Tag Archives: currency devaluation

Aug
30
2013
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In Case You Missed It…Articles Roundup Week of 8/30/13

130830 maduro 4a.photoblog600 e1377895796289 In Case You Missed It…Articles Roundup Week of 8/30/13

Courtesy of: Associated Press

This week: Nicolás Maduro airs his own hypocrisy by seeking enhanced powers to “tackle corruption;” leading Venezuelan TV news channel Globovisión receives a volley of resignations amid government censorship; the Venezuelan daily newspaper Versión Final is sold to a government supporter,  likely leading to staff dismissals; and ex-managers for Venezuelan oil-giant Pdvsa are charged with corruption. Maduro claims that two Colombian men planned to kill him at the same time as the attack in Syria; despite a lack of evidence, Maduro demands an explanation, arguing President Barack Obama knew of the plot to assassinate him; Henrique Capriles, on the other hand, dismisses the government’s claims of an assassination plot; and Maduro misquotes a Biblical passage, saying “Christ multiplied the penises.” With the bolivar collapsing and prices spiraling higher, the government turns to political witch hunts to distract people from reality; Venezuela is again on the verge of another currency devaluation, likely after December’s municipal elections; Venezuelan authorities insist the country will become an exporting giant, yet non-oil exports are down 20.6% from last year; according to Central Bank statistics, the GDP of Venezuela’s public sector doubles that of the private sector;  and the public debt in Venezuela has drastically increased over the past two years, rising 53% since 2011.

In Venezuela, Absolute Power Corrupts Absolutely, Bloomberg

Venezuelan President Nicolas Maduro has lately been accused of hypocrisy for seeking enhanced powers to rule by decree so that he can tackle the corruption that rots Venezuela’s political institutions. The accusation is fitting. Maduro is finally admitting that the Venezuela he inherited from the late Hugo Chavez is wracked by corruption, just five months after he famously claimed, “There is no corruption, for the first time in the history of Venezuela, in 180 years.”

Venezuelan news TV channel Globovisión receives a volley of resignations, El Universal

“I am only left with job uncertainty, but have the peace of mind that comes with knowing that I always did the right thing,” journalist Román Lozinski read out on his radio show from a personal statement he wrote following his resignation from Globovisión. Resignations have been piling up at the television news network after the retirement of call-in show host Leopoldo Castillo on August 16.

Pressure over sale of Venezuelan daily newspaper Versión Final, El Universal

Workers from Versión Final are likely to be dismissed upon the sale of the daily newspaper to an alleged relative of Francisco Arias Cárdenas, ruling party governor of the state of Zulia, northwest Venezuela. There are reports that the company underwent a lot of pressure prior to the negotiation: it first experienced restrictions related to newsprint, then economic pressure that finally ended in the sale of the company to Carlos Alaimo, the father-in-law of Cárdenas’ son.

Pdvsa’s ex managers in Monagas charged with corruption, El Universal

The Public Prosecutor Ministry charged two former managers of Petróleos de Venezuela (Pdvsa) for the collection of VEB 600,000 (US$ 95.279,40) from a contractor. Defendants are Jannimett de Los Ángeles Flores Quijada (37), former legal counsel of Pdvsa in Punta de Mata, and Jorge Natera Barrios(35), former super intendant of litigation at same division.

Maduro: “The plan was to kill me in parallel with the Syria attack”, El Universal

Venezuelan President Nicolás Maduro reported on Wednesday that two Colombian individuals “hired by drug traffickers to kill the Head of State” were arrested. In that sense, Maduro rejected the remarks made by opposition deputy Julio Borges about the assassination claims aired on Monday. “Borges made an irresponsible and anxious statement, saying that (the hit men) that were arrested did not even have firearms to accomplish their task.

Venezuela demands US explanation over alleged assassination plot, The Telegraph

Nicolas Maduro called on the American president to explain what he knew of the alleged assassination plan. President Maduro said that besides Colombia, it was hatched by far-right Venezuelan opposition figures in Miami. The Venezuelan president is a frequent and fiery critic of Washington, as was his predecessor, the late Hugo Chavez.

Capriles: “The people laugh about assassination plots”, El Universal

On Monday, on a meeting with “Miranda’s entrepreneurs,” in Caucagua, Miranda state, Henrique Capriles, Governor of Miranda state and opposition leader, referred to the announcement of the arrest of a gang who allegedly wanted to assassinate President Nicolás Maduro and Deputy Diosdado Cabello.  “Nobody believes that tall story.

Nicolas Maduro Says ‘Christ Multiplied The Penises’ In Major Screw Up (VIDEO), Huffington Post

Christ did WHAT?!? The man who once gave us “Chavez came to me as a little bird” has uttered another phrase that is getting a lot of chatter online. Venezuelan president, Nicolas Maduro, seriously screwed up an iconic biblical anecdote while speaking at the Miranda Stadium when he said: “Multiply ourselves, like Christ multiplied the penises.”

Chavez’s Inflation Bites His Successor, Wall Street Journal

Hyperinflation and political witch hunts seem to go together. Just ask the Venezuelan opposition. With the bolivar collapsing and prices spiraling higher, the government alleged this month that its No. 1 adversary, former presidential candidate Henrique Capriles, is linked to a prostitution ring that was using minors in the state of Miranda, where he is governor.

Venezuela is on the verge of another devaluation, El Universal

Imbalances ailing Nicolás Maduro’s government are so pronounced that most financial entities agree that the country, after undergoing stringent adjustments last February 8 through which the official exchange rate jumped from VEB 4.30 to VEB 6.30, is heading towards another devaluation likely to take place after December’s elections for mayors.

Venezuelan non oil exports down 20.6%, El Universal

Venezuelan authorities insist on saying: Venezuela will become an exporting giant. However, official records say the opposite. According to the figures from the Central Bank of Venezuela, non oil exports accounted for just USD 810 million in the second quarter, 20.6% down with respect to a year earlier.

GDP of the public sector doubles that of the private sector, El Universal

The statistics of the Central Bank of Venezuela (BCV) suggest that the loss of dynamism of the Venezuelan economy has exerted a heavier impact on the private sector rather than the public sector with growth reported at 1.1% and 2.6%, respectively. Such great disparity between the sectors is attributed to the existing imbalance in the sale of US dollars aimed at importing raw materials, machinery, and finished products to supply the domestic market.

Debt of the Venezuelan gov’t soars 53% in two years, El Universal

Since 2011, the Venezuelan oil basket price has been above the USD 100 ceiling. In this context of high oil revenues, the Government has spurred indebtedness. Based on the figures of the Ministry of Finance, the public debt grows rapidly with liabilities jumping 53% from the first half of 2011 through 2013. Such increase is mainly attributed to heavy expenditure exceeding regular income, a situation that has made authorities seek other founding sources.

Venezuelan unemployment hits 7.6% in July, El Universal

Venezuelan unemployment rate stood at 7.6% in July, according to a monthly report on the workforce issued by the National Statistics Institute (INE). The information was released by Professor Elías Eljuri, president of the institute, who also said the unemployment rate reported in July was actually lower than that of 2012 (7.9) and 2011 (8.0%).

 
Aug
26
2013
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ICYMI: Chavez’s Inflation Bites His Successor

Wall Street Journal
August 25, 2013
By Mary O’Grady

OB YQ920 amcol0 G 20130825120857 e1377534741885 ICYMI: Chavez’s Inflation Bites His Successor

Courtesy of: European Pressphoto Agency

Hyperinflation and political witch hunts seem to go together. Just ask the Venezuelan opposition.

With the bolivar collapsing and prices spiraling higher, the government alleged this month that its No. 1 adversary, former presidential candidate Henrique Capriles, is linked to a prostitution ring that was using minors in the state of Miranda, where he is governor.

Lest that not be enough to turn Venezuela’s socially conservative working-classes against the popular Mr. Capriles, a leading congressman from the ruling United Socialist Party of Venezuela (PSUV) used gutter talk on the floor of the national assembly to accuse the governor of homosexuality.

Don’t suppose for a minute that this mudslinging is merely about destroying Mr. Capriles. The ruling chavistas, led by President Nicolás Maduro, need a circus because there is no bread—and that’s not a metaphor. At times in Venezuela, there really is no bread. Earlier this year there was, for a time, no toilet paper. Mr. Maduro knows he is in trouble.

The “proof” of the allegations against Mr. Capriles’s chief of staff, who is accused of running the sex ring, cannot be shown to the public, according to Mr. Maduro. He says that the “videos and photos” that the government confiscated in a raid are of “un-publishable orgies.” Venezuelans will have to use their imaginations while trusting the courts—now controlled by the military government—and the government itself to get to the bottom of it all. Developments will be reported on television, which is almost exclusively state-controlled and where most Venezuelans get their news.

Mr. Capriles has said that the allegations are an attempt to distract the population from the real problems in the country. The charges are certainly well timed. An official 46% devaluation in April took the bolivar-to-dollar exchange rate to 6.3 from 4.3. Those who actually need dollars are unlikely to get them at that rate. Instead they have to go to the black market, where one greenback costs as much as 38 bolivars, up from 22 in March.

The government forecasts that inflation will hit 40% this year. But Johns Hopkins University economist Steve Hanke, director of the Cato Institute’s Troubled Currency Project, says that the soaring cost for the bolivar in the market translates into an implied annual inflation rate of more than 250%.

Earlier this month Caracas-based economist José Manuel Puente described the perfect storm to the Los Angeles Times this way: “The slowdown in economic growth, high and persistent inflation and high levels of scarcities [of basic foodstuffs] will combine to make Venezuela’s the worst-performing economy on the continent, despite the extraordinary oil boom that the country is still benefiting from.”

A mid-July survey by the Venezuelan polling company IVAD, posted on the website lapatilla.com, suggests Mr. Maduro is having no luck dodging the blame like his predecessor Hugo Chávez did so deftly. Asked what are the principal problems facing the country, almost 82% of respondents named crime. More than 53% also pointed to shortages. The scarcity is caused by the price controls that the government is using to try to hold down inflation. Those controls could explain why only 31% named “the high cost of living.”

But more than 65% said the economic situation was worse or much worse than one year ago, and more than half blamed either the national government or Mr. Maduro for the country’s problems.

Because the allegations against Mr. Capriles by the PSUV included a pejorative term for a homosexual, gay-rights groups took offense. But Venezuela’s homosexuals needn’t feel special. Hate speech as a political tool has been common practice in Venezuela’s military government for more than a decade. Catholics, Jews, entrepreneurs and the bourgeoisie have all been on the receiving end.

Mr. Maduro, coached as he is by Fidel Castro, immediately recognized that gay rights are a priority for many members of the international left. So in the aftermath of the impolitic comments by his colleague in Congress, he quickly seized a gay-pride flag to wave while he continued his verbal assaults against Mr. Capriles.

Political nonconformists regularly singled out by chavista politicians for ridicule and acrimony won’t get off so easily. This week Mr. Maduro is expected to try again to force through congress an “enabling law” that will allow him to rule by decree.

Opposition Congressman Richard Mardo has already been stripped of his congressional immunity and is slated for trial on corruption charges. Other opponents are being investigated. The Venezuelan daily El Nacional reported this month that more than one third of congressional sessions in the first half of the year were spent “harassing the opposition,” including with physical violence.

The goal is to drum up mass hysteria against opponents. Apparently Mr. Maduro has decided that if inflation cannot be contained, Mr. Capriles and his allies will be.

To read this article at Wall Street Journal, please click here.

 
Jun
28
2013
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In Case You Missed It…Articles Roundup Week of 6/28/13

madurocadena1.520.360 e1372450486683 In Case You Missed It…Articles Roundup Week of 6/28/13

Courtesy of: VTV

This week: Reports emerge that Snowden may be headed to Venezuela via Havana, though his whereabouts remain unconfirmed; the US urges Ecuador, Cuba and Venezuela not to grant asylum to Snowden, yet Maduro expresses support for Snowden; Roberta Jacobson,  US Deputy Secretary of State for Latin America, meets with the Venezuelan chargé d’affaires in a sign that the two countries may normalize relations; Maduro makes his first official visit to Haiti; Venezuela plans to make its foreign currency system more flexible by reviving a stalled dollar auction scheme in July; in a further attempt to boost alleviate growing debt, Venezuela looks  to devalue the Bolivar by “stealth”; Standard & Poor lowers its long-term currency credit ratings on Venezuela from ‘B+’ to ‘B’; the Venezuelan government illegally records conversation between an opposition lawmaker and a local academic; the consultancy IHS Jane’s releases a report stating that Venezuela was the main purchaser of weapons in 2012; Maduro upsets Venezuelan journalists by giving Chavez a posthumous journalism award; During the celebration of the 192th anniversary of Battle of Carabobo, Maduro claims that “Corruption is going to engulf [Venezuela],” yet he continues to neglect enforcing rule of law.

Snowden heads to Venezuela via Moscow, Havana: airline source, Reuters

Former U.S. National Security Agency contractor Edward Snowden will fly from Moscow to Cuba on Monday and then plans to go to Venezuela, a source at the Russian airline Aeroflot said on Sunday. The source said Snowden was already on his way to Moscow from Hong Kong and would leave for Havana within 24 hours. The South China Morning Post also reported that Snowden had left Hong Kong for Moscow and that his final destination might be Ecuador or Iceland.

US urges Ecuador, Cuba and Venezuela not to grant asylum to Snowden, El Universal

The US government on Sunday urged Ecuador not to grant political asylum to Edward Snowden, a former National Security Agency contractor who sought refuge at the South American country after revealing Internet surveillance programs implemented by the US authorities, CNN reported. According to a source consulted by CNN, Washington also requested Venezuela and Cuba not to grant asylum to Snowden, which are other two likely destinations for Snowden, DPA reported.

Maduro: Venezuela ‘would consider asylum for Snowden’, BBC

Venezuela’s President Nicolas Maduro has said his country would consider an asylum application from fugitive US whistleblower Edward Snowden. “We say and advocate that someone in the world should stand with this young man and protect him, the revelations he has made with courage serve to change the world,” he said. Mr Maduro said that Venezuela had not received any such request, but would evaluate any application for asylum from Mr Snowden, because “every case is a humanitarian protection”. He was speaking from Port-au-Prince, during his first official visit to Haiti.

Venezuela voices solidarity with Ecuador for support to Snowden, El Universal

Once again, Edward Snowden, a former agent and expert of the CIA, was on the agenda of Venezuelan President Nicolás Maduro, who said Thursday night that, if requested humanitarian support or asylum for Snowden, Venezuela would not hesitate to grant it. In this regard, hailing Snowden for his revelations, Maduro said he supported President of Ecuador Rafael Correa for taking a firm stance vis-à-vis Washington’s warnings against Ecuador if it granted asylum to the former agent.

Venezuelan chargé d’affaires meets with US Deputy Secretary of State, El Universal

The chargé d’affaires of Venezuela in Washington, Calixto Ortega, met on Tuesday with the US Deputy Secretary of State for Latin America, Roberta Jacobson, three weeks after the respective foreign ministers took a first step towards rapprochement at the Assembly of the Organization of American States (OAS) in Guatemala. At the headquarters of the Department of State, Jacobson received the top diplomat of Venezuela in the United States, as both countries withdrew their ambassadors in 2010.

US interested in maintaining high-level dialogue with Venezuela, El Universal

The United States has a “strong interest” to continue high-level contacts to bring relations with Venezuela back to normal, with the exchange of ambassadors among the main goals, said on Thursday the State Department. That was the message the Deputy Secretary of State for Latin America, Roberta Jacobson, conveyed on Tuesday during her meeting in Washington with Calixto Ortega, the Venezuelan chargé d’affaires, William Ostick, a US State Department spokesperson, told Efe.

Venezuelan Leader Nicolas Maduro Visits Haiti, ABC News

Venezuelan President Nicolas Maduro made his first official visit to Haiti on Tuesday as the countries began negotiations to figure out ways to renew a special fund that uses oil money on mostly infrastructure projects. Maduro and Haitian President Michel Martelly met privately for several hours on the grounds of where the National Palace stood before it collapsed in the 2010 earthquake. Venezuela is one of the biggest donors to help impoverished Haiti rebuild from the catastrophic 2010 earthquake.

Venezuela to ease foreign exchange regime: source, Reuters

Venezuela will make its foreign currency system more flexible by reviving a stalled dollar auction scheme in July and after that allowing a revival of a free-floating secondary currency mechanism, a source in the government’s economic team said on Sunday. Venezuela has operated currency controls for a decade, and restricted access to dollars at the official rate of 6.3 bolivars are a major gripe for local businesses and a cause of the OPEC member’s slowing growth rate.

Venezuela to Devalue Bolivar by Stealth: Analyst Survey, Bloomberg

Venezuela will look to weaken the Bolivar this year without making an official devaluation of the currency, as it tries to boost revenue and narrow the budget deficit, according to a survey of analysts. South America’s biggest crude producer will step back from formally devaluing the Bolivar for the sixth time in nine years, said eight out of 11 analysts surveyed by Bloomberg.

S&P Lowers Venezuela Ratings to ‘B’ from ‘B+’, Latin American Herald Tribune

Standard & Poor’s Ratings Services said on Monday it lowered its long-term foreign and local currency sovereign credit ratings on the Bolivarian Republic of Venezuela to ‘B’ from ‘B+’. The outlook on the long-term ratings is negative. At the same time, the agency affirmed its ‘B’ short-term foreign and local currency sovereign credit ratings on Venezuela. S&P also downgraded its transfer & convertibility (T&C) assessment to ‘B’ from ‘B+’.

Venezuelan government says recording proves opposition plots, Reuters

Venezuela’s government released a recording on Wednesday of a well-known opposition lawmaker apparently criticizing the head of the opposition coalition and accusing him of meeting U.S. officials to provoke a crisis in the OPEC nation. In the latest of a string of secretly-made recordings that have roiled politics in the South American country in recent months, the new tape was of female legislator Maria Corina Machado talking to a local academic.

Venezuela main purchaser of weapons in 2012, but Brazil has largest defence budget, Mercopress

The report said Venezuela imported some 1.2bn in 2012, surpassing Brazil, the country with the largest defence budget in the region. The document highlighted that the trend may continue even after the demise of former President Hugo Chávez. IHS Jane’s analyst Ben Moores said that Venezuela was halfway in its rearmament program and that it would be very costly to drop it. The US remains the top defence supplier in the region, with 758.52 million dollars in 2012. But Russia, particularly thanks to sales to Venezuela, stood behind the US with 730.8 million.

Journalists upset as Venezuela’s late president Hugo Chavez given posthumous journalism award, ABC

The decision “was unanimous” to grant the award “with extraordinary mention to the comandante president Hugo Chavez,” said the head of the awards jury, Milagros Perez. “The history and practice of journalism can only be divided in two moments – before and after comandante Chavez,” Mr Perez said. A journalists’ association cried foul, saying Chavez had made a habit of closing down media outlets.

Tal Cual: And Where Are Venezuela’s Most Corrupt Politicians?, Tal Cual

“Corruption is going to engulf our country,” claimed President Nicolás Maduro on Monday. Such grandiloquent phrase couldn’t have been said anywhere else but at Campo de Carabobo, in the northern central coast of the country, during the celebration of the 192th anniversary of Battle of Carabobo, a fight that led Venezuela to its independence. We are sure this is not the first time and, regretfully, will not be the last, either, that such a harangue against corruption is said on that venue.