International Trade
Cargo that has arrived at Puerto Cabello:
- 514 containers bearing milk,
butter, beef and chicken from Brazil, for state agency CASA
- 170 containers bearing supplies
for agriculture and the oil industry, consigned to state agency BARIVEN
- Over 400 steel structures from
China for building bridges here.
Forty-six products exempted
from import tariffs
For at least one year, 46 products of mass
consumption will be exempted from import tariffs in Venezuela under a joint
resolution of the Ministry of Trade, Economy and Finances and the Ministry of
Agriculture and Lands. Import tariff privileges have been granted through July
31, 2016. The ministries involved, along with the National Center for Foreign
Trade (CENCOEX) and the National Center of Food Balance (CENBAL), may update
the list of goods as provided in the resolution and if necessary. (El
Universal, http://www.eluniversal.com/economia/150905/forty-six-products-to-have-tariff-benefits)
Imports from Colombia down 40.5% in July
According to
Colombia's National Statistics Department (DANE), Colombian exports to
Venezuela dropped 40.5% in July as compared to last year: Down to US$ 3.001
million from US$ 5.048 million More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/internacional/exportaciones-de-colombia-cayeron-40-5--en-julio.aspx#ixzz3l33BynHD)
Venezuela seizes US$1.5 million in oil
equipment set to be smuggled to Colombia
Government sources say Venezuelan police seized
two trucks loaded with US$ 1.5 million in oil equipment that was to be smuggled
into neighboring Colombia. Tubes for oil extraction and production belonging to
state-run oil company PDVSA were uncovered in the western state of Zulia, the
country's traditional crude-producing area that sits at the contraband-rife
border with Colombia. Police started investigating following a report there was
a plan to steal equipment from PDVSA's Topomoro production area, the Zulia
state government said in a statement at the weekend. (Reuters, http://www.reuters.com/article/2015/09/07/us-venezuela-oil-idUSKCN0R71PN20150907)
Oil &
Energy
Russia, Venezuela did not reach agreement on
supporting global oil prices
Russia and Venezuela did not reach agreement on
measures to support global oil prices, Russian Energy Minister Alexander Novak
told reporters on Friday. Russia and Venezuela need to combine efforts to lift
oil prices, President Vladimir Putin told his Venezuelan counterpart Nicolas
Maduro on Thursday, but refused to spell out any specific action, including
output cuts. "No, consultations will
go on," Novak said when asked how talks went and if any decision was
taken. (Reuters, http://www.reuters.com/article/2015/09/04/us-russia-forum-oil-idUSKCN0R402U20150904;
Bloomberg, http://www.bloomberg.com/news/videos/2015-09-04/russia-and-venezuela-address-oil-price-slump;
Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395779&CategoryId=10717)
In Qatar, Maduro pushes for OPEC heads of state
summit
President Nicolas Maduro has suggested to the
Emir of Qatar a summit for heads of state of OPEC countries to defend oil
prices, an idea he said the leader of the Arab Gulf state "liked". "I made the proposal, he liked the idea, he said he was in agreement
with the idea, and as president of our organization for summits he will make
the necessary consultations," Maduro said. Maduro met with the emir,
Sheikh Tamim bin Hamad al-Thani during his visit to OPEC nation Qatar, and says
he also suggested non-OPEC countries, which include Russia, take part. (Reuters,
http://www.reuters.com/article/2015/09/05/us-venezuela-opec-qatar-idUSKCN0R50OA20150905)
Oil price slump will worsen next year once the US sanctions against Iran
are completely lifted and its crude oil feeds the international market,
according to internationalist Kenneth Ramírez. The drop could be as high as US$
15/bbl., according to estimates by the US Department of Mining. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45357&idc=4)
After setting new low
for 2015, Venezuela oil price bounces
After falling to a new low for the year the
previous week, Venezuela's weekly oil basket price bounced hard as oil prices
around the world rebounded from their lows. According to figures released by
the Ministry of Energy and Petroleum, the average price of Venezuelan crude
sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending September 4
was US$ 42.66, up US$ 6.50 from the previous week's US$ 36.48. (Latin American
Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395868&CategoryId=10717)
Venezuela loses US
refinery as ConocoPhillips ICC award enforced in US Court
A U.S. Federal Court has upheld U.S.
enforcement of an International Chamber of Commerce (ICC) arbitration agreeing
that U.S. oil giant ConocoPhillips has the right to take Venezuela state oil
company PDVSA's 50% stake in a delayed coking unit at the Sweeny refinery in
Old Ocean, Texas. Venezuela now has 30 days to appeal. The 70,000 barrel-per-day
coking unit was originally owned by Merey Sweeny LP, a joint venture between
PDVSA and Phillips. When Venezuela failed to supply its contractually agreed
amount of crude, ConocoPhillips announced it was exercising its right to buy
out its deficient partner. "Because
Venezuela had breached the contract by not supplying crude and also not
contributing further investment to the venture, ConocoPhillips was able to take
PDVSA's share of the refinery for literally zero - free -- as a result of the
way the contract was written," says Russ Dallen, an international
lawyer who follows Venezuela's cases as head of investment bank Caracas Capital
Markets. "Venezuela's 50% stake in
Sweeney was valued between US$ 352 million and US$ 540 million." ConocoPhillips
is in several multibillion dollar suits against Venezuela and PDVSA, after
President Hugo Chavez expropriated its investments and companies in Venezuela. ICSID
found Venezuela liable for the expropriations without compensation in 2013 and
is now arbitrating damages that are expected to be around US$ 5 billion. ConocoPhillips
has also filed a contractual claim for losses from the expropriations before
the ICC. That case is also ongoing.(Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395952&CategoryId=10717)
PDVSA has US$ 3 billion to pay off its bonds
and pay the 2015 PETROBONO, maturing in October, according to Barclays Capital. According to the
firm, PDVSA’s strategy of repurchasing and withdrawing bonds maturing in the
short-term from the international market has had a positive effect.
(Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45370&idc=2)
PETROCARIBE has approved a 10-year development
plan suggested by
Venezuela, during its 10-year anniversary summit held in Jamaica this weekend. (Veneconomy,
http://www.veneconomy.com/site/index.asp?ids=44&idt=45372&idc=4;
El Universal, http://www.eluniversal.com/economia/150907/petrocaribe-approves-10-year-development-plan)
Commodities
Government debt to the automotive sector is US$
3 billion, including
debts from 2012, 2013 and 2014, according to the Nueva Esparta State’s
Automobile Distributors’ Association’s (ADANE) head Gabriel Briceño. He pointed
out the government has promised to pay off this debt but has repeatedly failed
to do so. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45368&idc=3)
POLAR stopped its margarine plant in Carabobo due to lack of palm oil. The
company’s management was forced to send workers home until a shipment from
Ecuador arrives to continue operations. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45356&idc=3)
Economy
& Finance
August inflation pegged at 8.9%
According to a source
close to Venezuela's Central Bank, August inflation was 8.9%, year to date
inflation is 106.5% and projected annual inflation is up to 150.4%. Food and
non alcoholic beverages are reported to be registering the largest increases.
More in Spanish: (El
Nacional, http://www.el-nacional.com/economia/Inflacion-agosto-situo_0_697730442.html)
FORBES: Venezuela
doesn't quite have hyperinflation yet but it's getting there
We have no strict official definition of
hyperinflation but the usual rule of thumb is that an inflation rate of over
50% a month qualifies for the hyper- not just the inflation. And with estimates
of Venezuela’s annual inflation rate running in the 700 to 800% sort of range
the country’s not that far off the joy of joining Zimbabwe, post-WWII Hungary
and Weimar Germany in the hall of shame. Hyperinflation isn’t so much when
there’s too much money chasing the goods: it’s when the system flips over to
the velocity of money circulation increasing that’s the identifying point. What
we need there is that V change and change considerably. People see the
inflation: people are not, contrary to rumor, in aggregate dumb. So, they see
that money is going to be worth less in a month, or a week. So, they spend it
now. On anything. Absolutely anything at all. So, if hyperinflation does appear
then that’s the end for that particular currency, one way or the other. And
Venezuela does appear to be on the verge of it: we’re just going to have to
wait and see whether we get that change in V as people desperately buy anything
at all with the paper currency they have at hand. (FORBES, http://www.forbes.com/sites/timworstall/2015/09/06/)
Central Bank has
placed US$ 3.4 billion in 2015
As a part of its policy aimed at lessening
monetary liquidity, the Central Bank of Venezuela (BCV) has placed
approximately US$ 3.4 billion in "Directo BCV" investment notes to
date in 2015.
Based on its numbers, monetary liquidity or means of payment of the economy has expanded about 44.5%. As a result, at August 21, the balance stood at US$ 45.9 trillion, a hike of US$ 140 billion.
Expansion took place as international reserves, the main source of liquidity, plunged. (El Universal, http://www.eluniversal.com/economia/150905/venezuelan-central-bank-has-placed-usd-34-billion-in-2015)
Based on its numbers, monetary liquidity or means of payment of the economy has expanded about 44.5%. As a result, at August 21, the balance stood at US$ 45.9 trillion, a hike of US$ 140 billion.
Expansion took place as international reserves, the main source of liquidity, plunged. (El Universal, http://www.eluniversal.com/economia/150905/venezuelan-central-bank-has-placed-usd-34-billion-in-2015)
Politics and
International Affairs
Venezuela’s economy is
in tatters — and its border crisis could destabilize the region
Less than four months before crucial elections
that may make or break its legislative advantage, the government of President
Nicolas Maduro has embarked on an effort to clamp down the country’s western
border with Colombia. The ultimate consequences of the “state of emergency” imposed on western border areas remain unclear,
but the country's current situation threatens the rattle the overall stability
of the region, particularly that of Colombia. Maduro’s approval rating has
slipped below 25%, and his efforts to crackdown on smuggling and direct popular
frustration are likely meant to shift blame away from his government. Observers
and members of Venezuela’s opposition have suggested Maduro is only stoking
tensions to influence elections in December. There is also substantial evidence
that Venezuelan military forces have worked with criminal gangs and other
delinquent groups in drug trafficking and smuggling operations. Recent events
indicate that international assistance is not forthcoming. Colombia has
requested that the Organization of American States call a high-level summit on
the issue — a request the OAS did not approve. And Colombian officials
independent of the Santos administration have also called for Maduro to stand
before the International Criminal Court. (Business Insider, http://www.businessinsider.com/venezuelas-border-crisis-2015-9)
Colombia's Santos
accepts Uruguay as mediator for talks with Maduro, sets preconditions
Colombian President Juan Manuel Santos says he
has accepted an offer from the President of Uruguay to be the mediator in the
border conflict with Venezuela and facilitate a dialogue with President Nicolas
Maduro. He says he suggested the meeting could take place in Montevideo if
necessary. He added that "from the
first day" when Venezuela ordered the border closed in Táchira state
he tried "to talk to Maduro, but it
was not possible". Santos had previously set three conditions to meet
with Maduro: a) opening a humanitarian corridor so that over 2000 children
across the border can attend school in Colombia. This appears to have been
done. b) returning the belongings of over 11,000 Colombians that have been
deported or left Venezuela voluntarily; and c) the Venezuelan government must
"abide by minimum conventions and
not mistreat Colombians who are being deported." Maduro had previously
challenged Santos to not be afraid and talk "face to face"..."wherever,
whenever and however he likes". "Do
not run away any more. Face me", he said, and added that Santos "does not want to talk" due to
internal pressure. "This is my last
call", he said. He says he wants to talk "without conditions", and has added "I am the one calling the shots here". (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45371&idc=1;
Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2395854&CategoryId=10717;
El Universal, http://www.eluniversal.com/nacional-y-politica/150907/venezuela-re-opens-border-crossing-for-colombian-workers;
and more in Spanish: Infolatam, http://www.infolatam.com/2015/09/08/santos-acepta-mediacion-de-uruguay-para-dialogar-con-maduro/; http://www.infolatam.com/2015/09/03/santos-pone-tres-condiciones-para-reunirse-con-maduro/;
http://www.infolatam.com/2015/09/07/maduro-llama-a-santos-a-no-tener-miedo-y-hablar-donde-cuando-y-como-quiera/; AVN; http://www.avn.info.ve/contenido/venezuela-reitera-su-llamado-al-di%C3%A1logo-colombia-para-solventar-situaci%C3%B3n-fronteriza)
Maduro orders the border shut in Zulia state as
well
President Nicolás
Maduro has ordered Venezuela's border with Colombia to shut down at its other
major pass, in the state of Zulia. At the same time he ordered 3,000 military
into the area, to reinforce the decree at the last remaining open border post. More in
Spanish: (Agencia Venezolana de Noticias; http://www.avn.info.ve/contenido/ejecutivo-ordena-cierre-paso-fronterizo-paraguach%C3%B3n-estado-zulia;
http://www.avn.info.ve/contenido/maduro-decreta-estado-excepci%C3%B3n-municipios-guajira-mara-y-almirante-padilla-zulia;
El Universal, http://www.eluniversal.com/nacional-y-politica/150908/maduro-ordena-cierre-de-frontera-por-paraguachon;
El Nacional, http://www.el-nacional.com/politica/Maduro-Guajira-Mara-Almirante-Padilla_0_697730487.html;
http://www.el-nacional.com/politica/Maduro-migratorio-frontera-Colombia-Zulia_0_697730486.html)
OAS calls for joint
efforts to settle border crisis
OAS Secretary General Luis Almagro visited the
Colombian border city of Cúcuta, and urged the governments of Colombia and
Venezuela to bring peace to the citizens through dialogue. Almagro asked
Venezuela to urgently allow reunification of families split as a result of the
border shutdown; and also to give Colombians who remain in Venezuela peace of
mind through a message that "calms
the anxiety they feel." (El Universal, http://www.eluniversal.com/nacional-y-politica/150907/oas-calls-for-joint-efforts-to-settle-border-crisis)
Pope sees "hope" for Colombia-Venezuela border spat as bishops meet
Pope Francis says a meeting between Colombian
and Venezuelan bishops was a clear sign of hope in a border dispute that has
seen some 16,000 Colombians leave their adopted home. "The
bishops of Venezuela and Colombia have met in recent days to analyze together
the painful situation that has sprung up on the border between the two
countries," the Argentine pontiff said. (Reuters, http://www.reuters.com/article/2015/09/06/venezuela-colombia-pope-idUSL5N11C0DN20150906;
El Universal, http://www.eluniversal.com/nacional-y-politica/150907/pope-francis-calls-for-solidarity-in-venezuela-colombia-crisis)
Maduro names new ministers on Twitter from
Qatar
President Nicolas Maduro took to Twitter to
appoint new ministers after extending an international tour for “solid” oil prices to Qatar. Maduro, who
arrived in Doha by surprise after traveling to Vietnam and China earlier this
week, named Jesus Salazar as minister of the presidency, Clara Vidal as
indigenous peoples minister, and Rodulfo Perez as education minister, among
other appointments. Maduro said the appointments will allow the replaced
ministers to focus on National Assembly elections set for December. (Bloomberg,
http://www.bloomberg.com/news/articles/2015-09-04/venezuela-s-maduro-names-new-ministers-on-twitter-from-qatar-ie5tcfms)
Inter American Human Rights Court says Venezuela
must restore RCTV frequency
The Inter American
Human Rights Court has ordered the Venezuelan government to restore the
frequency for Radio Caracas Television (RCTV), Channel 2, on the basis that the
regime sought to "silence critical
voices" when ordered the station shut down in May 2007. The Court
found that the government here violated the rights to seek and receive
information, of the company, its workers, and all Venezuelans. More in Spanish:
(El Universal, http://www.eluniversal.com/nacional-y-politica/150908/corte-idh-ordeno-al-gobierno-devolver-la-senal-a-rctv; El Nacional, http://www.el-nacional.com/politica/Corte-Interamericana-restablecer-concesion-RCTV_0_697730435.html)
Leopoldo Lopez's
defense attorneys charge "serious
mistakes" in trial against him
Defense attorneys for opposition leader
Leopoldo López have charged "serious
mistakes" and "lack of
ethics" throughout the trial of their client, who has been jailed for
over a year and a half for alleged links to violence and damages during an anti
government protest in February 2014. The next hearing is scheduled for Thursday
this week. More in Spanish: (Infolatam, http://www.infolatam.com/2015/09/07/defensa-de-leopoldo-lopez-denuncia-graves-vicios-en-juicio-en-su-contra/)
Maduro says Venezuela will receive 20.000
Syrian refugees, as a "peace gesture". More in Spanish: (Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/politica/20-000-sirios-seran-recibidos-en-venezuela.aspx#ixzz3l8jDx514)
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.
