Marriages Of Convenience
We’ll go Down The Rabbit Hole in a few but first…Reuters reports that a broad easing of US sanctions on Venezuela’s oil industry has forged marriages of convenience between global commodities traders and little-known middlemen that dominated it’s exports during the period of restrictions.
At least two trading houses, Trafigura and Connor Group, in recent weeks have gained access to Venezuela cargoes by buying from intermediaries approved by PDVSA (Venezuela government-owned oil company).
OK, that’s the easy part to understand.The rest is a complicated mess of original, fixed-price deals, new offers, compliance rules, previously filed lawsuits, shipping agencies authorized by PDVSA, etc.
It’s not surprising that the two trading houses, one of the intermediaries, as well as PDVSA all declined to comment
Whatever they’re going to do, they may want to hurry as when the November 30th deadline arrives for Maduro to comply with sanctions-easing terms, everything could change (if Maduro doesn’t comply and Biden keeps his word to reinstate sanctions)
Then we have Aviation 24 telling us that Rainbow Tours has initiated direct long-haul charter flights from Katowice airport in Poland to Margarita Island in Venezuela. The inaugural flight took place on November 10th of this year.
It remains to be seen if there will be enough volume to make the route profitable, long term (many have failed in the past), however, anything that allows tourists to bypass the airport in Caracas is a step in the right direction.
I once took a charter flight direct from JFK in New York to Margarita Island and, compared to my normal route that required a connection in Caracas, it was wonderful.
Now, let’s head Down The Rabbit Hole…
Chapter 1/ continued…
…You may be wondering how the Chavistas can just “tell them nothing” about pretty much anything, especially a question like “Where did all the money go?” It’s simple. Early on, Hugo Chavez set up a government department called Fonden to distribute 60% of government spending. The first 40% was accountable to the National Assembly, Venezuela’s legislative body. Fonden was, and is, accountable to no one, except Chavez and now Maduro. Also, nobody is brave enough to ask a question like that but we’ll save that discussion for another time.
With no money and no credit, they tried a series of bilateral agreements to supply the failing systems but country by country, deal by deal, they screwed everyone and burned all those bridges.
To take us even further “Down The Rabbit Hole”, Maduro has been ruling by decree almost since he took power, due to the declaration of “a state of emergency”. At the same time he has been denying that there is a humanitarian crisis. Call me crazy but isn’t it either one or the other?
That led us to the government’s conscious decision to just let people die. They had to choose between paying off their bondholder, strangely enough many were wealthy, well-connected Chavistas, or putting that money to work caring for the people. Even that only lasted until November, 2017 and they are now, and have been for some time, in default on all those bonds. For years they continued to pay the holders of the 2020 bonds since they had used Citgo refining, owned by PDVSA, as collateral and wanted to protect it but eventually they defaulted on those as well.
So, here we are. The government keeps a well-staffed and supplied hospital or two, as well as a couple of Barrio Adentro locations they can show to visitors that are gullible enough to buy the government line that everything is OK. They don’t hear from people like the doctor in one of the non-showcase hospitals that said it was like practicing battlefield medicine two hundred years ago.
The good news is that the main hospital on Margarita Island did reopen. The bad news is that with few supplies, few doctors, and now, for the most part, no food, water,or dependable electricity it truly is, as Duglimar said, “In Venezuela you go to the hospital to die”.
Summary : It was my intent to show how the healthcare system collapsed. In doing so I didn’t get into all the details of how horrific the situation is ie; babies in cardboard boxes on the floor instead of incubators etc. It is catastrophic and, as you can see, it’s not the effect of outside influences, natural disasters, or civil war. It is a self-inflicted wound, a man-made disaster, a Chavista- made disaster.
That will do it for chapter one. We’ll be back tomorrow with a full slate of current news….
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