Thursday, April 3, 2008

Patrick J. O'Donoghue's round up of news from Venezuela

The Supreme Tribunal of Justice (TSJ) plenary chamber has appointed Francisco Ramos as the new director of the Magistracy Executive Directorate (DEM). Ramos says a close communication between the plenary chamber and the DEM and between the judicial committee and the DEM are key factors within the new judicial power. One of his first tasks will be to start the house move from the current building to a specially built area.

The opposition is up in arms at news that former Attorney General Isaias Rodriguez will take over temporally from TSJ plenary chamber president, Luisa Estela Morales. At the moment Rodriguez is facing a concerted attack for his handling of the Anderson assassination case and it is emerging appears to be an intimidation campaign against prosecutors and judges with fugitives, such as El Pais publisher/editor, Patricia Poleo leading the cavalry charge. State prosecutor, Danilo Anderson was blown up in his car in November 2004.

United Socialist Party of Venezuela (PSUV) electoral committee president, Willian Lara has started work by visiting the National Elections Committee (CNE), handing over a list of members and requesting the recognition of the political party's initials. Today, the PSUV will undertake an exploratory meeting to set up a strategic alliance with other parties of the revolution and to make some important decisions on the matter. Lara says said alliance is not an electoral objective but part of the party's program, as is selecting names of candidates for this year's regional elections.

National Assembly (AN) energy and mines committee president, Angel Rodriguez says the AN will pass the first reading of the law of taxes on extraordinary prices in the international market of hydrocarbons. This tax, Rodriguez points out, will apply only if oil passes the $70 mark. If the price is equal or less than $100, 50% of the difference between prices and $70 will be calculated, whereas if the price is greater than $100, 60% of the difference between the actual price and $100 will be applied. The law project proposes to use the Brent crude price as reference point in implementing tax calculations. The barrel reference is 42 gallons because it is the most commonly used in the oil market. The idea of the tax, Rodriguez states, comes from the fact that oil company profits are excessive and surpass reasonable levels of profitability. The increase of oil prices on the international market, he argues, has made it necessary for the government to review additional income that benefits the State, a fact, he hastens to add, that does not mean that private companies will not obtain their normal profits.

In an update on drug seizures this year, Anti-Drugs National Office (ONA) director, Nestor Reverol says 8,500 kg of assorted drugs have been seized in Venezuela so far. The most recent success was last Tuesday's seizure in Barcelona, eastern Venezuela where the National Guard (GN) got hold of almost 700 kg of cocaine. As for arrests this year, Reverol puts the number at 1,556 Venezuelans and 77 foreigners, pointing out that among those arrested are a dozen or so state officials.

Finance Minister Mario Isea has announced that the government is studying the possibility of issuing so-called cooperative bonds for importers in its fight to weaken the power of the parallel dollar market. The Minister rejects charges that the government is thinking of setting up a dual exchange system. The measure is expected take the bite out of the parallel market which importers use to obtain dollars. The importing companies that will benefit from the bond issue will be those dealing in food, machinery and medicines. The Minister did not give any time-date or details about how the emission will be undertaken, except to confirm that the bonds will be issued in dollars and paid out in bolivares. The reaction among economists has been mixed. Stock exchange analyst, Jose Luis Parra comments that although the Minister was very emphatic about not creating a dual exchange system, any issue of bonds will automatically set up an implicit market price for the dollar. However, he does admit that the bonds will ease up the market and make it easier for the import sector.

Patrick J. O'Donoghue
patrick.vheadline@gmail.com





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