International Trade
Inbound cargo at Puerto Cabello:
- Over
29,000 tons of yellow corn from Bunge Latinoamérica for Alimentos
Balanceados Tinaquillo C.A. y Nutrición Técnica Nutritec C.A.
- 14,153 tons of beef and chicken from JBS S/A for
CASA
- Over 14,000 tons of wheat from Terra World Trade
for Molinos Carabobo
- Over 1, 706 tons of milk
- 695 tons of margarine from JBS S/A for CASA
21 vessels remain at bay awaiting dock assignment. One
is carrying 33,000 tons of white corn from México and other with 33,000 tons of
yellow corn from Argentina for CASA.
More in Spanish: (Notitarde; http://www.notitarde.com/La-Costa/Mas-de-un-mes-en-bahia-de-Puerto-Cabello-tiene-buque-con-maiz-/2014/08/20/347493; http://www.notitarde.com/La-Costa/Llegaron-mas-de-16-mil-toneladas-de-alimentos-2218899/2014/08/19/347160
Food staple imports increase by 30% in order to
counter outbound smuggling
President Nicolás Maduro reports the government has
increased basic food imports by 30% during the first semester this year in
order to replace products smuggled outside the country. He says: "if they (the smugglers) hurt the basic supply of food taking 30 and even
40% out through an illegal system of logistics, we must invest to compensate
the same amount of supplies." More in Spanish: (Agencia Venezolana de
Noticias; http://www.avn.info.ve/contenido/importaciones-productos-b%C3%A1sicos-aumentaron-30-para-contrarrestar-da%C3%B1os-del-contrabando)
Logistics & Transport
US warns of limited access to flights in Venezuela
The US Embassy in Caracas has urged US nationals to
take precautions when they travel to Venezuela due to reduced availability of
flights. DELTA, AMERICAN, and UNITED Airlines have cut their services in
Venezuela. The Venezuelan Association of Airlines said the number of seats
available to travel between Venezuela and the United States has dropped to less
than half throughout this year, AP reported. (El Universal, http://www.eluniversal.com/nacional-y-politica/140820/the-us-warns-about-limited-access-to-flights-in-venezuela)
Oil &
Energy
Chavez propaganda tool CITGO for sale as crisis worsens
A decade ago, Hugo Chavez started using Venezuela’s CITGO Petroleum Corp. to provide heating oil to the
poor in the U.S. to spread his socialist message. His successor is now seeking
to sell the company to stem the South American country’s deepening economic
crisis. State-owned producer Petroleos de Venezuela SA wants at least US$ 10
billion for Citgo, its U.S. refining and distribution arm, company president
and Oil Minister Rafael Ramirez said
Aug. 5. Since energy news agency ARGUS first reported the potential sale July
24, Venezuela’s bonds have plunged an average 5.9%, the most in emerging markets after Argentina’s defaulted debt, according
to data compiled by Bloomberg. (Bloomberg, http://www.bloomberg.com/news/2014-08-21/chavez-propaganda-tool-for-sale-as-crisis-worsens-andes-credit.html)
As Venezuelan deliveries wane, allies tap
traders for pricey fuel
Venezuela signed numerous energy deals during
former President Hugo Chavez's 14 years in power, allowing countries in the
Caribbean, Central America and other regions to receive oil on favorable
financial terms. The accords, along with almost 500,000 barrels per day (bpd)
that are sent to China to repay debts owed by Venezuela, are
weighing on the cash flow of state-run oil company PDVSA. Venezuela last year
sent an average of 243,000 bpd of crude and products to countries that signed
accords known as PETROCARIBE, the Caracas Energy Agreement and other bilateral
deals. Those shipments were an 11% drop from the previous year and the lowest
since 2007. PDVSA has been forced to trim exports of oil products to its
customers due to lower oil output and weak economic growth at home, a domestic
refinery network that has not fully recovered from a severe accident in 2012,
and financing agreements with China that divert much of the OPEC nation's oil
production to Asia. (Reuters, http://www.reuters.com/article/2014/08/21/us-venezuela-oil-exports-facts-idUSKBN0GL1LS20140821;
http://www.reuters.com/article/2014/08/21/us-venezuela-oil-exports-insight-idUSKBN0GL1LP20140821)
PDVSA launches TV channel
State-run oil company PDVSA has launched a TV channel
to broadcast information on the sector with special emphasis on socialist
policies. The Ministry for Communications and Information reports that "PDVSA TV began last week its trial period,
which will last two months." It includes three broadcasts of one hour
each, in the morning, afternoon. (El Universal, http://www.eluniversal.com/nacional-y-politica/140821/venezuelan-oil-giant-pdvsa-launches-tv-channel)
BANCO BICENTENARIO to loan PDVSA VEB 1.2 billion to
build sugar complex
Government
owned BANCO BICENTENARIO will lend state run oil giant PDVSA VEB 1.2 billion to
develop a sugar agribusiness complex in Cojedes and Portuguesa states. The
amount is 26.09% of the bank's entire agricultural credit fund. More in
Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/banca/bicentenario-prestara-bs--1-200-millones-a-pdvsa-p.aspx#ixzz3B7FCDExf; El Universal, http://www.eluniversal.com/economia/140822/bs-12-millardos-prestara-el-banco-bicentenario-a-pdvsa)
Commodities
Venezuela to create nationwide fingerprint detection
system to limit food smuggling
President Nicolas Maduro ordered the creation of a
fingerprinting system in stores that sell food to limit smuggling of subsidized
staple products to neighboring countries. The system is meant to ease chronic
shortages of consumer products ranging from cooking oil to toilet paper by
preventing shoppers from buying large quantities of the same goods. "(We will) create a biometric system
... in all distribution and retail systems, public and private,"
Maduro said. He also announced a system of guidelines for distributing all
products that are traded in Venezuela, and said he would provide details soon. Fair
Price Superintendent Andrés Eloy Méndez says that by November 30th all national
public and private food networks must have installed the biometric fingerprint
system. He did not explain how. (Reuters, http://www.reuters.com/article/2014/08/21/venezuela-food-idUSL2N0QR0QG20140821;
and more in Spanish: El Universal, http://www.eluniversal.com/economia/140822/sistema-de-guias-regira-el-comercio-de-todos-los-bienes)
Opposition and business leaders call "biometric system" a rationing card
Opposition leader Henrique Capriles Radonski has harshly criticized
the announcement that the government will extend fingerprinting to customers of
private supermarkets. "The biometric
system they want to impose on markets is nothing but a rationing card, another
government failure", which will worsen scarcity. "They talk about supplies and the national
production system is paralyzed". He called for a "national agreement" to strengthen
domestic production. Congressman Alfonso Marquina of Primero Justicia said
"this is none other than the Cuban
rationing card". At the same
time, FEDECAMARAS President Jorge Roig, head of the nation's largest business
organization, also said "this is
nothing more than a rationing card", a form of "managing scarcity". Roig insists
the government has implemented a failed system of imports and has not supported
domestic production. More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/politica/capriles-el-sistema-biometrico-es-una-tarjeta-de-r.aspx#ixzz3B1ggEbSX; http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/sistema-biometrico-genera-dudas-y-prende-el-debate.aspx#ixzz3B1gJClkr; El Mundo, http://www.elmundo.com.ve/noticias/economia/gremios/roig--sistema-biometrico-es-una-tarjeta-de-raciona.aspx#ixzz3B7G0fido; and El Universal, http://www.eluniversal.com/nacional-y-politica/140822/plantean-mas-produccion-en-vez-de-las-captahuellas)
Consumers' association rejects "biometric
system"
Roberto León Parilli, the president of the National
Alliance of Users and Consumers (Anauco), questioned the implementation by the
government of a "biometric system"
to tackle the issue of shortage in Venezuela.
He stressed that installing fingerprint-reading
machines in stores and supermarkets will not solve lingering shortages in
Venezuela. "They (authorities)
should think about this thoroughly; the country needs far-reaching solutions,"
he asserted. (El
Universal, http://www.eluniversal.com/economia/140821/venezuelan-consumers-association-rejects-biometric-system)
Metal working industries report low steel inventories
National metal working industries have been deprived
of their main supplier after labor unrest at SIDOR and a drop in steel
production. The crisis is aggravated due to the lack of FOREX to import alloys.
Miguel Eseverri, President of the Metal and Mining Industry Association says
"we are concerned because
inventories will run out in September". The industry will request US$
600 million within the SICAD 1 system in order to order supplies to meet demand
during the first semester next year. Eseverri reports US$ 143 million are
required to buy basic supplies that can keep the industries running for one
month. If FOREX is not available more small and medium industries will be forced
to shut down. More in Spanish: (El Nacional; http://www.el-nacional.com/)
Economy
& Finance
BARCLAYS reports that Venezuela's dollar assets are
shrinking
BARCLAYS CAPITAL reports
that the latest FOREX allocation figures divulged by CENCOEX indicate that
Venezuela's FOREX deficit is deep and it has been financing itself by using up
the different funds available to the government. It adds: "Nevertheless it continues to procrastinate
on adjustments, distortions increase and restrictions grow lax, Venezuela's
external position could continue to deteriorate, which increases country risk."
More in Spanish: (El Universal, http://www.eluniversal.com/economia/140820/barclays-indica-que-se-reducen-activos-en-dolares-del-pais)
Credit Suisse: More sectors to buy FOREX at higher
rates
"We
forecast the government will continue to devaluate the weighted average
exchange rate by shifting sectors to the lower foreign exchange rates. However,
overvaluation and limited access to foreign currency will probably continue to
be a factor underlying economic problems" in Venezuela, says a report
by investment bank Credit Suisse. (El Universal, http://www.eluniversal.com/economia/140820/credit-suisse-more-sectors-to-buy-foreign-currency-at-higher-rates)
Maturing foreign debt pressures government accounts
Venezuela's Central Bank data shows dollar debt is no
longer at comfort level after increasing dramatically by 108% between 2008 and
the third quarter of 2013, which raised it to US$ 104 billion. Debt service is
becoming heavy amid a shortage of available FOREX to meet both imports and debt
obligations. More in Spanish: (El Universal, http://www.eluniversal.com/economia/140822/vencimientos-de-deuda-externa-presionan-las-finanzas-publicas)
FOREX sold at preferential VEB 6.30/US$1 rate down 28%
The National Center for Foreign Trade (CENCOEX) reports
that the government has been reducing the supply of FOREX to the private sector
at the preferential exchange rate of VEB 6.30 per USD. During the first
seven months of 2014, CENCOEX provided foreign currency for imports in
different sectors of the economy, including the the Latin American Integration
Association (ALADI) and the United System of Regional Payment Compensation (SUCRE),
amounting to US$ 9.57 billion. This figure, according to think tank SÍNTESIS
FINANCIERA, this is a drop of 28% from the same period in 2012 (Venezuelan authorities
have not disclosed the 2013 statistics.) (El Universal, http://www.eluniversal.com/economia/140820/foreign-currency-sold-at-preferential-rate-down-28)
Politics
Maduro’s rating falls to 39% in poll
President Nicolas Maduro’s approval rating fell 21%
this year to 39% in August, as the economy worsened, according to an
HINTERLACES (pro government) poll. “The
people are waiting for answers, for solutions,” says Oscar Schemel,
director of the polling company, "there’s
a lot of uncertainty about the direction of the economy.” Slumping
popularity has made Maduro reluctant to make economic adjustments such as
raising gasoline prices or devaluing the bolivar, says Eurasia Group analyst
Risa Grais-Targow. The government will start rationing basic products with
biometric sensors before year-end, according to the country’s price controls
ombudsman. The president’s opponents are not benefiting from his weakness, with
the approval rating of the main opposition alliance falling to 19% in August,
said Schemel. Around 40% of Venezuelans are not identifying with either the
government or the opposition, according to the poll. (Bloomberg: http://www.bloomberg.com/news/2014-08-21/maduro-s-rating-falls-to-39-in-venezuela-poll-on-economy.html)
GALLUP reports Venezuela as the most unsafe nation in
the world
A global study by GALLUP
shows Latin American nations as the most dangerous in the world, ahead of the
African continent and Russia, and Venezuela is described as the most unsafe
country globally, with only 19% of its people saying they feel safe walking at night in their own
neighborhood, 74% distrust local police and 22% have suffered theft or have a
relative who was robbed during the past 12 months. More in Spanish: (Notitarde,
http://www.notitarde.com/Internacional/Venezuela-es-el-pais-mas-inseguro-del-mundo-segun-la-firma-Gallup/2014/08/22/347656)
Maduro pays unannounced visit to Fidel Castro
President Nicolas Maduro made a belated birthday visit
to Fidel Castro, the former Cuban leader revealed in one of his regular columns.
Castro's "Reflections"
column posted on the official website CubaDebate said Venezuela's socialist
leader dropped by Tuesday, fulfilling a promise to make a visit that Maduro
made Aug. 13 as Castro turned 88. He didn't say whether the Venezuelan met with
Cuban President Raul Castro or other officials. (The New York Times, http://www.nytimes.com/aponline/2014/08/20/world/americas/ap-cb-cuba-maduro-visit.html?ref=americas&utm_source=Sailthru&utm_medium=email&utm_term=%2AMorning%20Brief&utm_campaign=2014_MorningBrief-%20NYU%20PROMO082114&_r=;
Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2349124&CategoryId=10717;
AVN, http://www.avn.info.ve/contenido/real-friendship)
Louisiana Democrat Senator Mary Landrieu who blocked
sanctions to Nicolás Maduro’s officials in the
Senate said she would be “happy to
endorse” that legislation once a simple paragraph is added protecting the
2,000 CITGO workers that make it possible for those who have a car in Louisiana
to fill their gas tanks. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=40715&idc=1)
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.
