The global crisis and local factors collapse bonds of the Republic

In the middle of the crisis that shakes to the markets of the world bonds of the Republic, as much the global ones as the emitted ones by Pdvsa, descend until historical minimums, shooting the cost of the loans for the Republic and making difficult the possibility that Finances act to contain to the parallel dollar.

Global the 27, the most representative bond of the basket of papers of the country has collapsed up to 54.1% of its value, lowest in six years, including the 11 of April of 2002, when in spite of the coup d'etat the day in 69,6% culminated and the crisis untied by oil unemployment, that the 16 of January of 2003 even collapsed, it up to 60.7%.

The papers of Pdvsa register a considerable declivity. A report elaborated by Merinvest, to the closing of the 20 of February, indicates that the bonds of the company that win in 2017 accumulate a fall of 77.57% with respect to the 12 of April of 2007, date from exit to the market; the 2027, a collapse of 79.97% and a 2037 declivity of 76.83%.

Analysts consider that although the debt of Pdvsa with respect to the patrimony does not represent major it loads and the country counts on sufficient resources to guarantee the payment of the global ones, the collapse of the prices of the crude one and the news that draw a confused situation for the company, like plans to turn it into “Socialist”, hit with force to the papers.

Another factor to take into account is that the market begins to consider the risk of which the government of Hugo Chavez, to see itself fit of resources, chooses not to cancel the debt in order to maintain other expenses within the country.

This fear, has taken wings since the president of Ecuador, Rafael Strap, chose to declare a moratorium in spite of counting on resources to pay and the president of Argentina, Cristina Kirchner, emits signals to pospone the cancellation of the commitments with the Club of Paris.

At the same time the global financial crisis acts. Investment funds with Venezuelan bonds in the portfolio have had to sell the papers reconstitute losses and the disappearance of organizations as Lehman Brothers trims the list of interested in buying bonds of emergent countries.

Operators consider that the Venezuelan Government saturated the market in 2007, when Pdvsa emitted debt by 7 thousand 500 million dollars and Finances other 4 billions in global, a magnitude that the supply beyond the advisable thing elevated and that also have contributed to the fall of the papers.

The collapse in the price of the bonds is translated in which the country will have to pay a high interest rate in case of needing financing and that Finances no longer counts on the facility to emit papers in dollars, that the public iron gate in bolivars, to maintain to ray to the parallel dollar.

So far, they indicate financial sources, Pdvsa has been selling currencies, at the same time as the Central bank absorbs liquidity, to diminish the pressure on the type of parallel change.

The price of the Venezuelan papers could recover if the administration of Hugo Chavez applies an adjustment plan that includes increase of taxes and devaluation of the currency, since this way, they consider stockbrokers, would be reinforcing the capacity of payment of the country the variable key for the investment funds.

Financial organizations as Barclays considers that once gained the victory in referendo constitutional of the 15 of February, the government of Hugo Chavez will take measures in the medium term.

vsalmeron@eluniversal.com

Victor Salmerón
THE UNIVERSAL ONE