International
Trade
New cargo arrivals reported at Puerto Cabello
- 681 tons of beef from Brazil, for state agency CASA
and others.
- 538 tons of wheat flour, for CASA
- 490 tons of long lasting PARMALAT milk from their
Uruguay operation,
- Over 306 tons of margarine, for CASA
- 284 tons of chicken, for CASA
- 265 tons of spaghetti, for CASA
- Also auto parts, motorcycles and electronic
material.
More in Spanish: (Notitarde; http://www.notitarde.com/La-Costa/Al-puerto-local-llego-carne-pollo-margarina-leche-y-harina-de-trigo-2236311/2014/09/18/354001)
MAERSK sells Venezuela cargo boat business
Danish shipping conglomerate A.P. Moller-Maersk has
announced the sale of its cargo boat business in Venezuela, saying it is a
"minor part" of its business.
The unit is made up of 10 cargo boats under contract in Lake Maracaibo. More in
Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/maersk-vende-negocio-de-cargueros-en-venezuela.aspx#ixzz3DZNZjQ5a)
Oil &
Energy
Barclay's estimates CITGO value at US$7-9 billion
Barclays Capital estimates the value of CITGO somewhere
between US$ 7-8 billion, despite the fact that other firms indicate its value
could be at US$ 10 billion. More in Spanish: (El Universal; http://www.eluniversal.com/economia/140919/calculan-que-citgo-tiene-un-valor-entre-7-y-9-millardos; El Nacional, http://www.el-nacional.com/economia/Barclays-valora-Citgo-millardos_0_485351624.html)
Sale of CITGO causes PDVSA default insurance to increase
Five-year bond insurance contracts known as credit
default swaps (CDS) on Venezuela's state oil company Petroleos de Venezuela
S.A. (PDVSA) widened 16% over the past week, according to international ratings
agency Fitch.
PDVSA CDSs widened 31% during the past month,
significantly underperforming Fitch Solutions' Global Oil & Gas CDS Index,
which had firmed 5% during the same period. The one- and five-year CDSs
referencing PDVSA have inverted, indicating that the market is pricing in
higher credit risk at the shorter end of the curve. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2352442&CategoryId=10717)
'Zombie' Hovensa refinery could live again due to
shale
The mothballed Hovensa refinery, once the largest in
the Western hemisphere, could be the latest "zombie refinery" to come
back to life, revived by the U.S. shale boom. Hess Corp and Venezuela's
state-run Petroleos de Venezuela (PDVSA) have found an interested buyer for
their 350,000 barrel per day (bpd) Hovensa refinery in the Virgin Islands,
sources close to the deal told Reuters, confirming a local news report that
said the plant would use U.S. crude. Refining at the plant has been halted
since 2012, but its owners have been using it as a terminal. The Virgin Islands
government has sought a buyer who will return the plant to its former status as
an active refinery. (Reuters, http://www.reuters.com/article/2014/09/18/us-refinery-hovensa-restart-analysis-idUSKBN0HD0B520140918; http://www.reuters.com/article/2014/09/17/refinery-hovensa-sale-idUSL1N0RI1CR20140917;
El Universal, http://www.eluniversal.com/economia/140918/hess-pdvsa-find-potential-buyer-for-refinery-in-the-virgin-islands)
Commodities
Mitsubishi halts Venezuela plant due to imports snag -union
The assembly plant for Mitsubishi autos in Venezuela
has halted operations due to a delay in the import of parts for assembly, a
union official said. Like other private businesses here, carmakers have been
complaining that the socialist government's complicated currency controls and
bureaucratic processes are slowing imports of essential products. The assembler
of Mitsubishi in Venezuela, MMC Automotriz, which belongs to Japan's Sojitz
Corporation, began a month-long stoppage on Monday, says union official
Jahaziel Bolivar. "We're waiting for
materials to arrive," he said, adding that they were held up at a port
in western Venezuela. (Reuters, http://www.reuters.com/article/2014/09/17/venezuela-autos-idUSL1N0R61NL20140917)
Economy
& Finance
Venezuelan bonds slide after S&P lowered credit
rating
Venezuela’s bonds sank to a 17-month low after
Standard & Poor’s lowered the country’s credit rating, citing an economic
slowdown and soaring inflation. The nation’s benchmark dollar bonds due 2027
slid 4.23 cents to 68.85 cents on the dollar today, the lowest since April
2013, after S&P cut Venezuela’s long-term rating by one step to CCC+, seven
levels below investment grade and just one notch above war-torn Ukraine, and
said the outlook is negative. “These guys
are operating on fumes,” says Marco Santamaria, a money manager at Alliance
Bernstein LP, which has reduced its holdings of Venezuelan bonds in recent months,
“I think the situation’s quite grim.”
S&P says Venezuela’s economy will contract 3.5% this year after growing 1%
in 2013. Annual inflation accelerated to 63.4% in August, the fastest since
1997 and the highest among countries tracked by Bloomberg. “The
downgrade is based on continued economic deterioration, including rising
inflation and falling external liquidity, and the declining likelihood that the
government will implement timely corrective steps to staunch it,” S&P
analyst Sebastian Briozzo said in the statement. “The government could come under greater strain to service its rising
level of external debt.” S&P’s rating is in line with the Caa1 ranking
from Moody’s Investors Service, which cut Venezuela’s grade in December.
(Bloomberg, http://www.bloomberg.com/news/2014-09-16/venezuela-s-rating-cut-by-s-p-to-ccc-on-deteriorating-economy.html)
Default naysayers undermined by S&P downgrade
Standard & Poor’s is undoing the efforts of banks
from Goldman Sachs Group Inc. to BNP Paribas SA to quell concern that Venezuela
will default. (Bloomberg, http://www.bloomberg.com/news/2014-09-18/venezuela-default-naysayers-undermined-by-s-p-cut-andes-credit.html;
http://www.bloomberg.com/news/2014-09-16/venezuela-s-rating-cut-by-s-p-to-ccc-on-deteriorating-economy.html;
Reuters, http://www.reuters.com/article/2014/09/17/venezuela-economy-idUSL1N0RI16A20140917)
Declining gold price increases Venezuela's reserve
contraction
73% of Venezuelan
international reserves are held in gold, which has dropped down to US$ 1216 an
ounce, its lowest price since January 2nd. The Central Bank valued gold
reserves at US$ 15.240 billion on August 7th, a 24% drop from December 2012.
More in Spanish: (El Universal, http://www.eluniversal.com/economia/140919/declive-del-oro-amenaza-con-agravar-caida-de-las-reservas)
Government expenditures have risen 150% above 2013
According to reports presented to the National
Assembly, in almost nine months the legislature has authorized an additional
VEB 313.2 billion for extraordinary expenses, which is 150% more than approved
during the same time frame in 2013. More
in Spanish: (El Universal, http://www.eluniversal.com/economia/140917/150-sube-el-gasto-adicional-del-gobierno-respecto-a-2013)
FOREX allocation will contract during the last quarter
of this year as public imports continue increasing,
says economist Jesús Casique. He explains it is extremely difficult for the
country’s productive sector to acquire dollars and at an overvalued exchange
rate of VEB 11.70/US$1 (SICAD I), and demand will be infinite. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=41120&idc=2)
Politics
Maduro orders investigation into international media
reporting virus in Aragua state
President Nicolás Maduro says media outlets CNN en
español, NTN24, and the Miami Herald have launched an international campaign
claiming "the state of Aragua had
been hit by a virus that had killed thousands of Venezuelans in recent hours at
Maracay (Central) Hospital, and that it was unknown whether Ebola was the virus
involved."
Maduro claimed the reports intended to cause "panic or psychological terror."
Fever cases notified to the Venezuelan
Health Ministry have almost quadrupled from last year’s August.
Only in the 32nd epidemiologic week 50,442 cases were reported, Venezuelan
Society of Infect logy issued a press release in which they pointed out “an exponential increase in the number of
cases of fever ailments in recent weeks have been unleashed without any
concrete explanation as to the cause.” (El Universal, http://www.eluniversal.com/nacional-y-politica/140918/maduro-orders-investigation-into-media-reporting-virus-in-aragua-state;
http://www.eluniversal.com/nacional-y-politica/140918/president-maduro-to-produce-evidence-of-psychological-war-in-venezuela; Bloomberg. http://www.bloomberg.com/news/2014-09-18/maduro-orders-media-probe-saying-cnn-causing-alarm.html; Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=41116&idc=3; http://www.veneconomy.com/site/index.asp?ids=44&idt=41115&idc=3; El
Universal, http://www.eluniversal.com/nacional-y-politica/140918/maracays-central-hospital-under-epidemiologic-surveillance)
Venezuelan cartoonist says fired for health satire
A Venezuelan cartoonist said she was fired from her
newspaper for a caricature that used the late socialist leader Hugo Chavez's
signature to satirize the state of healthcare. "I was informed of my sacking from El Universal over this caricature and
my awkward attitude over graphic satire," veteran cartoonist Rayma
Suprani said via Twitter. There was no confirmation from the newspaper. The
cartoon, which ran on El Universal's editorial page on Wednesday, showed a
normal-looking electrocardiogram under the heading "health" with another one merging Chavez's signature into a
flat-lining heartbeat line under a title "health in Venezuela." (Reuters, http://www.reuters.com/article/2014/09/18/us-venezuela-cartoonist-idUSKBN0HD1MF20140918;
Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=41123&idc=1)
Government seeks to revoke actress María Conchita
Alonso's nationality
Venezuela’s Internal
Affairs, Justice and Peace Ministry began procedures to revoke the Venezuelan
nationality of actress and singer María Conchita
Alonso. Minister Miguel Rodríguez Torres appointed attorney Douglas Camero to
file such a motion before the corresponding judicial bodies for alleged
treason, claiming Alonso asked American President Barak Obama’s intervention in
Venezuela. (Veneconomy,
http://www.veneconomy.com/site/index.asp?ids=44&idt=41122&idc=1; El
Universal, http://www.eluniversal.com/nacional-y-politica/140918/venezuela-to-revoke-citizenship-of-actress-maria-conchita-alonso)
Colombia's NTN24 reports Venezuela
blocks its' web page
Colombian international news channel NTN24
reports that its' web page was blocked by Venezuela starting last Tuesday, with
no prior notice. Johnattan Bilancieri, director for Digital Platforms at NTN24
says: "The level of sophistication
of this form of censorship reflects the viciousness of the Venezuelan regime
against freedom of expression and its resolve to restrict the right of
Venezuelans to be informed". Colombia's Foreign Ministry says it
"hopes the problems...in some
regions of Venezuela...is due to technical problems and not...censorship
through technological blocking". More in Spanish: (El Universal, http://www.eluniversal.com/nacional-y-politica/140919/ntn24-denuncia-que-fue-bloqueada-en-venezuela-su-pagina-web)
Venezuelan and Colombian FMs to meet in the US next
week on border closing
Colombia's Foreign Minister María Angela Holguín
announced that she will meet in New York with her Venezuelan counterpart,
Rafael Ramírez in the context of the United Nations (UN) General Assembly. They
intend to evaluate the issue of border smuggling, and also to express "diplomatically our disagreement with the
border closure". President Nicolás Maduro ordered on August 11 the
closure of the Colombia-Venezuela border on a daily basis, including a military
deployment, from 10 pm to 5 am. Colombia is the main market for Venezuelan
food, basic goods, and fuel sold at the border in Venezuela. (El
Universal, http://www.eluniversal.com/nacional-y-politica/140918/venezuelan-and-colombian-fms-to-meet-in-the-us-next-week)
Venezuelan protesters appear to discuss explosives in
video
Two Venezuelan activists recently deported by Colombia
have surfaced in a video that purportedly shows them discussing plans to
stockpile weapons and launch attacks on government targets in apparent attempt
to destabilize President Nicolas Maduro’s rule. The video, which aired on a TV
program known for battering the government’s foes, apparently contains excerpts
from a Skype video conference Lorent Saleh and Gabriel Valles had with an
unidentified third person, whose voice is distorted. It’s not clear when the
recording took place or how it was obtained. Its veracity could not be
independently confirmed, but in it the two students, apparently speaking from
inside Colombia, freely boast of all sorts of covert plans. (The Washington Post)
Venezuelan FM rejects recent US report on drugs
The Venezuelan government refuted
"conclusively" a drug report released on Monday by US President
Barack Obama, whereby Venezuela is accused of not fulfilling its international
commitments to counter-narcotics efforts. Venezuela "rejects conclusively a report on drugs issued by the US government on
Monday, August 15," the Venezuelan Foreign Office said in a press
release where Washington is accused of "meddling" in the country internal affairs. (El
Universal, http://www.eluniversal.com/nacional-y-politica/140918/venezuelan-fm-refuses-recent-us-report-on-drugs)
Milwaukee man gets 7 years for selling military parts
to Venezuela
A former Milwaukee man will spend the next seven years
in prison for conspiring to sell parts for a military fighter jet to the
Venezuelan Air Force. Ronald Dobek was sentenced last week following his
conviction in a trial by a jury which found him guilty on all three counts of
the indictment that charged him with conspiring to violate U.S. export laws and
unlawfully exporting F-16 parts to Venezuela in December 2007 and December
2008. According to the indictment, Dobek sent F-16 canopy seals to Venezuela,
in violation of federal law. (Milwaukee Journal Sentinel, http://www.jsonline.com/news/crime/ex-milwaukee-man-gets-7-years-for-selling-military-parts-to-venezuela-b99352702z1-275309231.html)
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.
