Posts Tagged ‘Hugo Chávez’

How are Venezuelans coping with tumbling oil prices?

| December 19th, 2014 | No Comments »
BBC

Falling global oil prices have been a headache for many oil-producing countries, with exports now failing to bring in cash they used to just six months ago.

On Thursday, the price of Brent crude was just below $63 a barrel, while US crude was near $58.

The price of Venezuelan oil, which is very heavy by international standards, was even lower – at $57.53 a barrel for the week ending 13 December.

The dramatic downward slide started in June.

Six months of falling prices have hit Venezuela particularly hard – the country is heavily dependent on oil money, with 96% of export revenues coming from oil, according to reports.

BBC News has been speaking to a selection of Venezuelans on the streets of Caracas to find out how they have been personally affected by the fall in oil prices.

Oil down, goods up

Alex Hernandez, a businessman in Caracas, says the problem is exacerbated ... Read More

Obama Signs Bill to Sanction Venezuelan Officials

| December 18th, 2014 | No Comments »
ABC News

President Barack Obama has signed legislation into law allowing him to sanction Venezuelan government officials who were involved in a crackdown on anti-government protesters.

The bill authorizes sanctions that would freeze the assets and ban visas for anyone accused of carrying out acts of violence or violating the human rights of those opposing the South American nation’s socialist government.

Last summer, the State Department imposed a travel ban on Venezuelan officials who were accused of abuses during street protests that left dozens of people dead.

Click here for original ... Read More

Obama and Cuba: The Triumph of Ideology over U.S. National Interests

| December 18th, 2014 | No Comments »
National Review

By Elliot Abrams

The American Left has loathed the embargo and overlooked all of Castro’s repressive actions since the 1960s. They have blamed the U.S.–Cuba deadlock entirely on the United States and have sought the end of the embargo whenever a Democrat was in the White House. Under Johnson, Carter, and Clinton they did not get their way; that had to await Obama.

When the Soviet Union fell, the Castro regime was in dire straits. It survived through sheer repression — until it was sustained by Venezuelan oil money sent by Hugo Chávez. Today Chávez is dead, oil is under $60 a barrel, and Venezuela is reeling. Who will bail Castro out this time? Now we have the answer: Barack Obama.

Put aside the prisoner exchange, which one can be for or against and still decry the rest of Obama’s moves today. It’s clear that Obama told the Cubans ... Read More

Venezuela’s Maduro says ‘no rush’ to hike world’s cheapest gasoline

| December 15th, 2014 | No Comments »
Article originally appeared in Reuters

(Reuters) – Venezuela’s Nicolas Maduro said there was “no rush” to hike the world’s cheapest gasoline prices, suggesting the increasingly unpopular president has shied away from implementing the risky domestic reform in the near future amid an economic crisis.

“I’ve considered, as head of state, that the moment has not arrived,” he said in a pre-recorded interview broadcast on the Televen channel on Sunday.

“The moment will come, maybe in 2015, there’s no rush, we’re not going to throw more gasoline on the fire that already exists with speculation and induced inflation.”

Venezuela’s economy is flailing under the weight of an over 60 percent annual inflation, an apparent recession, strict currency controls, and slipping oil prices.

Maduro has appeared reluctant to make necessary but unpopular economic adjustments, such as hiking gasoline prices for the first time in two ... Read More

Obama Favors Sanctions for Abuse of Venezuela Protesters

| December 12th, 2014 | No Comments »
The New York Times

By WILLIAM NEUMAN

CARACAS, Venezuela — President Obama plans to sign into law a bill that would impose sanctions on Venezuelan government officials responsible for human rights violations or violence against protesters who took part in antigovernment demonstrations here this year, a White House spokesman said in Washington on Thursday.

Venezuela is a major oil supplier to the United States, but the two countries have had rocky relations during the governments of two leftist presidents, Nicolás Maduro and his predecessor and mentor, Hugo Chávez, who died last year.

Mr. Maduro has condemned the proposed sanctions and hinted at possible reprisals.

“The gringos now say that they are going to impose sanctions on Venezuela,” he said on Wednesday. “No one imposes sanctions on Venezuela, because our people decided to be free.”

The bill, which passed the Senate and the House ... Read More

Venezuela needs credit to cope with oil price drop -Maduro

| December 9th, 2014 | No Comments »
Article originally appeared in Reuters

BY EYANIR CHINEA AND ANDREW CAWTHORNE

President Nicolas Maduro again fumed against Venezuela’s poor credit rating on Monday, saying the OPEC nation needed external financing to help it cope with oil price declines.

The socialist government has seen bond prices plunge, loan costs rise and market speculation of default emerge this year amid an economic slowdown exacerbated by a declining price of oil, which accounts for 96 percent of export revenues.

In near-daily speeches, Maduro, the successor to the late Hugo Chavez, insists that despite the oil slump, Venezuela has sufficient funds to cover all its external debt commitments and remains a well-resourced nation with the world’s biggest crude reserves.

“The risk rating companies have put the country’s risk at practically the highest in the world, more than countries in war or suffering the ravages of Ebola,” he complained, repeating allegations of a hostile international campaign.

“There is a financial ... Read More

Ni el gobierno ni la izquierda se atreven contra ‘Cubazuela’

| December 8th, 2014 | No Comments »
Milenio Diario

POR JORGE G. CASTAÑEDA

En estos últimos días visitó nuestro país una joven y valiente mujer venezolana; sus amigos la acogieron con cariño pero partió con las manos vacías. Lilian Tintori, la esposa de Leopoldo López, el opositor venezolano encarcelado sin proceso por el gobierno chavista de Maduro; acudió a una serie de eventos de comunicación programados en México, pero también viajó a nuestro país buscando solidaridad para su marido. No la encontró.

Hasta donde sé, nadie del gobierno —Presidencia, Relaciones Exteriores, Gobernación— se atrevió a recibirla. Asimismo, con la excepción de un par de legisladores priistas, ningún jerarca del partido de gobierno —Manlio, Gamboa, César Camacho— accedió a verla, a pesar de varios intentos. No sé si algunos legisladores de Acción Nacional se reunieron con ella —cuando vino a México Leopoldo López, hace un par de años, pude juntarlo con algunos—, y obviamente nadie de la izquierda tuvo la ... Read More

Is Venezuela headed for a default?

| December 8th, 2014 | No Comments »
CNBC-01

BY LESLIE SHAFFER

Falling oil prices have side-swiped Venezuela’s government finances, spurring concerns of a sovereign default, but it isn’t clear whether contagion effects will emerge.

“Both the government’s willingness and ability to service its foreign currency debt is in serious question,” Capital Economics said in a note last week, citing declining oil prices.

“Given that the government has nothing in the way of savings from the oil price boom of the past decade, the loss of oil revenues will wipe out whatever foreign currency that the government has,” it said. “With the bolivar collapsing in the black market, capital flight is only likely to increase putting even more pressure on the supply of hard currency.”

It expects a default is “more likely than not” within two years, although there may not be a “flashpoint” until September or October of next year, when $5 billion of debt payments come due.

Unprepared

Among ... Read More

Falling Oil Prices Turn Up The Heat On Venezuela’s Maduro

| December 5th, 2014 | No Comments »
From Time

BY GIRISH GUPTA

Oil and gas accounts for a quarter of Venezuela’s economy, which was already struggling when global oil prices turned south, compounding Nicolás Maduro’s political woes

On Nov. 27, as the OPEC oil cartel gathered in Vienna to discuss falling oil prices, the front page of Venezuela’s anti-government Tal Cual newspaper ran a cartoon showing President Nicolás Maduro and his former oil and economic tzar Rafael Ramírez praying before a barrel of oil. With the oil and gas sector accounting for a quarter of the Venezuelan economy and oil sales the source for around 95% of export earnings, the country has been hammered by the recent drop in prices. OPEC’s decision last week to hold off on production cuts to arrest the decline promises to sharpen the pain for oil-dependent nations like Venezuela. It is also a political challenge for Maduro who has grown increasingly unpopular since being elected after ... Read More

Venezuela: On borrowed time

| December 1st, 2014 | No Comments »
The Economist

AS BIRTHDAYS go, it could have been a happier one. Venezuela’s president, Nicolás Maduro, celebrated his 52nd on November 23rd with a hand-picked crowd of supporters and public employees in a cramped square in the centre of Caracas. His birthday wish was to live (and presumably to govern) for another 50 years to see “Bolivarian socialism” come to fruition.

In fact, time may be running out for the revolution. The price of Venezuelan oil, source of 96% of Venezuela’s foreign-exchange earnings, has dropped from $99 to $69 a barrel since June. The economy is in a deep recession and inflation is headed for triple-digit rates. Basic goods like flour and cooking oil are in short supply and queues to obtain them are common. More than two-thirds of voters think Mr Maduro should not serve out his six-year term, which began just last year (see chart); more than ... Read More

Venezuela’s downward economic spiral

| December 1st, 2014 | No Comments »
From the Washington Post

VLADIMIR PUTIN pointed out that the Russian currency’s recent loss of value had a silver lining. “We earlier sold a product worth $1 and got 32 rubles for it,” he told the TASS news agency. “And now we get 45 rubles for the same product costing $1. Budget revenues have increased and not decreased.” That simple math works for big energy producers like Russia, where government revenues come mostly from sales of oil and gas for dollars. When world energy prices drop, a depreciating currency can allow a government to keep spending at home and cushion the shock.

Not everyone gets it, however. Unfortunately for Venezuelans, Mr. Putin’s lesson is lost on their own leaders, who are continuing to preside over an accelerating — and dangerous — economic collapse in one of the world’s biggest petroleum powers.

The price of Venezuela’s heavy oil dropped below $70 a barrel last week, compared with an average ... Read More

Battered Venezuela Bondholders Look to OPEC for Reprieve

| November 26th, 2014 | No Comments »
Bloomberg

By Nathan Crooks and Sebastian Boyd

When OPEC nations meet in Vienna this week to discuss whether to cut production, Venezuelabondholders will be paying close attention.

The nation’s dollar-denominated notes have lost 25 percent in the past three months, the most in emerging markets, as the biggest plummet in the price of Venezuelan crude since the global financial crisis in 2008 deepens concern the government will default. Yields on the country’s benchmark bonds due 2027, which reached a six-year high this month, have soared 5.29 percentage points to 18.4 percent over that span.

With Venezuela’s foreign-currency reserves hovering close to an 11-year low and oil accounting for 95 percent of its export revenue, the nation needs the Organization of Petroleum Exporting Countries to agree to reduce global output to help bolster its finances, according to Credit Suisse Group AG. The 20 oil analysts surveyed last week by Bloomberg were ... Read More

Ecuador: Can President Correa’s popularity keep him in office indefinitely?

| November 25th, 2014 | No Comments »
Article originally appeared in The Christian Science Monitor

By Ruxandra Guidi

QUITO, ECUADOR — A meme circulating on social media features a portrait of Ecuador’s controversial president, Rafael Correa, winking at the camera. The image is split down the middle, with one half reading “before“ and the other “after.“

In the before section, he’s quoted in November 2007, soon after he was first elected, saying, “indefinite reelections are absurd, because democracy requires a rotation in leadership.”

But on the “after” side is a quote from a speech he gave in June 2014: “Rotation of leadership is a bourgeois discourse that no one believes anymore. It’s a myth.”

A recent vote from Ecuador’s Constitutional Court partially cleared Correa’s path for indefinite reelection, and it appears he’s poised to stay in power beyond 2016. The National Assembly has until October 2015 to decide whether the issue should go up for a vote, or whether it can be resolved through a constitutional amendment ... Read More

Venezuela counts on aid from China during financial crisis

| November 24th, 2014 | No Comments »
China Daily

By PAUL WELITZKIN

Venezuela is entering the third year of an economic crisis as slumping oil prices threaten to hamper the South American country’s ability to make payments on its foreign debt.

In September, rating agency Standard & Poor’s lowered the country’s credit rating, citing a persistent economic slowdown. As Venezuelan President Nicolas Maduro grapples with chronic shortages of consumer goods and the world’s highest inflation rate at 63 percent, he has turned to China for help.

Maduro said last week that a $4 billion loan from China would be added to the country’s international reserves. Venezuela’s Central Bank said the reserves had fallen to an 11-year low of $19.4 billion on Nov 14.

The loan came from what is called the China Fund, which was created in 2008. It has pumped billions of dollars into state projects in Venezuela. The loans are repaid ... Read More

Venezuela’s Maduro Raises Taxes, Reserves to Help Growth

| November 20th, 2014 | No Comments »
Bloomberg

By Anatoly Kurmanaev and Jose Orozco

Venezuela’s President Nicolas Maduro raised taxes on goods ranging from yachts to rum and increased international reserves as the government responds to the lowest oil prices in four years. Bonds rallied by the most in almost six years.

The president said in a four-hour televised address late yesterday that the 28 laws he signed using decree powers will restore growth in an economy suffering the world’s fastest inflation and shortages of basic goods. He ordered that a $4 billion loan from China be added to international reserves.

“Maduro is at last recognizing there’s a need for a fiscal adjustment and stronger reserves,” Orlando Ochoa, economics professor at Andres Bello Catholic University in Caracas, said by telephone. “The measures in themselves are a drop in the ocean given the magnitude of the problem. Rather, this is a signal of bigger steps to ... Read More

Venezuela Bond Exodus Accelerates on Spurned Devaluation

| November 17th, 2014 | No Comments »
Bloomberg

By Nathan Gill and Katia Porzecanski 

Bond investors are abandoning Venezuela as President Nicolas Maduro’s administration signals the nation doesn’t intend to devalue the currency with sinking oil prices undermining its ability to pay debt.

The country’s $4 billion of dollar-denominated debt due 2027 plummeted to an almost six-year low of 55.10 cents on the dollar yesterday after Finance Minister Rodolfo Marco Torres said this week that there’s “no devaluation planned.” The securities have fallen 14.1 percent this month, posting the biggest drop inemerging markets over that span.

Concern is deepening that Maduro isn’t moving fast enough to bolster the nation’s finances at a time when the price of its oil, which accounts for about 95 percent of Venezuela’s exports, has plunged 28 percent since June to a four-year low. A devaluation would give the government more bolivars for each dollar of export revenue from state oil monopoly Petroleos de Venezuela SA and narrow its price gap ... Read More

Falling oil prices put Venezuela’s Nicolás Maduro in a vice

| November 17th, 2014 | No Comments »
From the Washington Post

By Nick Miroff

CARACAS, Venezuela — Six months ago, Venezuelan President Nicolás Maduro faced bloody protests demanding his resignation. The streets were clogged with flaming barricades. By the time the smoke cleared, dozens of protesters and national guardsmen were dead, and Maduro’s government was widely assailed for rights abuses.

Those were the good old days.

Venezuelan oil, the lifeblood of the leftist revolution entrusted to Maduro by the late Hugo Chávez, was worth $97 a barrel then. Now it’s middling around $70, and with every dollar it dips, Venezuela’s export-dependent, popularity-challenged government loses $700 million a year.

With the money pot shrinking, Maduro’s approval rating has slumped to 30 percent, according to recent surveys, down from 55 percent in April 2013. The supermarket scarcities and unchecked crime that fueled the protests earlier this year are as bad as ever.

Loath to adopt austerity measures that would hit his softening support base, Maduro has been borrowing money ... Read More

Traders Are ‘Scared As Hell’ Of What’s Happening In Venezuela

| November 14th, 2014 | No Comments »
Business Insider

BY LINETTE LOPEZ

Venezuelan investors are abandoning ship en masse after the government indicated that it would not take immediate measures to stop the country from sinking deeper into chaos.

“I am scared as hell,” one Latin American bond trader said. “Default [is] likely within 12 months; the oil price collapse [is] just adding to a completely dysfunctional political and financial situation.”

The signal to head for the exits was so subtle that you would have missed it if you were not paying close attention.

This week the Venezuelan government reiterated that it would not devalue its currency, giving it more bolivars for every dollar. It does not want to do that because the country already has the highest inflation rate in the world, at 64%.

The official exchange rate is 6.3 bolivars per dollar, but the black-market rate sits at 113.62 bolivars to the dollar.

... Read More

With goods scarce in Caracas’s stores, street sales boom and officials glower

| November 14th, 2014 | No Comments »
From the Washington Post

By Nick Miroff

CARACAS, Venezuela — The sprawling street market that radiates outward from the metro station in Petare, Caracas’s largest slum, is the retail equivalent of an anti-Target.

There’s no organization to it. Tube socks and school supplies are sold beside giant pyramids of pineapple and piled yucca. Leopard-print hot pants stretch over mannequin buttocks next to the stinky stalls of fishmongers.

The bazaar was known until this month as one of the city’s biggest open-air black markets, the place to find all the scarce items that shoppers must queue up for hours to get in supermarkets, or can’t find at all. Earlier this year, toilet paper and corn­meal were scarce; lately it’s diapers and deodorant that have “gotten lost,” as Venezuelans say.

Authorities mostly turned a blind eye to the informal commerce, but late last month Venezuelan President Nicolás Maduro went on TV to decree a ban on street sales of coffee, eggs, shampoo and ... Read More

Counting Pennies In Venezuela

| November 13th, 2014 | No Comments »
Article originally appeared in Reuters

By Daniel Bases

It was a gloomy, rainy night in Boston last week where emerging market analysts and portfolio managers huddled together before an audience of 75+ people to discuss an equally gloomy situation in Venezuela, specifically whether or not the nation, with the biggest proven oil reserves in the world, is on the precipice of defaulting on its debt.

Trying to figure out what economic and fiscal policies the administration of President Nicolas Maduro will follow to alleviate rampant inflation and shortages is akin to trying to read tea leaves. But a panel put together by EMTA laid out the scenarios and discussed the implications of any potential default. The talk of default really kicked off Sept. 5, 2014 after anarticle published by former Venezuelan planning minister Ricardo Hausmann and Harvard research fellow Miguel Angel Santos asked whether or not Venezuela should default.

Maduro is the hand-picked successor of former President Hugh ... Read More

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