International
Trade
Cargo that has arrived at Puerto Cabello:
- Over
3,000 tons of milk and beef from Centrolac S.A., Productos Lácteos La
Perfecta, Industria Comercial San Martín, Eskimo S.A. and Nova Terra for
state agency Corporación de Abastecimiento y Servicios Agrícolas (CASA)
- Over 1,500 tons of personal care items such as
diapers, sanitary towels and shampoo from Procter & Gamble for its
subsidiary in Venezuela
- 73 tons of auto parts from Ford Motor for its
subsidiary in Venezuela
There are 8 vessels offloading at port, one carrying 30,000 tons of yellow corn for CASA. More in Spanish: (Notitarde; http://www.notitarde.com/La-Costa/Mas-de-3-mil-toneladas-de-leche-y-carne-llegaron-para-la-estatal-Casa-2412480/2015/05/10/510686/)
Bilateral Venezuela-Colombia trade is reported down 36%
in Q1 2015
Trade between Venezuela and Colombia shrank 36% during
the first quarter of 2015, compared to the same period in 2014. According to
the Venezuelan-Colombian Economic Integration Chamber (CAVECOL) binational
trade was US$ 343 million, compared to US$ 538 million in 2014, a 36%-decline. The
report is based on figures provided by Colombia's Administrative Department of
Statistics (Dane) and Venezuela's National Statistics Institute (INE). (El Universal, http://www.eluniversal.com/economia/150511/venezuela-colombia-trade-down-in-the-first-quarter)
Trade with the US also down 36% in Q1 2015
The US Department of
Commerce also reports a 36% drop in bilateral trade with Venezuela during the
first quarter of 2015. Imports and exports were US$ 6.259 billion as compared
to US$ 9.893 billion the year before. More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/intercambio-comercial-con-eeuu-cae-36-en-el-primer.aspx#ixzz3Zp86GLcC; El Mundo; http://www.elmundo.com.ve/noticias/economia/politicas-publicas/intercambio-comercial-con-eeuu-cae-36--en-el-prime.aspx)
Oil &
Energy
Venezuela oil price rises for 7th straight week
Venezuela's weekly oil basket price continued to rise
for a seventh week in a row as oil prices around the world went up as Saudi
Arabia continued fighting against Iranian-backed rebels in neighboring Yemen at
the mouth of the Persian Gulf, problems in Libya continued disrupting supply
from that country, and U.S. stocks were unexpectedly drawn down.
According to figures released by the Venezuela
Ministry of Energy and Petroleum, the average price of Venezuelan crude sold by
Petroleos de Venezuela S.A. (PDVSA) during the week ending May 8 was US$ 56.74,
up US$ 2.53 from the previous week's US$ 54.21. (Latin American Herald Tribune,
http://www.laht.com/article.asp?ArticleId=2386899&CategoryId=10717)
Commodities
Ford to sell Venezuelan cars in greenbacks in
dollarization
Ford Motor Co. will sell some of its cars in Venezuela
in dollars to alleviate a shortage of greenbacks that has slashed its imports
and paralyzed its plant, according to a labor union official. “Car sales will be in dollars,” Gilberto
Troya, head of the Ford Motors de Venezuela union, said by telephone from
Valencia, Venezuela. He said the company informed the union of the deal with
the government April 28. “This could lead
to a complete dollarization of the sector.” Under the deal, customers will
give dealerships dollars, which will be used to import car parts to be
assembled at the Valencia plant, Troya said. Customers could still buy some of
the cheaper models such as the Fiesta in bolivars, he said. Dearborn,
Michigan-based Ford spokeswoman Susan Krusel confirmed a deal has been reached
with the Venezuelan government to restart production in an e-mailed response to
questions, without providing further details. (Bloomberg: http://www.bloomberg.com/news/articles/2015-05-08/ford-to-sell-venezuelan-cars-in-greenbacks-in-slow-dollarization)
Health Minister confirms state control over medicines
Health Minister Henry Ventura has confirmed government
control over the sale of medicines and refuted a report by the President of
Venezuela's Medical Federation of 13,000 medical doctors migrating. He claims
added state controls will make it possible to compare FOREX provided to
importers and the quantity of medicine sold at each pharmacy. The system
encourages patients to enroll at pharmacies in order to guarantee access to
medicines. He said "anything Douglas
Leon Natera (President of the Federation) lacks credibility because he does not
go to hospitals", and claimed only 320 doctors have left in six years.
(More in Spanish: Infolatam, http://www.infolatam.com/2015/05/11/venezuela-confirma-control-estatal-en-medicinas-y-niega-fuga-13-000-medicos/)
Economy
& Finance
Already at a 12 Year Low, Venezuela Central Bank reserves
fall another half-a-billion in one day
Venezuela's international reserves fell US$ 507
million dollars on Thursday, pushing toward crashing through the US$ 18 billion
level and marking a new low since 2003. With heavy foreign debt burdens,
falling crude production, falling crude production, increased domestic usage --
gasoline sells for less than a penny a gallon at the black market dollar rate
-- Venezuela's foreign reserves have fallen to US$ 18.211 billion as of May 7. That
is the lowest level since 2003. Reserves have now fallen US$ 4.101 billion
since the beginning of the year. Not adding confidence to the accuracy of its
numbers, on May 4, the Central Bank reported that reserves were US$ 19.799
billion but then erased that number and changed it to a full US$ 1 billion
lower at US$ 18.799 a day later with no explanation. (Latin American Herald
Tribune, http://www.laht.com/article.asp?ArticleId=2386906&CategoryId=10717)
Venezuela: A worthy investment for China?
As the future of Venezuela's economy continues to
spiral downwards into chaos, its leaders have relied heavily upon China's
financial support and mercy to stave off complete collapse. Until now, China
has extended over US$ 50 billion dollars in loans to Venezuela, permitting the
Venezuelan government to repay the loans through guaranteed deliveries of oil.
Of the 600,000 barrels of oil the Venezuelan government exports to China daily,
over half are exported in order to repay loans to various Chinese banks, not to
generate new revenue. However the global drop in oil prices has gravely damaged
the Venezuelan economy and thereby the country's ability to repay loans;
unfortunately for Venezuela, China has other partnerships to uphold as well. Despite
past financial leniency with Venezuela, Beijing feels reluctant to lend large
sums of money to economically weak states, especially when dealing with so many
foreign projects at once. Most foreign policy experts doubt China will attempt
to become economically close with - let alone continue to lend to - Venezuela
in the near future. Rather than simply loaning money, Chinese banks may instead
provide funds for developmental projects in hopes of generating profit. But
most bankers want to increase revenue, not spread a particular ideology.
Nevertheless, in the event that China's government decides to increase its
support of Maduro's government, such a decision would not end Venezuela's
economic troubles. If anything, increased Chinese support may come to hurt
Venezuela in the long run, encouraging Maduro and future Venezuelan leaders to
look abroad for help rather than implement the painful economic reforms needed
to turn the country around. If Venezuela's economy is to truly recover, change
must come from within its borders. (The Huffington Post, http://www.huffingtonpost.com/china-hands/venezuela-a-worthy-invest_b_7250192.html)
Central Bank stops issuing domestic debt bonds
The Finance Ministry has stopped issuing domestic debt
bonds planned for the second quarter this year until further notice. More in
Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/bcv-suspende-emision-de-bonos-de-la-deuda-publica-.aspx#ixzz3ZusA1Y3s; El Mundo, http://www.elmundo.com.ve/noticias/economia/mercados/bcv-suspende-emision-de-bonos-de-la-deuda-publica-.aspx)
Venezuelan sovereign debt and PDVSA’s bonds were up on
Friday, compared to their closing rates the
day before. In average, the sovereign bonds posted a 1 point weekly increase.
Securities such as the Venz 2018, 7% coupon and the Venz 2025 and 2027 received
the most demand, with increases over 0.50 points. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43813&idc=2)
Politics and
International Affairs
Venezuela parliamentary elections to be held in fourth
quarter
Venezuela will hold parliamentary elections in the
last quarter of this year and the exact date will be announced soon, according
to the head of the National Electoral Council (CNE). President Nicolas Maduro
is under growing pressure over the 2015 elections, especially after leftist
ally and regional heavyweight Brazil on Thursday urged its neighbor to set a
date. "We can say that in the last
quarter of this year we'll have the elections. We're going to announce it very
soon," Tibisay Lucena said in an interview with state television. Luis
Emilio Rondon, a CNE official, said on Friday the elections will be held at the
end of November or the beginning of December. (Reuters, http://www.reuters.com/article/2015/05/10/us-venezuela-election-idUSKBN0NV0TE20150510; Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43814&idc=1; El Universal, http://www.eluniversal.com/nacional-y-politica/150511/parliament-vote-to-be-held-in-the-last-quarter-in-venezuela)
Venezuela-US dialogue continues through embassies
The government of the United States is holding talks
with the Venezuelan Ministry of Foreign Affairs to solve the impasse that
started more than two months ago, on March 8, when President Nicolás Maduro
ordered a cut in the US embassy staff in Caracas within 15 days. Venezuela
started demanding visas for US tourists entering the country. "We are holding talks on this matter (of the
US embassy staff cut) with the Venezuelan government through diplomatic means,"
a spokesperson of the US State Department told El Universal. (El Universal, http://www.eluniversal.com/nacional-y-politica/150511/venezuela-us-dialogue-about-embassies-continues)
Venezuela among the countries with the highest rate of
violent deaths
Based on rates of violent murders recorded in 2012 in
Honduras (90.2 violent deaths per every 100,000 inhabitants) and Venezuela
(72.2), these two countries are listed behind Syria where a civil war started
in 2011 among the most violent countries in the world. The rate of violent
deaths in those two Latin American countries are over 10 times higher than the
global average, which is 7.4 murders per every 100,000 people. The United
Nations has revealed that one fourth of violent deaths in the world occur in
countries that are home to only 4% of world population; among those countries,
Syria, Honduras, and Venezuela, which experience the worst situation. (El Universal, http://www.eluniversal.com/nacional-y-politica/150509/venezuela-among-the-countries-with-the-highest-rates-of-violent-deaths)
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.
