August 27, 2019

International Trade

Venezuela, Russia sign ports agreement

Warships from Russia and Venezuela can dock at one another’s national ports under an agreement signed earlier this month between Venezuelan Defense Minister Vladimir Padrino López and his Russian counterpart, Defense Minister Sergei Shoigu, in Moscow. The Venezuelan official was in Moscow for nearly a week in mid-August. In a video posted on 15 August on the Twitter account of the Venezuelan military’s press office, Padrino López said bilateral defense ties commenced in 2001 and the new ports agreement will “strengthen these relations.” (Jane’s: https://www.janes.com/article/90647/venezuela-russia-sign-ports-agreement)

 

Venezuela Parliament says military agreement with Russia ‘unconstitutional’

Venezuela's National Assembly controlled by the opposition declared null and void a new agreement with Russia on military cooperation. The declaration was published on Monday. The document concerns "the agreement on military cooperation between the governments of Venezuela and Russia, signed by defense ministers Vladimir Padrino Lopez and Sergey Shoigu." "This agreement was not considered either by a commission on foreign policy, sovereignty and integration or by parliament, which makes it unconstitutional, and this means that it is null and void," the declaration said, calling it unconstitutional. The parliament also said that opening a Venezuelan embassy in North Korea was "a violation of the constitution", TASS reported. On August 15, Shoigu and Lopez signed an agreement on reciprocal visits of military ships at the meeting in Moscow. The defense ministers also discussed the situation in Venezuela and issues of bilateral military cooperation. (TASNIM News Agency: https://www.tasnimnews.com/en/news/2019/08/27/2084075/venezuela-parliament-says-military-agreement-with-russia-unconstitutional)

 

Oil & Energy

China's July Venezuela oil imports fall over U.S. sanctions

China’s crude oil imports from Venezuela plunged 62% in July from the previous month, Chinese customs data showed on Sunday, as growing tension between Washington and the Maduro regime made buyers wary of taking oil from this nation. Arrivals of crude oil from Venezuela were 703,742 tons last month, or 165,720 barrels per day (bpd), data from the General Administration of Customs showed. That is down from 275,646 bpd in June. With U.S. sanctions on Venezuela having already driven away many of its oil buyers, the Trump administration in early August kept up the pressure by threatening sanctions on any company that works with Maduro’s government. Venezuela’s oil exports fell 17.5% in July to their second lowest since Washington imposed the sanctions in January, according to internal data from the company and REFINITIV EIKON. China National Petroleum Corp, a leading buyer of Venezuelan oil, has halted loadings in August amid concerns over potential hits by the secondary sanctions. REFINITIV Oil Research showed only three cargos carrying a total 540,000 tons of crude have left from Venezuela for China so far this month, half of the figure in July. For the first seven months of the year, China’s imports of Venezuela crude oil fell 13.4% on a year earlier to 9.37 million tons, or 322,601 bpd. (Reuters: https://www.reuters.com/article/us-china-economy-trade-crude/chinas-july-venezuela-oil-imports-fall-over-us-sanctions-idUSKCN1VF06N; Lloyd’s List: https://lloydslist.maritimeintelligence.informa.com/LL1128939/VenezuelaChina-oil-flows-fail-to-stem-plunging-tanker-demand)

 

Half of Venezuela's oil rigs may disappear if U.S. waivers lapse

A looming U.S. sanctions deadline is threatening to clobber Venezuela’s dwindling oil-rig fleet and hamper energy production in the nation with the world’s largest crude reserves. Almost half the rigs still operating in Venezuela will shut down by Oct. 25 if the Trump administration doesn’t extend a 90-day waiver from its sanctions, according to data compiled from consultancy Caracas Capital Markets. That could further cripple this nation’s production because the structures are needed to drill new wells crucial for even maintaining output, which is already near the lowest level since the 1940s. (Bloomberg, https://www.bloomberg.com/news/articles/2019-08-22/trump-takes-aim-at-oil-rigs-crucial-to-venezuela-s-energy-future)

 

CITGO profits hit by fallout from split, sees 2H improvement -CEO

The two new top executives at CITGO Petroleum disclosed this week that net income in the second quarter slid to less than half its level a year earlier, hit by a broad slump for the refining industry as well as complications from U.S. sanctions on Venezuela and CITGO’s split with state-run oil company PDVSA. Chief Executive Officer Carlos Jorda and Chairwoman Luisa Palacios on Thursday laid out a plan to rebuild profits, pay down debt and invest in operations after a jarring split this year from parent Petroleos de Venezuela (PDVSA). But they conceded that their plans could be complicated by U.S. sanctions on Venezuela which have affected relationships with suppliers and partners. One contentious issue is whether CITGO or another PDVSA subsidiary is responsible for a payment of almost US$ 1 billion due to bondholders this fall. Houston-based CITGO, the eighth-largest U.S. refiner, ousted its CEO and other top executives early this year and halted all dealings with PDVSA after Washington levied sanctions on Venezuela intended to force Nicolas Maduro from power. (Reuters, https://www.reuters.com/article/citgo-ceo/citgo-profits-hit-by-fallout-from-split-sees-2h-improvement-ceo-idUSL2N25J0LQ)

 

Explosion rocks Venezuela oil plant

An explosion rocked a natural gas-filling plant in the Venezuelan state of Miranda, forcing the evacuation of 6,500 residents, TELESUR reports, adding the Venezuelan government has called the event an act of sabotage. The explosion caused no fatalities with only one worker at the plant reported injured. According to a report in the leftist daily Morning Star, “The attacks were branded ‘terrorism’ by the Maduro regime. This is the latest in a string of accidents that highlight the precarious energy situation in sanction-bound Venezuela. Earlier this year, several blackouts crippled the country, with the government calling them a sabotage as well. The latest blackout, in July, Caracas blamed on an electromagnetic attack. The blackouts hit Venezuela’s oil industry particularly hard, leading to a suspension of operations at crude upgraders and its main oil export terminal. (Oil Price: https://oilprice.com/Latest-Energy-News/World-News/Explosion-Rocks-Venezuela-Oil-Plant.html)

 

Economy & Finance

Cold, hard euros: Venezuela turns to European cash after U.S. sanctions

From supermarket checkouts in the capital Caracas to electronics stores in the central city of Maracay, Venezuelans struggling with hyperinflation and a deep economic crisis are turning to a new form of payment: euros in cash. Runaway inflation that has made even large piles of the local bolivar currency worthless - combined with the socialist government’s relaxation of restrictions on the use of foreign currency - has encouraged Venezuelans to turn to dollar bills for everyday transactions in the past year. But in the past four months, euros have also started proliferating in markets and stores here. With the stock of dollars in circulation still far greater than euros, Venezuelan merchants tend to quote items at the same price in the European and U.S. currency - ignoring the euro’s higher value on international markets. (Reuters, https://www.reuters.com/article/us-venezuela-economy-euros/cold-hard-euros-venezuela-turns-to-european-cash-after-u-s-sanctions-idUSKCN1VD195)

 

Politics and International Affairs

Guaidó vows to shun early election

Venezuela's National Assembly President and interim President Juan Guaidó said Friday that opponents of Nicolás Maduro won't participate in any early legislative elections he calls amid a protracted power struggle. Guaidó said in an interview with The Associated Press that it would be a "farce" to participate in any election with the Maduro regime still in control of the country. The man recognized by the U.S. as Venezuela's rightful leader also said he plans to keep the self-claimed title of "acting president" even after his one-year term as leader of the opposition-controlled National Assembly ends in the new year. "We are very clear that we're going to continue until the point that elections in Venezuela are in reality free," Guaidó said. He contended there are signs Maduro's government is weakening, alleging it is resorting to torturing opponents while growing isolated from its people and the international community. Socialist party chief Diosdado Cabello, a key Maduro ally, has said elections for the National Assembly — the most important opposition-dominated institution in Venezuela — could be held in January or earlier. The legislature's five-year term is set to end in December 2020 and elections are traditionally held in the last month of its term. (AP: https://news.yahoo.com/venezuela-opposition-leader-vows-boycott-164911841.html)

 

The price of removing Nicolas Maduro from office may be amnesty for his deputies, by Eli Lake

No one should take Venezuelan dictator Nicolas Maduro’s words at face value. That applies to his claims last week that his regime is in secret negotiations with “high-ranking” American officials. His comments were almost certainly a gambit to divide the opposition during the on-again, off-again negotiations over new elections being brokered by the Norwegian government. They were a ploy to make the internationally recognized but largely powerless government of interim President Juan Guaidó believe that U.S. President Donald Trump was negotiating behind its back. That said, there is a kernel of truth buried in Maduro’s fiction. Trump also acknowledged talks at “a very high level” last week. U.S. National Security Adviser John Bolton has said these contacts are not authorized by Maduro and are aimed at ushering in free elections. So: America is talking to Maduro’s deputies — about how to get rid of Maduro. If the apparatchiks who preach socialism are now looking to protect their fortunes and stay out of jail, that may mean the collapse of the regime is nigh. At the same time, this back and forth highlight just how unsatisfactory the fall of Maduro is likely to be. His ouster will require the cooperation of his enablers — and the price of their cooperation, at a minimum, will be amnesty. Guaidó and his supporters have been keenly aware of this dilemma since January, when most of the Western Hemisphere recognized him as interim president of Venezuela. One of his first acts was to press the National Assembly to pass an amnesty law for civilian and military officials who worked to restore constitutional government. At the time, Human Rights Watch, which has documented much of the Maduro regime’s crimes, criticized the law for being dangerously vague and overbroad. More than eight months into his efforts to oust Maduro, however, some details are coming into focus — namely, the kinds of scoundrels that will evade justice in exchange for turning on Maduro. As one senior U.S. official told me, the U.S. has delivered messages to Maduro’s deputies, often through intermediaries, that they are interested not in vengeance but only in an orderly transition to free and fair elections. (Bloomberg: https://www.bloomberg.com/opinion/articles/2019-08-26/ousting-venezuela-s-maduro-may-require-amnesty-for-his-deputies)

 

U.S. sanctions on Venezuela undercut talks, key Maduro ally says

U.S. sanctions against Venezuela are making successful talks with the opposition impossible, said a key ally of Nicolas Maduro, demanding that President Donald Trump immediately act to drop them. "The stone in the way of any negotiation is sanctions," Tarek William Saab, Venezuela’s public prosecutor, said in a rare interview at the Public Prosecutor headquarters office in downtown Caracas. "It is a shot in the foot of any negotiation because how can you negotiate with a gun pointed at your head?" (Bloomberg, https://www.bloomberg.com/news/articles/2019-08-23/u-s-sanctions-on-venezuela-undercut-talks-key-maduro-ally-says)

 

Argentina poised to abandon Venezuela’s opposition

Election-bound Argentina is poised to withdraw from the vocal bloc of Latin American nations that supports Venezuela's political opposition and recognizes its leader, Juan Guaidó, as the country's interim president. Alberto Fernandez, the leading candidate to replace Argentina's president Mauricio Macri in 27 October elections, is signaling that his administration would not seek to remove Nicolas Maduro. If Fernandez and his unrelated running mate and former president Cristina Fernandez de Kirchner win the presidency, Buenos Aires would likely pull out of the Lima Group of Latin American countries and Canada that have been seeking to isolate the Maduro government in favor of a transition administration led by Guaidó. In a 25 August television interview, Alberto Fernandez made it clear that he disagreed with Macri who has long denounced Maduro's government as a dictatorship. "It is very difficult to qualify an elected government as a dictatorship. An elected government can become an authoritarian government," Fernandez said, explicitly challenging the position of the Lima Group, the US and most EU countries, which assert that Maduro was fraudulently re-elected in May 2018. "The institutions are working there, we can then discuss how they work, but formally there is an assembly, there are courts. A dictatorship generally lacks these things," he added in explaining why he does not deem Venezuela to be a dictatorship and prefers to describe Maduro's government as authoritarian. A Fernandez administration would bring Argentina closer in line to the stance of Uruguay and Mexico, which advocate non-intervention in Venezuela and object to extensive US financial and oil sanctions on the country. "I do not agree with all these proposals that line up Latin America behind (US president Donald) Trump and I value the proposal that was made by (Mexican president Manuel) Lopez Obrador and (Uruguayan president) Tabare Vazquez and I think I would add myself to those two to try to help find a solution for Venezuela," Fernandez said in the television interview. (Argus: https://www.argusmedia.com/en/news/1965727-argentina-poised-to-abandon-venezuelas-opposition?backToResults=true)

 

Maduro looks to North Korea for support – opens first embassy in Pyongyang

The deterioration of Venezuela’s relations with the Western world, imposition of harsh Western economic sanctions and open calls for regime change by the United States and many of its allies have led Caracas to strengthen ties with several Western adversaries since 2017. The country’s ties with Russia and China have been highly prolific, but a quieter but less conspicuous partnership which has been built has been that between Venezuela and North Korea. In December 2018 North Korean Presidium President and Head of State Kim Yong Nam paid a state visit to Caracas, and it was widely speculated that defense and economic cooperation was under discussion. North Korea opened an embassy in Caracas four years prior. Furthering a trend towards greater cooperation, on August 21^st, 2019, the Maduro regime opened its first embassy in Pyongyang which was attended by the deputy foreign ministers of both states. Maduro’s Deputy Foreign Minister Ruben Dario Molina stated at the event: “the people and leaders of Venezuela and the North Korea have become a target for attacks and threats by North American imperialism, which seeks to put us on their knees because of our implacable ideology and the desire to achieve economic and social progress.” His Korean counterpart Pak Myung Guk stated: “the government of the DPRK (North Korea) is constantly in its desire to expand and develop a relationship of friendship and cooperation with Venezuela, which are being placed in the flame of the general anti-imperialist struggle for independence and socialism.” (Check Point Asia Net: https://www.checkpointasia.net/venezuela-looks-to-north-korea-for-support-opens-first-embassy-in-pyongyang/)

 

Venezuelans stranded as Ecuador imposes new visa rules

Ecuador on Monday joined Peru and Chile in restricting Venezuelan immigration. To enter the country, Venezuelans now need to provide a criminal record, apply for a visa before arrival and present a valid passport. As the deadline neared, many Venezuelans in Ecuador rushed home to retrieve family members. Thousands more rushed east from their homes in Venezuela, eager to start a life in Ecuador that would soon be much harder to achieve. The last-minute wave sowed chaos for immigration officials on both sides of the Ecuador-Colombia border. Migrants waited hours in bitterly cold temperatures as they navigated immigration processes. Temperatures dropped to six degrees Celsius and many slept huddled together in blankets as they queued, in some cases overnight. Colombian migration officials did not know the exact number of Venezuelans who crossed before the border closed on Sunday, but a director at the Rumichaca office told Al Jazeera that more than 11,000 Venezuelans had crossed as of 6pm, well before the midnight deadline. According to Colombian immigration officials on the Venezuelan border in Cucuta, there are still more on the way. The chaos was not limited just to Colombia as masses of migrants huddled in Ecuador as well, waiting to be processed. Passports can cost several months’ salary for most Venezuelans, though many migrants told Al Jazeera the actual price is much higher when one factors in necessary bribes of US$ 100 to US$300. In a country where the monthly minimum wages has fallen to below US$ 5, that is beyond the reach of most Venezuelans. (Al Jazeera: https://www.aljazeera.com/news/2019/08/venezuelans-stranded-ecuador-imposes-visa-rules-190826134509203.html)

 

Venezuelan socialist defiant as US sanctions threaten baseball

Venezuela's upcoming baseball season will go on "even if we have to play ourselves," socialist party No. 2 Diosdado Cabello said on Monday, criticizing a move by US-based Major League Baseball to restrict players from participating because of US sanctions. MLB said last week it would suspend involvement in the Venezuelan league, which starts play in October, while it awaited word from the US government on whether its players' participation was consistent with Washington's sanctions on this nation, which are meant to force out socialist Nicolas Maduro. While the number of Venezuelan major league stars returning to their baseball-mad homeland to play has declined in recent years because of security issues and an economic crisis, many of the players on the Venezuelan league's eight professional teams also play for one of MLB's hundreds of minor-league affiliates. (The Sydney Morning Herald: https://www.smh.com.au/world/south-america/even-if-we-have-to-play-ourselves-venezuelan-socialist-defiant-as-us-sanctions-threaten-baseball-20190827-p52l2q.html)

 

Russia, China offer to help Venezuela in preparing for 2020 Olympics — Maduro

Russia and China have offered to help Venezuelan athletes to prepare for the next Summer Olympic Games, Nicolas Maduro claimed on Thursday. "Russia and China have offered us special help in training," Maduro said at a meeting with young athletes that was broadcast on Twitter. He said that "many athletes" will be able to go to Russia and China for training. "I am confident that we will show our best results in history at the Tokyo Olympics," Maduro noted. The next Summer Olympic Games will be held in Japan's Tokyo in July-August 2020. (TASS: https://tass.com/world/1073700)

 

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.

 

August 20, 2019

International Trade

Cargo arrivals reported at Puerto Cabello

The local port authority is reporting the arrival of 10,743 ton of assorted merchandise at Puerto Cabello, including auto parts, personal care products, chemicals, textiles, and appliances, aboard vessels AS FABIANA, NIKOLAS, PERITO MORENO, CAP BEATRICE, CONTSHIP ZOE, FS IPANEMA and CFS PALAMEDES. It also reports the arrival of 81,290 tons of bulk products, such as 30,000 tons of soy on the BOSPHORUS PRINCE, and 40,000 tons of White corn aboard the CORAL ISLAND. More in Spanish: (Bolipuertos, http://www.bolipuertos.gob.ve/noticia.aspx?id=43614)

 

Logistics & Transport

Vessels from Venezuela can still transit Panama Canal

The Panama Canal will allow vessels coming from Venezuela to transit the waterway provided they present the necessary paperwork, the canal authority’s chief said on Wednesday, suggesting a new round of U.S. sanctions on this country may not make any difference to canal traffic. (Reuters, https://www.reuters.com/article/us-panamacanal-venezuela/vessels-from-venezuela-can-still-transit-panama-canal-authority-idUSKCN1V41WM)

 

Oil & Energy

China CNPC suspends Venezuelan oil loading, worried about U.S. sanctions

China National Petroleum Corp, a leading buyer of Venezuelan oil, has halted August loadings following the latest set of U.S. sanctions. Two Beijing-based senior sources with direct knowledge of the matter told Reuters on Monday. "Trump's executive order gave a directive for the follow-up sanction measures that shall be announced by the U.S. Treasury... CNPC is worried that the company is likely to be hit by the secondary sanctions," said one source. A second person, an executive with a key marketer of Venezuelan oil in China, said his company had been notified of the suspension. "We were told that CHINAOIL will not load any oil in August. We don't know what will happen after." CHINAOIL is the trading vehicle of CNPC that lifts Venezuelan oil under term contracts and is one of Caracas' top oil clients. CNPC will wait for more guidelines from the U.S. Treasury before further moves in dealing with Venezuelan oil, said the first source. The suspension followed recent communications between the U.S. and Chinese governments, including a meeting between U.S. embassy officials in Beijing and top management at CNPC, the source added. Beijing has become increasingly pragmatic in recent years in an amply supplied global oil market and as Venezuela's economy plunged deeper into recession. For the first six months of this year, China imported 8.67 million tons of crude oil from Venezuela, or roughly 350,000 barrels per day, about 3.5% of its total imports, according to Chinese customs data. (Reuters, https://www.reuters.com/article/us-china-venezuela-oil-cnpc/china-cnpc-suspends-venezuelan-oil-loading-worried-about-u-s-sanctions-sources-idUSKCN1V909C)

 

Maduro battles for control of US-based refinery

The regime of President Nicolas Maduro on Thursday nullified the newly named board of Venezuela’s prized CITGO refineries in the U.S. amid a political battle for control of the country, saying opposition leaders had no right to appoint them. The opposition-run National Assembly appointed the 15-member CITGO board early this year after Guaidó declared presidential powers, arguing that Maduro’s re-election was illegitimate. CITGO is valued at an estimated $8 billion and includes three refineries in Louisiana, Texas and Illinois, in addition to a network of pipelines. Citgo is also at the center of court battles, such a lawsuit filed by Crystallex, which seeks to liquidate CITGO for payment following a disputed takeover of the Canadian mining firm by Venezuela’s late President Hugo Chavez. Russ Dallen, head of the Miami-based Caracas Capital Markets brokerage firm, said U.S. courts have already weighed in on who controls CITGO, deferring to the U.S. government’s recognition of Guaidó as Venezuela’s president, therefore recognizing his board appointments. Maduro’s state comptroller Elvis Amoroso, who made the announcement on state TV, also said the ad-hoc board members are banned from leaving the country and their Venezuelan bank accounts have been frozen. But it is unclear whether any of them continue to live here. Amoroso also said another five leading figures opposed to Maduro have been banned from politics for 15 years. They include former Attorney General Luisa Ortega, former Caracas Mayor Antonio Ledezma and three opposition lawmakers, all of whom are living in self-imposed exile. So far this year, Maduro’s government has stripped 18 opposition lawmakers of their immunity, exposing them to criminal prosecution in a sigh of heightened political tensions. (WTOP: https://wtop.com/latin-america/2019/08/venezuelas-maduro-battles-for-control-of-us-based-refinery/)

 

Economy & Finance

Turkish BANK ZIRAAT closes door on Venezuela amid U.S. sanctions

ZIRAAT BANK, Turkey’s largest bank by assets, has stopped offering services to Venezuela’s Central Bank in wake of tougher U.S. sanctions that raise the stakes for companies that do business with the Caribbean nation. The Ankara-based state bank confirmed the closing of its account without providing further details. Venezuela’s Central Bank was relying on ZIRAAT to pay contractors, move money and import products in Turkish liras. (Bloomberg: https://www.bloomberg.com/news/articles/2019-08-15/turkish-bank-ziraat-closes-door-on-venezuela-amid-u-s-sanctions)

 

Politics and International Affairs

In Venezuela talks, Maduro allies said they would consider fresh elections

Allies of Nicolas Maduro had discussed holding a presidential election in the coming months during talks to find a breakthrough in the country’s political crisis, four sources told Reuters on Monday. Opposition politicians will travel to Washington to speak to U.S. officials this week, the sources said. Maduro representatives and a delegation representing opposition leader Juan Guaidó have been meeting in Barbados as part of talks to resolve a political stalemate in the struggling nation that is suffering from a hyperinflationary economic collapse. Guaidó’s delegation had proposed a presidential vote in six to nine months on several conditions including changes to the election’s council and supreme court, said the sources, who asked not to be identified because the talks are confidential. The government had in theory agreed to a presidential vote on the condition that the United States lift economic sanctions, Maduro be allowed to run as the Socialist Party candidate, and that the vote be held in a year, one of the sources said. U.S. officials have expressed support for an election but without Maduro as a candidate, which may be a point of discussion, two of the sources said. Preparing groundwork for an election requires a raft of changes to state institutions, including both the elections council and the supreme court - both of which have aggressively intervened in election processes to favor Maduro. Another possible roadblock would be the existence of the Constituent Assembly, an all-powerful legislative body controlled by Socialist Party supporters that opposition leaders say could also intervene in any potential vote. (Reuters: https://www.reuters.com/article/us-venezuela-politics/in-venezuela-talks-maduro-allies-said-they-would-consider-fresh-elections-sources-idUSKCN1V91SF)

 

US talks secretly to Venezuela socialist boss

The U.S. has opened secret communications with Venezuela’s socialist party boss as members of Nicolás Maduro’s inner circle seek guarantees they won’t face retribution if they cede to growing demands to remove him, a senior U.S. administration official has told The Associated Press. Diosdado Cabello, who is considered the most-powerful man in Venezuela after Maduro, met last month in Caracas with someone who is in close contact with the Trump administration, said the official. A second meeting is in the works but has not yet taken place. The talks are still preliminary. It’s not clear whether the talks have Maduro’s approval or not. Cabello, 56, is a major power broker inside Venezuela, who has seen his influence in the government and security forces expand as Maduro’s grip on power has weakened. But he’s also been accused by U.S. officials of being behind massive corruption, drug trafficking and even death threats against a sitting U.S. senator. The administration official said that under no circumstances is the U.S. looking to prop up Cabello or pave the way for him to substitute Maduro. Instead, the goal of the outreach is to ratchet up pressure on the regime by contributing to the knife fight the U.S. believes is taking place behind the scenes among competing circles of power within the ruling party. Similar contacts exist with other top Venezuelan insiders, the official said, and the U.S. is in a listening mode to hear what it would take for them to betray Maduro and support a transition plan. At a press conference Monday, Cabello shied away from discussing any details of the meeting, at one point likening it to “a lie, a manipulation.” But he also said he has long stood welcome to talk to anyone, so long as any discussions take place with Maduro’s approval. An aide said the U.S. has been increasingly knocking on Cabello’s door, desperately looking to establish contact. The aide rejected the notion Cabello was somehow betraying Maduro, saying that Cabello would only meet with Americans if it contributes to lifting sanctions, he blames for crippling the oil-dependent economy. The aide spoke on the condition of anonymity because he isn’t authorized to discuss political affairs publicly. The U.S. has repeatedly said it would offer top socialists’ relief from sanctions if they take “concrete and meaningful actions” to end Maduro’s rule. As head of the constitutional assembly, Cabello has the power to remove Maduro, a position that could come in handy in any negotiated transition. The news site AXIOS reported Monday morning that Mauricio Claver-Carone is the U.S. official that has been in contact with Diosdado Cabello, the number two man in Venezuela and President of the polemical Constituent Assembly legislative. An opposition politician briefed on the outreach said Defense Minister Vladimir Padrino and Interior Minister Néstor Reverol are among those in indirect contact with the Americans, underscoring the degree to which Maduro is surrounded by conspirators even after an opposition-led military uprising in April was easily quashed. (AP: https://www.apnews.com/a3e6b0da8c5648558e61bbaa466fbb42; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2482306&CategoryId=10717)

 

82% of Venezuelans polled believe Maduro should leave office in 2019

The latest poll by DATANALISIS shows 85.1% of the population has a negative view of the Maduro administration, and only 12.9% called it positive. 64.8% of Venezuelans pointed to the economy as the worst problem they are facing, and 18.3% mentioned social issues, as well as 16.3% pointed to political issues. More in Spanish: (El Nacional, https://www.elnacional.com/venezuela/datanalisis/)

 

US Southern Command head focused on ‘day after’ in Venezuela

The head of U.S. Southern Command says military officials are focusing on preparing for “the day after” once an “isolated” Nicolás Maduro leaves power. Navy Adm. Craig Faller warned Monday against Venezuela’s “formidable weapon system” and criticized Cuba, Russia and China for assisting Maduro, saying it was important to put “continuous pressure” on the “illegitimate regime” and organize humanitarian efforts. (Military Times: https://www.militarytimes.com/video/2019/08/06/saudi-special-forces-go-all-out-for-hajj-display/)

 

Trump has considered naval blockade of Venezuela

President Trump has reportedly suggested that the U.S. place ships along the coast of Venezuela to blockade goods from coming into the fraught nation. According to five current and former officials, the Pentagon hasn’t taken the suggestions by the president seriously because of its impracticability and because it would divert naval assets away from countering Iran and China, Axios reported. “He literally just said we should get the ships out there and do a naval embargo,” one official said. “Prevent anything going in.” “I’m assuming he's thinking of the Cuban missile crisis,” the official added. “But Cuba is an island and Venezuela is a massive coastline. And Cuba, we knew what we were trying to prevent from getting in. But here what are we talking about? It would need massive, massive amounts of resources; probably more than the U.S. Navy can provide.” (Washington Examiner: https://www.washingtonexaminer.com/news/trump-has-considered-naval-blockade-of-venezuela)

 

Russia warns US against imposing blockade on Venezuela

Russia on Tuesday warned the U.S. against "incautious steps" in tightening sanctions on Venezuela, and throwing a total blockade over the country. Speaking to reporters in Moscow, Deputy Foreign Minister Sergey Ryabkov called on Washington to assist Venezuelans in bridging existing chasms instead of hindering talks between the government and opposition. He said he would discuss the situation in Venezuela with Delcy Rodriguez, the country's vice president, who arrived in Russia on Monday for a working visit. "We will examine the situation, referring to the strengthening by Washington of illegal, illegitimate sanction measures, attempts to set up a blockade [on Venezuela]. We warn Washington against incautious steps in this area," Ryabkov said. (AA: https://www.aa.com.tr/en/world/russia-warns-us-against-imposing-blockade-on-venezuela/1560476)

 

Venezuelan exodus may soon double, triggering a bigger regional crisis

One of the things that surprised me the most during a lengthy interview with Juan Guaidó, the Venezuelan National Assembly president who is recognized by the United States and more than 50 countries as Venezuela’s legitimate leader, was his forecast that the number of Venezuelan exiles may “easily” reach 8 million by next year. It’s a mind-boggling figure because it would be twice the 4 million exiles that, according to a recent United Nations report, have already fled the country since dictator Nicolas Maduro took office five years ago. Eight million people would amount to about 25% of Venezuela’s population. Twice the current number of Venezuelan exiles would cause a much bigger economic, and perhaps political, earthquake for many Latin American countries. Asked about the Trump administration’s new economic sanctions on Venezuela, which ban U.S. transactions with state-owned Venezuelan businesses, Guaidó told me in the Aug. 12 interview that, “They seek to prevent the regime’s use of those resources to finance irregular (paramilitary) groups or to steal the Venezuelan people’s money.” Dismissing Maduro’s claims that Venezuela’s humanitarian crisis has been caused by U.S. sanctions, Guaidó said that, “The sanctions went into effect three days ago, whereas the 65% contraction of the economy has been taking place over the past six years. The Maduro regime bears total responsibility for the crisis.” Asked about the Cuban presence in Venezuela, Guaidó told me that there are “between 2,000 and 3,000 Cubans who are carrying out intelligence, counterintelligence, repression and even torture” for Maduro’s armed forces. I asked Guaidó whether he’s fearful that international pressure to restore democracy in Venezuela may weaken soon. Guaidó responded that governments come and go, noting that El Salvador’s new government, for instance, has switched sides to support him. He added that Maduro, too, is becoming weaker, as nearly 90% of Venezuelans want him to leave power, according to a recent MEGANALISIS poll. “Time is running against (all) Venezuelans, including Maduro, who is collapsing,” Guaidó told me. “What’s important is to take advantage of the window of opportunity we have to prevent an even bigger humanitarian catastrophe” and to “step up international diplomatic pressures to end the suffering of the Venezuelan people.” (The Oppenheimer Report: https://tribunecontentagency.com/article/venezuelan-exodus-may-soon-double-triggering-a-bigger-regional-crisis/

 

U.N. pleads for more help to relieve Venezuelan refugee crisis

United Nations High Commissioner for Refugees Filippo Grandi appealed on Sunday for more humanitarian aid for Venezuelan refugees pouring into neighboring countries where they are overwhelming social services and sparking local tensions. Grandi had planned to visit the Brazilian border town of Pacaraima this weekend, but authorities advised him to cancel due to protests by residents unhappy with the arrival of more than 500 Venezuelans a day. The UNHCR estimates 4.3 million Venezuelans have fled economic and political turmoil in their country, mainly to Colombia where there are 1.2 million and to Peru, Chile and Ecuador. Some 180,000 have stayed in Brazil. The U.N. and NGOs put out a humanitarian appeal for US$ 770 million at the start of the year and has received less than US$ 180 million, Grandi said in a telephone interview after visiting Chile and Brazil. “This is really one of the most under-funded humanitarian appeals in the world for one of the biggest crises,” he said. Financial institutions such as the World Bank and the Inter-American Development Bank are engaged but need to speed up their help, he said, to help sustain health and education systems. Grandi said there were signs of anti-immigrant sentiment spreading across the region, reflected in mounting restrictions on the movement of Venezuelans in Andean countries. But he praised Chile, which has received 400,000 Venezuelans, for granting safe passage and a guarantee of asylum. (Reuters: https://www.reuters.com/article/us-venezuela-brazil-refugees/u-n-pleads-for-more-help-to-relieve-venezuelan-refugee-crisis-idUSKCN1V80M8)

 

Colombia’s armed groups prey on Venezuela migrants

A new report by Human Rights Watch (HRW) on violence in the department of Norte de Santander, Colombia, shows how vulnerable Venezuelan migrants are to the criminal groups that dominate the region. The report, entitled “The War in Catatumbo” and published August 8, documents abuses by armed groups against Venezuelan and Colombian civilians in Norte de Santander’s Catatumbo region in northeast Colombia along the border with Venezuela. It explains that groups like the National Liberation Army (Ejército de Liberación Nacional – ELN), the Popular Liberation Army (Ejército Popular de Liberación – EPL), and the dissidents of the Revolutionary Armed Forces of Colombia (Fuerzas Armadas Revolucionarias de Colombia – FARC), are responsible for an uptick in killings and other crimes. The affected Venezuelan citizens live in Catatumbo’s urban areas, including the municipalities of Tibú, Ocaña, El Tarra, Ábrego, Convención and Sardinata. In these areas, the migrants — including many minors and women — live in precarious conditions which leave them at the mercy of criminals, according to HRW. “We have documented on the ground that armed groups in Catatumbo commit all types of abuses: murders, disappearances, kidnappings, recruitment of minors, sexual violations, threats and displacements,” HRW Director José Miguel Vivanco told Semana. There are currently close to 25,000 Venezuelans in Catatumbo who, despite being aware of the security risks in the region, have crossed the border in search of work, food and medicine, according to Vivanco. The Venezuelans have arrived as tens of thousands of Catatumbo’s residents have been displaced by the conflict among the various armed groups. Desperate, the migrants find themselves caught in areas where these groups are vying for territory and control of criminal economies. Officials with the United Nations Office for the Coordination of Humanitarian Affairs (OCHA) on the border city of Cúcuta told InSight Crime that fear of being deported or arrested keeps Venezuelan nationals from seeking help from local authorities. (InSight Crime: https://www.insightcrime.org/news/brief/armed-groups-colombia-receive-venezuela-migrants/)

 

Fears grow of Venezuela malnutrition time bomb

The graffiti scrawled across a wall in Caracas is short but heartfelt. “Tengo hambre,” it reads. “I am hungry”. It is a cry increasingly heard across Venezuela. As Nicolás Maduro and western-backed opposition leader Juan Guaidó battle for the country’s future amid an economic collapse that has sparked severe shortages of food, fuel and medicine, millions of people are going hungry for extended periods and risking long-term damage to their health, humanitarian organizations have warned. “Six to eight million people are living in a state of undernourishment,” said Susana Raffalli, a veteran Venezuelan humanitarian adviser who has worked across the world with the Red Cross and UNICEF, the UN agency for children. Speaking before the latest US sanctions, she said: “That means the state cannot guarantee they have an adequate supply of food.” Ms. Raffalli’ s assessment is supported by the UN’s Food and Agriculture Organization. José Graziano da Silva, outgoing head of the FAO, said in a press interview last month that there had been a “dizzying increase” in hunger in Venezuela in recent years. In a recent report on global food security, the FAO estimates that between 2016 and 2018, about 21.2% of the Venezuelan population was undernourished. When Maduro came to power in 2013 the figure was 6.4%, it says. In a June report, UNICEFs estimated that 3.2m children in Venezuela were “in need of assistance”. Millions of poorer Venezuelans rely on monthly deliveries of government-subsidized food boxes for survival, a system critics denounce as a form of social control, alleging supplies are skewed towards supporters of the government. Delivery has become increasingly erratic, and the contents of the boxes are of variable quality, say aid workers. Washington has meanwhile accused the Maduro government of skimming off hundreds of millions of dollars from the food program, and last month-imposed sanctions on Maduro’s three stepsons over their alleged roles. One businessman with knowledge of the food situation in Venezuela, who spoke to the Financial Times on condition of anonymity for fear of government reprisals, said data show a large proportion of Venezuelans are living on between 1,500 and 1,900 calories a day. Malnutrition is particularly acute in the provinces, say aid workers. North-western Zulia state, on the border with Colombia, is one of the worst-hit areas. In a survey late last year, the Commission for Human Rights in Zulia State (CODHEZ), a local NGO, found that three-quarters of households in the state capital Maracaibo were suffering from hunger. Eight in 10 people said they could no longer afford protein such as chicken and beef and survived largely on arepas — traditional corn flour patties — margarine, pasta and rice. Since then, the situation has worsened as wages have failed to keep pace with galloping inflation. “The price of food went up 8,165% between last October and this June,” said Juan Berríos, a researcher at CODHEZ. Nine months ago, the monthly minimum wage bought 24kg of corn flour but now it buys less than 4kg. Venezuela will face long-term consequences from chronic undernourishment, especially of children, humanitarian organizations warn. NGO data seen by the FT show the weight and height of Venezuelan children have fallen significantly below the average for comparable populations. (Financial Times: https://www.ft.com/content/b6459434-b531-11e9-8cb2-799a3a8cf37b)

 

EDITORIAL: US sanctions are worsening Venezuela’s agony

“One of the worst man-made humanitarian disasters in the modern world.” US secretary of state Mike Pompeo’s assessment of Venezuela is sweeping, but fair. A nation which has the world’s biggest oil reserves but has descended into such economic chaos that up to a quarter of its population has fled should qualify by any standards. Those left behind face severe shortages of food, medicine and fuel. Malnutrition is stunting a generation of Venezuelan children. Top officials stand accused of corruption, drug trafficking and gold smuggling. Sadly, the cure adopted by the Trump administration is only making the patient sicker. Evidently the blame for the suffering of the Venezuelan people lies principally at the door of Chávez and his chosen successor, Nicolás Maduro, under whose rule the country has plumbed new depths. The Trump administration believes that by choking Venezuela’s economy harder Maduro can be ejected. The remedy is not working; other countries under drastic sanctions, such as Cuba, have similarly strangled economies, but long-lived leaders. The key to ending the agony lies in a much broader diplomatic effort. EU and Latin American nations have brokered talks between the government and opposition, but these have failed because Maduro’s key backers — Cuba, Russia and China — are missing. If Moscow, Beijing and Havana have nothing to gain from Maduro leaving power, they will continue to back him. Broad international talks to negotiate Maduro’s exit to a third country, installation of a respected interim president, equal treatment of all creditors and fresh elections are the way forward. This will not be popular with some in Washington. But the Venezuelan people’s suffering is rapidly worsening. Russian president Vladimir Putin suggested to this newspaper in July that Moscow’s interests in Venezuela were purely commercial and vowed that if Guaidó won an election, the Kremlin would work with him. That pledge should be put to the test. (Financial Times: https://www.ft.com/content/f7dd72a4-c044-11e9-b350-db00d509634e)

 

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.

July 11, 2019

Oil & Energy

CHEVRON's Venezuela oil assets threatened as Trump weighs extending joint venture waiver

The Trump administration faces an important decision later this month, one that could either maintain the status quo, or one that could escalate the “maximum pressure” campaign on Caracas. In January, the U.S. government tightened sanctions on Venezuela, but issued a series of waivers to oil companies operating in joint ventures with PDVSA in Venezuela. The waivers expire later this month, and the U.S. government is considering letting them expire to force some of the companies out in order to further tighten the fiscal noose around the Venezuelan government. That could affect operations for CHEVRON, HALLIBURTON, SCHLUMBERGER, BAKER HUGHES and WEATHERFORD International, according to S&P Global Platts. If the Trump administration followed through, the companies would have 60 to 90 days to wind down their operations, S&P reported. CHEVRON plays a crucial role in keeping Venezuela’s oil sector running, such as it is. The American oil major is active in four joint ventures with PDVSA, and its share of production accounts for 42,000 b/d, although total output from the four sites exceeds 200,000 b/d. The exit of Chevron and other international companies would be especially painful for Maduro’s regime because the joint ventures have proven to be much more resilient than PDVSA’s sole operations. Foreign companies bring capital and technical expertise, and when the industry really began to deteriorate in 2017 and 2018, output from the joint ventures held up better than production from projects run only by PDVSA. The upshot is that if the U.S. lets the waivers expire in late July, Venezuela’s oil production could resume its downward slide, ending a several-month hiatus that saw output stabilize. “The service companies leaving will have some additional effect since they are involved in the operation of at least a third of the rigs in activity. However, the U.S. government is also wary of allowing oil companies from China and Russia to step into the void. The prospect of greater influence for Moscow and Beijing in Venezuela might be enough for the Trump administration to extend the waivers to CHEVRON. The tradeoff is hardly theoretical. Venezuela's government threatens to nationalize CHEVRON's oil assets if the Trump administration does not extend a sanctions waiver that expires July 27. In perhaps an attempt to clarify what is at stake, an unnamed official in the Venezuelan presidential palace told Argus Media that if the Trump administration lets the waivers expire, Maduro’s government would seize Chevron’s assets and “offer Russian, Chinese and other non-US oil companies an ‘opportunity to acquire’ them,” Argus reported. In fact, the official said that “discreet discussions” have already started with ROSNEFT and CNPC. It’s unclear how the Trump administration will approach what appear to be competing geostrategic goals, but Venezuela’s oil sector hangs in the balance. White House advisor Larry Kudlow said yesterday the administration was considering a possible waiver extension. “It is under discussion,” Kudlow said. “I don’t know about the license. That will be determined in the future. It’s under discussion right now,” he said. (Reuters, https://www.reuters.com/article/us-venezuela-politics-usa-chevron/white-house-discussing-renewing-license-for-chevron-to-operate-in-venezuela-idUSKCN1U42NG; Bloomberg, https://www.bloomberg.com/news/articles/2019-07-09/venezuela-license-for-chevron-under-discussion-kudlow-says; The Fuse: http://energyfuse.org/venezuela-faces-more-outages-as-trump-admin-mulls-escalation/; Seeking Alpha: https://seekingalpha.com/news/3476997-chevrons-venezuela-oil-assets-threatened-seizure)

 

Vessels change names or go dark to ship Venezuelan crude to Cuba

Stopping the flow of Venezuelan oil to its ally Cuba might prove harder than the U.S. expected. Tankers are being renamed and vessels are switching off their transponders to sail under the radar of the U.S. government. The vessel Ocean Elegance, an oil tanker that has been delivering Venezuelan crude to Cuba for the past three years, was renamed Oceano after being sanctioned in May. The ship S-Trotter, another one that’s on the sanctions list, is now known as Tropic Sea, according to data compiled by Bloomberg. (Bloomberg, https://www.bloomberg.com/news/articles/2019-07-08/vessels-change-names-go-dark-to-ship-venezuelan-crude-to-cuba)  

 

Economy & Finance

Venezuela creditors push back on Guaidó's debt restructuring plan

Creditors holding Venezuelan debt on Tuesday pushed back on debt restructuring plans backed by opposition leader Juan Guaidó, urging a “fair and effective” framework for talks and improved communications with investors holding defaulted bonds. The main committee of Venezuela creditors said it opposed requests for a U.S. executive order that would prevent asset seizures by investors and disagreed with a proposal to give different treatment to debts owed to Russia and China. But the statement added that restructuring would not begin until the end of a “humanitarian crisis,” in reference to the hyperinflationary collapse overseen by President Nicolas Maduro that has fueled malnutrition and disease. “A new government should work with creditor parties, such as the Committee, to agree on the design of the restructuring process and to negotiate the financial and other terms of the restructuring,” the statement said. (Reuters, Venezuela creditors push back on Guaidó's debt restructuring plan)

 

Politics and International Affairs

Maduro regime and opposition talks conclude in Barbados, no deal announced; Putin remains hopeful

Talks between Venezuela's government and the opposition about how to address the country's political crisis concluded on Wednesday (Jul 11) with no announcement of a deal. "This round of talks for dialogue and peace in Barbados has concluded," Information Minister Jorge Rodriguez, who led the government's delegation, wrote on Twitter late on Wednesday, describing it as "a successful exchange promoted by the government of Norway." Rodriguez tweeted that the discussions in Barbados had ended and served as a space for the "settlement of disputes through constitutional and peaceful channels." A Venezuelan opposition source who asked not to be identified said the two sides could meet again on Monday in Barbados. The press team for opposition leader Juan Guaidó, who has been recognized by more than 50 countries as Venezuela's legitimate leader, said the opposition would make a statement about the talks in the coming hours. Rumors have been circulating in recent days that the opposition was seeking a presidential election within nine months and that Maduro would not be in power during the vote. Socialist Party Vice President Diosdado Cabello, who is influential in Maduro's regime, on Wednesday night dismissed the idea that any presidential election was in the works. "Here there are no presidential elections; here the president is named Nicolas Maduro," Cabello said during a televised broadcast. Russian President Vladimir Putin said on Thursday he hoped Norway-brokered talks between Venezuela's government and the opposition would normalize the situation in country and bring an end to political turmoil. In referring to the talks, interim president Juan Guaidó had previously asked one and all “not to commit the mistake of seeing a single mechanism as the solution,” and for that reason insisted on maintaining both internal and foreign pressure on the party in power. (Channel News Asia: https://www.channelnewsasia.com/news/world/venezuela-talks-with-opposition-conclude-in-barbados--no-deal-announced-11712606; EFE: https://www.efe.com/efe/english/world/venezuelan-government-says-talks-with-opposition-concluded-successfully/50000262-4020424; The Jerusalem Post: https://www.jpost.com/Breaking-News/Putin-I-hope-Venezuela-talks-will-normalize-situation-595359; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2480869&CategoryId=10717)

 

U.S. military plans to battle Russia, China and Iran's 'most disturbing' influence in Venezuela

The head of the Pentagon's Southern Command warned that Russia, China and Iran were expanding their influence in Latin America, particularly in Venezuela, where they support a government the United States seeks to depose. In his testimony to the Senate Armed Services Committee, Southern Command chief Air Force Admiral Craig Faller identified Moscow, Beijing and Tehran as the primary international obstacles to Washington's interests as the trio backed Nicolás Maduro in the face of a challenge posed by interim leader Juan Guaidó. The National Assembly head declared him acting president in January and was almost immediately recognized by the U.S., which cut ties with Maduro and has attempted to isolate him globally. "Russia, in their own words, is protecting their 'loyal friend,' to quote, by propping up the corrupt, illegitimate Maduro regime with loans and technical and military support," Faller said. "China, as Venezuela's largest single-state creditor, saddled the Venezuelan people with more than $60 billion in debt and is exporting surveillance technology used to monitor and repress the Venezuelan people. Iran has restarted direct flights from Tehran to Caracas and reinvigorated diplomatic ties." "Along with Cuba, these actors engage in activities that are profoundly unhealthy to democracy and regional stability and counter to U.S. interests," he added, calling for the "right, focused and consistent military presence" to counter these countries' "most disturbing" growing influence in the region. "These geopolitical tensions are inimical to stability across the world and we look forward to world leaders to continue to do their best to ensure that conflicts on trade and military are avoided”, he added. (NEWSWEEK: https://www.newsweek.com/venezuela-us-battle-russia-china-iran-influence-most-disturbing-1448545)

 

Russian equipment to be part of military drills in Venezuela

Russia on Thursday said its military equipment will be part of military drills in Venezuela scheduled for July 24. "Weapons and military equipment that are currently present in Venezuela and that the National Bolivarian Armed Forces use is mostly Russia-made. So, it just cannot be otherwise. I don't know if they have purchased any kinds of equipment in other countries, but the army is equipped with our weapons to a significant extent, so it will be used as well," Sputnik quoted Russian Deputy Foreign Minister Sergei Ryabkov as saying. Ryabkov also noted that there are almost no Russian military experts in Venezuela right now. "A rotation has taken place. As I see it, the presence of our personnel there is close to zero. However, this does not mean that it will not appear there when the need may arise to maintain the equipment", he said. "We are concerned about a continuous melody from Washington, where there is a tendency to talk about all options being on the table and nothing can be excluded. That deliberately creates a sense of uncertainty, of what is possible and what is not in terms of U.S. participation," Ryabkov told Spanish newspaper El Pais on Wednesday. (Business Standard: https://www.business-standard.com/article/news-ani/russian-equipment-to-be-part-of-military-drills-in-venezuela-119071100712_1.html; NEWSWEEK: https://www.newsweek.com/venezuela-us-battle-russia-china-iran-influence-most-disturbing-1448545)

 

Against family wishes, Venezuela government buries navy captain who died in captivity

The Maduro regime on Wednesday buried the remains of a navy captain who died in military custody last month, despite the opposition of family members who say he was tortured to death and want an independent autopsy.  Rafael Acosta was detained in June 21 for alleged participation in a coup plot but died following a week in custody of military intelligence agency DGCIM. Lawyers said he showed signs of severe beatings.  “What can be interpreted is that government authorities are (saying) ‘I killed him, I bury him,’” said Alonso Medina, a lawyer representing Acosta’s family. Acosta’s wife, Waleswka Perez, had demanded that the government hand over his body and called for an U.N. investigation into his death, which was condemned by the United States as well as the Lima Group of Latin American nations. An official autopsy showed that Acosta died of “polytrauma with a blunt object,” Medina said. (Reuters: https://www.reuters.com/article/us-venezuela-politics-captain/against-family-wishes-venezuela-government-buries-navy-captain-who-died-in-captivity-idUSKCN1U52M0)

 

U.S. sanctions Venezuela's counter-intelligence agency after death of navy captain

The United States on Thursday imposed sanctions against Venezuela's military counter-intelligence agency following the death in custody of a Venezuelan navy captain amid allegations of torture. The U.S. Treasury said on its website that it had sanctioned the General Directorate of Military Counterintelligence. U.S. Treasury Secretary Steven Mnuchin said the "politically motivated arrest and tragic death" of Rafael Acosta was "unwarranted and unacceptable." The Maduro regime confirmed the death on June 29 of Acosta, who was arrested eight days earlier for alleged participation in a coup plot. Human rights organizations and political leaders have accused Maduro's government of torturing Acosta to death and refusing to clarify the circumstances. (CBC: https://www.cbc.ca/news/world/us-sanctions-venezuela-counterintelligence-navy-death-1.5208073)

 

Ex-Venezuela spy chief says Maduro ordered illegal arrests

As Nicolás Maduro began to lean on the brawny 55-year-old General Manuel Cristopher Figuera to do his dirty work — ordering him to jail opponents and victims of torture — the Cuban and Belarusian-trained intelligence officer gradually lost faith. In a show of nerve, he betrayed the leader he met with almost daily and secretly plotted to launch a military uprising that he said came close to ousting Maduro. Now one of the most prominent defectors in two decades of socialist rule in Venezuela has come to Washington seeking revenge against his former boss. It’s unclear whether Cristopher Figuera still has influence inside the government and can collect evidence against his former comrades. But he’s talking a big game. Cristopher Figuera for the first time provided details of what he said was Maduro’s personal commissioning of abuses, including arbitrary detentions and the planting of evidence against opponents. As the deputy head of military counterintelligence and then director of the feared SEBIN intelligence police, Cristopher Figuera stood alongside Maduro as Venezuela was coming apart. During the freefall, he said, he witnessed and played a role in abuses, including not speaking out when confronted with evidence of torture by others and the arbitrary detention of a prominent journalist. But he said Maduro’s most-brazen order — and one of Cristopher Figuera’s biggest regrets — was his role trying to break opposition leader Juan Guaidó’s resolve by going after his inner circle. Initially, he said, Maduro wanted to arrest Guaidó’s mother. When Cristopher Figuera pointed out that she was undergoing cancer treatment, the focus shifted to Roberto Marrero, Guaidó’s chief of staff, who has been held since March on accusations of running a “terrorist cell” bent on carrying out assassinations. Cristopher Figuera said he then told Maduro that he did not have legal cause. “How can I jail him?” Cristopher Figuera recalled asking Maduro in a tense meeting with top officials at Fort Tiuna in Caracas less than 72 hours before a violent raid on Marrero’s house. “He told me, ‘That’s not my problem. Plant some weapons on him. Do what you have to do.'” Cristopher Figuera expects one day to be called as a witness by the International Criminal Court, which is carrying out a preliminary investigation into the Maduro government at the request of several Latin American nations, France and Canada. Still, he acknowledges that he obediently carried out orders to spy on 40 or so of Maduro’s top opponents, using wiretaps as well as electronic and on-the-streets surveillance, and reporting to his boss every two hours any noteworthy movements. He claims to have tried to persuade Maduro to change course, sending him a two-page letter in early April that urged him to appoint a new electoral council and call early elections. He thought the move would have been a strategic retrenchment to regain the upper hand amid mounting international pressure.  He said he’s in constant contact with high-level officials — generals, deputy ministers and heads of government institutions — all of whom despise Maduro and want to see him leave but are afraid to act. (AP: https://www.columbian.com/news/2019/jul/04/ex-venezuela-spy-chief-says-maduro-ordered-illegal-arrests/)

 

With tenacity and torture, Venezuela’s awful regime is hanging on

Almost six months since Juan Guaidó began his attempt to remove Venezuela’s leftist dictatorship, the strain is showing. The 35-year-old’s jet-black hair is peppered with grey. His eyes seem weary. He has dropped his snappy slogan, “vamos bien” (“we are doing well”). Now his demoralized supporters utter it sarcastically. But the need to end the rule of Nicolás Maduro is as strong as ever. His mismanagement, plus sanctions imposed in January on Venezuela’s oil industry by the United States, will cause the economy to shrink by more than 25% this year. In dollar terms, the drop in output since Maduro became president in 2013 will be around 70%. Francisco Rodríguez, an economist in New York who has advised the moderate opposition, warns of famine. On July 5th the un High Commissioner for Human Rights published evidence that security forces loyal to the government, such as the FAES, had murdered at least 6,800 people from January 2018 to May 2019. It documented cases of torture, including the use of electric shocks and waterboarding. Days before it was published, Rafael Acosta, a reserve naval captain accused of plotting to overthrow Maduro, appeared in court in Caracas, bruised and unable to say anything but “help me” to his lawyer. He died hours later. Mr. Guaidó, the head of the opposition-controlled legislature, had hoped to lead a velvet revolution. That plan has suffered one reversal after another. Although Maduro claims to “sleep like a child” he has cause for insomnia. The April uprising revealed splits in the regime.  The state-owned oil giant PDVSA, the main foreign-exchange earner, is trying to shift exports from the United States to Asia. Corruption, mismanagement by executives chosen for their loyalty to the regime and now sanctions has caused output to plunge. Although Venezuela has the world’s largest proven oil reserves, much of the country is suffering from shortages of petrol. “The regime’s entire focus now is survival,” says a Caracas-based diplomat. “The rulebook has been thrown away.” Maduro has quietly abandoned elements of the socialism brought in by his predecessor. The dollar has become accepted almost everywhere. Inflation has plummeted, to a still stratospheric 445,482%. But these moves towards saner economic policies have so far done little to ease hardship for most people. The main hope for a political transition. It is hard to imagine a resolution to Venezuela’s agony that does not include Maduro’s departure and a plan to hold elections with international monitoring. If that is to happen, the president will have to sleep less and worry more. (The Economist: https://www.economist.com/the-americas/2019/07/13/with-tenacity-and-torture-venezuelas-awful-regime-is-hanging-on)

 

John Bolton uses Twitter to try to flip Venezuela's defense minister

It looks like the White House national security adviser is trying to get Venezuela's defense secretary and military chief to flip. Four out of six John Bolton tweets since Monday evening have targeted Venezuelan defense minister Vladimir Padrino. Bolton's focus has been warning Padrino that he serves an illegitimate leader and that he will be held accountable for deaths that the Venezuelan military inflict under Nicolás Maduro's orders. In the first of what would be a three-day series of tweets addressed to the Maduro regime’s Defense Minister General Vladimir Padrino, Bolton argued that Maduro "deprived your soldiers, relied on illegal armed groups & 'colectivos' to violate the rights of Venezuela's people & has systematically executed political opponents." "Why do you support a tyrant whose inability to govern is visible for all to see?" Bolton asked. Shortly after Guaidó tried and failed to overthrow Maduro in late April, Bolton alleged that Padrino was among the socialist leader's top officials who agreed to switch sides, but ultimately failed to do so. Padrino has denied the claim and Monday was neither the first nor last time Bolton went off against Maduro and his administration on Twitter. "Do you want to be held to account for the arrest, torture and extrajudicial killings of your fellow Venezuelans, including members of the FANB? The atrocities are being documented for the world to see," Bolton tweeted Tuesday, using an acronym for Venezuela's National Bolivarian Armed Forces. "Are you proud to serve Maduro, a despot who has ordered the killing of thousands of your fellow Venezuelans in the last 18 months?" On Wednesday, Padrino responded, tweeting that Bolton "insists on an unhealthy attitude against me, like an obsessive-compulsive disorder, through recurrent, persistent and intrusive statements, characteristic of the insidious political blindness to which they resort to failing to divide the FANB." Padrino linked Bolton's "obsessive doubt" to the "clumsy and failed strategy he sold to Trump" and said that his continued position as defense minister "represents a mental torture for Bolton." Bolton hit back about 15 minutes later, arguing that the "Venezuelan Constitution does not call for the death of over 9,000 of your fellow Venezuelans because they voice disagreement with Maduro." He continued: "Remember your responsibilities to defend the constitution and the Venezuelan people."  It's not at all clear that Bolton's latest effort here will have any more success than the last time around. For one, Maduro has just reappointed Padrino as defense minister. While that might be a case of friends close and enemies closer, it's equally likely to reflect Maduro's increased confidence. (NEWSWEEK: https://www.newsweek.com/us-twitter-iran-venezuela-bolton-1448591; The Washington Examiner: https://www.washingtonexaminer.com/opinion/john-bolton-uses-twitter-to-try-to-flip-venezuelas-defense-minister)

 

Maduro regime’s war on children at a 'breaking point' over lack of medical care

The cries of millions of children still languishing inside Venezuela all too often go unanswered as the deteriorating conditions and the iron-grip of the Maduro regime has set the stage for once eradicated diseases to run rampant, trauma medicine to vanish, infant mortality to drastically spike, and for simple health skirmishes to morph into life-threatening plagues. “The current health situation is at a very delicate breaking point,” Ephraim Mattos, executive director of Stronghold Rescue & Relief, told Fox News. “We will never know the exact numbers of people who have died due to the corruption of the Maduro government, but what is happening in Venezuela – especially to the children – is nothing short of genocide.”  “One of the biggest health crises facing children fleeing Venezuela is simple dysentery caused by the contaminated food and water they are forced to eat and drink just to survive in Venezuela.  The dysentery causes the children to become even more malnourished and dehydrated which only compounds the issue further,” Mattos, who endeavors to reach some of the most famished and dangerous pockets of Venezuela with vital assistance, said. “Children who should be able to not only survive but also thrive, are needlessly dying every single day.” Paloma Escudero, the Global Director of Communication for UNICEF, concurred to Fox News that the UN children’s agency is concerned that Venezuela has reduced children’s access to essential services and increased their vulnerability. “Under-5 mortality increased by more than half between 2014 and 2017. Venezuela went from being a model for malaria eradication in the Americas, with its northern region declared malaria-free by the WHO in 1961, to becoming the largest contributor to the malaria burden in the region,” she said. “Between 2016 and 2017, reported malaria cases increased by over 70 percent. The number of people who died from malaria increased from 54 in 2010 to 456 in 2017.” In addition, UNICEF has recorded 190 suspected cases of diphtheria since the beginning of 2019, leading to 13 deaths. Escudero continued, noted that families are being forced to wake at the crack of dawn to trek their children across the border to the ravished Colombian city of Cucuta, to get them immunized or treated for common childhood illnesses. (Fox News: https://www.foxnews.com/health/venezuelas-war-children-medical-care-lacking)

 

Trinidad criticized for lack of action as Venezuelan migrants flee to the island nation

While large numbers of desperate Venezuelans have flocked to their Spanish-speaking neighbors in South America, more than 98,500 have fled to the Caribbean, according to a 2018 report from the United Nations. There are an estimated 40,000 Venezuelans residing in Trinidad and Tobago, just 10 miles off the coast of Venezuela. With unrest at their shores, Trinidad and Tobago’s government continues to avoid formal asylum legislation. The island nation remains the only country to take in large numbers of Venezuelan migrants without having an official asylum policy in place. It has also not taken political sides on the unraveling situation in Venezuela, instead choosing to remain officially neutral. As a result, the islands’ government is receiving condemnation from world leaders, the country’s own opposition, and asylum-seekers who say the country needs to do more. This leaves desperate families to choose between remaining in their divided homeland or moving to islands where they are unsure if they are safe and welcome. The side effects have led to reports of unlawful detention by the police and the deportation of 82 refugees, actions which the U.N. condemned as illegal. The uncertainty has Venezuelans there living in fear and seeking financial assistance on the black market, where reports of human trafficking are rampant. (NBC News: https://www.nbcnews.com/news/nbcblk/trinidad-criticized-lack-action-venezuelan-migrants-flee-island-nation-n1028246)

 

Spain arrests suspect sought by Venezuela for deadly arson

A Spanish National Court spokesman says that a man sought by Venezuela for allegedly burning a 22-year-old man during anti-government protests two years ago has been jailed in Madrid. Enzo Franchini Oliveros’ arrest was first announced on Wednesday by Venezuela’s top prosecutor, Tarek William Saab. Saab tweeted that Oliveros was sought for public disorder, intentional homicide and terrorism charges related to the burning of Orlando Figuera during a demonstration in May 2017. A Spanish National Police spokeswoman said Oliveros was arrested on Monday in a town near Madrid. A National Court spokesman says the man told Judge Santiago Pedraz during questioning Thursday that he didn’t want to be extradited. A hearing needs to be scheduled for magistrates to decide. (CBS: https://www.cbs42.com/news/international/spain-arrests-suspect-sought-by-venezuela-for-deadly-arson/)

 

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.