International Trade
Cargo that has arrived at Puerto Cabello:
- 30,000 metric tons of white corn from Panama for
state agency CASA
- 4,199 tons of beef; 3,000 tons of milk; 408 tons
of black beans; 748 tons of margarine; and 3,485 tons of chicken, from
Colombia and Argentina for state agency CASA.
Amid scarcities, imported food piles up at ports
Opposition National Assembly member Neidy Rosal has
charged that amid current scarcities there are very worrisome reports of huge
stockpiling of imported food that has not been distributed and is at risk of
being damaged. She says "60% of the
134,000 tons of food imported in September have not left" the port,
and another 152,000 tons of food have arrived in October. She demanded that
experts be sent to verify the state of this merchandise in order to "avoid
what happened in 2010, when 160,000 tons of food were lost. More in Spanish: (GRUPOSOLUCIONES, jsl100@gruposolucionesgs.com)
New decline in Venezuela-Colombia trade is reported
Venezuela-Colombia trade shrank 48% in FY2015-Q3,
compared with the same term in 2014, the Chamber of Venezuelan-Colombian
Integration (CAVECOL) reported, noting that "trade between Venezuela and Colombia during the third quarter of 2015,
has accrued the amount of US$ 281 million versus US$ 544 million in the same
term of 2014." It also reported that in January-September 2015,
bilateral trade ended 40% below the same term last year, down to US$ 954
million from US$ 1.59 billion. (El Universal, http://www.eluniversal.com/economia/151019/new-decline-in-venezuela-colombia-trade-is-reported;
Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45855&idc=3)
CONSECOMERCIO: Imports have declined 50% from last
year
The President of the National Trade and Services
Council (CONSECOMERCIO), Cipriana Ramos, reports that imports are needed to
fully stock the Venezuelan market, because local production has heavily
declined. She says private traders are unable to import products because the
government is not holding auction sales of foreign currency, and adds that
"The only
products available in the market are the ones that they (the government) are
importing, because there are no auction sales, we will not be able to import
with the Ancillary Foreign Currency Administration System (Sicad I), and
foreign currency is not being sold at the Foreign Exchange Marginal System
(Simadi)." El Universal, http://www.eluniversal.com/economia/151019/consecomercio-imports-have-declined-50-from-last-year)
Oil &
Energy
PDVSA’s cash flow deficit was US$19.4 billion n the first nine months of this year, compared to the
same period in 2014, due to falling oil prices, according to BancTrust. The
firm points out the Venezuelan State oil company’s deficit at the end of 2015
will be US$ 22.8 billion if oil prices do not recover. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45854&idc=4)
Venezuela oil price falls after bounce
Venezuela's weekly oil basket price fell after a one
week bounce as oil prices around the world moderated as markets appeared to be
well supplied. 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 October 16 was US$ 41.49, down 68 cents
from the previous week's US$ 42.17. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2398365&CategoryId=10717)
Venezuela buys 25% percent stake in Antigua oil company
Venezuela has signed an agreement with the government
of Antigua and Barbuda to buy a 25% stake in the West Indies Oil Company
(WIOC), says Venezuela's state petroleum company (PDVSA), without providing financial
details for the purchase of the stake in the refinery and distribution company
owned by the government of the Caribbean island nation. Venezuela has been
seeking greater storage space in the region. (Reuters, http://www.reuters.com/article/2015/10/17/us-venezuela-antigua-idUSKCN0SB0XD20151017)
Venezuela's Cardon catcracker to restart next week says
PDVSA
The catalytic cracker at Venezuela's 310,000
barrel-per-day (bpd) Cardon refinery will be operating within a few days after
being damaged in a power outage earlier this month, state oil company PDVSA
said. A PDVSA statement said both Cardon and the adjacent 645,000 bpd Amuay
refinery were working after the blackout. (Reuters, http://www.reuters.com/article/2015/10/17/us-venezuela-refinery-pdvsa-idUSKCN0SB10F20151017)
Commodities
Tuna production paralyzed, must be imported from
Ecuador and Colombia
Members of the Fish Canning
Industry Chamber (CAVENPESCA) are in a state of emergency since production has
halted entirely due to lack of supplies, and say they since the end of 2014
they have not received import permits that could allow them access to FOREX.
The industry requires 90,000 tons of whole tuna per year and domestic
production was around 37,464 tons in 2014. The rest must be imported from Ecuador, Colombia and Costa Rica. More in Spanish: (El
Nacional; http://www.el-nacional.com/)
Economy
& Finance
Foreign reserves fall to 12-year low as payments loom
Venezuela’s international reserves fell to a
12-year low of US$ 15.3 billion as the country faces payments on its dollar
debt totaling US$ 4.5 billion in October and November. Reserves fell US$ 614
million on Oct. 16, the Central Bank said
on its website. That’s the lowest level since May 2003
and the biggest daily decline since June 3. The country and its
state-owned oil company, Petroleos de Venezuela SA, have principal and interest
payments of US$ 1.5 billion due this month and another US$ 3 billion in
November.. The government will likely be able to pay its debt due this year,
although there’s a 60% chance of default next year, Eurasia Group said in
an en e-mailed note to clients. (Bloomberg, http://www.bloomberg.com/news/articles/2015-10-19/venezuela-foreign-reserves-fall-to-12-year-low-as-payments-loom)
BOFA expert says Venezuela has the means to honor
foreign debt
Francisco Rodríguez, of Bank Of America-Merrill Lynch,
says "Venezuela must not default on
its foreign debt because it has the capacity to continue honoring its
commitments". He says the cost of a default would be very high to the
Venezuelan economy, adding that in the first place "Venezuelan foreign debt in the hands of non-government entities amounts
to US$ 117 billion, which is 24% of GDP...if some very conservative adjustments
are made on the exchange rate and other calculations, it could be 42% of GDP,
which is not major when compared to other countries". BOFA sees potential for a political
transition in Venezuela towards a friendlier regime with the market in a
recent report in which analysts follow Latin American economies. However, they
are cautious about the political risks associated with this scenario, and the
fear of a messy transition that could have an effect on bond prices. (Veneconomy,
http://www.veneconomy.com/site/index.asp?ids=44&idt=45853&idc=2;
and more in Spanish: El Universal, http://www.eluniversal.com/economia/151016/venezuela-tiene-capacidad-para-honrar-compromisos
Another salary increase today, more hunger tomorrow in
Venezuela
President Nicolás Maduro has announced an increase of
30% in Venezuela’s national minimum salary and an adjustment in the food
vouchers paid to workers on a monthly basis of 1.5%. Thus, the minimum salary
goes from Bs.7,421.66 (US$ 1,178.04 at the country’s official fictional rate of
Bs.6.30 per dollar) to Bs.9,648.18 (US$ 1,531.45); while food vouchers will go
from Bs.2,475 (US$ 393) to Bs.6,759 (US$ 1,072.85), for a total minimum monthly
income of Bs.16,399 (US$ 2,603). These increases will take effect from November
1. However, these improvements can’t beat inflation, which has risen 175% so
far this year. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2398325&CategoryId=10717;
Bloomberg, http://www.bloomberg.com/news/articles/2015-10-16/venezuela-raises-minimum-wage-30-it-s-still-only-13-a-month)
Politics and
International Affairs
Venezuela again rejects
OAS election observers
Venezuela has once again rejected an offer by
the Organization of American States to send a group of election observers to
upcoming December 6th legislative elections, saying it doesn't trust the organization.
The regime's representative for human rights, Germán Saltrón, says "Venezuela doesn't trust the OAS, the OAS has
supported dictatorships, approved coups d'etat and election fraud, and has not
practice democracy throughout its history". The government has
accepted observers from the Union of South American Nations (UNASUR) and the
Community of Latin American and Caribbean States (CELAC). It has not accepted
OAS observers since 2006. Saltrón also said the Inter American Human Rights
Court is not to be trusted because "it
is financed by the United States"; and added that the European Union
can participate. More in Spanish: (INFOLATAM, http://www.infolatam.com/2015/10/19/venezuela-rechaza-la-observacion-electoral-de-la-oea-por-falta-de-confianza/)
Maduro calls for
prosecution of business leader Mendoza
Venezuela's president has urged legal action
against billionaire businessman Lorenzo Mendoza over a phone call which airs
the possibility of an international bailout for the nation's ailing economy. The
50-year-old Mendoza runs Venezuela's largest private company, Empresas Polar,
and has often been cast as a symbol of unscrupulous capitalism by socialist
President Nicolas Maduro and his predecessor Hugo Chavez. This week, National
Assembly Speaker Captain Diosdado Cabello broadcast on state media an illegally
tapped state phone call between Mendoza and U.S.-based Venezuelan economist
Ricardo Hausmann in which the latter says a $50 billion to $60 billion
International Monetary Fund package and "adjustment" plan is needed. Maduro said "what he did was a crime for speaking on
behalf of the fatherland...I expect he will be charged and must be
charged"..adding that he expects the judiciary to "react". Mendoza has rejected the
broadcasting of a private conversation as an "attempt to manipulate public
opinion with the clear intention of using me in Venezuelan politics."
(Reuters, http://www.reuters.com/article/2015/10/19/us-venezuela-mendoza-idUSKCN0SD09720151019;
Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=45861&idc=2);
and more in Spanish: Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/politica/lorenzo-mendoza-tiene-que-ser-procesado-por-la-jus.aspx#ixzz3p0Ov5doD; El Nacional; http://www.el-nacional.com/; El Mundo, http://www.elmundo.com.ve/noticias/economia/empresas/mendoza--manipulan-a-la-opinion-publica-para-utili.aspx#ixzz3p0Uu3qBF; http://www.elmundo.com.ve/noticias/economia/empresas/10-frases-de-lorenzo-mendoza-en-respuesta-al-audio.aspx; http://www.elmundo.com.ve/noticias/economia/politicas-publicas/gobierno-asegura-que-ha-liquidado--5-200-millones-.aspx)
Opposition politician
Manuel Rosales arrested
Venezuelan opposition politician Manuel Rosales
has been arrested on his return to the country after six years of self-imposed
exile. Rosales, who said he wanted to take part in December's parliamentary
elections, was detained shortly after landing in the city of Maracaibo. He ran
against the late President Hugo Chavez in 2006, and fled to Peru in 2009 amid
corruption allegations, which he says are politically motivated. He is expected
to appear in court in Caracas shortly. Eveling Trejo de Rosales, wife of Manuel
Rosales and mayor of Maracaibo, went to the airport to try to meet him. Last
month, prominent opposition leader Leopoldo Lopez was found guilty of inciting
violence during protests in 2014 in which 43 people - from both sides of the
political divide - were killed. He was sentenced to 13 years and nine months in
prison. (BBC News, http://www.bbc.com/news/world-latin-america-34546419)
STRATFOR: Venezuela's
leaders prepare for a risky election
A political turnover could be in store for
Venezuela, and the country's leaders are doing their best to prepare for it.
The Dec. 6 parliamentary elections are less than two months away, and the
ruling United Socialist Party of Venezuela (PSUV) stands a good chance of
losing its legislative majority. Faced with the prospect of diminished
political power, the party's key figures are taking steps to secure their own
futures, including banding together and preemptively limiting the opposition's
room to maneuver. Even if the opposition manages to gain control of Venezuela's
legislature in December, its effect on the country's broader economic crisis
will be minimal. But Venezuela's political landscape could look very different
in the coming year. If the party suffers a significant defeat, members could
perceive it as a harbinger of further electoral losses in 2019 that could
imperil their political futures and could splinter into separate factions
composed of individuals determined to save their own positions. Regardless of
the December vote's outcome, Venezuela's wider economic crisis will continue
unabated. With reduced oil export revenues and no major fiscal adjustments on
the horizon, the country's public finances will remain strained for the
foreseeable future. The crisis will also raise the risk of demonstrations or
social unrest as citizens become increasingly dissatisfied. Thus, Venezuela
will likely continue to be a risky investment destination and a difficult
operating environment for foreign firms until real economic reforms become more
politically palatable to the Venezuelan government. (STRATFOR, https://www.stratfor.com/user/login?destination=analysis/venezuelas-leaders-prepare-risky-election&login=1)
World leaders ask UN
to set conditions on Venezuela human rights
World leaders of the Madrid Club asked the
United Nations (UN) General Assembly to condition the renewal of Venezuela's
membership in the UN Human Rights Council to the release of political
prisoners, and also linked the renewal to the acceptance by Venezuelan
government authorities of an impartial mission of electoral observation for the
next parliament vote slated for December 6. (El Universal, http://www.eluniversal.com/nacional-y-politica/151019/world-leaders-ask-un-to-set-conditions-on-venezuela)
Venezuela's Supreme Tribunal admits that 66% of judges
lack tenure
Venezuela's Supreme Tribunal
has admitted in a statement to the Inter American Human Rights Committee that
six out of every ten judges in Venezuela are temporary and can be removed at
any time without any procedure. Constitutional Chamber Judge Carmen Zuleta de
Merchán told the Committee that "there are 2,231 judges nationwide, of
which 34% have tenure through competitions held in 2002, 2005 and 2006". More in Spanish: (El
Universal, http://www.eluniversal.com/nacional-y-politica/151020/tsj-admitio-en-la-cidh-que-solo-34-de-los-jueces-del-pais-son-titulare)
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.
