetened drinks has stopped, but output of diet drinks such as Coca-Cola light and other zero-sugar beverages continued. (Reuters,; Bloomberg,;; El Universal,


Food shortages take toll on Venezuelans' diet, cattle slaughtered, people scrounge in garbage

With prolonged shortages of basic foods, Venezuelans have been forced to shift their diets to whatever they can find. And what they can find is not necessarily healthy. Milk, meat and beans – the main sources of protein in the Venezuelan diet – are hard to find or sold at exorbitant prices, and many are filling up on empty carbs from pasta, rice and the traditional arepa cornmeal cake. A study revealed last month by Venezuela’s top three universities showed that 12% of those polled said they were eating less than three meals a day.  And those who do have access to three meals have seen a deterioration in the quality of their diet,” said Marianella Herrera-Cuenca, of the Bengoa Foundation, an NGO dedicated to promoting nutrition. Children and the elderly are hardest hit. Investigators from the Bengoa Foundation said a sampling of 4,000 school-aged children showed 30% were malnourished and that school absences were on the rise.  Cruces, the nutritionist, predicted that future generations of Venezuelans will be shorter and wider because of the low quality of the food they are consuming. “The lack of calcium will stunt growth and excess carbohydrates will make them fat,” he said. Critics of the socialist government of Nicolas Maduro say food production collapsed in the oil-reliant country due to a mix of the expropriation of farmland and agro-industrial enterprises and strict price controls that made importing food cheaper than producing it locally. But a byzantine currency control system and plummeting oil prices have slashed imports of raw materials and food products. Opposition Congressman Elías Matta has reported cattle has been stolen and found slaughtered and quartered by hungry inhabitants of Zulia state, he also points to long lines seeking food at markets and other establishments, as well as people scrounging for food in garbage dumps near restaurants and shopping centers, “while indolent authorities are only concerned with clinging to power at any cost”. (The Guardian:; and more in Spanish: El Impulso:



Economy & Finance


Venezuela’s economy shrank 10.8% in Q1 2016

A source close to the Finance and Banking Ministry reports Venezuela’s economic activity dropped 10.8% during Q1 2016, down from the same period in 2015. Manufacturing, trade and oil register a severe contraction, which point to unheard of results by the year’s end. The same source reports demand dropped 6.7% and investment shrank 15.6% during the same period this year. Trade and Investment Minister Jesus Faria says the greatest hurdles for the economy are “in the exchange area and the lack of FOREX”, but claims the worst part is over and “there are signs that a fundamental improvement is coming”. More in Spanish: (El Nacional:


Supreme Tribunal says Maduro's state of emergency is “constitutional

The Venezuelan Supreme Court has ruled that a decree issued by President Nicolas Maduro last week declaring a state of emergency is constitutional. The decree gives Maduro extra powers to deal with Venezuela's economic crisis, including the right to impose tougher security measures. The opposition-controlled parliament rejected the decree, but the Supreme Court, which rarely rules against the government, immediately said the decree was justifiable.  The court upheld the decree because of what it called "the extraordinary social, economic, political, natural and ecological circumstances that are gravely affecting the national economy." In measures published in the government gazette on Monday, the armed forces and local committees now have powers to distribute and sell food. Authorities will also be allowed to cut the working week in the private sector, as they have done in the public sector, to conserve electricity. The new measures also allow the government to take control of basic goods or services, which analysts say opens the way to the expropriation of companies. (BBC News:


Dominican Republic’s Fernandez to coordinate talks on Venezuela’s economy

Spain’s former President José Luis Rodríguez Zapatero announced that a task force from the Union of South American Nations (UNASUR) headed by Leonel Fernandez, former President of the Dominican Republic, will work to “reactivate economic growth” in Venezuela as part of their efforts to seek political talks between the Maduro regime and its opponents. Fernandez said there would be talks “between the government, representatives of the Democratic Unity coalition, economists and the private sector” More in Spanish: (Notitarde,; El Mundo,; Ultimas Noticias,


Bridgestone sells Venezuela business

Tire manufacturer BRIDGESTONE has announced it is selling its business in Venezuela after over 60 years operating here. It has sold to the CORIMON local business group. More in Spanish: (Ultimas Noticias:; Notitarde,; El Universal,



Politics and International Affairs


Venezuela holds war games as opposition demands recall vote

Venezuela held the biggest military exercise in its history this weekend, citing threats to national security, as the opposition pushes for a recall referendum on President Nicolas Maduro. While the streets of Caracas were mostly calm, state television and government news websites showed of deployments across the country, with tanks being unloaded from landing craft, troops setting up tents and armored vehicles on the move. Maduro announced the drills a week ago, a day after pledging to prolong his government’s special emergency powers as the country battles its worst recession in decades. He sought to deflect blame for those ills, saying high crime and crippling economic woes are part of an “unconventional war” being waged against Venezuela. (Bloomberg,


….and Maduro claims U.S. 'dreams' of dividing loyal military

The United States "dreams of dividing" a "Chavista" military fiercely loyal to Venezuela's socialist government, president Nicolas Maduro said on Saturday, as the military comes under scrutiny in the crisis-gripped nation. Maduro and the opposition are at loggerheads over a referendum to recall him. Authorities say the vote will not happen this year, while the opposition says an unpopular Maduro must be removed to keep a brutal recession from worsening. Some opposition supporters hope factions of Venezuela's opaque but powerful military will nudge the former bus driver and union leader to allow the vote. (Reuters,


Regime will make no “concessions” over recall referendum

Legislator Diosdado Cabello, Vice President of the ruling United Socialist Party (PSUV) insists they will make “no concessions” to opponents requesting a recall referendum, and will demand that all deadlines must be met. “It is impossible for a referendum to take place here in Venezuela this year, whatever they say”, he said, adding that in his count the process requires 243 days. “We are asking that each period be complied with according to law, not each step the right wing demands”, he said, and added “we will not give them any type of option”. More in Spanish: (Infolatam:


….and CNE says signature verification will require 5 steps, through May 31st.

At the same time, Carlos Quintero, a deputy director at the National Elections Council (CNE) said the signatures collected to launch the recall referendum will require a 5 step verification process before they are validated, and this process will end on May 31st.  More in Spanish: (Ultimas Noticias,


Opposition plans to rally in front of the high court, following ban on demonstrations at Elections authority

Miranda state governor Henrique Capriles said an injunction by the Supreme Tribunal of Justice (TSJ) banning any demonstration in the surroundings of the offices of the National Electoral Council (CNE) is unconstitutional, and has called for a march to all the TSJ chapters nationwide on Wednesday, May 25. “We will take action to demand that court officers observe the Constitution, people’s rights and for decisions to ensure benefits mandated by the legislature,” he admonished. (El Universal,; El Universal,


Ban Ki-Moon calls for talks in Venezuela

United Nations (UN) Secretary General Ban Ki-moon has recommended that the Venezuelan government and opposition sit down to talks in order to overcome the national crisis, upholding the Constitution and the rule of law.

Ban claimed to be “encouraged by the ongoing initiatives by former Heads of State and Government to promote dialogue between the Government of Venezuela and the opposition, under the auspices of the Union of South American Nations (UNASUR)”. (El Universal,


Maduro tells UNASUR group promoting talks to be patient and wishes them luck

President Nicolas Maduro wished “good luck” to the group of former Presidents (Jose Luis Rodríguez Zapatero of Spain; Martín Torrijos of Panama; and Leonel Fernandez, of the Dominican Republica) who are seeking to promote talks between the regime and its opponents here under UNASUR auspices; and told them to “be patient.” The opposition Democratic Unity coalition has expressed it is willing to engage in talks if they have a precise agenda that deals first with freeing political prisoners and moving forward with the proposed recall referendum. It rejects talks as a distraction from these issues. Maduro says the talks are for “opposition groups to cease in their coup attitude and cooperate in a dialogue so that the nation can overcome its problems”. More in Spanish: (El Universal,; Ultimas Noticias,


Venezuela has become a failed state.

According to the International Monetary Fund's latest projections, it has the world's worst economic growth, worst inflation and ninth-worst unemployment rate right now. It also has the second-worst murder rate, and an infant mortality rate at public hospitals that's gotten 100 times worse itself the past four years. And in case all that wasn't bad enough, its currency, going by black market rates, has lost 99% of its value since the start of 2012. It's what you call a complete social and economic collapse. And it has happened despite the fact that Venezuela has the world's largest oil reserves. Never has a country that should have been so rich been so poor. Venezuela's government is to blame. Every other country whose economy begins and ends at its oil wells has at least managed to avoid that fate. Which is to say that Venezuela is a man-made disaster. It's a gangster state that doesn't know how to do anything other than sell drugs and steal money for itself.  Venezuela struggles with days of looting, following widespread shortages in energy and basic goods. Venezuela is the answer to what would happen if an economically illiterate drug cartel took over a country. (The Washington Post:


Yes, I'm mad as a goat!”, Maduro responds to Uruguay's Mujica

Called "mad as a goat" by Uruguay's Jose Mujica this week, President Nicolas Maduro retorted laughingly on Thursday that the former president was right - but he was only crazy with love for his country. "Yes, I'm mad as a goat, it's true," Maduro told a rally of the ruling Socialist Party. "I'm mad with love for Venezuela, for the Bolivarian Revolution, for Chavez and his example," he added, smiling as the crowd cheered, in a reference to former President Hugo Chavez. Mujica, a fellow leftist who ruled Uruguay between 2010 and 2015, said on Wednesday he respected Maduro, but still thought he and others in Venezuela were "crazy" for attacking each other rather than sitting down to resolve problems. (Yahoo News:


Nicolas Maduro, Venezuela’s lord of misrule

Ever since he became Venezuelan president, Nicolas Maduro has gone to ridiculous lengths to eulogize the memory of Hugo Chávez. The burly 53-year-old has claimed to speak with his predecessor’s spirit manifested as a “little bird”. At cabinet meetings he waves a book of his mentor’s sayings as if they are holy script. He has even argued that Chávez should be sanctified: a rare trespass into Christianity by the gaffe-prone Maduro, who once compared Venezuelan socialism to “when Christ multiplied the penises” — a confusion of peces, the Spanish for fish, and penes that must rank as one of the worst malapropisms in history. Such absurdities would be comic if Maduro’s presidency, and the state of the country he has governed for three years, were not so tragic. More than two-thirds of Venezuelans believe he should not finish his term. Instead, this Latin American Mugabe has dug in. This week he claimed the country was suffering a “brutal media and political offensive” from the “Washington-Miami-Madrid” axis. Although he has a 26% approval rating, such exhortations draw only faint cheers from the red-clad supporters bussed in to hear him rant. Chávez controlled the vipers’ nest of Chavista politics with charisma; the leaden Maduro has to use patronage. Corruption flourishes in Venezuela, a narcocracy and petro-state in one.  Maduro’s control of the state oil company and import system gives him economic control; subordination of the courts ensured legal domination. At least until now. The opposition won control of the national congress in last year’s midterm elections and has called for a “no confidence” referendum that could mean Maduro is replaced. Maduro, who calls the opposition “faggots”, swears he will block this constitutionally allowed process. What next? The role of the army as arbiter is crucial. There is a high chance Venezuela could default on its US$ 127 billion of international debt — in which case, oil cargoes could be seized, collapsing internal systems of patronage as dollar revenues dry up. There is persistent speculation of a military-backed palace coup, especially if current sporadic looting spreads. There is a growing risk of a humanitarian crisis. Nonetheless, Maduro may cling on. Luis Almagro, head of the Organization of American States, has called him “a petty dictator”, while Henrique Capriles, an opposition leader, fears Venezuela is “a time bomb”. Both charges appear to be all too true. (Financial Times:


Another Hugo Chavez mystery -- what happened to Venezuela's Air Force One?

Former President Hugo Chavez’s US$ 75 million, customized Airbus luxury jetplane is missing. Chavez had ordered the Airbus A319 jet after seeing one belonging to a sheik of the United Arab Emirates in 2001 but it has not been seen since 2013. After an investigation by the Latin American Herald Tribune, two things seem certain, however: the plane is not in Venezuela and, even worse, it is not in operation, air industry sources say. (Latin American Herald Tribune,


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.