March 22, 2016

International Trade

 

Cargo that has arrived at Puerto Cabello:

• 561,44 tons of coffee for Café Venezuela
• 74,04 tons of female sanitary napkins for Corporación Venezolana de Comercio
• 23 tons of linseed for Comercializadora Tulipán 2014
• 2 tons of onion seed for Excel Servicios Logísticos
• 770 tons of detergent and cleaning products for Corporación Macex
• 25.000 tons of corn for grupo Souto
• 14.999 tons of soybean food for grupo Souto
• 38 containers of air conditioners for importadora Champi
• 4 auto parts containers for FCA Venezuela
• Similarly, products such as shoes, slippers, sandals, clothing, fabric rolls, etc. have arrived

More in Spanish: (El Nacional; http://www.el-nacional.com/economia/Llegaron-semillas-cafe-productos-limpieza_0_813518962.html)

 

90.000 tons of rice, durum wheat and soy have arrived at ports here, according to Nutrition Minister General Rodolfo Marco Torres. He said another 30,000 tons of baking wheat are about to arrive, and added that 60,000 tons of white and yellow corn are also scheduled to arrive. He said US$ 27 million have been allocated for seed imports for future crops. More in Spanish: (AVN; http://www.avn.info.ve/contenido/90000-toneladas-entre-arroz-trigo-duro-y-soya-llegaron-puertos-del-pa%C3%ADs)

 

New technology announced for ports here

Foreign Trade Minister Jesús Farías reports new equipment has been installed at La Guaira and Puerto Cabello ports to improve export-import activities here. Both these ports carry out 80% of all transactions, and he says an investment of US$ 60 million can eliminate 60% of former procedures. Farías also claims a new FOREX credit line will be available to local exporters at the protected rate, in order to acquire supplies. More in Spanish: (AVN; http://www.avn.info.ve/contenido/gobierno-venezolano-activa-equipos-tecnol%C3%B3gicos-para-agilizar-actividades-puertos-del-pa%C3%ADs; El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/activan-sistema-tecnologico-para-agilizar-tramites.aspx;Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/activan-equipos-tecnologicos-para-agilizar-activid.aspx)

 

 

Oil & Energy

 

PDVSA to import light crude from BP, China Oil

British oil major BP and China Oil have been awarded a tender launched by Venezuela's PDVSA to buy some 8 million barrels of Nigerian and U.S. light crude for delivery during the second quarter, traders told Reuters. The deal, which will significantly increase PDVSA's crude purchases, could in exchange give BP access to Venezuelan oil to process or resell, while increasing the volume that Chinese firms take from PDVSA under loan-for-oil agreements.

China Oil, a unit of state-run China National Petroleum Corporation (CNPC), must deliver 2.7 million barrels of U.S. WTI crude in April at PDVSA's terminal in Curacao at a price of NYMEX WTI plus US$ 1.58 per barrel, according to a Platts report published earlier. (Reuters, http://www.reuters.com/article/us-oil-venezuela-tender-idUSKCN0WK2PC)

 

Venezuela has shut down for a week to cope with electricity crisis

Venezuela has shut down for a week as the government struggles with a deepening electricity crisis. President Nicolas Maduro gave everyone an extra three days off work this week, extending the two-day Easter holiday, Maduro had originally said over the weekend that the extended holiday would only apply to state employees. The government has rationed electricity and water supplies across the country for months and urged citizens to avoid waste as Venezuela endures a prolonged drought that has slashed output at hydroelectric dams. The ruling socialists have blamed the shortage on the El Nino weather phenomena and “sabotage” by their political foes, while critics cite a lack of maintenance and poor planning. (Bloomberg, http://www.bloomberg.com/news/articles/2016-03-16/venezuela-to-shut-down-for-a-week-as-electricity-crisis-mounts)

 

Venezuelan crude oil price hits US$ 30.53

The Venezuelan oil price this week ended at US$ 30.53 per barrel, a US$ 0.93 surge from the previous term.
The local Ministry of Petroleum and Mining explained through its website that "crude oil prices recorded an upward trend this week due to dollar depreciation compared to other currencies, and due to more optimism over a meeting a number of large world (oil) producers will hold next month to agree on measures to stabilize the market." (El Universal, http://www.eluniversal.com/economia/160318/venezuelan-crude-oil-price-hits-usd-3053)

 

 

Commodities

 

Food distribution in public system dropped 24.72% during 2015, according to the 2015 yearly report from the Nutrition Ministry, which shows that the MERCAL, PDVAL and Bicentenario systems dropped from 1.8 million tons to 1.3 million tons. More in Spanish: (El Nacional, http://www.el-nacional.com/economia/Distribucion-alimentos-redes-publicas-cayo_0_815318673.html)

 

Labor leader charges JOHNSON & JOHNSON with sabotaging sanitary napkin production

Jaime Guevara, secretary general of the company union at JOHNSON & JOHNSON, charges that the company has stopped producing personal care products that have regulated prices in favor of others that are sold at higher prices. Guevara made his claim in a telephone call to the government news agency AVP. More in Spanish: (AVN; http://www.avn.info.ve/contenido/johnson-amp-jhonson-sabotea-producci%C3%B3n-toallas-sanitarias; El Nacional, http://www.el-nacional.com/economia/Sindicato-denuncia-irregularidades-produccion-Johnson_0_815318531.html; Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/denuncian-saboteo-de-johnson-johnson-en-produccion.aspx)

 

 

Economy & Finance

 

Supreme Tribunal has extended the Economic Emergency Decree for another 60 days starting March 11th, after authorization to renew it was voted down by the National Assembly. Pollsters Félix Seijas of DELPHOS and Luis Vicente León of DATANALISIS, along with political analyst Nicmer Evans, believe that actions by the regime and the Supreme Tribunal over the past 60-days show that the purpose of the Economic Emergency Decree was political and not economic, aimed at evading legislative control and showing strength, and that none of the formal objectives were reached during the first 60 days, More in Spanish: (El Universal, http://www.eluniversal.com/nacional-y-politica/160318/tsj-prorrogo-el-decreto-de-emergencia-economica; El Nacional, http://www.el-nacional.com/politica/TSJ-prorroga-emergencia-economica-constitucional_0_812919022.html; and (El Nacional, http://www.el-nacional.com/politica/Evadir-AN-mostrarse-objetivos-emergencia_0_814718653.html)

 

Regime aims at unifying the FOREX rate, says Jesús Faría, Minister for Foreign Trade and International Investments. Faría has stated “the distortions within the economy are so marked, particularly those arising from the brutal drop in oil prices, that we will gradually seek to unify the exchange rate”. More in Spanish: (El Universal, http://www.eluniversal.com/economia/160317/gobierno-mantiene-meta-de-unificacion-cambiaria; Ultimas Noticias: http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/faria-con-dolar-today-se-explica-70-de-la-inflacio.aspx

 

Venezuelan bolivar loses ground

Venezuelans are feeling their lower purchasing power due to the domestic inflation index. By the end of 2015, this index totaled 180.9%, according to the Central Bank of Venezuela (BCV). Nelson Merentes, President of Venezuela’s Central Bank has admitted that the existing family of bills and is insufficient and adds that the bank is pondering on printing notes of 500 (USD 50) and 1,000 (USD 100) bolivars this year. He did not specify an exact date. The projected skyrocketing prices in Venezuela over the following months puts a big question mark as to the successful implementation of a new group of notes with a top value of 1,000 bolivars. (El Universal, http://www.eluniversal.com/economia/160319/venezuelan-bolivar-loses-ground)

 

DICOM FOREX rate up to VEB 249.03/US$1, according to Central Bank data, which reports that 7.11% of all official FOREX transactions have been made at this “floating” rate, while 92.89% of all transactions are made at the “protected” DIPRO rate of VEB 10/US$1. More in Spanish: (El Nacional, http://www.el-nacional.com/economia/Dicom-cerro-lunes-bolivares-dolar_0_815318656.html; El Mundo, http://www.elmundo.com.ve/noticias/economia/mercados/tasa-simadi-sube-bs--42-11-desde-anuncio-del-dolar.aspx)

 

Government to retain control of housing in Venezuela

The Venezuelan government will retain control over housing, according to Manuel Quevedo, Minister of Housing and Habitat, who has disregarded the enforcement of the ownership law proposed by the National Assembly. He claimed that the cost of a dwelling for the middle class is quoted at US$ 20,000, a price deemed by him as out of Venezuelans' reach. (El Universal, http://www.eluniversal.com/economia/160321/gmvv-to-retain-control-of-building-in-venezuela)

 

 

Politics and International Affairs

 

Obama and Raul Castro mention Venezuela in joint press conference

During their joint press conference in Havana, US President Barack Obama and Cuban President Raúl Castro both referred to Venezuela. Castro said: “it was planned, and there was no time to finish it, to talk about our concern over the destabilization situation that is being attempted in Venezuela, which is counterproductive to the continent’s environment”. Obama, in turn, said: “We spoke about Venezuela. I think the entire region has an interest in a country that faces up to its trade challenge, that responds to the aspirations of its people, and that is a source of stability in the region. That is an interest I believe we should all share.” More in Spanish: (Venevision: http://www.noticierovenevision.net/internacionales/2016/marzo/21/152386=barack-obama-y-raul-castro-hicieron-mencion-en-sus-discursos-sobre-la-situacion-en-venezuela)

 

Maduro meets with Castro brothers on eve of Obama’s arrival in Cuba

Former Cuban President Fidel Castro received Venezuelan President Nicolas Maduro for a meeting in Havana that came on the eve of the arrival on Sunday of U.S. President Barack Obama. Castro and Maduro held a two-and-a-half-hour meeting on Saturday, the Venezuelan president told Cuban state media, adding that he found the former Cuban leader writing and editing articles, “full of optimism and tremendous force.” He also said that 89-year-old Castro – who stepped down from power in 2006 – was the “most informed man on the planet” and remains attentive to the plans for cooperation between Cuba and Venezuela, especially those related to food production. President Maduro reportedly also met with Cuban President Raúl Castro, to review joint programs, and was decorated with the “José Martí Order”. (Latin American Herald Tribune,http://www.laht.com/article.asp?ArticleId=2408164&CategoryId=10717; El Universal, http://www.eluniversal.com/nacional-y-politica/160321/venezuelas-maduro-satisfied-with-results-of-visit-to-cuba; and more in Spanish: Venevisión: http://www.noticierovenevision.net/politica/2016/marzo/18/152183=presidente-maduro-se-reunio-con-raul-castro-para-consolidar-acuerdos-entre-ambas-naciones)

 

Ramos Allup accuses the Comptroller General of obstructing legislative oversight

National Assembly President Henry Ramos Allup has rejected an order by the Comptroller General demanding that all legislative request should be sent to the CG office. Ramos Allup says: “Not only is the Comptroller General’s office remiss in its duties by pimping for regime corruption but also obstructs investigations by the National Assembly”. More in Spanish: (Venevisión: http://www.noticierovenevision.net/politica/2016/marzo/18/152198=ramos-allup-denuncia-obstruccion-de-la-contraloria-general-en-las-investigaciones-del-parlamento)

 

Editor jailed as another paper closes

The director of a major newspaper, "Correo del Caroní", was thrown in jail for four years and another paper, "El Carabobeño", had to close down because it couldn’t get newsprint. Those two incidents took place in Venezuela within days.  “These are Maduro’s contributions to the destruction of democratic media, which Chavez started by shutting down Radio Caracas Television,” said Luis Salamanca, a political consultant in Caracas, on the recent developments. “Maduro is adding a new element: manipulating the supply of newsprint. He is just letting newspapers die. Several newspapers have closed because of the very same problem,” Salamanca said. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2408191&CategoryId=10717)

 

92% of all Venezuelans believes the economic crisis has become worse recently

A poll taken in 20 states by Keller and Associates shows that 92% of all Venezuelans believe scarcity has become worse recently, and only 8% say “things are going very well”. 92% called the situation “grave”, 82% consider the general situation, including crime, corruption, cost of living, poverty, housing and the economy has become worse; and 80% say the government is inefficient in solving national problems. More in Spanish: (El Nacional, http://www.el-nacional.com/sociedad/venezolanos-crisis-economica-empeorado-recientemente_0_812918893.html)

 

Oscar Schemel says 58% of all Venezuelans believe Maduro’s exit is the solution

Oscar Schemel, of HINTERENLACES, a pollster widely regarded as pro-regime, says 58% of all Venezuelans believe Maduro’s exit is the solution to economic problems here. Schemel spoke during an interview program conducted by former Chavez Vice President José Vicente Rangel, and said “the national government is reviving confrontation amid a fantastic revolutionary epic”. State media cancelled a previously announced retransmission of the program. More in Spanish: (El Nacional, http://www.el-nacional.com/politica/Oscar-Schemel-venezolanos-Maduro-solucion_0_814718561.html)

 

Small protests proliferate in simmering Venezuela

Frustrated neighbors block a road with trash after days without water. Placard-waving nurses halt traffic to demand uniforms and medicines. Women bang pots on balconies when the lights go out. Venezuela is simmering with small-scale street protests as water and electricity services stutter, labor disputes mount, and basic food items become more scarce and expensive amid a worsening economic crisis across the nation. (Reuters, http://www.reuters.com/article/us-venezuela-politics-protests-idUSKCN0WJ1CU)

 

US$ 350 billion would make Venezuela the nation with the most stolen money on earth.

Peru’s Oscar Solórzano, an expert on recovering embezzled funds within the Basel International Institute for Asset Recovery, if it is proven that the amount “looted” by corruption here is above US$ 350 billion, Venezuela would top the list of nations with most stolen money on earth. More in Spanish: (El Nacional, http://www.el-nacional.com/politica/Freddy-Guevara-millones-convertiria-Venezuela_0_815318654.html)

 

Two more massacred miners identified in Venezuela

Prosecutor General Luisa Ortega Diaz has announced that two more bodies from among the group of 17 found in a mine in the southeastern town of Tumeremo have been identified. “Just one person remains to be identified of the ... 17 who were executed with firearms and later found in the Nuevo Callao sector (in Bolivar state),” Ortega Diaz said, adding that the two bodies have been turned over to relatives. She said that her office is working the hypothesis that criminal bands carried out the killings, and police have made progress in gaining “control of the ... illegal mining exploitation” in the zone, which is rich in gold. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2408200&CategoryId=10717)

 

Egyptian murdered during robbery attempt at Caracas’ international airport

An Egyptian man was shot and killed when he resisted a robbery attempt at Maiquetia’s Simon Bolivar International Airport, Venezuela’s largest airport, a few minutes after arriving in the country, the Prosecutor General’s Office announced. Abdelrahman Ismail Elsayeb Hassan Abdelaziz was murdered on Saturday at the airport, which serves Caracas. The 30-year-old man arrived at approximately 4:30 p.m. on Saturday “on a flight from Frankfurt (Germany) and was intercepted by two men on motorcycles who tried to steal his belongings as he made his way through the national air terminal via an outside path,” the report said. “The man resisted the robbery and was hit by a shot that killed him instantly,” (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2408195&CategoryId=10717)

 

Venezuela condemns “coup” activity in Brazil

President Nicolas Maduro says right wing forces in Brazil are reactivating a “coup d’etat” there against Brazilian President Dilma Rousseff and former President Luiz Inácio “Lula” da Silva, Maduro said: “Venezuela condemns the “coup d’etat” which is announced and executed by media and parts of the judiciary. It is very dangerous that these paths are taken to snatch away what has been gained in the streets over decades of resistance fighting”, More in Spanish: (AVN; http://www.avn.info.ve/contenido/venezuela-condena-reactivaci%C3%B3n-golpe-estado-brasil)

 

 

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.

 

March 10, 2016

Logistics & Transport

 

American Airlines to ax newly reinstated Caracas-New York route

American Airlines announced it will ax its Caracas to New York route on April 4 due to low demand just over three months after reinstating it. The surprise move comes amid a years-long battle between American Airlines Group and the Venezuelan government in which the world's largest airline says it has not been able to repatriate revenue. In January, the Fort Worth-based company wrote off US$ 592 million which it said was stuck in Venezuela due to the government's failure to exchange it for hard currency. President Nicolas Maduro's cash-squeezed socialist government has said it is negotiating solutions. "We are suspending service on the JFK-Caracas route until market conditions improve," said Martha Pantin, a spokeswoman for the airline. "This suspension is due to demand not being strong enough to support this route." Since reinstating the flight in December, many seats have remained unfilled except around holiday periods. Many airlines have reduced routes in recent years saying they were collectively owed several billion dollars in revenue for tickets sold in the local bolivar currency. The flights are priced in U.S. dollars, which put them out of reach for many Venezuelans amid the national economic crisis. The airline continues to run two daily flights to Caracas from Miami. (Reuters; http://www.reuters.com/article/us-americanairlines-venezuela-idUSKCN0WA24N)

 

 

Oil & Energy

 

Venezuela military company to start servicing PDVSA soon

Deputy Defense Minister Alexander Hernandez said CAMIMPEG, a new company formed by Venezuela's military, will begin providing state oil producer PDVSA with services including drilling, logistics and security in less than a month. It will have a commercial relationship with PDVSA and work alongside foreign companies. Hernandez's comments came after speculation among investors and foreign oil partners that CAMIMPEG could be a means to shield assets from seizure in the event of a debt default. PDVSA has a heavy repayment schedule this year, and Venezuela's economy is in crisis. (Reuters, http://www.reuters.com/article/us-venezuela-pdvsa-military-idUSKCN0WA1XW)

 

Level of major Venezuelan dam reaches collapse zone

Venezuela's National Electric Corporation (CORPOELEC) reported that the water level of major Guri dam has hit 248.02 meters above sea level, below the minimum level recorded in 2010 at that hydroelectric power station, located in Bolívar state, in southeastern Venezuela. The Guri dam has reached the so-called "collapse zone" -a level below 248 meters above sea level- three times in the past. As water levels approach 240 meters above sea level, the operational safety of the turbines is endangered.(El Universal, http://www.eluniversal.com/economia/160309/level-of-major-venezuelan-dam-reaches-collapse-zone)

 

 

Commodities

 

Local gold production dropped 47.12% during 2015

According to the 2015 annual report from the Oil and Mining Ministry, national gold production contracted 47.12% last year, from 1055.5 kilos in 2014 to 558.1 kilos in 2015. The report points to the performance of Venezuela’s General Mining Company (MINERVEN) and says “the development of plans was hit mainly by the drop in income from fine gold sales as a result of lower production due to lack of materials and critical spare parts, as well as the delay in investments.” More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/petroleo/mineria/la-produccion-de-oro-en-el-pais-se-contrajo-47-12-.aspx#ixzz42UiMywLr; Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/la-produccion-de-oro-en-el-pais-se-contrajo-47-12-.aspx)

 

Oil minister presents Venezuelan mining potential in Canada

Oil and Mining Minister Eulogio del Pino has urged Canadian investors to take part in developing mining reserves in Venezuela. He briefed members of the Prospectors and Developers Association of Canada (PDAC) on the nation’s potential in gold, coltan, copper, diamond, and bauxite. (El Universal, http://www.eluniversal.com/economia/160308/oil-minister-displays-in-canada-venezuelan-mining-potential)

 

 

Economy & Finance

 

Venezuela's new dual FOREX rate launched

Venezuela's new dual foreign exchange system, with one rate fixed at 10 bolivars to the dollar and another "floating" at a starting rate of 206 bolivars, is now coming into operation, according to the vice president for economy. Miguel Perez has reiterated that the socialist government is "religiously" honoring foreign debt payments and did not have solvency problems despite the current "economic emergency." Venezuela last month made a US$ 1.5 billion debt payment, but investors are fretting as to whether it will be able to pay state oil company PDVSA's heavier obligations later in the year. "Venezuela does not have a solvency problem," Perez said. "We have a cash-flow problem." The official said details of the new foreign exchange mechanism would be published today, meaning the system should come into being from now. The 10 bolivar rate at the newly-named DIPRO system would be used for priority food and medicine sectors, Perez said. (Reuters, http://www.reuters.com/article/us-venezuela-economy-idUSKCN0WB28P; Bloomberg, http://www.bloomberg.com/news/articles/2016-03-09/venezuela-to-implement-new-foreign-exchange-system-on-thursday; El Universal, http://www.eluniversal.com/economia/160309/floating-exchange-rate-for-travel-quotas-in-venezuela)

 

Most economists call the new exchange system more of the same failed policies

• Pedro Palma, former President of the National Economic Council, says: “These announcements are more of the same. Exchange controls remain untouched…This all will have a large inflationary impact, and I doubt they will allow really free fluctuation. The black market rate will not disappear.”
• Alejandro Grisanti, of BARCLAYS, says “I unfortunately see no change in the announcement by Pérez Abad. The step repeats previous forex rules with a different name and does not deal with the main economic problem, which is the black market rate”. He believes it illogical for PDVSA to deliver FOREX to the Central Bank at the SIMADI rate (VEB 206.92/US$1) and for the bank to reallocate them at VEB 10/US$1.
• Luis Vicente León, of DATANÁLISIS, says “There are no surprises in the exchange announcements. Neither is there any change as to what has not worked to date….it goes from an absurd 6.3 rate to another absurd rate of 10 for basic goods, which will be allocated on a discretionary basis….to allocate foreign exchange at 10 or 200 is an economic crime that simply favors manipulators, no matter their political inclination”
• Juan Pablo Olalquiaga, president of the National Industry Federation (CONINDUSTRIA) says: “there will be no great change because the issue is the volume of FOREX, and apparently there isn’t any, unless they have enough or get an international loan”. He adds that “they will not bring a change to the economy”.
• Leonardo Buniak, of Planificación Estratégica, says the underlying problem is: “How much FOREX does Central Bank have to support the fluctuating rate?”
• Arístides Maza Tirado, President of Venezuela’s Banking Association, says “this new stage of a dual exchange is a start in the right direction” which will lead to “a single rate, which is what the country needs.”

More in Spanish: (El Nacional, http://www.el-nacional.com/economia/Luis-Vicente-Leon-Entregar-bolivares_0_808119394.html; Notitarde, http://www.notitarde.com/Economia/Control-dual-no-soluciona-el-problema-del-mercado/2016/03/10/907499/; El Mundo http://www.elmundo.com.ve/noticias/economia/gremios/conindustria-considera-que-nuevo-sistema-cambiario.aspx#ixzz42UgeEmQC; El Universal, http://www.eluniversal.com/economia/160310/creen-que-nuevo-sistema-cambiario-necesita-divisas)

 

Venezuela seeks new repayment system with China

Oil and Mining Minister Eulogio Del Pino says Venezuelan and Chinese authorities are analyzing adjustments to the multibillion-dollar financing arrangement, where the nation repays China by delivering oil. More in Spanish: (Notitarde; http://www.notitarde.com/Economia/Venezuela-evalua-con-China-metodos-para-pagar-prestamos-2629988/2016/03/08/906286/; El Mundo, http://www.elmundo.com.ve/noticias/economia/politicas-publicas/del-pino--evaluamos-con-china-hacer-ajustes-en-acu.aspx)

 

Venezuelans will pay 1500% more for FOREX to travel abroad

Miguel Pérez Abad, Vice President for Productive Economics said the new exchange rate to be applied to Venezuelans trying to purchase FOREX for travel abroad will be 1500% more than it is now. It will go from VEB 13/US$1 to around VEB 200/US$1. The government will continue subsidizing foreign travel, but much less than it has been doing. Rigid procedures will remain in place and Pérez Abad did not specify how much each traveler would be allocated. More in Spanish: (Infolatam: http://www.infolatam.com/2016/03/09/venezolanos-pagaran-un-1-500-mas-por-un-dolar-para-viajar-al-exterior/)

 

Hedge fund plows half its money into Venezuela bond and wins big

When Carmelo Haddad and Francisco Ghersi invested half their hedge fund’s money into a soon-to-mature Venezuela bond in mid-January, only two outcomes were possible: the trade could go horribly wrong or it could pay off fabulously. After all, the odds that Venezuela would make the Feb. 26 payment were far from good. Racked by political turmoil, the economy was on the brink of collapse as slumping oil prices deprived the government of much-needed income. At the time, traders put the chance Venezuela would default in the next 12 months at 80% -- by far the highest probability in the world. Venezuela went on to make the US$ 1.5 billion payment, handing the founders of Knossos Asset Management a return of 12% in just 45 days -- or an excess of 150% on an annualized basis. (Bloomberg, http://www.bloomberg.com/news/articles/2016-03-08/hedge-fund-plows-half-its-money-into-venezuela-bond-and-wins-big)

 

 

Politics and International Affairs

 

Venezuela lawmakers call for recall vote, renewed protests

Venezuelan opposition parties united to call for a referendum to oust President Nicolas Maduro and renewed protests starting this Saturday to get him to leave office before his term ends in 2019. Lawmakers, led by Jesus “Chuo” Torrealba, outlined a three-pronged campaign to seek to shorten term limits through a constitutional amendment, launch the recall referendum and mount a campaign to pressure Maduro into resigning. “The current state of the country demands that we place greater emphasis on mobilization and pressure,” Torrealba said, calling a for national protest against Maduro on Saturday. "Change is coming and no one can stop it," Jesus Torrealba, the head of the Democratic Unity (MUD) coalition, told reporters. Miranda state governor Henrique Capriles Radonski, speaking on the issue, said the "recall referendum may take place in October". He added: "My proposals have always included (a constitutional) amendment and a recall referendum, since the amendment may be requested right now and be subject to consultation once approved. And the recall referendum is the measure that will lead us to the political change we all want".  (Bloomberg, http://www.bloomberg.com/news/articles/2016-03-08/venezuela-lawmakers-call-for-recall-vote-protest-against-maduro; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2407324&CategoryId=10717; Reuters, http://www.reuters.com/article/us-venezuela-politics-idUSKCN0WA1UK; El Universal, http://www.eluniversal.com/nacional-y-politica/160309/capriles-recall-referendum-may-take-place-in-october)

 

Regime withdraws its top representative in the US in protest over renewed executive order

President Nicolas Maduro has ordered the withdrawal of Venezuela’s main US representative in Washington DC, Maximilien Sánchez Arvelaiz, acting charge d’affaires at the embassy, in protest for the renewal of US President Barack Obama’s executive order calling Venezuela “an extraordinary and unusual threat”. Arveláiz spent 18 months in Washington without receiving approval from the US State Department. In making the announcement, Maduro said: “Obama had plenty of chances to rectify”, adding that one gesture would be to approve Arveláiz’s nomination. “Eighteen months, what was stopping him?”, says Maduro, adding that Obama acted “at the request of the oligarchic right”. More in Spanish: (El Universal, http://www.eluniversal.com/nacional-y-politica/160310/maduro-retiro-a-encargado-de-negocios-en-washington; Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/politica/maduro-retira-a-encargado-de-negocios-en-washingto.aspx)

 

National Assembly will investigate US$ 142 billion allocations for food supplies

At the request of National Assembly Deputy Manuela Bolívar, the legislature’s Comptroller Committee will look into what happened to US$ 142 which allegedly went to nutrition programs, despite which, “the nation is undergoing a food scarcity crisis”. Legislator Bolivar says: “50% of Venezuelans have only two meals a day, but US$ 142 billion have been delivered to the “Mission Alimentation” food program. Where is that money? We believe there has been a mixture of theft and inefficiency in managing those resources.” More in Spanish: (El Nacional, http://www.el-nacional.com/politica/Investigaran-destino-millardos-alimentos_0_808119433.html)

 

Maduro orders militarization of mineral-rich zone after miners’ disappearance

President Nicolas Maduro has created a “special military zone” to protect the Orinoco “mining arc”, a zone rich in minerals, after the disappearance of 28 miners in the region, all of them presumably murdered, according to relatives. “I have decided to create a special military zone of protection for all the mining municipalities and to deploy ... strengthened military units,” said Maduro. He also said that the alleged massacre of the miners was part of a “national and international media campaign” against his government directed by a sector of Venezuela’s opposition in the town of Tumeremo, near Essequibo, a part Guyana claimed by Venezuela, and along the route to the border with Brazil. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2407342&CategoryId=10718; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2407314&CategoryId=10717; El Universal, http://www.eluniversal.com/nacional-y-politica/160309/maduro-situation-south-venezuela-may-be-due-to-gang-confrontation)

 

Ombudsman admits evidence suggests crimes were perpetrated south Venezuela

Ombudsman Tarek William Saab said that a government joint task force investigating a situation involving a group of miners missing in Tumeremo town (southeastern Bolívar state) managed to collect convincing evidence of criminal interest, which reveals that crimes were committed. He indicated there is evidence that a number of Colombian nationals took part in the event. (El Universal, http://www.eluniversal.com/nacional-y-politica/160309/ombudsman-evidence-suggests-crimes-were-perpetrated-south-venezuela)

 

 

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.