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Venezuelan unrest affects friends and foe

Tuesday, March 11, 2014

In Central America, Nicaragua and Panama especially are feeling the effects of unrest in Venezuela, including riots last month, in which more than 20 people died.

President Nicolas Maduro is the heir to the charismatic Hugo Chavez.

But many Venezuelans are angry about high inflation and a scarcity of basic goods.

For its part, Nicaragua is part of the Venezuela-led Bolivarian Alliance.

Venezuela is Nicaragua’s second largest trading partner after the United States.

But last year, Nicaraguan exports to Venezuela fell 7 percent to $2.6 billion.

A year earlier, exports to Venezuela grew by more than 57 percent.
Venezuelan aid payments are also down.

Meanwhile, the 'Supremo Sueño de Bolívar' (Bolivar’s Supreme Dream) refinery, a $1 billion investment by Venezuela in Nicaragua, is stalled.

The refinery was to begin operating in 2016, with a daily output of 150,000 barrels, along with a 1-million barrel storage facility.

Panama has for years had poor relations with Venezuela.

Now, things are getting worse. 

The Maduro government last week told Venezuelan businesses to stop payment of more than $1 billion to Panamanians, mainly wholesalers in the Colón Free Trade Zone.

Panamanian president Ricardo Martinelli was getting a commission on all sales to Venezuela, alleged Maduro.

Meanwhile, shares of Panama-based Copa Airlines have fallen by more than 20 percent since the start of the year, the result of a sharp decline in business and tourism visits to Venezuela, and the fact that Caracas has frozen nearly $500 million of the company’s funds.

Venezuela also cut diplomatic and trade ties with Panama.