March 03, 2017

International Trade

529 food containers have arrived at the Port of La Guaira

529 containers bringing food from Mexico, aboard the container ship CNP PAITA, have arrived at the port of La Guaira. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=36067; Ultima Hora Digital, http://ultimahoradigital.com/2017/02/alimentos-llegaron-de-mexico-para-repartirse-en-los-clap/)

Cargo that has arrived at Puerto Cabello

·         30.000 tons of rice

·         27 containers of agro chemicals for state agency AGROPATRIA

·         30.000 tons of wheat for state agency Corporación de Abastecimiento y Servicios Agrícolas (CASA)

·         30.000 tons of white corn

An additional 574 containers bearing food, personal care products and medicine arrived from Cartagena-Colombia on the MAERKS WISMAR. The shipment includes 139 containers of food: canned tuna, black beans, white rice, powdered milk, pasta and margarine. 19 containers of medicine, 12 of personal care products, and 404 bearing vehicle spare parts and machinery. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=36065; http://www.bolipuertos.gob.ve/noticia.aspx?id=36074: Ultima Hora Digital, http://ultimahoradigital.com/2017/02/30-mil-toneladas-de-arroz-son-descargadas-en-el-puerto-de-puerto-cabello/; El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/arribaron-a-puerto-cabello-30-000-toneladas-de-arr.aspx)

 

Cargo that has arrived at Maracaibo

·         3.278 tons of food packets from México for the state government of Zulia state. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=36063; El Mundo, http://www.elmundo.com.ve/noticias/mundo-corporativo/sociales/contenedores-con-alimentos-llegaron-al-puerto-de-m.aspx)

Cargo that has arrived at El Guamache (Margarita Island):

113 containers from Kingston, Jamaica, including 384 tons of food items such as rice, pasta and coffee, plus 1165 tons of vehicle parts and accessories, textiles, clothing and footwear, furniture and household products, hardware, health and personal care products such as soap, toothpaste and shampoo. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=36072)

 

Oil & Energy

Hitting Venezuela's Government where it hurts. Not yet two months into his tenure, U.S. President Donald Trump has demonstrated his intention to increase the pressure on Venezuela's government, whose imperatives are at odds with those of his own administration. Washington appears ready to impose further sanctions on Venezuelan officials and entities, perhaps even against the country's vital state oil and natural gas company, Petroleos de Venezuela (PDVSA). The U.S. government may find it easier to keep targeting Venezuela through sanctions than to organize a regional response. If the Trump administration imposes heavy sanctions on PDVSA, thereby preventing U.S. companies and businesses subject to Washington's jurisdiction from doing business with the oil firm, it could herald Maduro's ruin. Caracas depends on oil for about 95% of its total export revenue, and it has already had to slash imports over the past few years as a result of limited production capacity and sanctions. Tough sanctions on the state oil and gas company would only intensify the economic crisis and probably also the divisions within the government over whether Venezuela should continue down the path of international isolation. Whether more sanctions would cause the Maduro administration to change course depends on the ruling party's internal dynamics. (STRATFOR: https://www.stratfor.com/analysis/hitting-venezuelas-government-where-it-hurts)

 

Economy & Finance

Venezuela running out of cash

The Central Bank of Venezuela says the country is down to just US$ 10.5 billion in foreign reserves. At the same time, Caracas must meet debt obligations of US$ 7.2 billion this year. The country had nearly US$ 30 billion in reserve five years ago; in 2015, it was down to US$ 20 billion. According to economists, the trend can't go on much longer, but it’s not easy to predict how long it would take Venezuela to reach the bottom. Nearly US$ 7.7 billion of the country’s remaining reserves is in gold, according to the latest financial report for 2016. Venezuela had to ship gold to Switzerland to foot debt bills last year. Dwindling reserves are only exacerbating the humanitarian crisis in the country. The economic blow has led to food and medical shortages, as well as skyrocketing prices. Inflation is expected to rise to 1,660% this year and 2,880% in 2018, according to the IMF. Among the key factors boosting inflation experts see the crashing bolivar, huge government spending, poor management of the country's infrastructure, as well as high level of corruption. However, oil prices averaging US$ 55 remain the major problem for the country’s economy. As the largest holder of reported oil reserves in the world, Venezuela produced over 2.4 million barrels of crude and condensates per day at the end of the last year, as per ministry data. Oil shipments make up more than 90% of the country's exports. That makes it more and more difficult for Caracas to pay debts and import food, medicine and other essentials for its citizens. The country's imports dropped 50% from a year ago, according to Venezuelan research firm ECOANALITICA. (RT: https://www.rt.com/business/379160-venezuela-ten-billion-down-oil/; Fox News: http://www.foxnews.com/world/2017/03/02/venezuelas-foreign-reserves-tank-to-10-5-billion-report-says.html)

South America's last bastion of Socialism is falling to pieces

The currency is worth a dime, though probably not even that much. The brain drain is immense. People are starving. Unemployment is in the double digits. Inflation is triple digits. And its president, Nicholas Maduro of the disastrous United Socialist Party of Venezuela, talks to deceased president Hugo Chavez who comes to him in the form of a little bird. South America's last hold-out of pre-colonial times is going broke. It has US$ 10 billion in foreign currency reserves. There are now individuals in South America that have more money than Venezuela's central bank. If Maduro wanted to be more like Cuba, he's got it, maybe minus the 57 Chevy's and armies of doctors. It's not just the popping of the oil bubble that's hurt Venezuela. Every other one trick pony has managed to survive. Venezuela's economy has contracted an impressive 18.6% in 2016. If there is a failed state in the America's, Maduro is running it. Dwindling oil revenues have knocked Venezuela out. It faces unprecedented social, political and economic crisis. The only thing that is keeping incomes up is the fact that Maduro keeps giving poor people money. In the absence of structural reforms and without a resolution to the political impasse between the ruling Socialists and the opposition, the country is set for another challenging year. The absence of real sector and inflation information makes any assessment of the economy difficult. (Forbes: https://www.forbes.com/sites/kenrapoza/2017/03/02/south-americas-last-bastion-of-socialism-is-falling-to-pieces/#3b804a292fd8)

Job losses, low wages add to Venezuela economic hardship

Multiple companies - local and foreign - are closing doors or cutting payrolls across Venezuela, which despite its oil wealth is suffering deep recession, triple-digit inflation and chronic shortages. As per CONSECOMERCIO, the major retail industry group, Venezuela in the past 18 months lost close to 1 million private sector jobs. "Who is creating jobs? Nobody," said CONSECOMERCIO Vice President Alfonso Riera. "That unemployed population unfortunately is migrating to the street, informal work or worse." Government critics say nationalizations of businesses and more than a decade of price and currency controls have crippled private enterprise, but President Nicolas Maduro says Venezuela is a victim of an "economic war" led by business leaders with U.S. help. Venezuela has not reported official unemployment figures since April 2016, when the rate was at 7.3%. A survey by three universities showed unemployment at the end of 2016 remained at that level. But the study also found 38% of those surveyed were working informal jobs ranging from buying and reselling goods to freelance work without benefits. Only 28% said they were public employees and 27% had a job in the private sector. Union sources said major companies such as food and beermaker POLAR, carmaker FORD and bottler COLA-COLA FEMSA all are reducing their workforce by negotiating redundancies and offering employees buyouts. "People are taking the packages," said Johnny Magdaleno, who leads a POLAR union. He said workers were being offered the equivalent of US$ 2,500 at the black-market exchange rate. "Production has fallen too much," he said. "The workers who are left are making 4,000 bolivars weekly ($1 at the black-market rate). That doesn't even enable them to buy a pack of flour."  (Reuters: http://www.reuters.com/article/us-venezuela-economy-idUSKBN16926M)

 

Politics and International Affairs

US Senate unanimously passes resolution demanding Trump act on Venezuela
US Senators unanimously passed a resolution Wednesday urging President Donald Trump to take further action against Venezuelan officials. The bill also expressed support for a controversial move by Organization of American States (OAS) head Luis Almagro to invoke the Democratic Charter. If invoked, Venezuela would be suspended from the OAS. When Almagro first announced the move in 2016, he also demanded President Nicolas Maduro be “immediately” removed from office, prompting many Latin American leaders to accuse the OAS head of overreach. Despite the controversy, the Senate bill called on Trump to “provide full support for OAS efforts in favor of constitutional and democratic solutions to the political impasse and to instruct federal agencies to hold officials of the Venezuelan government accountable for violations of US law and abuses of internationally recognized human rights.” The bill will now head to the House of Representatives. One of the main supporters of the bill, Senator Marco Rubio, thanked both Republicans and Democrats for supporting the move. The bill was co-sponsored by prominent Democrats including Senators Bob Menendez and Bill Nelson, along with Hillary Clinton’s 2016 presidential running mate Tim Kaine. (Venezuelanalysis.com: https://venezuelanalysis.com/news/12953; El Universal, http://www.eluniversal.com/noticias/daily-news/senate-lobbies-for-release-political-prisoners-venezuela_641844; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2431988&CategoryId=10717)

US Council on Foreign Relations: Options for U.S. Policy in Venezuela, prepared for the US Senate Committee on Foreign Relations. Venezuela’s economic, political, and social situation represents both a regional problem and a global affront to democratic values. As such it should be a priority for the current U.S. government, which should invest in the necessarily complex, time consuming, and fragile diplomatic processes to push for change, as well as to prepare for the day when it in fact may come. (Full presentation: ATTACHED)

Maduro looks to get on Trump’s good side with praise for Congressional address

Venezuela’s socialist dictator Nicolás Maduro appears to be attempting to ingratiate himself with his American counterpart Donald Trump, praising the president’s joint address to Congress on Tuesday as “the first time I hear a U.S. president speak of the struggle against drug trafficking.” He highlighted as significant President Trump’s emphasis on combatting drug addiction from the United States, particularly in poorer communities. Maduro’s compliments follow a month in which the U.S. Treasury Department designated his vice president, Tareck El Aissami, a “Specially Designated Narcotics Trafficker” for his ties to various cocaine-trafficking outlets and President Trump personally welcomed Lilian Tintori, wife of Venezuelan political prisoner Leopoldo López, to the Oval Office. Maduro nonetheless highlighted that he and President Trump “have differences” but reiterated that he wished to engage in respectful diplomatic relations with the White House, a departure from his regular warnings that President Barack Obama was preparing a ground invasion of Venezuela during his tenure. Among those differences is the fact that Maduro employs a known high-level drug trafficker as his second-in-command. According to the U.S. Treasury Department, El Aissami has cooperated with “groups as varied as the Mexican Zetas cartel and Hezbollah.” Reports — published prior to the Treasury using the Drug Kingpin Act to freeze El Aissami’s U.S. assets — accused him of, among other crimes, recruiting Latin American Muslims to join Hezbollah and running his own cocaine trafficking outfit the Cartel de los Soles. Diosdado Cabello, the Socialist Party’s minority leader in Venezuela’s National Assembly, is widely believed to be the Cartel de los Soles’s boss. While Maduro himself has never been accused of drug trafficking, reports have indicated he has funded political campaigns with drug money generated by Cabello and El Aissami. El Aissami responded to the Treasury sanctions with a full-page ad attacking the United States in the New York Times. In addition to sanctioning El Aissami, the Trump administration has called for the release of all political prisoners under Maduro’s chavista dictatorship. In February, Trump welcomed Tintori, an anti-socialist activist and wife of Popular Will party leader Leopoldo López, to the White House, publishing a photo standing next to her, Vice President Mike Pence, and Senator Marco Rubio on Twitter. (BREIBART: http://www.breitbart.com/national-security/2017/03/02/venezuela-tries-get-trumps-good-side-drug-war/)

 

…but falls back on familiar defiant discourse after US Senate vote

Embattled President Nicolas Maduro warned Wednesday of a resurgence in “racism and xenophobia”, the day after the US Senate unanimously voted a resolution expressing “profound concern” about the present Venezuelan crisis.
It is a familiar pattern for Cuban and Venezuelan leaders, and, in his first public speech after the U.S. Senate’s vote, Maduro re-adopted it with ease. “I am making a worldwide alert in the face of surging dangerous, segregationist, racist and xenophobic currents that threaten to divide mankind even further, threaten to fill the whole world with war. That’s why I am calling and asking for the Venezuelan people to unite, to keep on making the revolution and keep on defending our identity,” Maduro said during an event of the CLAP, a new government mechanism to ration price-controlled foodstuffs administered by ruling party PSUV militants. Maduro didn’t mention the U.S. vote specifically, but he denounced “white supremacy” and it was enough for a crowd of hundreds, clad in red, to cheer for him. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2432136&CategoryId=10717)

 

US State Department reports Venezuela has “failed demonstrably” on drug traffic control

“During the past 12 months, the Venezuelan government failed demonstrably to make sufficient efforts to meet its obligations under applicable international counter-narcotics agreements or to uphold the counter-narcotics measures set forth in the Foreign Assistance Act.  Due to Venezuela’s porous border with Colombia, its weak judicial system, sporadic international counter-narcotics cooperation, and permissive and corrupt environment, Venezuela remains a major drug-transit country.  It is one of the preferred trafficking routes for illegal drugs, predominately cocaine, from South America to the Caribbean region, Central America, the United States, Western Africa, and Europe. In 2015, the Venezuelan government engaged in minimal bilateral law enforcement cooperation with the United States.  Venezuelan authorities do not effectively prosecute drug traffickers, in part due to political corruption. Although the Venezuelan government, as a matter of policy, neither encourages nor facilitates illicit drug production or distribution, and although it is not involved in laundering the proceeds of the sale of illicit drugs, public corruption is a major problem in Venezuela that makes it easier for drug-trafficking organizations to operate.  Additionally, the Venezuelan government has not taken action against government and military officials with known links to FARC members involved in drug trafficking.” US Department of State: https://www.state.gov/documents/organization/268025.pdf)

OAS Democratic Charter action on Venezuela hinges on Vatican

In response to the US Senate resolution, Luis Almagro, Secretary General of the Organization of American States (OAS) says: “As long as the Vatican remains there we will definitely take no action to apply the Democratic Charter. If we are told that dialogue is over and we receive notice from the opposition and the Vatican about it, we will recommend the timely steps to take”. Talks between the Maduro regime and the Venezuelan opposition remain paralyzed since December, with the opposition charging that the government has reneged on agreements. Spain has said it continues to support efforts by its former President José Luis Rodríguez Zapatero to prop up talks here. More in Spanish: (Notiminuto: http://www.notiminuto.com/noticia/para-la-carta-democratica-todas-las-miradas-van-al-vaticano/#

Colombia’s FM says dialogue is the only way to face Venezuela’s great problems

Colombian Minister of Foreign Affairs María Angela Holguín has called for more dialogue between the Venezuelan government and the opposition, sponsored by former presidents José Luis Rodríguez Zapatero (Spain), Martín Torrijos (Panama) and Leonel Fernández (Dominican Republic), in order to face up to this nation’s "great difficulties." During a press conference in Madrid, after a meeting with his Spanish counterpart, Alfonso Dastis, Holguín said Rodríguez Zapatero, “has made a great effort” for dialogue in Venezuela. “Polarization in Venezuela is immense, but through dialogue a solution will be found to a crisis that worries many countries around the world; we, in Colombia, have it closer,” the minister said. (El Universal, http://www.eluniversal.com/noticias/daily-news/holguin-dialogue-the-only-way-face-great-problems_642023; http://www.eluniversal.com/noticias/daily-news/colombia-backs-dialogue-venezuela_641837)

 

European Foreign Service asks Venezuela to abide by its Constitution

Adrianus Koetsenruijter, Head of the South America Division of the European External Action Service (EEAS), has strongly recommended that the Venezuelan government must abide by the Constitution and made an appeal for renewed dialogue between government authorities and the dissent. “It has to do with respect for the Constitution, respect for fundamental rights and liberties, such as freedom of speech, opinion and association,” Koetsenruijter while speaking at the European Parliament Committee on Foreign Affairs. He reported that many Venezuelans have been incarcerated in the absence of proper conditions of transparency, and insisted that the government ought to observe the “basic principles of democracy”. (El Universal, http://www.eluniversal.com/noticias/daily-news/european-external-service-exacts-venezuela-observance-constitution_641647)

 

New charges brought against imprisoned Defense Minister

A military court here has brought new charges against former Defense Minister General Raúl Isaias Baduel, who was due to be freed today after serving seven years and eleven months for alleged corruption. He is now being accused of “treason”, and was forcibly transferred to the military court by the Military Counter-Intelligence agency. Baduel’ s legal counsel termed the charges “unfounded military criminal persecution”. Baduel had been on conditional freedom since mid-2015, but was detained again on January 12^th for allegedly violating the conditions of his parole. Baduel was Defense Minister under the late President Hugo Chavez and one of his closest advisors. He is considered to have been the key force in bringing Chavez back to power after he was ousted for 48 hours in April 2002, but signed a 2010 manifesto publicly calling on the late president to resign, thus becoming a key opposition figure. More in Spanish: (Infolatam: http://www.infolatam.com/2017/03/03/dictan-nueva-privativa-libertad-exministro-baduel-e-imputan-otros-cargos/
 

In search of Venezuelan pilots of a plane in flames in Honduras

Honduras police authorities are searching for the pilots of a plane with Venezuelan registration that entered the country on Monday morning and landed to the north of the nation. Honduran investigators suspect that the plane had been used to carry narcotics, in keeping with the standards of such flights related to drug trafficking, such as arriving in the early hours of the morning, landing on non-authorized areas and setting fire to the plane after the unloading, DPA cited. The aircraft with Venezuelan registration landed in a field in the city of Choloma, around 280 kilometers from Tegucigalpa. (El Universal, http://www.eluniversal.com/noticias/daily-news/search-venezuelan-pilots-plane-flames-honduras_641648)

 

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.

November 24, 2016

International Trade

Maduro, Foreign Minister claims Venezuela remains in MERCOSUR

Foreign Minister Delcy Rodríguez says Venezuela will continue to preside pro tempore over the Common Market of the South (MERCOSUR). “Venezuela is neither leaving nor being expelled from MERCOSUR. We will never accept this kind of aggression against our Fatherland”, she tweeted in rejection of an announcement by Uruguay’s President Tabaré Vásquez and Paraguay’s Foreign Minister Eladio Loizaga, saying that Venezuela will be suspended from MERCOSUR if it has not complied with all the organization’s rules by December 1^st. President Nicolas Maduro said the group of MERCOSUR founding nations was applying “a sanction that does not exist”. Experts, however, report that the other 4 nations within MERCOSUR are applying the Vienna Convention on Treaty Rights in this case under the “pacta sunct servanda” clause that states that any treaty in force requires the parties to comply in good faith, which applies to international organizations. More in Spanish: (Noticiero Venevisión, http://www.noticierovenevision.net/economia/2016/noviembre/22/176386=presidente-maduro-expreso-que-nadie-podra-sacar-a-venezuela-del-mercosur; El Mundo, http://www.elmundo.com.ve/noticias/actualidad/politica/maduro--nadie-podra-sacar-a-venezuela-del-mercosur.aspx; El Mundo, http://www.elmundo.com.ve/noticias/economia/politica/aplican-convencion-de-viena-para-suspender-a-venez.aspx#ixzz4QpN3G8Ql; AVN; http://www.avn.info.ve/contenido/venezuela-ni-se-va-ni-expulsan-mercosur; El Mundo, http://www.elmundo.com.ve/noticias/actualidad/noticias/rodriguez--venezuela-ni-se-va--ni-la-expulsan-de-m.aspx)

 

ECLAC estimates 26.1% drop in Venezuela’s exports in 2016

The UN Economic Commission for Latin America and the Caribbean (ECLAC) estimates a 5% drop in Latin American exports during 2016, and expects a slight recovery in 2017. Venezuela has experienced the worst contraction in the region: at 26.1% this year. More in Spanish: (El Carabobeño: http://www.el-carabobeno.com/cepal-exportaciones-america-latina-se-contraera-5-2016/)

 

Burnt petcoke cargo sets sail from Venezuela, exports resume

A vessel carrying Venezuelan petroleum coke whose load caught fire set sail late on Tuesday for Colombia, allowing exports from the terminal to resume after a three-week halt while authorities decided what to do with the ship. The PETROSANFELIX terminal where the vessel was stuck accounts for more than a third of the around 150,000 tons of petroleum coke that Venezuela can export per month. Utilities buy the product and mix it with coal to burn at power plants. The Top Trader, chartered by U.S. Koch Industries and carrying 22,000 metric tons of petroleum coke, sailed on Tuesday, according to Thomson Reuters vessel tracking data. The cargo was sailing for Cartagena, Colombia, a change from the original destination in Europe. Petroleum coke is a product derived from upgrading Venezuelan Orinoco belt's extra heavy oil into a crude more valuable for refiners. The coke is typically transported from production facilities to the terminals at a high temperature, but many customers do not accept loading the cargoes if they detect fire. Frequent outages and logistics problems have created an accumulation of millions of tons of petroleum coke at PDVSA's eastern terminals in recent years. Exports have also been affected in the past. After the Top Trader left the Petrosanfelix terminal, loading operations resumed at that facility, while other PDVSA ports were also loading petroleum coke this week, according to an independent report. (Reuters: http://www.cnbc.com/2016/11/23/reuters-america-burnt-petcoke-cargo-sets-sail-from-venezuela-exports-resume.html)

 

Customs impounds humanitarian shipment sent to CARITAS here

SENIAT customs authorities reported they have impounded 525 boxes of medicine and 92 boxes of nutrition supplement consigned to CARITAS Venezuela. They declared the cargo abandoned because it lacked permits, and consigned it to the Social Security Institute. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/politica/seniat-declara-en-abandono-legal-cargamento-de-car.aspx#ixzz4Qv7xNPhP)

 

New currency bills reportedly have arrived at La Guaira port

Cipriana Ramos, President of the National Trade Association (CONSECOMERCIO) says the current currency scarcity could improve with the arrival of newly minted bills at La Guaira port. She said: “We were able to see a cargo that arrived at La Guaira on Tuesday and was strongly guarded by national security” More in Spanish: (El Nacional; http://www.el-nacional.com/economia/Presumen-billetes-denominacion-llegado-Guaira_0_963503883.html)

 

Venezuela's iron and steel complex plans to raise US$ 54 million in exports in 2017

Venezuela's iron and steel complex expects to raise US$ 54 million next year for exports of industry and building materials, said Carlos Padilla, Planning Director of the complex. He told the government news agency that about 30,000 tons of finished products −including steel bars, beams, angles and fences, and more than 80,000 tons of base steel for billets. He said that Panama and Brazil, as well as other Caribbean nations, are the main destinations for the export of steel material. (AVN, http://www.avn.info.ve/contenido/venezuela039s-iron-and-steel-complex-plans-raise-54-million-exports-2017)

 

Oil & Energy

Maduro orders an “absolute restructuring” of PDVSA

President Nicolas Maduro has issued a decree ordering an “absolute restructuring” and “change of course” at state oil company PDVSA, to “defeat corruption and bureaucracy” within. He claimed there are “infiltrators” inside the Venezuelan oil industry, and that he will have “zero tolerance with corruption and treason”. He called on PDVSA President Eulogio Del Pino, who is also Oil and Mining Minister, work with the company workers in a group for “specific change policies” to “strengthen” the industry, and ordered an increase in production. Venezuela’s National Assembly last week voted to censure former PDVSA President Rafael Ramírez, currently Venezuela’s UN ambassador, whom they accused of being a part of a US$ 11 billion corruption case. Maduro said Ramírez was being targeted in a defamation campaign by imperialists, and Ramírez said he would sue the legislature. More in Spanish: (EFE: http://www.economiaynegocios.cl/noticias/noticias.asp?id=311421)

 

Venezuela refinery network operating at roughly a third

Venezuela's refinery network was operating at about a third of capacity, according to union sources and workers, as state oil company PDVSA struggles with equipment issues after years of underinvestment. Venezuela's biggest refinery, 645,000-barrel-per-day Amuay refinery, was operating at only 260,000 bpd with two of its five crude distillation units out of service, union leader Ivan Freites told Reuters, citing an internal report. Its flexicoker remains down, Freites added.  Adjacent Cardon, with capacity of 310,000 bpd, was at 120,000 bpd, added Freites, a fierce critic of PDVSA and the government of socialist President Nicolas Maduro.  Meanwhile, the smaller refineries of El Palito and Puerto La Cruz, with capacities of 146,000 barrels per day and 187,000 bpd respectively, were barely refining any crude, according to a separate union leader and a worker. The El Palito refinery was halted in October for scheduled maintenance, according to PDVSA. Union leader Freddy Alvarado said on Wednesday that the complex remained shut. The catalytic cracking and alkylation units at Puerto la Cruz have been inoperative since the start of November, union leader Jose Bodas said earlier this month. Over the weekend, the refinery's reformer unit for octane 95 gasoline stopped operating, Bodas added. Venezuela's refineries have been plagued with blackouts, equipment issues and stoppages for years. PDVSA often blames problems on "saboteurs" intent on bringing down socialist rule in Venezuela, and says its foes and hostile media try to exaggerate refinery issues. Critics say years of underinvestment and poor maintenance are the cause. U.S. refining firm CITGO Petroleum is sending more products to its parent company, PDVSA, to compensate for problems in the domestic network, according to sources and Reuters data. (Reuters: http://www.reuters.com/article/us-venezuela-refinery-idUSKBN13I2MA)

 

Economy & Finance

Maduro threatens legal action against JPMorgan

President Nicolas Maduro has ordered state oil company PDVSA to look into legal action against JPMorgan after the U.S. investment bank reported delays in US$ 404 million in bond interest payments. PDVSA said on Monday it was using a 30-day grace period for coupon payments on its 2035 bond but that reports of other payment delays were wrong. It suggested paying agent CITIBANK was creating a backlog that had spooked markets. "JPMorgan's attitude is of a criminal nature," Maduro said. He claimed local and foreign opponents were conspiring to give a false impression that Venezuela is on the verge of a debt default. Maduro accused JPMorgan of falsely reporting that PDVSA was in default. In fact, the report in question said payments on three bonds were not made on time and that the company had a "30-day grace period to make payments on the coupons before (the situation) becomes an event of default." Maduro said he had asked PDVSA head Eulogio Del Pino to study legal options. "The least JPMorgan can do is apologize to the Venezuelan people," Maduro said. Maduro also said the U.S. Treasury Department was behind a campaign against PDVSA. PDVSA said it had "punctually" paid this month's obligations for 2021, 2024 and 2026 paper but had activated the grace period for the 2035 bond. "I'd tell the bondholders to call CITIBANK and ask why they are delaying payment of money that is already in their accounts," Del Pino said on state television. He suggested CITIBANK was participating in "attacks" on Venezuela's socialist government and implied that it had reneged on its contract, but later said the bank confirmed it was making payments. CITIGROUP told bondholders in a letter in July that PDVSA would need to name a new paying agent for seven outstanding dollar-denominated bonds, but will stay on as paying agent until PDVSA finds a new one. (Reuters: http://www.reuters.com/article/us-pdvsa-debt-idUSKBN13H24G?il=0; El Universal, http://www.eluniversal.com/noticias/daily-news/venezuelan-oil-authority-blames-citibank-for-bond-payment-delay_628216; http://www.eluniversal.com/noticias/daily-news/venezuelan-govt-ponders-lawsuit-against-morgan_628283)

 

Faría says economic crisis is not over

Foreign Trade and Investment Minister Jesús Faria say Venezuela has not yet overcome its economic crisis, calling it deep and structural. He claims economic activity has improved substantially and expects slight growth in 2017. More in Spanish: (Noticiero Venevisión, http://www.noticierovenevision.net/economia/2016/noviembre/22/176374=ministro-jesus-faria-afirmo-que-la-crisis-economica-no-ha-sido-superada)

 

Venezuelan top court rules that the extension of state of emergency is constitutional

Venezuela’s Supreme Tribunal has declared that the extension for more 60 days of the state of exception and economic emergency, decreed by President Nicolás Maduro is constitutional and said he is authorized to continue “adopting urgent, conclusive, and exceptional measures required to ensure full enjoyment of their rights by the population, to preserve domestic order, and to ensure timely access to goods, services, food, medicines and other products which are essential for everyday life.” (El Universal, http://www.eluniversal.com/noticias/daily-news/venezuelan-top-court-rules-constitutional-extension-state-exception_628328)

 

 

Politics and International Affairs

Opposition says Vatican-brokered talks are 'frozen'

Venezuela’s opposition said that talks with the government were “frozen” after officials failed to attend meetings, throwing cold water on Vatican-brokered attempts to bridge the country’s deep political crisis. Though the formal talks, which began last month, appeared to have led to the release of a handful of detained activists, hopes for real rapprochement were always slim. The two sides are fundamentally at loggerheads, with the opposition seeking to oust the socialist president, Nicolás Maduro, while authorities vow he will not leave office before his term ends in 2019. “The government, in an irresponsible manner, froze the dialogue process by not showing up to two technical meetings last night,” said opposition coalition leader Jesús Torrealba. Opposition activists said authorities backed away after the national assembly on Tuesday held a heated session in which they slammed Maduro over a drug scandal. Two nephews of Maduro’s wife were found guilty this month on charges in the US that they tried to carry out a multimillion-dollar drug deal to help their family stay in power. “The government is using the debate as an excuse,” said two-time presidential candidate Henrique Capriles, accusing authorities of not being committed to talks. “The government has not complied with any of its promises. They promised to free political prisoners; there are more than 100 imprisoned. They promised [to open] a humanitarian channel; not a single medicine has come in.” “They [the government] don’t want to fulfill any commitments”, he said. During the talks, the opposition and the government have agreed to hold parliamentary elections in the contested state of Amazonas, which could give Maduro’s opponents a supermajority in congress to enact sweeping new laws and fire ministers. It is unclear whether the elections will take place if the talks don’t resume. It was not clear if the talks could be revived or if the opposition would resume a more militant agenda, which before the talks included protests and putting Maduro on trial before the national assembly. Spain’s ex-prime minister José Luis Rodríguez Zapatero and US diplomat Thomas Shannon were holding or seeking meetings with both sides. Dialogue had divided the diverse opposition coalition, with some activists feeling the government was duping the opposition to buy time. Previous sit-downs also showed little progress. Chavista lawmaker Elias Jaua, the government negotiator in talks with the opposition, claimed that an early election as an attempt to remove President Nicolas Maduro from power was never on the table, never mind what the opposition says. Carlos Ocariz, an opposition representative in government-opposition talks, said the government “lies” when claiming that the removal of President Nicolás Maduro from office was never addressed in the negotiating table. In that connection, Ocariz said that “since the very first day” they proposed early elections or the activation of a recall referendum against Maduro. He pointed to in-house strife within pro-regime forces, tweeting that: “honoring agreements has become a nightmare for them and has made their in-house warfare worse. That’s why any excuse is good enough to back away”. He asked mediators to pressure the government to comply on agreements. (The Guardian: https://www.theguardian.com/world/2016/nov/23/venezuela-nicolas-maduro-opposition-vatican-talks-frozen; The Wall Street Journal: http://www.wsj.com/articles/venezuela-talks-break-down-opposition-claims-1479934607; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2425748&CategoryId=10717; El Universal, http://www.eluniversal.com/noticias/daily-news/elections-recall-vote-proposed-since-the-launch-dialogue-venezuela_628320; and more in Spanish: Globovision: http://globovision.com/article/ocariz-solicitamos-a-los-mediadores-que-exijan-al-gobierno-cumplir-con-los-acuerdos)

 

…. then Maduro backs down, meets with Zapatero and says government has not withdrawn from talks

President Nicolas Maduro denied the government was withdrawing from the talks. After a meeting with Spain’s Rodríguez Zapatero, he said: “The dialogue table continues to move forward, is consolidating”, he said, expressing optimism over a process sponsored by the Union of South American Nations (UNASUR) and the Vatican. He demanded that the National Assembly exclude three legislators from Amazonas state that were incorporated in defiance of a Supreme Tribunal ruling. He claimed his regime has completely complied with all agreements. The mediators also met with representatives of the Democratic Unity (MUD) opposition alliance and said both sides were willing to continue. More in Spanish: (Infolatam: http://www.infolatam.com/2016/11/23/gobierno-venezolano-niega-haber-abandonado-la-mesa-dialogo-oposicion/; Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/noviembre/23/176579=mediadores-del-dialogo-reiteran-)

 

Supreme Tribunal urges National Assembly to formally separate contested legislators

The Supreme Tribunal’s Constitutional Chamber has urged the National Assembly to take formal action to separate three contested legislators from Amazonas state, as it did on January 11^th this year, since the three legislators said they were willing to withdraw. The Tribunal again held that all acts of parliament in defiance of Tribunal orders are null and void. Hector Rodríguez, head of the pro-government minority caucus at the National Assembly said that new pro Maduro legislators and a new “revolutionary” governor would soon be elected in Amazonas state. More in Spanish: (Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/noviembre/23/176546=tsj-exhorto-a-la-an-a-desincorporar-formalmente-a-diputados-impugnadosM http://www.noticierovenevision.net/politica/2016/noviembre/23/176581=hector-rodriguez-afirmo-que-en-amazonas-elegiran-a-diputados-del-psuv-en-apoyo-al-presidente-maduro)

 

Foreign Minister, Capriles, trade accusations over diplomatic passports held by convicted drug dealers

Foreign Minister Delcy Rodríguez has brought charges with the Prosecutor General against Miranda state governor and opposition leader Henrique Capriles, accusing him of “presumably” forging official documents. She denied a charge that Efrain Campo Flores and Francisco Flores de Freitas, the nephews of First Lady Cilia Flores that were recently convicted for drug trafficking in NY, were holding Diplomatic Passports when they were arrested. Capriles quickly retorted: “Now the issue is over the passports they themselves issued and not with the drugs that went through from the Presidential airport ramp. They have no shame!”. More in Spanish: (Noticiero Venevision: http://www.noticierovenevision.net/politica/2016/noviembre/23/176517=delcy-rodriguez-denuncio-a-capriles-por-falsificacion-de-documentos; El Nacional, http://www.el-nacional.com/politica/Capriles-respondio-acusaciones-Delcy-Rodriguez_0_963503797.html; El Universal, http://www.eluniversal.com/noticias/politica/canciller-desmiente-emision-pasaportes-implicados-caso-campo-flores_628147)

 

Opposition lawmaker jailed for 2 years joins legislature

The National Assembly welcomed opposition lawmaker Rosmit Mantilla, the country’s first openly gay legislator, who was released from jail last week after being imprisoned for two-and-a-half years as a new member. Mantilla was received with applause and was sworn-in before the leadership of the legislature headed by speaker Henry Ramos Allup, who invited him to take a seat and participate in the debate. “Outside (in the street) there’s hunger, there’s insecurity, I was imprisoned by the SEBIN (national intelligence service), but Venezuela is imprisoned by hunger and insecurity,” Mantilla told reporters after being sworn-in. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2425768&CategoryId=10717)

 

What it's like being a political prisoner in Venezuela under Maduro

Since Nicolas Maduro became president in 2013, the Venezuelan government has arrested and detained thousands of citizens. Most but not all are let go within a few days. One who remains incarcerated is opposition leader Leopoldo Lopez. Another is Joshua Holt, an American from Utah. Francisco Marquez wants the international community to understand something about the government of Venezuelan President Nicolas Maduro: "You are dealing with a government that currently engages in having political prisoners and systematic torture within their prison system." Marquez says he's seen it himself. He was released from a Venezuelan prison in late October after spending four months as a political prisoner.  Marquez says he witnessed the torture of political prisoners as well as common inmates. Marquez is 30 and a dual citizen of the United States and Venezuela, lawyer by training and a political activist by choice. He graduated from Harvard's Kennedy School of Government in 2012. He was arrested in June while working for the political opposition and campaigning for a referendum to remove Maduro from office. He was in jail for a month before being charged with money laundering and conspiracy to incite violence. He says the prison conditions were dungeon-like. "Almost no sunlight, very dark, very humid. Full of mosquitoes. I actually got dengue fever," he says. Marquez says the brutal treatment he witnessed is systematic. "It's not like a one-off prison guard doing this. The warden in my prison, I saw him as he beat other prisoners with what all the prison guards had: this bat with a flat surface," he recalls. Alfredo Romero, a human rights lawyer in Caracas who works on behalf of political prisoners, says since student protests rocked Venezuela in 2014, there have been hundreds of political prisoners, but the actual number in jail at any one time rarely rises above 100 to avoid international scrutiny. Romero says that's a perfect example of the Venezuelan government's revolving-door method of dealing with political prisoners. "They keep people for four months, one year, 20 days," Romero says. "Then they release them and put new people into prison. It's never the same people. It's never the same number." Romero says as of Nov. 22, there are 108 political prisoners in Venezuela. Some are incarcerated. Others have restrictions on their freedom. They can't leave the country. They must present themselves to court. They're prohibited from talking to the media or attending public meetings. "Most of them are protesters, students. Some have been persecuted for tweeting," he says. The United Socialist Party of Venezuela controls the judicial system, which intimidates the political opposition through arrests and detentions, a point echoed in a 2015 report by Human Rights Watch. Romero says since January 2014 there have been nearly 7,000 political arrests and detentions. (PRI: http://www.pri.org/stories/2016-11-23/what-its-being-political-prisoner-venezuela-under-maduro)

 

President dances salsa while Venezuela churns

Venezuelans are running short of food, medicine and patience, but fear not: President Nicolas Maduro is here to cheer them up -- by dancing salsa. Grinning under his black mustache, the burly, towering socialist swivels his hips and twirls his wife Cilia Flores in front of the cameras. With hunger and violent crime gripping the country and the opposition calling for his head, this is Maduro's new strategy for winning hearts and minds. That is an uphill battle; most Venezuelans would like him to leave power. Wednesday was a case in point as Maduro celebrated his 54th birthday with a live performance by old-school salsa greats El Gran Combo de Puerto Rico. But his continued capering amid the crisis, and his recent launch of a dedicated salsa radio show, seem like bad taste to some weary citizens. Spoof photo "memes" of Maduro online have shown him dancing in various inappropriate settings: at the scene of a crime or in a long queue for food. Maduro launched his radio show "Salsa Hour" late last month on the same day that opposition lawmakers called for a political trial against him. Now Maduro is using salsa's popular beats to reach out to ordinary Venezuelans who deserted him in that vote, says social psychologist Ricardo Sucre. "He wants to show himself to be confident and relaxed, not as though his government is about to fall." With his long broadcasts, Maduro is carrying on a tradition of his late mentor and predecessor Hugo Chavez. But Maduro lacks Chavez's charisma, Sucre says, but all the same "Chavez chose him as his successor because he could get through difficult times without looking nervous." Maduro weathered a scandal last week when a US jury convicted two of his wife's nephews of plotting to smuggle cocaine. But the following Sunday, the presidential couples were on television dancing for the nation. "Are you still dancing now?" said senior opposition leader Henrique Capriles. "The country is waiting for you to face up to things." (Agence France Presse: http://news.abs-cbn.com/overseas/11/24/16/president-dances-salsa-while-venezuela-churns)

 

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.