November 07, 2017

International Trade

130 containers of food and medicine offloaded at Puerto Cabello

130 containers bearing food and medicine have been offloaded at Puerto Cabello from the vessel NIKOLAS, from Cartagena, in Colombia. The shipment includes 50 containers of semolina pasta, 20 of milk, 15 of black beans, 10 of red beans, and 3 of beef, as well as chemicals for the pharmaceutical industry. All cargo was consigned to state agency CUSPALCA. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=37758)

 

Oil & Energy

U.S. oil service firms face hit from Venezuela debt restructuring

U.S. oil service companies face hard decisions in the coming weeks on whether to continue working for Venezuela’s state-run oil company PDVSA, and the prospect of hundreds of millions of dollars in write-offs for overdue bills. The companies’ services are critical for Venezuela, which is struggling with a deep economic crisis marked by shortages of food and medicine. Oil accounts for over 90% of the nation’s export revenues. Socialist President Nicolas Maduro on Thursday said the country plans to potentially restructure some US$ 60 billion in bonds, widely seen as signaling a possible default that could affect other debt. New York-based investment firm Torino Capital estimates that, in addition to the bonds, Venezuela owes some US$ 26 billion to creditors and US$ 24 billion in commercial loans. (Reuters, http://www.reuters.com/article/venezuela-bonds-oilservices/rpt-u-s-oil-service-firms-face-hit-from-venezuela-debt-restructuring-idUSL1N1NC029)

 

Commerce Secretary appears to have links to PDVSA, despite U.S. sanctions

Despite U.S. sanctions on Venezuela’s bond transactions in international markets and other restrictions against top officials, the Paradise Papers show that Secretary of Commerce Wilbur Ross has an important stake in multi-million-dollar businesses related with state-oil giant Petroleos de Venezuela (PDVSA). Ross still retains interest in Navigator Holdings, a shipping company incorporated in the Marshall Islands in the South Pacific that maintains a close relationship with Russia’s energy company SIBUR, which is run by President Vladimir Putin’s son-in-law Kirill Shamalov and other individuals who have been sanctioned by the U.S. Navigator Holdings has received millions of dollars every year in earnings due to coastal shipping services provided to PDVSA, which is no small client of Navigator Holdings. The state-oil company contributed to 10.7% of Navigator’s earnings during fiscal year 2014 and 11.7% in fiscal year 2015. (Newsweek: http://www.newsweek.com/paradise-papers-show-links-between-trumps-secretary-commerce-and-venezuelas-703496)

 

Brother of former PDVSA head implicated in money laundering

Fidel Ramírez Carreño, brother of Rafael Ramírez Carreño, former President of PDVSA and Venezuela’s current Ambassador to the United Nations, has been listed among the beneficiaries of a money laundering scheme that provided fake consulting bills to send millions of dollars to the United States through a Doral, Florida, company called Miami Equipment & Export Co. The company is under investigation for selling Venezuela overpriced electric plants. A Venezuelan consortium called KCT Cumaná II International sent millions of dollars to the Doral company, which in turn transferred the funds to the private accounts of Venezuelan government officials and former officials. Luis and Luis Javier Díaz, owners of the Doral based firm, are being charged by the US government for operating an unlicensed bank and money laundering. The transactions, involving a PDVSA affiliate, took place while Ambassador Ramírez was the company’s CEO. His brother, Fidel, has held several government positions under the current regime. The money-laundering case is being filed by NY Southern District DA Joon A. Kim. More in Spanish: (Venepress: https://venepress.com/article/Hermano_de_Rafael_Ramirez_implicado_en_lavado_de_dinero_en_bancos_de_Nueva_York1509906927514

 

Venezuela oil basket hits 2 year high

The price Venezuela receives for its mix of medium and heavy oil rose for a third straight week, hitting its highest level since July of 2015.  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 November 3 rose to US$ 52.90, up US$ 2.16 from the previous week's US$ 50.74.  According to Venezuelan government figures, the average price in 2017 for Venezuela's mix of heavy and medium crude is now US$ 44.96. (Latin America Herald Tribune: http://www.laht.com/article.asp?ArticleId=2445811&CategoryId=10717)

 

Commodities

Pets on the menu as Venezuelans starve

In a country that once was rich, but where people are beginning to starve, few animals are safe. One morning in August at the metropolitan zoo in the torrid city of Maracaibo, workers were shocked to find the bones of a buffalo and some wild pigs inside their cages with clear signs of mutilation. Thieves allegedly stole the meat to eat what they could and sell the rest on the local market. In west Caracas, at the zoo of Caricuao district, the same sort of thing happened. Watchmen found the bones and offal of a black horse inside its enclosure. Apparently the perpetrators only took the edible parts of the animal. Venezuela’s increasingly authoritarian President Nicolas Maduro knows people are going hungry in his country, but he doesn’t know what to do about it. He keeps announcing new stopgap measures, but his words don’t carry a lot of nutritional weight. One of the latest programs was the so-called rabbit plan, a failed attempt to start rabbit farms all over the capital to substitute the proteins that come from unaffordable chicken and even more unaffordable beef. But, indeed, Venezuelans traditionally do see rabbits as pets and not food, so in areas where the government brought rabbits to start farms people started adopting them, giving them funny nicknames, and even embellishing their long ears with colorful bows. No question of eating the little dears after that. (Barron ’s: http://www.barrons.com/articles/its-your-default-not-mine-maduros-doublespeak-in-venezuela-1509721529)

 

Economy & Finance

Venezuela’s debt struggle poses more questions for investors

Analysts and investors say there are more questions than answers surrounding Venezuela’s plans to “refinance and restructure” its financial liabilities. Venezuela has about US$ 63 billion of foreign bonds outstanding, according to TORINO Capital, while the central bank estimates the country’s overall foreign debts at about US$90 billion. The real number say most analysts is much higher.  PDVSA, the state oil company, has sold US$ 28.6 billion of bonds and owes billions of dollars more in “promissory notes”. Venezuela owes another US$ 4billion or so to creditors that have taken it to the World Bank’s ICSID court. Stuart Culverhouse, chief economist at EXOTIX, thinks total public sector external debts range between US$100 billion and US$ 150 billion. Even this is uncertain. A refinancing usually implies something voluntary while a restructuring means forcibly “haircutting” creditors. Crucially, US sanctions imposed this summer in practice means both options are off the table. That Maduro named vice-president Tareck El Aissami as the lead negotiator with bondholders complicates matters further. Aissami has himself been sanctioned by the US as an alleged narcotics trafficker, which means US investment groups — the biggest holders of Venezuelan debt — cannot enter talks with him.  “The logistics seem almost impossible,” notes Siobhan Morden, head of Latin American fixed income strategy at Nomura. “The cynical interpretation is that the impossible deadline for negotiations conveniently shifts the blame of default to bondholders for their unwillingness (inability) to negotiate.” Worries that a default would trigger creditor lawsuits that could imperil its vital oil export revenues have spurred Venezuela to stay current much longer than many expected. It has managed this largely through largesse from China and Russia and pushing the hardship on to ordinary Venezuelans by sharply limiting imports. The country’s options appear limited. Venezuela is overdue on the interest payments on bonds that mature in 2019, 2024, 2025 and 2026, demonstrating the “significant fiscal strain” the country is facing, S&P notes. Foreign currency reserves are below US$ 10 billion — and much of this is in gold that will be hard to liquidate. China is wary of deepening its financial exposure to Venezuela while the country has already restructured some of its bilateral loans from Russia. The markets have reacted badly. The price of Venezuela’s bond maturing in August next year has tumbled from 72 cents on the dollar to about 34 cents this week, as investors panicked after the restructuring announcement and bank traders pulled out of the market, causing prices to “gap” lower.  S&P last week downgraded Venezuela’s rating to the second-lowest rung possible without actually being in default, arguing there was an even chance of a full default within the next three months. That dour view is reflected in the spiraling cost of Venezuelan credit-default swaps. The most likely outcome, investors and analysts say, is a protracted period of financial limbo, with a restructuring precluded by US sanctions and Venezuela facing a barrage of lawsuits that will tie it up for years to come. (Financial Times: https://www.ft.com/content/5f07e298-c326-11e7-a1d2-6786f39ef675; Bloomberg: https://www.bloomberg.com/news/articles/2017-11-06/gramercy-says-venezuela-debt-saga-will-be-worse-than-argentina-s; https://www.bloomberg.com/news/articles/2017-11-06/drug-kingpin-leading-venezuelan-bond-talks-has-a-violent-streak; Dealbreaker: https://dealbreaker.com/2017/11/heisenberg-venzuela-debt-drug-kingpin/; FORBES: https://www.forbes.com/sites/kenrapoza/2017/11/06/venezuela-default-day-looms/#30b56b1c7202; Oilprice: https://oilprice.com/Geopolitics/International/Is-A-Venezuelan-Default-Inevitable.html; Barron’s: http://www.barrons.com/articles/its-your-default-not-mine-maduros-doublespeak-in-venezuela-1509721529: Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2445698&CategoryId=10718; http://www.laht.com/article.asp?ArticleId=2445774&CategoryId=10717; El Universal, http://www.eluniversal.com/noticias/daily-news/venezuelas-maduro-announces-restructuring_676546)

 

Venezuela bonds tumble, PDVSA bonds rise on partial default speculation

Venezuelan bond prices tumbled on Monday while those of state oil company PDVSA were mixed, affected by speculation that the government of President Nicolas Maduro could halt payments on sovereign bonds while maintaining payment on PDVSA debt. The country’s cash-strapped government invited creditors to a Nov. 13 meeting in Caracas on Friday, after announcing plans to potentially restructure some US$ 60 billion in bonds. Venezuela’s 2018N bond, the country’s next sovereign maturity, was down 31.125 points to a bid price of 34. Meanwhile, several PDVSA bonds were rising, with the benchmark 2022 rising 2.000 points to a bid price of 32. Investors remain confused by Maduro’s announcement that his government will continue to pay but that it will also refinance and restructure debts. The latter options are all but impossible given U.S. sanctions against Caracas that block U.S. citizens from acquiring newly-issued Venezuelan debt. Many believe Maduro’s announcement was meant to pave the way for default, because the country’s debt burden has left it desperately short of basic goods such as food and medicines - spurring malnutrition and preventable diseases. Next year service is close to US$ 9 billion, of which US$ 6 billion must be paid by Venezuela. Investors are still waiting for a US$ 1.2 billion payment on PDVSA’s 2017N bond that came due last week. Officials last week said they had initiated the payment. Such payments have been increasingly slowed, as banks worry about doing business with PDVSA following the U.S. sanctions. (Reuters: https://www.reuters.com/article/venezuela-bonds/venezuela-bonds-tumble-pdvsa-bonds-rise-on-partial-default-speculation-idUSL1N1NC0ZJ)

 

National Assembly accuses Maduro of sinking bond prices in secret buy-back plan

Venezuela’s Parliament today accused President Nicolás Maduro, of announcing a foreign debt restructuring to sink the price of Venezuelan bonds, to allow them to be repurchased by funds willing to offer better payment terms. The charge was made today by the congressman Rafael Guzmán, on behalf of the Finance Committee’s opposition majority. He accused the government for providing "inside information" to "friendly funds." (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2445824&CategoryId=10717)

 

OP-ED: A debt restructuring that’s really a giant money laundering operation

Nicolás Maduro has announced Venezuela couldn’t keep paying its debts, and needed to restructure.  But “restructuring” - a negotiated outcome agreed with bond holders — is totally impossible in current circumstances. Even if sanctions didn’t rule restructuring out, it’d still be unrealistic without major, sweeping policy reforms, which Maduro certainly isn’t promising. Without them, you’d end up having to offer 30% yields or some similarly high number. And even if Maduro did promise sweeping neoliberal policy reforms, restructuring would still not be feasible, because PDVSA bonds have no collective action clauses, so it’s practically impossible for the government to deal with holdout bondholders.  Long story short, this talk of “restructuring” is just noise. They can’t restructure. One way to see it is that this is about the political marketing of an already expected default: an attempt to soften public opinion ahead of the inevitable. But if so, why would you exempt the 2017N maturity due today? Why would you pay that bond even after you’ve announced default? One possibility is that this is all a bit of high-stakes market manipulation designed to send the price of all Venezuelan bonds plummeting. The CITGO-backed PDVSA 2020s could be a buyback target in such a scenario. Last week, trading in 2017Ns saw unprecedented volume. The kind of volume you’d expect if a few very rich, very well-connected people had reliable information that the 2017Ns were the last bond Maduro was planning to pay. That’s the kind of volume that could be interpreted as a massive money laundering operation, with tons of dirty money rushing in to buy-up a sure-thing bond. (Caracas Chronicles: https://www.caracaschronicles.com/2017/11/02/debt-restructuring-thats-really-default-thats-really-giant-money-laundering-operation/)

 

Standard & Poor's downgrades Venezuela's credit rating

Credit rating agency Standard & Poor's reported on Friday that it has downgraded Venezuela’s debt notes with an outlook of probable default after the announcement made by Venezuelan President Nicolás Maduro about restructuring and refinancing. The decision followed a similar step taken earlier on Friday by credit rating agency Fitch, AFP reported. Rating lowered from CCC- to CC. In other words, the agency considers Venezuela’s debt in foreign currency as it were in default, with some possibility of recovery. (El Universal, http://www.eluniversal.com/noticias/daily-news/standard-poors-downgrades-venezuelas-credit-rating_676554)

 

Venezuela bonds now yield a record 40 points over U.S. Treasuries

Venezuelan debt is teetering toward default with average prices near 30 cents on the dollar. As investors ponder an invite from the government to come to Caracas next week to discuss a restructuring (or renegotiation or refinancing, depending on which official is speaking), they now demand a record 40.8 percentage points of extra yield over U.S. Treasury bills to hold the country’s bonds. No one really expects those yields to pay out as Venezuela seeks debt relief, but they do give an idea as to just how distressed the securities have become. The spread implies that if the government were to issue new notes it would either have to pay a coupon near that figure or sell them at an extreme discount from the face price. In a normal sovereign restructuring, negotiations would probably lead to a haircut for bondholders around current prices. (Bloomberg, https://www.bloomberg.com/news/articles/2017-11-06/venezuela-bonds-now-yield-record-40-points-over-u-s-treasuries) 

 

Goldman Sachs asset arm faces large paper loss on Venezuelan bond

Goldman Sachs’ asset management division is likely to be nursing a multimillion-dollar paper loss on a controversial Venezuelan bond purchase it made this summer after the country abruptly announced that it was seeking to restructure its foreign debts. Ricardo Penfold, a senior portfolio manager at Goldman Sachs Asset Management, earlier this year swooped on a big slice of a bond issued by PDVSA, Venezuela’s state oil company, people familiar with the matter say. Mr. Penfold paid US$ 865 million for bonds with a face value of US$2.8 billion — a price of just under 31 cents on the dollar — reflecting the elevated risks of a default even at the time. While GSAM has since sold off chunks of the bond, it was still listed as the single biggest overall owner of the PDVSA bond maturing in 2022, with a face value holding of US$ 1.3 billion at the end of the third quarter. But with Thursday’s announcement that Venezuela would seek to restructure all its foreign bonds, the bond is now trading at 25 cents on the dollar, down from 29 cents at the start of last week. That would translate into a paper loss of US$ 54 million in just five days if GSAM has not reduced its stake since the end of the third quarter. “The opposition has already said they won’t honor that bond, so you’re taking a big risk trading those,” said Russ Dallen of Caracas Capital, an investment bank boutique that follows Venezuela. (Financial Times: https://www.ft.com/content/94a6cbc0-c101-11e7-b8a3-38a6e068f464)

 

Venezuela's debt restructuring is probably just a political gambit by Maduro, experts say

President Nicolas Maduro may be trying to shore up support for next year's presidential election with the announcement of a massive foreign debt restructuring. Last week, Maduro unveiled plans to restructure Venezuela's US$ 120 billion debt. The restructuring effort will be led by Vice President Tareck El Aissami, who will also start "the fight against the financial persecution of our country," Maduro said. But a successful debt restructuring seems unlikely now, given a series of sanctions imposed by the U.S. earlier this year. The announcement also raises concern that the oil-rich country could default on its debt. "There's a political angle to this," said Risa Grais-Targow, director of risk consultancy Eurasia Group's Latin America practice. "I think their eye is on the presidential election next year." By unveiling this restructuring, Maduro can score political points and help secure his place as the most powerful person in the country, said Reggie Thompson, Latin America analyst at STRATFOR, a geopolitical analysis platform. (CNBC: https://www.cnbc.com/2017/11/06/heres-the-real-endgame-for-nicolas-maduro-of-venezuela.html)

 

Maduro chooses food over bondholders as Venezuela goes hungry

With foreign reserves at a 15-year low after years of ruinous economic stewardship, Maduro is caught between satisfying creditors and voters who struggle to afford basics like beef, chicken and milk. When Maduro said last week that he would renegotiate the nation’s crushing $140 billion-plus debt, he chose butter over bonds. Obtaining fresh financing is a tall order, given the authoritarian government’s increasingly toxic reputation and U.S. sanctions that prohibit Americans from receiving new bonds as part of a restructuring. But rather than simply declaring default, Maduro has summoned creditors to Caracas on Nov. 13 to discuss new terms. By staving off a final reckoning, the nation can keep control of oil-producing assets, use its       US$ 9.7 billion in reserves to purchase goods from abroad -- and keep food and other social aid flowing. Through food distribution programs like the CLAPs, or Local Committees for Supply and Production, Maduro has tried to hold sway over Venezuela’s urban poor and countryside -- long considered the bedrock of the socialists’ support. Rather than sending scarce subsidized goods to supermarkets or state food stores, the government since last year has supplied food to loyal neighborhood groups, which distributes it directly to their neighbors to head off reselling and long lines. As Maduro and his allies promise to improve shaky services and increase deliveries, critics say the program only extorts a hungry electorate. The government says it shelled out almost US$ 72 billion to pay principal and interest on bonds and loans since Maduro took office four years ago, but after making a final payment last week, the president suggested such funds would be better spent in social programs. “It could have been spent in schools, clinics, housing, a prosperous economy,’’ he said. Luis Vicente Leon, head of DATANALISIS, said that whether bondholders turn up for the meeting, the government will lay blame on the U.S., which Maduro has described as indulging in “financial persecution.” (Bloomberg: https://www.bloomberg.com/news/articles/2017-11-07/maduro-chooses-food-over-bondholders-as-venezuela-goes-hungry)

 

Unversed in debt details, Venezuelans desperate for any relief

Venezuelans heaving under an unprecedented economic meltdown know little about the finer points of foreign debt negotiations, but long for anything that would put more food on their plate and slow the world’s highest inflation. Few on the streets of capital Caracas really understood unpopular leftist President Nicolas Maduro’s announcement this week that he would seek to refinance the oil-rich nation’s heavy bond burden of US$ 60 billion - or about US$ 2,000 per person. But those interviewed by Reuters said they were hoping any deals between the government and its multiple foreign creditors would free up foreign currency to increase imports of scarce food, medicine, and basic products. (Reuters, http://www.reuters.com/article/us-venezuela-bonds-reaction/unversed-in-debt-details-venezuelans-desperate-for-any-relief-idUSKBN1D40GV)

 

IMF gives Venezuela six months to supply economic data

The International Monetary Fund (IMF) gave Venezuela on Friday six months to produce statistics on the domestic economy, following the government failure to meet the deadline stipulated in the IMF regulations. Should Venezuela fail to supply the requested information, the IMF could end up expelling it. The board of the International Monetary Fund (IMF) found that Venezuela did not deliver data on time on the operations of the Social Security Institute and total exports and imports of commodities, expressing their value in local currency, per country of destination and country of origin, AP quoted. The organization explained in a release that the meeting of the executive board of directors had been slated well in advance and it is not related at all with the announcement made on the eve by Venezuelan President Nicolás Maduro on the beginning of restructuring of the Venezuelan foreign debt for U$D 120 billion. (El Universal, http://www.eluniversal.com/noticias/daily-news/imf-gives-venezuela-six-months-supply-economic-data_676565)

 

OP-ED: How Long Can Venezuela Count on Russia and China? by Geoff Ramsey

Venezuela has found in Russia a source of quick loans and oil deals that have been essential to the government’s efforts to stay afloat. In the near term, it appears that Russia is willing to accept the high risks associated with lending to Venezuela in exchange for an increasing role in the country’s oil industry. This has been a major point of concern U.S. policymakers. The Venezuela Humanitarian Assistance and Defense of Democratic Governance Act—which passed the House Foreign Affairs Committee on September 28 and is awaiting consideration by the full House—specifically tasks the State Department and intelligence community with providing a report on Russia’s activities in Venezuela. Much of the discussion on Venezuela’s international backers have tended to lump Russia and China in the same boat, with some painting them both as “enablers” of the Maduro government. However, these arguments obscure more than they reveal. For one thing, Russia’s economic support has clear limits. Russia’s economy has been degraded by declining oil prices and sanctions. Russia has a GDP smaller than that of New York state, and its capacity to project power abroad is somewhat exaggerated. While the Russian government has been willing to accept higher risks in backing Maduro, they do not appear to have the resources to provide an indefinite lifeline. China’s government, on the other hand, has a far greater capacity to do so, but appears to have more interest in looking beyond the Maduro government than its Russian counterparts. Unlike Russia, though, China moved to stop issuing new loans to the country in 2016, and has held unofficial meetings with individual members of the opposition to seek assurances that debt would be honored by a potential opposition government in the future. More recently, PETROCHINA announced that its U.S. affiliate would respect the U.S. debt sanctions announced by the White House in August, and China has reportedly grown impatient with increasing delays in shipments of Venezuelan crude. International relations analysts have pointed to two other clear incentives for China to support a resolution to the Venezuelan crisis. The first of these reasons, put plainly, is that serving as a lifeline to the Maduro government is bad for China’s “brand” in Latin America. The second reason for a Chinese interest in backing away from Maduro and supporting transition is China’s own evolving approach to relations with other developing nations. In recent years, analysts suggest that China has been cautiously reevaluating its long-held policy of non-intervention in other states’ internal affairs. Now, China is calculating that the benefits of having Maduro in power outweigh the risks of his government’s economic mismanagement. However, the differences between the Chinese and Russian approach to the Venezuelan crisis suggest that China’s support for Venezuela cannot be taken for granted. Moving forward, it is unlikely that the Chinese government will be an entirely inflexible ally to Maduro. (WOLA: https://www.wola.org/analysis/long-can-venezuela-count-russia-china/)

 

Politics and International Affairs

Maduro's allies strip leading legislator of immunity, launch trial

Prominent Venezuelan lawmaker Freddy Guevara has sought refuge in the Chilean ambassador’s residence in Caracas amid fears he could be jailed, a development that leaves the ailing opposition with even fewer leaders to take on leftist President Nicolas Maduro. Venezuela's pro-government constitutional assembly (ANC) stripped Guevara of his immunity from prosecution in a case that is fueling fears of another crackdown on President Nicolas Maduro's opponents. Guevara released a video saying he doesn't regret his call for civil obedience after the unanimous vote Monday. Guevara was one of the leaders of this year's deadly protests against Maduro and the second highest-ranking member of the opposition-controlled congress. The opposition and local media said that SEBIN intelligence agents had surrounded Guevara’s house over the weekend. The vote by the constitutional assembly was widely expected after the supreme tribunal Friday barred Guevara from leaving the country and accused him of instigating unrest and other crimes. By law only congress can determine whether a legislator's immunity should be lifted. The Venezuelan Supreme Court (TSJ), which is packed with government loyalists, ordered on Friday that Guevara be stripped of his immunity and prosecuted for crimes of "association, persistent public instigation and the use of an adolescent to commit crimes." Twelve governments — including those of Mexico, Brazil and Canada — issued a joint statement on Saturday calling the Supreme Court's accusations against Guevara a "new blow to the rule of law and separation of powers in Venezuela." The 31-year-old lawmaker is the vice president in the opposition-controlled National Assembly. Chile is willing to grant political asylum to Venezuelan opposition politician Freddy Guevara, Chilean Foreign Minister Heraldo Munoz said on Monday. The Maduro regime’s Foreign Ministry demanded other countries cease their “aggressions” against this country. The head of the opposition-controlled Venezuelan Parliament, Julio Borges, called the Supreme Court’s ruling “absolutely political ... arbitrary ... outside the law”. Borges said that the move by the TSJ is “one more attempt” to try and “destroy the Parliament,” adding that since the opposition took control of the chamber after the 2015 legislative election, the government has sought to divest it of its functions. The National Assembly will take this new instance of political persecution to the World Parliamentary Union and other international organizations. Guevara could become the highest-profile Venezuelan politician to seek exile in recent years. (The New York Times: https://www.nytimes.com/aponline/2017/11/07/world/americas/ap-lt-venezuela-political-crisis.html; DW: http://www.dw.com/en/chile-willing-to-offer-venezuelan-opposition-politician-political-asylum/a-41268076; Fox News: http://www.foxnews.com/world/2017/11/07/maduros-allies-strip-leading-venezuela-opponent-immunity.html; The Chicago Tribune: http://www.chicagotribune.com/sns-bc-lt--venezuela-political-crisis-20171105-story.html; Reuters, http://www.reuters.com/article/us-venezuela-politics/venezuela-opposition-leader-guevara-seeks-refuge-in-chile-ambassadors-home-idUSKBN1D50LN; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2445792&CategoryId=10717; http://www.laht.com/article.asp?ArticleId=2445819&CategoryId=10717; and more in Spanish: El Universal, http://www.eluniversal.com/noticias/politica/anc-autoriza-tsj-continuar-juicio-diputado-freddy-guevara_676806; Noticiero Venevisión, http://www.noticierovenevision.net/noticias/politica/gobierno-nacional-exige-cese-inmediato-de-agresiones-en-su-contra-tras-medida-contra-diputado-guevara; http://www.noticierovenevision.net/noticias/politica/parlamento-denunciara-persecucion-contra-freddy-guevara-ante-instancias-internacionales)

 

Venezuela frees two anti-Maduro activists; scores still jailed

Venezuelan authorities overnight freed two activists who were in jail for more than a year after being accused of plotting against socialist President Nicolas Maduro, the opposition said on Saturday. Delson Guarate, who had been a mayor in central Aragua state, and former student leader Yon Goicoechea were among nearly 400 jailed anti-Maduro activists who rights campaigners say are political prisoners but whom the government calls coup-plotters. “I‘m with my family today,” tweeted Goicoechea, displaying a photo of himself against the backdrop of Caracas’ Avila mountain. “Tomorrow I’ll address the country. God is with us.” (Reuters, http://www.reuters.com/article/us-venezuela-politics/venezuela-frees-two-anti-maduro-activists-scores-still-jailed-idUSKBN1D40QW)

 

Canada imposes sanctions on Maduro and 18 government officers

Canada imposed sanctions on 52 government officers of Venezuela, Sudan and the Russian Federation on charges of human rights abuses and corruption. The Canadian government renewed on Friday sanctions against Venezuelan President Nicolás Maduro, in addition to 18 government authorities for “gross violations of internationally recognized human rights or acts of significant corruption.” Under the new Justice for Victims of Corrupt Foreign Officials Act, Canadian Minister of Foreign Affairs, Chrystia Freeland, announced targeted sanctions against 52 individuals. In addition to Maduro, other officials include Executive Vice-President Tareck el Aissami; Adán Chávez and Argenis Chávez, brothers of late President Hugo Chávez, and multiple ex ministers and pro-government deputies. (El Universal, http://www.eluniversal.com/noticias/daily-news/canada-imposes-sanctions-maduro-and-government-officers_676570)

 

Venezuela's hate crime law seeks to silence political opposition, bishops warn

The president of the Venezuelan bishops' justice and peace commission has criticized a hate crimes law passed on Thursday, charging that its aim is to silence those opposed to the socialist government of Nicolas Maduro. The Law Against Hatred and Fascism, the Nov. 2 legislation passed by the Constituent Assembly, will be used by Maduro's government against the opposition “so we can't even speak or protest,” said the Emeritus Archbishop of Coro Roberto Lückert Leon. The Constituent Assembly's president, Delcy Rodriguez, has said the law targets media that “promote hatred and racism.” Lückert stated that news media critical of the government have been undercut by Maduro's government. “Right now, they've hamstrung the news media. They're using the supply of newsprint to undermine us. The oldest newspaper in Coro is called La Mañana. The can't print it because they're not giving them any newsprint; on the other hand, they gave to the paper that they founded a building, machinery, and newsprint, and it comes out every day. That's freedom of the speech? No.” Archbishop Lückert stated that “as a Venezuelan, the only solution for the country that I have is elections; but elections that are transparent and fair.”  However, he said that now the Venezuelan people are profoundly upset by the National Electoral Council, which “is completely sold out to the government” and which manipulated recent elections, so Maduro's party would win. The prelate also said the Constituent Assembly “is an invention Maduro brought in from Cuba,” where there are no political parties or independent news media”. Cardinal Jorge Urosa Savino of Caracas called the Constituent Assembly “fraudulent and illegitimate” in a recent interview. “It's made up of political activists at the service of the government and it's not going to resolve the problems with the economy. What's needed here is to change the Marxist, totalitarian, and statist ideology that has brought the country to ruin,” he charged. Cardinal Urosa said Maduro wants to “decapitate the opposition so there's just one political party.” (EWTN: http://www.ewtnnews.com/catholic-news/Americas.php?id=16530)

 

OP-ED: Is Venezuela's Maduro regime on its way out the door? by Michael Rowan

The reported hope that Venezuela’s dictatorial regime may collapse in the face of its tardiness in paying bond bills is wildly exaggerated. What may be happening is the new normal for Venezuela: just more lying. Consequently, a whole lot more killing, disease and starvation may be in store for the population. Sorry to say it, but relief from oppression and social collapse may not be on the horizon. Hugo Chavez built a very powerful machine to unravel Venezuela’s democracy and free market, and it is not going to be easy to set it right. It might never happen. But as they say, the bigger they are the harder they fall. The strength – and weakness -- of the current gang in power is their connection to the US$300 billion missing from public accounts since 2000. Where is that money? Without control of the state, that gang is toast. The game of the world’s outlaws is to ultimately escape from dependence on law and the dollar. Venezuela, Iran and Russia have exerted ferocious effort to destroy the dollar and failed. China is cleverly on both sides of that game, which is a big game, the world game. Chavez went “all in” with Venezuela’s chips in that game and lost big time. Yet while Venezuela is only a pawn in that game, and easily sacrificed, it still has oil and other assets – official corruption, for example – which have great value to outlaws. Maduro should look on the bright side: he’s worth a lot more alive than gone and forgotten by the bad guys. (Latin American Herald Tribune: http://www.laht.com/article.asp?ArticleId=2445805&CategoryId=13303)

 

OP-ED: If the Trump doesn't do something, Venezuela will collapse, by Roger Noriega

The Trump administration’s targeted sanctions have taken a toll on the regime and its corrupt leaders, and the U.S. president has pressed regional and European partners to back an urgent democratic transition. However, without stronger internal opposition and tougher international efforts, Maduro will either consolidate a dictatorship or collapse the country altogether. After more than a decade of beleaguered opposition to the regimes of Hugo Chávez and his acolyte Maduro, most Venezuelans prefer fundamental change and are seeking new ways to obtain it. Creating a much more coherent and resolute opposition—which earns the confidence of the people and the international community—is a key to avoiding a catastrophic meltdown or dictatorship in Venezuela. Much tougher, clear-headed U.S. leadership is indispensable to that outcome. What is lacking is a strategy to focus these pro-democracy efforts in a more decisive, coordinated way. This should be the task of the State Department. It is not too late for the White House to empower a coordinator to lead a whole-of-government effort on Venezuela and work with global partners to promote democracy and adopt targeted sanctions. (Newsweek: http://www.newsweek.com/tougher-us-leadership-could-help-save-venezuela-catastrophe-696815)

 

Guyana has been outfoxed by Venezuela

Guyana has bungled its handling of the territorial controversy with Venezuela. The talks which were held recently in New York between the foreign Ministers of Guyana and Venezuela suggest strongly that Guyana will not achieve its objective of having the matter placed before the International Court of Justice. Venezuela launched a diplomatic blitz when Guyana tried to isolate it within CARICOM, and Guyana had no response to that blitz, because it did not have the resources or the know-how to respond. CARICOM was always going to call for talks and negotiations as a condition of its support for Guyana’s position. One mistake that Guyana made was to place all its eggs in one basket. It decided to go for a juridical settlement of the dispute without carefully contemplating how realistic were the chances of success. The matter is never likely to end up before the ICJ, because Venezuela is not a member of the ICJ and it requires the approval of both parties to a controversy for a matter to go in front of the ICJ. So, Guyana is misdirecting its diplomatic efforts – in a direction in which there is little hope. Even if the matter does go to the ICJ eventually, this is a drawn-out process. Guyana is now locked into a good offices process, which can drag on for another 10 years. (Kaietur News: https://www.kaieteurnewsonline.com/2017/11/07/guyana-has-been-outfoxed-by-venezuela/)

 

 

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