International Trade
Cargo that has arrived at Puerto Cabello:
- 30,000 tons of corn
- 47 containers of wood
- 40 containers of metal doors
- 27 containers of beef
- 21 containers of toilet paper
- 10 containers of powdered milk
- 2 containers of medication
All the
above consigned to state agencies CUSPALCA, CORPOVEX and Fundación Misión
Barrio Adentro. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=36191;
http://www.bolipuertos.gob.ve/noticia.aspx?id=36190;
El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/arribaron-30-mil-toneladas-de-maiz-a-puerto-cabell.aspx; El
Universal, http://www.eluniversal.com/noticias/economia/arriban-puerto-cabello-alimentos-medicamentos_645993)
Venezuelan imports fell 24.5% in January 2017
Venezuela’s
imports slid US$ 800 million in January 2017, a decline of 73.9% from the 2012
peak and down 24.5% from January of last year, financial firm Torino Capital
reported on Monday. They said Venezuela’s imports continued contracting in
January, reaching “their lowest level
observed” since the start of their probe in 2007. The economists affirmed
that the series showed a 17.9% plunge with respect to the previous month
(December 2016) and is 5.3% lower than the previous low (October 2016). (El Universal, http://www.eluniversal.com/noticias/daily-news/torino-capital-venezuelan-imports-fall-245-january-2017_645725)
Wheat and soy arrived at Maracaibo’s port
Over
11,000 tons of cereal, wheat and soy, arrived at the port of Maracaibo,
consigned to state agency GMAS, for distribution to PROPORCA, INVERAVICA,
Avícola Aeropuerto and Alimentos Balanceados Lamar, according to the local port
authority. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/arribaron-toneladas-de-trigo-y-soya-al-puerto-de-m.aspx#ixzz4chzXcKEa)
Oil & Energy
PDVSA said
to be preparing for exit of President Del Pino, investors wary
Petroleos de Venezuela SA is preparing for the departure of its president Eulogio Del Pino
in what would be the biggest management shift in years for the state-owned oil
producer, people familiar with the plans said. Del Pino, 61, may depart by July
and will be replaced by Nelson Martinez, Venezuela’s oil minister. Martinez,
65, would remain in his role as oil minister in addition to becoming head of
PDVSA. The move would come after a board shakeup in January and the recent
replacement of some refining managers. Del Pino has been in charge of PDVSA
since 2014 and has worked at the company for about 30 years. He previously ran
the energy producer while also serving as Venezuela’s oil minister, but in
January the roles were split and Martinez, previously the head of U.S.-based
unit CITGO Petroleum Corp., was named minister. For
bond investors, the timing of a management changes is bad with oil prices
slipping below US$ 50 and Venezuela’s April 12 amortization payment of US$ 2
billion due, writes Nomura Securities‘ Siobhan Morden, head of Latin America
fixed-income strategy. The departure “bodes
poorly for the company, given del Pino’s more pragmatic stance and close
relationships with joint venture partners that are key to boosting [oil]
output. While del Pino’s apparent replacement Nelson Martinez is closer to
President Nicolas Maduro, Martinez will struggle to improve PDVSA’s outlook
amid competing demands for scarce resources and severe political constraints.
Del Pino’s departure is unlikely to shift the government’s near-term debt
service commitment or affect its April payments, but it does remove a strong
advocate for avoiding default should that strategy be revisited … the
government will likely make its April payments and continue to mobilize all
available resources to avoid a default this year, with the main risk to debt
service not willingness, but capacity. The latter is becoming more difficult
given diminishing assets that can be made liquid.” (Bloomberg, https://www.bloomberg.com/news/articles/2017-03-28/pdvsa-said-to-be-preparing-for-exit-of-president-del-pino-j0ty8kuf;
Barron’s: http://blogs.barrons.com/emergingmarketsdaily/2017/03/29/3-venezuela-experts-debt-risk-dollar-adoption/)
PDVSA manager arrested in Venezuela fuel corruption
probe
Venezuela
has arrested a senior manager of state oil company PDVSA on suspicion of
"irregularities" in
contracts to supply fuel to the domestic market, authorities said on Wednesday.
The detention of international commerce manager Marco Malave, 47, followed a
shakeup of personnel at PDVSA's trade department since January and amid
gasoline shortages around the nation last week. "PDVSA representatives denounced a series of irregularities in the
protocol for contracting companies with vessels to supply the referred hydrocarbon
to the Venezuelan market," the state prosecutor's office said in a
statement. The situation affected fuel distribution in seven states, including
the capital Caracas, it said. Malave was arrested last week in Caracas and his
bank accounts have been frozen. President Nicolas Maduro's socialist government
and PDVSA, have repeatedly vowed to take steps to combat corruption, which has
affected Venezuela and its oil industry for decades. (Reuters, http://www.reuters.com/article/us-venezuela-pdvsa-idUSKBN1702OZ)
Venezuela’s main crude oil port hit by spill
Venezuela’s
main oil terminal, Jose, suffered disruptions in operations on Tuesday after a
break in a pipeline had led to a crude spill. As per Reuters’ sources, the
spill was likely caused by a break in the pipeline connecting the Jose oil
terminal and a single buoy mooring (SBM) facility that is being used by crude
tankers to load oil for exports. The pipeline has the capacity to ship 32,000
bpd of crude to the SBM facility. Operators have told the agency that no
tankers had been docking at the SBM facility at the time when the incident
occurred. It is unclear how loading and unloading of oil have been affected.
Referring to Tuesday’s spill, one shipping operator told Reuters that “the spill on the coast is complex”. The
Jose terminal has suffered delays in loading of crude in recent weeks, due to
unscheduled maintenance at one of the docks, which has surely added further pressure
on struggling cash-strapped Venezuelan oil company PDVSA that has been barely
avoiding default. PDVSA on Wednesday confirmed reports of a crude spill from a
pipeline connecting its main oil-exporting complex with a tanker
loading facility, but said shipments have not been affected. "PDVSA on Tuesday activated a contingency
plan to address a crude leak ... A temporary staple was installed in the
pipeline to stop the leak," the company said in a statement. It added
it was expeditiously cleaning up the area. "Operations of production and shipment of crudes from the Hugo Chavez
Orinoco Belt were not compromised and continue with absolute normality,"
it said in a statement. (Oil Price: http://oilprice.com/Latest-Energy-News/World-News/Venezuelas-Main-Crude-Oil-Port-Hit-By-Spill.html;
Reuters: http://www.reuters.com/article/us-venezuela-oil-spill-idUSKBN1700XE;
http://www.reuters.com/article/venezuela-oil-spill-pdvsa-idUSL2N1H60S5)
Economy & Finance
Venezuela announces a new exchange rate — but this one
probably won't help, either
Venezuela's
latest effort to curb its economic free fall is one it's tried before, and it
will probably yield the same results. President Nicolas Maduro announced Monday
night that his oil-exporting nation will put a new currency exchange rate in
place next week. The new rate will replace the DICOM exchange rate, one of
Venezuela's two official rates. The problem is that nobody pays attention to
the official exchange rate in Venezuela, a country wracked by inflation and
whose people survive by buying food and other necessary items mostly on the
black market. "Ultimately, this is a
fool's errand, because the government fails to address the major economic
issues facing Venezuela," said Jason Marczak, director of the Latin
America Economic Growth Initiative at the Atlantic Council's Adrienne Arsht
Latin America Center. "Venezuela has
launched a number of exchange rates over the years, and none of them have kept
pace with the black market." The
Venezuelan bolivar currently trades around 710 per U.S. dollar under the DICOM
exchange rate and at 10 under the DIPRO rate, Venezuela's other official
rate. On the black market, however, a
dollar can fetch around 3,000 bolivars. (CNBC: http://www.cnbc.com/2017/03/28/venezuelan-just-announced-a-new-currency-rate--and-nobody-cares.html?utm_source=Sailthru&utm_medium=email&utm_campaign=New%20Campaign&utm_term=%2AMorning%20Brief)
Supreme Tribunal rules that the government can bypass
legislature in joint ventures
The
Constitutional Chamber of the Supreme Tribunal has ruled that the Executive
branch of government can now set up joint ventures without the approval of the
National Assembly, which the Tribunal has rules is in contempt. It added that
the legislature cannot “modify proposed
conditions or pretend to establish other conditions.” More in Spanish: (Agencia
Venezolana de Noticias; http://www.avn.info.ve/contenido/ejecutivo-podr%C3%A1-constituir-empresas-mixtas-aprobaci%C3%B3n-del-tsj)
Politics and International Affairs
OAS pushes Venezuela to engage in dialogue as tensions
flare
Members
of the Organization of American States urged Venezuela's government and
opposition to settle their differences through dialogue Tuesday, backing off
from threats to suspend the socialist-run country and providing President
Nicolas Maduro some short-term relief as he struggles to rescue the polarized
nation from crisis. The contentious special meeting at the OAS headquarters in
Washington underscored the difficulty that regional governments increasingly
concerned about Venezuela's crisis face as they try to force the unpopular
Maduro to cede some power to his opponents and restore badly damaged democratic
norms. The outcome also showed the degree to which Venezuela, even crippled by
triple-digit inflation and widespread shortages of basic goods, can still count
on an alliance with a few small Caribbean nations whose support was won through
years of subsidized oil shipments. The meeting was called to debate a 75-page
report issued two weeks ago by OAS Secretary General Luis Almagro in which he
characterized Venezuela as a country where rule of law no longer exists and
called on member nations to suspend Venezuela unless elections are held soon.
Hours before the meeting began, Maduro's opponents decried what they see as
another power grab: a surprise ruling by the government-stacked Supreme Court
threatening to impose limits on the immunity enjoyed by opposition members of
congress. "Once aberrations of this
gravity begin we do not know where they will end," the U.S.
representative at the OAS, Michael Fitzpatrick, said about the ruling. He said
that it was essential for Venezuela's government accept the hand being extended
by the OAS and that further delays in restoring democratic order meant the
region's solidarity with "the
suffering people of Venezuela only grows deeper and stronger." The
three-hour meeting ended with a declaration on behalf of 20 nations pledging to
take concrete steps toward a diplomatic solution, but provided few details on
what that would involve. Representatives from the Dominican Republic, El
Salvador and Haiti voted with Venezuela in trying to cancel the meeting
altogether, despite a warning from Sen. Marco Rubio, the Republican chairman of
the U.S. Senate subcommittee that deals with Latin America, that U.S. aid to
them could be cut off if they don't stand up for democracy. International pressure is building on Maduro,
especially from the Trump administration, which recently slapped drug sanctions
on Venezuela's vice president and has forcefully called for Maduro to release
political prisoners. Luis Almagro, the OAS secretary-general, says “The continent is telling the [Maduro] regime
to release political prisoners. It is saying it wants democracy for the
country. That is essential, it is fundamental.” Tuesday’s session at the OAS coincided with a
US Congress hearing on Venezuela and fresh democratic calls from Federica
Mogherini, the EU’s foreign policy chief. Vatican-sponsored talks between
officials and the opposition have failed to make meaningful gains and many
Venezuelans fear next year’s presidential elections will be cancelled. The more
drastic action could mean Venezuela’s suspension from the organization. To
suspend Venezuela, two-thirds of the 34 active member states of OAS would have
to agree in a vote set for June. Venezuela can count on the support of a
handful of leftwing governments, such as Bolivia, and small Caribbean states to
which it has provided subsidized oil over the years. “Sanctions against a country should be the last resort, after there has
been no answer” from the government, said Almagro. A suspension from OAS
could also threaten disbursements from multilateral lenders. However, some
analysts said the move by OAS would “have
little impact” in Venezuela and that the government will continue to do
everything in its power to avoid regime change and can depict the OAS actions
as part of a broader imperialist attack on Venezuela. (Financial Times: https://www.ft.com/content/66b51e14-1432-11e7-80f4-13e067d5072c;
ABC News: http://abcnews.go.com/International/wireStory/oas-weighs-punishing-venezuela-disrupting-democracy-46425558)
Crisis upon crisis in Venezuela
Venezuela
was once one of Latin America’s economic powerhouses and a regional diplomatic
heavyweight. To grasp how precipitously its global standing has eroded under
President Nicolás Maduro, consider these two recent developments. Last month,
the United Nations announced that Venezuela had lost its right to vote in the
General Assembly for a second year because it owes tens of millions of dollars
in dues. And on Tuesday, against Venezuela’s ardent protests, diplomats from
across the hemisphere convened a rare meeting in Washington to discuss what it
would take to restore democracy and a semblance of order in the autocratic,
impoverished and dysfunctional nation. Tuesday’s hearing at the Organization of
American States did not result in a clear plan to address Venezuela’s political
and humanitarian crisis. But the fact it was held at all was deeply
embarrassing to Venezuela, which just a decade ago aspired to become a
counterbalance to United States power and policy in the region. Venezuelan
diplomats have sought to characterize growing regional opposition to Maduro’s rule
as part of an underhanded effort by the United States to justify military
intervention. A coalition of O.A.S. members, currently led by Mexico, isn’t
buying that excuse and is trying to find and broker solutions to the crisis.
One proposal being floated is to expel Venezuela from the organization. While
this would be fully justified, given that the government’s repression of the
political opposition and its dismal human rights record violate the O.A.S.
charter, it’s hard to see what this would accomplish. Furthermore, it could
prompt Maduro to act even more rashly. (The New York Times: https://www.nytimes.com/2017/03/29/opinion/crisis-upon-crisis-in-venezuela.html)
Venezuela's government hopes for international
sanctions
Venezuela's
government is moving further and further away from democracy, sparking
criticism from former political partners. The socialists in Caracas portray the
criticism as proof of their own integrity. Fourteen countries from North and
South America have urged Venezuela's Socialist Unity Party (PSUV) to restore
democracy in Venezuela. In a joint statement, they have asked the government in
Caracas to release their political prisoners and recognize the legitimacy of
parliamentary decisions. In the middle of March, OAS Secretary General Luis
Almagro published a painfully blunt report detailing the social, economic,
political and humanitarian situation here. Opposition politicians and critical
journalists are being threatened; some have been imprisoned or even murdered.
Since the end of 2015, the opposition has held a majority in Venezuela's
congress. However, it is virtually unable to act because the government refuses
to implement its resolutions or the PSUV-dominated constitutional court blocks
them. Almagro accuses President Nicolas Maduro and his government of violating
all 28 articles of the Inter-American Democratic Charter. In response, Maduro
demanded Almagro's dismissal and insulted him in his usual manner - calling him
a "clown" and saying,
"Almagro's stupidity in the OAS does
not upset me for a second." The OAS has initially refrained from
imposing sanctions. But General Secretary Almagro is likely to further pursue
the issue. Some analysts believe it is possible that international pressure may
make Caracas restore the rule of law; others consider this to be unlikely and
compare the Venezuelan government to Fidel Castro's communist regime in Cuba,
which was effectively expelled from the OAS in 1962 and hit with an expanded
trade embargo. In fact, former Venezuelan vice-president Diosdado Cabello had
announced before the OAS meeting: "They
would do us a favor." Yesterday, President Nicolás Maduro called for
a domestic and international debate on the “usefulness”
and “relevance” of the OAS; and
claimed his regime has won an important “victory”
this week. Several analysts in Caracas report that the Supreme Tribunal is
laying the groundwork for withdrawing Venezuela from the OAS immediately. (DW: http://www.dw.com/en/venezuelas-government-hopes-for-international-sanctions/a-38174996;
and more in Spanish: (Infolatam: http://www.infolatam.com/2017/03/29/maduro-pide-abrir-debate-la-utilidad-pertinencia-la-oea/;
El Universal: http://www.eluniversal.com/noticias/politica/runrunes_646002)
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.
