Telefonica SA plans to increase spending in Venezuela this year to hedge against a further decline in the value of cash it can’t repatriate to Spain, according to a company presentation seen by Bloomberg News.
The retired Venezuelan teacher says he was so desperate for dollars that he wired his life savings to a front company posing as a Margarita Island inn. Almost four months later, all he has to show for it is a menacing e-mail.
In his last year as president, Hugo Chavez ordered Coca-Cola Femsa SAB and other beverage makers to cut prices, seized a local steel company’s assets and tightened currency controls that may cost Procter & Gamble Co. $275 million. Doing business in Venezuela isn’t likely to get easier under his successor.
Venezuela will establish a new parallel exchange rate as it seeks to crack down on a black market in which the dollar is worth about four times more than the official rate, Oil Minister Rafael Ramirez said.
Venezuela’s cancer-stricken President Hugo Chavez, who still has breathing problems, approved from Cuba an economic plan to boost exports that will be announced this weekend, said Vice President Nicolas Maduro.
Venezuela is weighing changes to a central bank system used to control the foreign-exchange rate after the bolivar fell to a record in black-market trading, fueling speculation the currency will be devalued.