Contrasting satellite images of Puerto Cabello in February and Juneshowing import shortages. One image from February showed the ports full of shipping containers when the Venezuelan government's spending was near a historic high before the Venezuela presidential election. A second image from June shows the port with many fewer containers, since the Venezuelan government could no longer afford to import goods, as oil revenues dropped. By Mayexperts feared that Venezuela was possibly entering a period of faminewith President Maduro encouraging Venezuelans to cultivate their own food.
They had no choice. Any further delay may have triggered a default under the terms of PDVSA bonds, which require that the company releases its financials each year before June 30th, with a day grace period. The biggest tell is right at the front of the doc.: The eight pages of caveats are like a dystopian poem written in bureaucratese.
The warnings relate to the key issues that are drowning the company: These issues paint a picture of internal disorder so pervasive that it puts into question whether PDVSA is keeping the government afloat or vice versa. Or even worse, whether both entities are dragging one another into a shared abyss.
But wait, how did they arrive at that number?
Where did all those freshly minted bolivars go? To the dollar black market, it seems. Revenue was down Net income was down a staggering These schemes, devised in desperation to make ends meet, could severely compromise future cash flows for the company.
Why Rosneft continues to play ball is hard to fathom. The defined-benefit plan is nominally run independently from the board of directors of the company, but in reality has been used for several years now to support the payment of bonds, enriching the Bachaqueros of Wall Street at the expense of the present and future retirees from the oil industry.
The mechanics are rather simple: As you can imagine, the arbitrary use of such wildly different exchange rates may overestimate assets and downplay liabilities making the reported data unreliable at best. Going through all of them is an exercise in learned depression that we cannot recommend.
We will leave at here and wonder what do buyside investors think of these figures. Last month it tried and failed to put together an investor call. Support independent Venezuelan journalism by making a donation.What’s Next for Venezuela?
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“Much of this activity occurred under President Carlos Andres Perez, during his first term in office in Introduction.
Venezuela is in the midst of an unprecedented economic and political crisis marked by severe food and medicine shortages, soaring crime rates, and an increasingly authoritarian. Watch video · Since the government has not made any economic data available making it difficult to track.
But what went wrong? 1) What is the state of Venezuela's economy today?