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 1, 2016

November 01, 2016


Oil & Energy

Crisis at PDVSA deepens as Caribbean debts pile up
Unpaid debts and broken promises are making PDVSA an outcast in several Caribbean countries where it had been a guest of honor. The state-run company's crumbling finances are causing operational disruptions across one of its most essential regions. Business partners in the island nations of Curacao, Bonaire, Jamaica and the Bahamas are turning away from the firm as debts pile up to tugboat operators, ship brokers, maritime agencies and terminal owners, the sources and documents show. The company's problems include blocked loading operations in the Bahamas and threats from the governments of Curacao and Jamaica to replace PDVSA as a partner of refineries in both places. Many vessels are also anchored offshore, blocked from discharging cargoes at ports because PDVSA has not paid suppliers and business partners. PDVSA's Caribbean operations represent a quarter of its global refining capacity and serve as a loading hub for a third of its exports of crude and fuel oil. The problems reflect a stark reversal for a company that has been a trusted partner of governments in the Caribbean. But the relationships of the past are now increasingly strained as suppliers and service providers go unpaid. The company has slashed its operating budget to US$ 45 million monthly from US$ 145 million monthly in 2015d. That budget pays for all trade activities in Venezuela and overseas, including tanker cleaning, routine inspections, storage, brokerage, freight costs, port services and oil imports. A In September, PDVSA's crude exports suffered an annual decline of 12% to 1.55 million barrels per day. Near other Caribbean and Venezuelan ports, about a dozen tankers carrying around 2.5 million barrels of light crude and products - including two cargoes supplied by BP - have been stuck at sea for weeks at a time, waiting for payment from PDVSA before discharging. (Reuters: http://www.reuters.com/article/us-caribbean-oil-pdvsa-insight-idUSKCN12S0EO)

 Venezuelan oil slides down further to US$ 42,51 per barrel, 52 cents less than last week’s US$ 43,03, as per the Oil and Mining Ministry report. The annual average price now averages US$ 33.88 per barrel. More in Spanish: (Panorama: http://www.panorama.com.ve/politicayeconomia/Petroleo-venezolano-perdio-52-centavos-y-cerro-la-semana-en-4251-dolares-por-barril-20161028-0039.html)

 

Commodities
Maduro regime is telling hungry city dwellers to grow their own food
Some Venezuelan city dwellers are trying to grow their own produce to offset the country’s severe shortages following socialist President Nicolás Maduro’s calls for “food sovereignty.” But in a country where families are going hungry because of government mismanagement and sky-high inflation, many view the “Great Agro-Venezuela Mission” with skepticism. Critics have taken to social media to accuse the government of downplaying the country’s critical situation, and ridicule Maduro for trying to solve Venezuela’s dire food crisis through getting urbanites to farm small plots of land. When the project was presented in February, the newly created Ministry of Urban Agriculture announced that 12,000 square kilometers — about 4,600 square miles — would be planted in the first 100 days. The government promised to invest US$ 300,000 in seeds, equipment and educational projects, and help with logistics. The government urged citizens to plant in every available space — private terraces, communal areas, jails and schools among other sites — but did not itself provide the land. Eight months into the project, only 21 square kilometers (about 8 square miles) of land have been cultivated, per the ministry. (The Washington Post: https://www.washingtonpost.com/news/worldviews/wp/2016/11/01/venezuela-is-telling-hungry-city-dwellers-to-grow-their-own-food/?tid=sm_tw)

 

FERROMINERA starts producing pellets and briquettes again
State run FERROMINERA DEL ORINOCO has again started to produce pellets and briquettes to bolster iron production here. It is estimated that start up production of pellets will be 5,000 tons per day. More in Spanish:  (El Mundo, http://www.elmundo.com.ve/noticias/economia/industrias/arranca-produccion-de-pellas-y-briquetas-en-ferrom.aspx#ixzz4OknbHTIE)

 

Economy & Finance

Venezuela's bolivar collapsing on the black market again
Venezuela’s currency is so weak; shopkeepers have taken to weighing it. In 2015, the black-market bolivar frequently fell more than 10% a month. In the six months through September the black-market currency appreciated, even as prices for unregulated goods began to skyrocket. The calm ended in October, when the bolivar lost almost a third of its value compared to the U.S. dollar in a matter of weeks. On the black market, where people and businesses turn when they can’t obtain government approval to purchase dollars at the legal rates, the bolivar has weakened 48% over the past year to 1,501 bolivars per dollar on Oct. 31. On the border with Colombia, the rate is even weaker at 1,737.50 bolivars per dollar. The general trajectory has been down, and without a floor. Falling hard currency reserves weaken the implicit rate as the central bank has less assets to back its ever-expanding money supply. The government of President Nicolas Maduro maintains exchange controls that sell dollars for 10 bolivars to import priority goods and for 659 bolivars for less important items. But businesses and individual citizens are broadly unable to access dollars at either of those rates, and thus end up buying on less favorable terms on the black market. (Bloomberg: http://www.bloomberg.com/news/articles/2016-11-01/venezuela-s-currency-is-collapsing-on-the-black-market-again; http://www.bloomberg.com/news/articles/2016-10-31/tired-of-counting-piles-of-cash-venezuelans-start-weighing-them; Reuters, http://www.reuters.com/article/venezuela-economy-idUSL1N1D11DC)

 

PDVSA must pay US$ 1.1 billion on Wednesday, reserves down an additional US$ 909 million
State-run oil company Petroleos de Venezuela (PDVSA) is due to pay US$ 1.10 billion in amortization of its 8 œ 2017 bond on Wednesday, November 2. This is “US$ 0.9 billion less than what it would have had to cancel if it had not gone ahead with the exchange of 45.3% of these bonds and 31.4% of its 5 Œ 2017 bonds for a new 8 Œ 2020 bond backed with Citgo Holding collateral,” according to Chief Economist Francisco Rodríguez from firm TORINO Capital Additionally, Rodríguez underscored that international reserves of the Central Bank of Venezuela (BCV) declined by US$ 909 million on Friday, October 27, “the same day that Pdvsa had to cancel USD 1.0 billion of its maturing 5 1/8 2106 bond”. He added that Friday’s decline “also includes funds directed to other payments such as the amortization of the 17N or the Gold Reserve payment this week.” PDVSA announced that holders of 2017 bonds would be paid principal and interests. (El Universal: http://www.eluniversal.com/noticias/daily-news/pdvsa-savings-estimated-usd-billion-after-bond-amortization_625133)

 

Opposition led strike patchy amid government threats, POLAR harassed by intelligence agency
Residents of the Venezuelan capital partially heeded the opposition’s calls for a 12-hour general strike on Friday, with banks and numerous commercial establishments and offices operating normally but fewer cars than usual on the main roads. More stores and offices were closed on the city’s more affluent east side than in lower-income neighborhoods, where fewer people participated in the protest. The strike was most evident at schools, universities and technological institutes, since students mostly stayed home, whereas activity was virtually uninterrupted in the teeming Petare slum overlooking eastern Caracas, Latin America’s largest shantytown. Businesses such as bakeries and pharmacies were open, with customary lines of shoppers seeking basics like bread and flour which have gone scarce in Venezuela's economic crisis. Traffic was light and public transport fell by about half in San Cristobal, where earlier in the week masked protesters clashed with police. Parts of Maracaibo, Venezuela's second city, were deserted. Participation was patchy after the socialist government threatened to shut down businesses that closed. The government vowed to take over any companies heeding the strike, sending inspectors to ensure they were open. "We are going to look for the big company owners, the leaders of FEDECAMARAS if they insist on a coup d'etat," said Diosdado Cabello, the ruling Socialist Party's second in command. Carlos Larrazabal, vice-president of FEDECAMARAS, Venezuela's largest corporate umbrella group, said companies were staying open and letting staff decide whether to attend or not, but troops were stationed outside various businesses. "That should not happen in a democratic country," he said. The regime posted intelligence agents outside Venezuela's main private company, beer and food conglomerate POLAR, which was working normally. POLAR denounced harassment by state intelligence agents who have been stationed at the gates of its headquarters since late last week. Lorenzo Mendoza, owner of the conglomerate, said armed and masked officers from the SEBIN intelligence agency have also been stationed outside his residence for no apparent reason. "I simply wanted to make this statement to reject the persecution and harassment that my workers, my family, and I have been subjected to by the political police," said Mendoza, surrounded by cheering workers, in comments to reporters. (MSN: http://www.msn.com/en-us/news/world/venezuelan-opposition-strike-patchy-amid-government-threats/ar-AAjwxkd?li=AA4Zpp&ocid=spartandhp; Reuters, http://www.reuters.com/article/venezuela-polar-idUSL1N1D115P; (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2424165&CategoryId=10717)

 

Maduro decrees 40% mandatory minimum wage hike; economists predict more inflation, misery and unemployment
President Nicolás Maduro has for the fourth time this year decreed a mandatory wage hike – this time 40%, effective immediately, with an impact on worker benefits. Economists and business leaders immediately decried the inflationary impact this move – decreed on the same day of the opposition led strike - will have on the nation’s economy. (Noticiero Venevision: http://www.noticierovenevision.net/economia/2016/octubre/27/173693=presidente-maduro-anuncio-aumento-del-40-en-el-salario-integral-a-partir-del-1ero-de-noviembre; El Universal: http://www.eluniversal.com/noticias/economia/economistas-vislumbran-mas-inflacion-miseria-con-nuevo-aumento-salarial_624524)

 

Politics and International Affairs
Maduro met opposition at Vatican-led talks, rivals agree to tone down rhetoric; opposition insists on demands
President Nicolas Maduro shook hands with opposition leaders at Vatican-convened talks on Sunday, but his wary foes threatened to boycott further meetings if some demands were not quickly met. The opposition Democratic Unity coalition has escalated protests Maduro after authorities scuttled a recall referendum that polls show he would have lost, triggering a presidential election. Their top demand is to revive the plebiscite. The opposition is also demanding freedom for political prisoners, humanitarian aid amid an unprecedented economic downturn, and respect for the opposition-led National Assembly. While representatives of three opposition parties including Accion Democratica, Un Nuevo Tiempo and the Primero Justicia party led by Governor Henrique Capriles attended the talks, the Voluntad Popular party, which is led by its jailed leader, Leopoldo Lopez, did not attend. Voluntad Popular may join the talks later if its conditions that include the release of political prisoners are addressed, MUD said. Also attending were a Vatican envoy, representatives of the UNASUR regional bloc, and three former heads of state or government from Spain, Panama and the Dominican Republic.  The opposition delegation said it would "walk away from the dialogue if the demands are not resolved in the short term," Most opposition leaders have no intention of sitting down with a regime they regard as illegal. Henrique Capriles, who nearly defeated Maduro in a presidential election in 2013, has made clear his refusal to attend any talks. “We are fighting against the devil,” he says. Maduro is trying to present himself as open to dialogue, and the opposition as divided and intransigent. The opposition has responded by issuing an ultimatum. If Maduro fails to restart the recall process, it will call for a march on the presidential palace on November 3rd. the coalition said in a statement. Maduro only stayed for a few minutes. He has distanced himself from the quashing of the referendum, saying it was a decision of independent judicial and electoral authorities based on allegations of fraud in an initial opposition signature drive. In advance, some opposition leaders had been skeptical about talks, saying Maduro had become a dictator by denying a vote and was only promoting dialogue to buy time. Senior Socialist Party official Jorge Rodriguez, who was at Sunday's talks, said the government hoped to persuade its foes to renounce street violence and reject neo-liberal economics like those being applied in Argentina and Brazil. The opposition-controlled congress, meanwhile, has begun a "political trial" against Maduro accusing him of neglecting his duties, though it is a largely symbolic gesture since the body doesn't have the power to remove a president under Venezuela's constitution. Archbishop Claudio Maria Celli, a Vatican envoy to the talks, hailed the start of latest round of talks as "constructive ands respectful." He urged both sides to make concessions for the talks not to falter like the previous attempts. "At the start of this journey, I ask you in the name of Pope Francis that each side agrees to some concrete gestures to give credibility to this process," said Celli, who is president of the pope's council for social communications. "The country is waiting for genuine signs to understand that dialogue is for real." The talks extended until 2 am on Monday and ended with both sides agreeing to tone down the heated rhetoric of the past few days and set up four working groups to discuss issues including the respect for the rule of law and national sovereignty; human rights and reparations to victims; the economy; and the generation of confidence and the electoral schedule, Celli said, adding that the current situation of political prisoners in the country would be reviewed. The opposition alliance, known as MUD, said in a separate statement that the next formal meeting would take place Nov. 11. Jesús Torrealba, who attended the meeting as head of the Democratic Unity alliance, said the opposition’s patience is limited. “Without freedom for the political prisoners in the next few days this process of dialogue can’t continue,” he told reporters after emerging from the meeting. President Maduro says the dialogue had a “good start” but “will not be easy”. He made his statement after meeting with separately with Vatican envoy Claudio Cell and Papal Nuncio Aldo Giordano, US Under Secretary of State Thomas Shannon and Spain’s former President José Luis Rodríguez Zapatero. (Reuters: http://www.reuters.com/article/us-venezuela-politics-idUSKBN12U0QV; The Miami Herald: http://www.miamiherald.com/news/nation-world/article111525237.html#storylink=cpy; The Guardian: https://www.theguardian.com/world/2016/oct/31/venezuela-president-nicolas-maduro-vatican-talks; The Economist: http://www.economist.com/news/americas/21709364-lurch-towards-dictatorship-massive-protests-and-no-sign-regime-change-fighting-their?frsc=dg%7Ca; Bloomberg: http://www.bloomberg.com/news/articles/2016-10-31/venezuela-government-opposition-meet-for-exploratory-dialogue: Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2424255&CategoryId=10717; and more in Spanish: Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/octubre/31/174165=presidente-maduro-reconocio-que-proceso-de-dialogo-con-la-oposicion-no-sera-facil)

 

UN, OAS, US and Venezuela’s Roman Catholic bishops back Vatican efforts to promote real dialogue here
UN Secretary General Ban Ki-moon has supported Vatican and UNASUR efforts at mediation and called on both the government and the opposition here to “reduce polarization” and sincerely engage in a dialogue through “tangible steps”. Incoming UN Secretary General António Guterres, says there will be no solution to Venezuela’s situation if there is no “constructive dialogue” between the Maduro regime and its’ opposition; Luis Almagro, Secretary General of the Organization of American States (OAS) has said he supports Vatican efforts to promote “a dialogue the restores the separation of powers” in Venezuela. The United States send Under Secretary of State Thomas Shannon to Caracas “underscore our support for the ongoing dialogue process, and our interest in the well-being of the Venezuelan people”. Shannon met with President Nicolas Maduro and is meeting today with leaders of the opposition Democratic Unity (MUD) coalition, and Miranda state governor Henrique Capriles Radonski, Monsignor Diego Padron, President of the Venezuelan Bishops Conference (CEV) said the first meeting between government and opposition representatives was positive, and Cardinal Jorge Urosa Sabino said that for the dialogue to succeed “the government must be asked to cease its negative and repressive attitude against the opposition, which represents the majority of the Venezuelan people”. He called government signals “contradictory”, citing the “unacceptable” attack on the National Assembly. He added that Venezuelan bishops have a clear view of what is going on here and “it is important that the government accepts it must change”. (Reuters, http://www.reuters.com/article/us-usa-venezuela-shannon-idUSKBN12V1N7); and more in Spanish: Noticiero Venevision: http://www.noticierovenevision.net/internacionales/2016/octubre/28/173866=ban-ki-moon-pide-a-gobierno-y-a-oposicion-reducir-polarizacion-en-venezuela;  http://www.noticierovenevision.net/internacionales/2016/octubre/31/174127=oea-saluda-la-mediacion-del-vaticano-en-venezuela-para-facilitar-el-dialogo; http://www.noticierovenevision.net/politica/2016/octubre/31/174101=monsenor-diego-padron-califico-de-positivo-primer-encuentro-entre-gobierno-y-oposicion; http://www.noticierovenevision.net/politica/2016/octubre/31/174166=capriles-sostendra-reunion-con-thomas-shannon-este-martes; El Universal, http://www.eluniversal.com/noticias/politica/capriles-noviembre-hay-que-rendirle-cuentas-pais_625099; http://www.eluniversal.com/noticias/politica/urosa-savino-gobierno-debe-cesar-actitud-represiva-contra-oposicion_624960; Infolatam: http://www.infolatam.com/2016/10/31/shannon-eeuu-va-a-caracas-para-apoyar-dialogo-de-gobierno-y-oposicion/)

 

Voluntad Popular denies split in Democratic Unity (MUD) coalition
Freddy Guevara, National Coordinator of the Voluntad Popular (VP) party founded by jailed opposition leader Leopoldo López, has denies they have split from the Democratic Unity (MUD) coalition over talks with the Maduro regime. “The exploratory talks begun by other MUD parties do not in any way imply giving up the MUD agenda for change”, he said. He added that the agenda includes a political judgement on President Nicolas Maduro at the National Assembly, and declaring he has abandoned his office. He also voiced VP’s support for the march on the Miraflores presidential palace scheduled for November 3rd. More in Spanish: (El Universal, http://www.eluniversal.com/noticias/politica/voluntad-popular-niega-ruptura-con-mesa-unidad-democratica_625018)

 

Capriles says next hours are decisive as concern rises over march to Miraflores Palace

Tension has risen over the scheduled opposition march to the Miraflores presidential palace next Thursday, to protest the suspension of the recall plebiscite process and deliver the results of the National Assembly’s discussion on President Nicolas Maduro’s responsibility in the ongoing political crisis. Executive Vice President Aristobulo Istúriz earlier announced that hordes of pro regime supporters would block all access routes to the palace, and establish camps around it. “We will await them at all entrances to Miraflores”, he said. Hector Rodríguez, leader of the pro-regime minority in the National Assembly says “The decision has been made based on past opposition demonstrations in Caracas that they cannot mobilize within Caracas until they can guarantee that they will be in peace”. He confirmed that chavista forces would march to the palace on the same day. Pro government legislator Elías Jaua, who is taking part in Vatican sponsored talks with the opposition, called the move by opposition leaders “irresponsible” and asked that they redirect the demonstration elsewhere, while denying they were barred from going to the palace. Opposition leader Henrique Capriles says the demonstration will be peaceful and “the next few hours are decisive because we will know if...anything was achieved (in the dialogue). Venezuelans want facts and results, we do not want the outcome to be bullets”; and adds: “Our agenda remains the same, it will change if the government wants it to change, if they start to produce signs. No one has said one right is being negotiated for another right…Do you think the Pope is naïve, that he doesn’t know where he’s at?”. Capriles added: “I spoke today to OAS Secretary General Luis Almagro and we agreed it is obvious the region wants the solution to be through elections”; and said: “The opposition is neither armed nor organized. The government is the only one that can carry out a slaughter and imprison people”. (El Correo del Caroní: http://www.correodelcaroni.com/index.php/nacional-2/item/51042-capriles-la-agenda-cambiara-si-el-gobierno-quiere-que-cambie; Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/octubre/29/173942=oficialismo-bloqueara-entradas-de-palacio-de-miraflores-durante-marcha-opositora; http://www.noticierovenevision.net/politica/2016/octubre/31/174144=hector-rodriguez-explico-que-la-constitucion-venezolana-no-permite-la-interpelacion-del-presidente;


 

Maduro summoned by legislature to face a political trial today

National Assembly President Henry Ramos Allup has issued a summons to President Nicolás Maduro to appear today before the legislature to make his case during an ongoing political trial launched by the Democratic Unity (MUD) opposition coalition’s majority in the Assembly, possibly charging Maduro with being politically responsible for the serious break in constitutional and democratic order as well as devastating the nation’s economic and social underpinnings. Maduro has replied: “Let us wait. I hope they will reconsider that under the Constitution and the national legal system. The entire nation knows that the National Assembly does not have the authority to politically try the President, as is the case in order countries.” Héctor Rodríguez, leader of the pro-regime caucus within the Assembly adds that “should there be a judgement, it is required that all powers take part concurrently, no power can by itself judge the President, they know it”. Assembly President Ramos Allup explains that the legislature has the authority to determine political responsibility, follow an evaluation, but not to carry out a trial that implies the President’s removal. More in Spanish: (Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/octubre/28/173845=ramos-allup-envio-citacion-a-nicolas-maduro-para-comparecer-este-1-noviembre-ante-la-an; http://www.noticierovenevision.net/politica/2016/octubre/31/174144=hector-rodriguez-explico-que-la-constitucion-venezolana-no-permite-la-interpelacion-del-presidente; El Mundo, http://www.elmundo.com.ve/noticias/actualidad/politica/maduro--sobre-la-asamblea-nacional--esperemos.aspx#ixzz4Oknr849q; El Estímulo: http://elestimulo.com/blog/fotos-chavistas-rodean-la-an-aqui-esta-el-pueblo-defendiendo-la-revolucion/)

 

Prosecutor General says Supreme Tribunal cannot dissolve the National Assembly, Assembly cannot try Maduro
Venezuela’s Prosecutor General Luisa Ortega Díaz, a close ally of President Nicolas Maduro, says the National Assembly does not have the authority to pass a political judgement on the country’s President. She said “political trials do not exist”, and that the Constitution does not even provide a vote of censure against the head of state. She also said the Supreme Tribunal cannot dissolve the National Assembly under the current Constitution. Ortega asked security forces not to use firearms or harmful substances during demonstrations, and said 97 people have been detained during recent disturbances. Ortega added that the SEBIN intelligence agency will “have to decline authority” in summoning opposition Mayors Carlos Ocariz and David Smolanski because they are not under military jurisdiction. She called on both sides of the political spectrum to dialogue and stop inciting confrontation. More in Spanish: (Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/octubre/28/173874=fiscal-general-aseguro-que-an-no-posee-facultades-para-realizar-un-juicio-politico-contra-maduro)

 

Supreme Tribunal declares President Maduro is Venezuelan citizen by birth

The Constitutional Chamber of Venezuela’s Supreme Tribunal has declared that President Nicolas Maduro is a Venezuelan citizen by birth and holds no other nationality. It based its ruling on an alleged birth certificate filed with the National Elections Council. The ruling was made at the request of the President’s office, following the announcement that the National Assembly will publish the contents of an investigation on Maduro’s nationality. (La Nación: http://lanacionweb.com/regional/tsj-declara-que-el-presidente-nicolas-maduro-es-venezolano/)

 

Maduro frees three jailed activists in post-talks gesture, over 100 remain in jail

The Maduro regime has freed three opposition activists jailed for more than a month in a first gesture by President Nicolas Maduro's government after talks began with his foes. Authorities freed the three activists - Carlos Melo, Andres Moreno and Marco Trejo - on Monday night, but the opposition says another 100 or so Maduro opponents remain in jail. "These (releases) were decisions by the tribunals in the context of the dialogue process, gestures," said senior Socialist Party official Jorge Rodriguez, who is representing the government in the talks. He added that investigations of the three activists were continuing. They deny the charges, and opposition parties say they were trumped up as part of a wave of repression this year. (Reuters: http://www.reuters.com/article/us-venezuela-politics-idUSKBN12W4EV)

 

Miami’s Nuevo Herald reports that Maduro may offer to call new general elections by year end 2017

Miami’s Nuevo Herald daily reports that sources close to negotiations here say President Nicolas Maduro is willing to call for general elections at the end of 2017 and give up some political space, in a move to stave off opposition efforts to remove him from office before that time. The offer could be made during the ongoing talks between the regime and the Democratic Unity (MUD) opposition coalition. Other sources say the regime’s offer could include releasing some political prisoners and promises to reduce attacks by the chavista Supreme Tribunal on the National Assembly. In exchange, the opposition would have to call off its agenda to depose Maduro. More in Spanish: (El Nuevo Herald: http://www.elnuevoherald.com/noticias/mundo/america-latina/venezuela-es/article111718147.html#storylink=cpy)

 

Ibero-American summit overshadowed by Venezuelan president's non-appearance
Leaders of Ibero-American nations met Saturday as a political and humanitarian crisis deepened in Venezuela, the summit overshadowed by a guessing game over whether their Venezuelan colleague would show. He didn't. His attendance had been expected after Peru's president laid down a gauntlet of sorts. Pedro Pablo Kuczynski said he would seek consensus for Venezuela's suspension from the Organization of American States for violating its democratic charter. And though talk of Venezuela was the main course at the leader's private lunch, they issued no related statement. Venezuela's foreign minister, Delcy Rodriguez, said Maduro couldn't attend because he was preparing for a Sunday meeting with Venezuela's opposition leaders sponsored by the Vatican. She did not respond directly to Kuczynski's concerns. Kuczynski, a 78-year-old former investment banker and World Bank official who assumed Peru's presidency in July, said it is very difficult for leaders to meet and not discuss the region's most burning issues. He urged a diplomatic offensive in view of Venezuela's "potential humanitarian crisis." "There is urgency so things get better and not worse," Kucznyski added. The secretary general-elect of the United Nations, Antonio Guterres of Portugal, said he believed there was a clear consensus that the only solution for Venezuela is "a constructive dialogue between the parties" backed by the international community. (Fox News Latino: http://latino.foxnews.com/latino/news/2016/10/30/ibero-american-summit-overshadowed-by-venezuelan-president-maduro-non/)

 

The final blow to Venezuela's democracy: What Latin America can do about it
For the past decade, Venezuela's neighbors have sat on the sidelines as the chavista government made its anti-democratic ambitions clear. Much of the blame lies with UNASUR, the institution in charge of the mediations. UNASUR has become the go-to forum for autocrats seeking either a platform upon which to denounce the United States or a way to avoid accountability for rights abuses. Now that more conservative governments have taken power in Argentina, Brazil, and Peru, the question is whether Venezuela’s neighbors will finally step up. The first step should be to call for another discussion and even vote on the democratic situation in Venezuela at the OAS. By invoking the OAS’ 2001 Democratic Charter, the organization’s members would collectively call out the brazen violations of democratic and human rights in Venezuela and give license to individual members to voluntarily impose sanctions on the government. The second should be to follow the lead of the United States and selectively deny visas to Venezuelan officials tied to human rights abuses and corruption. The third should be to drop the farcical belief that UNASUR or the Vatican can convene a serious mediation effort without the will or power to either recognize the Maduro government's responsibility to protect its citizens and respect human rights or sanction his government's noncompliance. It is time for neighboring countries, the OAS, Canada, the United States, and even UNASUR to demand accountability for the Venezuelan government’s refusal to abide by their repeated and unanswered calls for greater respect for human rights and a recall referendum. (Christopher Sabatini op-ed: Foreign Affairs: https://www.foreignaffairs.com/articles/venezuela/2016-11-01/final-blow-venezuelas-democracy?cid=soc-tw-rdr)


Venezuela in the grip of a political stalemate
The Oct. 20 decision by the politically influential Cabello and his allies to try to permanently suspend the ongoing referendum process here through the judicial system has exposed the opposition's limitations. The MUD simply does not control enough institutions to pressure the government into rapidly accepting a recall referendum. For now, the opposition's attempts to pressure the government into accepting the referendum will likely rely on bringing as many people into the streets as possible. That strategy is a risky one, however, given the potential for violence or retribution against the MUD's leadership. Barring a major disturbance — such as a loss of military support for the leadership, a wave of violent protests or a debt payment default — government pressure could be enough to break the MUD's tenuous unity. Though Defense Minister Vladimir Padrino Lopez backs Maduro, the same cannot be said of the military's middle ranks. And even Padrino Lopez took four days to make his support for Maduro public after the lower courts ruled against the referendum. His hesitance, combined with the opposition's appeals to the armed forces to switch sides and back the referendum, hints at divisions within the military. So, what could break the political stalemate? A rash of violent protests resulting in mass casualties could invite heavier sanctions on Venezuela by the United States or degrade the armed forces' loyalty to the current government. The United States has so far been reluctant to heavily sanction Venezuela because of the damage that stringent measures could do to the country's fragile economy. (Stratfor: https://www.stratfor.com/analysis/venezuela-grip-political-stalemate?utm_source=Twitter&utm_medium=social&utm_campaign=article)

 
Venezuelan dictatorship digs in and hunkers down
Thomas Shannon, Under Secretary of State for Political Affairs, has been working for years to head off a crisis in Venezuela on President Obama's watch. By killing the referendum outright, the regime is wagering that Obama's do-nothing strategy will not change. However, what career diplomat wants to explain to the next U.S. president the decision to punt this worsening crisis to Obama's successor? This next week will be critical: Will the people take to the streets to demand their constitutional rights? Will the military side with the constitution or criminals? Will regional governments—especially those under new democratic presidents in Argentina, Brazil, and Peru—stand up to reject a new dictatorship in Venezuela? Will the United States adopt a new strategy, now that averting a meltdown appears increasingly impossible? In addition to backing OAS action, the Obama administration can target the criminal henchmen who have dictated a crackdown on democracy because they fear that a transition will land them in jail. The criminal activities of former National Assembly Diosdado Cabello and Aragua state governor Tareck El-Aissami have been denounced publicly for more than a year. Obama should also use his relationship with the Castro regime to arrange Maduro's asylum in Cuba. Finally, Venezuela's military leadership must be warned not to use force to deny people their constitutional rights. If professionals in the security forces do their jobs, they can help salvage a democratic and prosperous Venezuela. (Roger Noriega op-ed: The Washington Examiner: http://www.washingtonexaminer.com/venezuelan-dictatorship-digs-in-and-hunkers-down/article/2605569#.WBK1eFRr4kl.twitter)

 

Journalists covering Venezuela tension face violence, obstruction
Journalists trying to cover rising political tensions in Venezuela have been obstructed and have come under attack, including by Venezuelan security forces and immigration officials, according to press freedom groups and news reports. Many of the attacks occurred yesterday during nationwide marches in which protesters demanded that the socialist government allow a recall election that could remove President Nicolás Maduro from office. Several foreign correspondents were unable to cover the protests. Security forces on October 24 detained Matt Gutman, a correspondent for the U.S. television channel ABC News, while he reported on deteriorating conditions at a hospital in the central city of Valencia. He was released yesterday. "Matt was detained while in Venezuela to report for ABC News. He was released without incident," ABC News confirmed. On Tuesday, four Peruvian journalists were stopped at Caracas' international airport and denied entry to Venezuela. Peruvian journalists Ricardo Burgos, Leónidas Chávez, and Armando Muñoz, who were working for the Mexican TV station TELEVISA, and photographer Ricardo Venegas were told by immigration officials that they lacked the proper permits to enter the country and denied entry, Peru's ambassador to Venezuela, Mario López Chávarri said. Since 2012, foreign correspondents have been instructed to apply for press credentials with the Communications Ministry before traveling to Venezuela. Online and radio journalist Braulio Jatar Alonso was arrested in early September and is still imprisoned, accused of money laundering after covering a protest. The arrest and the latest incidents came amid a crackdown on political opponents, as the Maduro government confronts growing unrest over widespread food shortages and triple-digit inflation. (CPJ Committee to Protect Journalists: https://cpj.org/2016/10/journalists-covering-venezuela-tensions-face-viole.php)

 

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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