The Latest, Saddest, and Dumbest News From Venezuela.
Surprise, surprise…there have been no recent surprises in the situation.
Nicolás Maduro is still in power, Opposition President Juan Guaidó is still running around like a chicken with his head cut off screaming for change. and Maduro broke off all negotiations towards a settlement. Doesn’t matter much because he wasn’t negotiating in earnest in the first place, and anyone who believed he would is an idiot. Maduro broke it off because of the new U.S. sanctions/embargo, he says, but he was just looking for any excuse to do so.
Guaidó warns that Maduro will soon order the Supreme Court to illegally dissolve the opposition-controlled National Assembly.
With three Assemblymen recently stripped of immunity from prosecution, and at least eighteen having already fled the country in fear of prison and for their lives, it’s Maduro’s next logical step. However, he doesn’t really have to, and the status quo doesn’t help or hurt his position. International powers can’t do anything about it, and shutting those doors wouldn’t change a thing at this stage of the game.
U.S. sanctions are sucking Maduro dry and costing China and Russia a fortune.
This week saw Trump’s full embargo on doing any business with any Venezuelan agency, or with companies associated with the government. Surprisingly, even Turkish Bank Ziraat just announced it’s closing the door on doing business with Venezuela, surprising because of how strong a Maduro ally Turkey’s Erdogan has been. (No doubt there are going to be some “problems” over there about this, but since the choice is so clear that the U.S. makes a more profitable business partner than VZ, maybe it’s just a matter of money talking way louder than politics.)
Russia and China have been forced to step up to the plate with humanitarian food and medical aid, and they might even have the receipts to prove they paid for some of that. But they’re now learning something most of us learned long ago:
That aid never reached the pueblos, it was stolen, and the people are still suffering. Often not spoken about is the financial hit they’re taking for so-called influence and prestige in the Western Hemisphere, but aside from discounted oil (amidst severe economic downturns in their regions no less), I’ll never figure out why they think it’s worth it.
$60 billion in unpaid bond debt, and a whole lot more.
People keep forgetting about this, and it’s a doozy, because although Maduro tries to con Russia and China into keeping him afloat, nothing either country can do will help save VZ’s economy. It is toast, and Jesus himself would have a hard time saving it.
In the meantime, Guaidó is putting together a commission to discuss repayment of Venezuelan and PDVSA state oil company debt with bondholders, because Maduro, like someone three months late with his credit card payment, he’s scared to pick up the phone and speak with the collection agency about it. At stake is seizure U.S. Citgo refinery operations, which, laughably, would only cover part of that $60 billion owed!
The other kink in the armor here to save Citgo is Guaidó’s and the National Assembly’s legitimacy to undertake such negotiations, or rather, possess the actual power. It’s like they’re playing at politics, kids playing doctor, and none of it means anything or have any real-world consequences.
Also, remember this $60 billion is just what they owe bondholders. Estimates have them owing that much and more to China and Russia, on top of another few dozen billions to private companies due to expropriations, unpaid bills, broken contracts, you name it…they’ve done it.
And the pitiful amount of oil they’re pumping now won’t pay jacks**t for everything they need to survive on any semblance of a subsistence level, let alone pay these debts.
And a hodgepodge of stuff that only merits a sentence a two.
Maduro just accused former Colombian President Alvaro Uribe of actively plotting to have him killed. Maduro has made accusations like this in the past against Uribe and others, never proven, never any evidence.
China pledges to come into the country and work PDVSA’s oil fields, in what was proudly announced as a Chavista triumph, but is nothing more than a desperate attempt by China to recover double-digit billions in oil wealth already owed them. And of course, an opportunity for China to dupe VZ into billions of new debt.
Russia and Venezuela agree to reciprocal naval warship visits, so have fun playing in the bathtub kids but don’t forget to wash behind your ears. What the two countries intended as a warning of their military might is instead laughed at as a sign of foolishness. Can’t wait to see the Venezuela navy bombing Kiev from offshore.
Former Vice President Tareck El Aissami is wanted by U.S. Homeland Security for drug trafficking and money laundering. It’s just another day at the Miraflores presidential palace, and although Tareck might never touch U.S. soil and get to visit Disney World, he may get to visit Maduro’s nephews, now serving time here for the same crimes.
The Bolivar (their currency) is basically extinct, and the country has de facto dollarized although it isn’t official. So bad is the economic situation there that the Bolivar has actually gotten stronger recently, only because it couldn’t get any weaker (this is an incredibly rare economic event), and no one is using it. But, the dollar is now losing its buying power there as well, as the government certainly can’t supply its remaining people with enough of the stronger currency, but family members abroad aren’t sending enough dollars home to make any difference. Too few dollars on the street. An example of this effect? A can of Coke now sells for $3 U.S.