Posts Tagged ‘Nicolas Maduro’

Battered Venezuela Bondholders Look to OPEC for Reprieve

| November 26th, 2014 | No Comments »

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

And Now Venezuela Will Have To Go It Alone

| November 26th, 2014 | No Comments »
Business Insider


Of all the member nations of OPEC, Venezuela arguably is most in need of a rally in oil prices.

An agreement to cut oil production would do the trick.

But OPEC members have reportedly indicated that it will not cut.

This means Venezuela will most likely have to go it alone. The country will have to get through its economic free fall without the help of higher oil prices (which would boost the value of its massive oil exports), and it is going to be an incredibly difficult road.

In the past year the country’s inflation rate has grown to about 64%, its export basket has fallen over $30 to $68.97 (a four-year low), and currency reserves are at an all-time low. For the past month, Venezuelan bonds have been selling off at breakneck speed.

Venezuela’s foreign minister Rafael Ramirez told reporters earlier ... Read More

China Loosens Debt Terms for Venezuela

| November 25th, 2014 | No Comments »
Wall Street Journal WSJ-01


CARACAS, Venezuela—South America’s most economically troubled country, facing fears of a debt default amid tumbling oil prices and a cash crunch, has been thrown a lifeline by its largest lender, China.

The Asian giant loosened repayment terms on the nearly $50 billion in loans it has granted Venezuela since 2007, according to Venezuela’s Official Gazette. And President Nicolás Maduro said in a speech last week that his finance minister, Rodolfo Marco, would soon travel to China to try to secure new loans.

Mr. Maduro’s popularity has plummeted to 30%, polls show, as Venezuela’s currency collapses and the government struggles with the world’s highest inflation rate and widespread scarcity of basic goods. The country’s woes threaten the future of what Mr. Maduro’s predecessor, the late President Hugo Chávez , called 21st Century Socialism.

Analysts say Beijing’s flexibility may buy Mr. Maduro more time.

Last week the president used a $4 billion Chinese credit, traditionally earmarked by ... Read More

Venezuela counts on aid from China during financial crisis

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


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

The Iran-Cuba-Venezuela Nexus

| November 24th, 2014 | No Comments »
Wall Street Journal WSJ-01 By MARY ANASTASIA O’GRADY Oranjestad, Aruba

Regular readers of this column will remember that in July the U.S. asked local officials here to arrest Venezuelan Gen. Hugo Carvajal and to extradite him on suspicion of drug trafficking with Colombian guerrillas. He was detained but the Netherlands stepped in, refused the extradition request and let him go.

The general had been sent here to become Venezuelan consul and spread Bolivarian propaganda. He would have been an important intelligence grab for the U.S. So it wasn’t too surprising that Venezuelan foreign minister Elias Jaua and Cilia Flores, the wife of Venezuelan strongman Nicolás Maduro, celebrated the Dutch decision by meeting his plane when he returned to Caracas.

The third person in the high-level greeting party at the airport—the governor of the state of Aragua, Tareck Zaidan El Aissami Maddah—seemed out of place because he is not in the national government. That is until you consider his résumé: ... Read More

Obama administration would back sanctions against Venezuela: official

| November 20th, 2014 | No Comments »
Article originally appeared in Reuters

WASHINGTON (Reuters) – The Obama administration would like to work with the U.S. Congress to impose sanctions on Venezuela in response to a crackdown on anti-government protests, President Barack Obama’s deputy national security adviser told lawmakers on Wednesday.

Tony Blinken, who is Obama’s choice to be deputy secretary of state, said Washington had refrained from pushing for sanctions in the past few months to allow diplomatic efforts by some Latin American countries to secure the release of opposition leaders from jail and nudge Caracas toward electoral reform.

But those efforts have failed, Blinken told the Senate Foreign Relations Committee at his nomination hearing. “We would not oppose moving forward with additional sanctions,” he said.

In July, Washington barred a group of Venezuelan officials, including government ministers and presidential advisers, from the United States after accusing them of abuses in the crackdown on protests against President Nicolas Maduro this spring.

But the State Department did not ... Read More

Venezuela’s Maduro Raises Taxes, Reserves to Help Growth

| November 20th, 2014 | No Comments »

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 »

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


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

Oil Price a Concern Says Venezuela as Al-Naimi Visits

| November 7th, 2014 | No Comments »

By Ben Sharples and Pietro D. Pitts

The price of oil is a “concern for everyone,” Venezuela’s representative to OPEC said after a meeting with Saudi Arabia’s oil minister yesterday.

Rafael Ramirez, who is also Venezuela’s foreign minister, told reporters at a climate-change conference on Margarita Island that Saudi Arabia’s participation at the event was part of a meeting between friends. The Middle East nation is the biggest producer in the Organization Of Petroleum Exporting Countries, a 12-member group responsible for about 40 percent of the world’s oil supply.

Brent crude has collapsed to the lowest level in more than four years amid speculation that global supply is outpacing demand. OPEC’s leading producers are responding by cutting prices, resisting calls to reduce supply as they compete with the highest U.S. output in three decades.

Ramirez greeted Saudi Arabia’s Ali Al-Naimi as he arrived at the event before they began ... Read More

En Venezuela se necesitan 3.5 salarios mínimos para la alimentación de una familia

| November 6th, 2014 | No Comments »
El Nuevo Herald


En Venezuela, una familia promedio debe peregrinar por “el menor costo posible” para completar una canasta alimentaria que, aún subvencionada, está un 17 por ciento por encima del salario mínimo y que es irreal con un mercado que ignora las regulaciones del Estado.

En el país petrolero, un ciudadano puede pagar por un kilo de café 220 bolívares (34 dólares) en el primer establecimiento que lo consiga, o puede recorrer las calles hasta dar con una tienda que lo venda a 26.50 bolívares (4.2 dólares) y hacer que el precio subsidiado del Ejecutivo se convierta en una realidad.

La distorsión entre los precios establecidos por el Gobierno de Nicolás Maduro y los establecidos por el mercado se extiende sobre los más de 40 productos de la Canasta Alimentaría Normativa (CAN), que, según las autoridades, tiene un valor de 5,741 bolívares (911 dólares).

En 2011, el Gobierno del fallecido Hugo Chávez (1999-2013) ... Read More

US Sen Rubio sees new hope for Venezuela sanctions

| November 6th, 2014 | No Comments »
Article originally appeared in the Associated Press


BOGOTA, Colombia (AP) — U.S. Sen. Marco Rubio hopes Republican gains in midterm elections will breathe new life into efforts to impose sanctions on Venezuelan officials who commit human rights abuses.

The Florida Republican is a sponsor of legislation targeting Venezuela’s socialist government that has been stalled since clearing the Senate Foreign Relations Committee in May with bipartisan support. Similar legislation, which instructs the Obama administration to freeze the U.S. assets of known abusers and commit more American funding to pro-democracy groups in the South American country, has already passed the U.S. House.

Speaking in Colombia’s capital a day after Republicans won control of the Senate, Rubio said Wednesday that he welcomes the Obama administration’s decision in July to impose a travel ban on more than 20 unidentified senior Venezuelan officials who played a role crushing anti-government demonstrations earlier this year. At least ... Read More

Las Naciones ‘Sumergidas’ de Latinoamérica

| November 5th, 2014 | No Comments »
Folha de Sao Paulo

Líderes políticos y diplomáticos de América Latina y el Caribe saben más sobre Cuba y Venezuela que incluso los observadores más astutos en Washington. Por lo tanto, deberían saber lo que le conviene más a su región ¿no?

Entonces, ¿por qué el Grupo de América Latina y el Caribe en la ONU le dio su apoyo a Venezuela para ser el próximo representante de la región ante el Consejo de Seguridad? Y, ¿por qué están determinados en invitar a el déspota cubano Raúl Castro a la Cumbre de las Américas en Panamá en la primavera?; haciendo caso omiso de las objeciones por parte de sus socios comerciales más importantes, como Estados Unidos y Canadá.

Para muchas generaciones de latinoamericanos, Cuba fue el hogar de algunas de las mejores editoriales de lengua española en el mundo, cientos de periódicos y estaciones de radio de calidad, derechos laborales progresistas, altos niveles de alfabetización y ... Read More

Latin America’s ‘submerging nations’

| November 5th, 2014 | 2 Comments »
Folha de Sao Paulo

The political leaders and diplomats of Latin America and the Caribbean know more about Cuba and Venezuela than even the keenest observers in Washington. So, they should know better, right?

Then why did the Group of Latin America and the Caribbean at the UN designate Venezuela to take the region’s non-permanent Security Council seat?

And, why are they determined to invite Cuban despot Raúl Castro to the Summit of the Americas in Panama next spring, ignoring the objections of the leaders of the consequential trade partners in the United States and Canada?

For generations of Latin Americans, Cuba was home to some of the world’s best Spanish-language publishing houses, hundreds of quality newspapers and radio stations, progressive labor rights, the region’s highest rates of literacy and nutrition, and a robust middle class.

Then came the Castro revolution. Although some may have been caught up ... Read More

In violent Venezuela, bulletproof everything

| November 5th, 2014 | No Comments »
Yahoo News-01

By Patricia Clarembaux

Caracas (AFP) – Venezuela is known for its obsession with beauty contests and plastic surgery. Now, the latest fashion rage is bulletproof clothes and cars to protect against rampant violent crime.

Miguel Caballero, a Colombian designer known for his bulletproof clothing, told AFP that over the past seven months up to 30 percent of his sales are with people sporting his style-meets-safety duds in Venezuela.

The oil-rich country has a huge gap between rich and poor, and sadly, it boasts the world’s second-highest homicide rate.

Costly precautions like protective clothing, armored cars and bodyguards used to be the stuff of presidents and entertainers like pop star Ricky Martin.

But Venezuela is a violent mess. Nearly four kidnappings per week are reported, according to the government, 65 people a day die violent deaths, according to NGOs, and the obsession with survival is spreading everywhere.

Caballero says his customers are Venezuelan ... Read More

Blackout Halts Venezuela’s Largest Refinery

| November 5th, 2014 | No Comments »
Wall Street Journal WSJ-01

By Ezequiel Minya

Caracas—A power failure temporarily halted Venezuela’s largest oil refinery late Tuesday at the same site of the country’s deadliest oil industry accident in 2012.

State oil company Petróleos de Venezuela, known as PdVSA, said a “strange” malfunction occurred at 9:10 p.m. local time at the Amuay refinery in the northwestern state of Falcon. The facility is part of the Paraguana Refining complex, which has a total processing capacity of 955,000 barrels a day.

A Twitter message posted on the account of Oil Minister Asdrubal Chavez just before midnight said that the blackout had been fixed and power reestablished. The posted messages also promised an investigation into the cause.

A timetable for the facility’s return to operation hasn’t been provided. Calls seeking confirmation from the ministries of energy and information weren’t answered.

Authorities said no “fire or explosions” had occurred and didn’t report any injuries, though they did report that the smoke visible ... Read More

Could Low Oil Prices End Venezuela’s Revolution?

| November 4th, 2014 | No Comments »
The New Yorker

By Girish Gupta

In early September, the Harvard economist and former Venezuelan planning minister Ricardo Hausmann wrote an essay, published online at Project Syndicate, suggesting that there were sound economic reasons the country might choose to default on a debt payment of more than five billion dollars that was due to investors the following month. The government might thereby spread the challenges of economic recovery among other creditors, he argued. Already, Hausmann said, Venezuela had “chosen to default on thirty million Venezuelans” by failing to pay suppliers and allow importers access to hard currency, and by leaving its citizens short of basic goods and services. Currency controls enacted more than a decade ago have created shortages of basic products, including shampoo, diapers, and insect repellent. Supermarket lines have stretched for hundreds of metres, with thousands of people waiting to shop, and scuffles sometimes break out when products arrive. Annual inflation is at more ... Read More

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