Forbes: Venezuela Prepares For Another Coup d'Etat
Venezuela’s Bolivar Revolutionary government loves a conspiracy as much as the next guy and they are about to be served yet another as President Nicolas Maduro’s own military wants him out of office, the sooner the better.
On Tuesday, the Venezuelan opposition presented its strategy for a constitutional way to remove Maduro from power and bondholders — mainly those holding oil company PDVSA debt — are worried about what a changing of the guard means to their investment. The intensity of the ongoing economic crisis has pit old allies against Maduro. Some in the military and legislature are now willing to align with the opposition in order to save patria over party. There is growing frustration on the streets of Caracas that also does not bode well for Maduro. Confidence in the Venezuelan president is wearing thin.
Nomura Securities fixed income chief for Latin America, Siobhan Morden, says she sees an inflection point for Venezuela this year, with inflation accelerating even more amid a continual collapse in imports. No matter which way it happens – through a constitutional move or a full-out coup – the context and timing of Venezuelan regime change will depend on the intensity of the economic crisis in the country, she says.
There was an average 50% decline in imports in the fourth quarter of 2015 versus last year with the early data for January still confirming this trend from Venezuela’s top trading partners.
The pace of inflation was 14% higher in January than it was in December, and has annualized inflation at a ridiculously high 482%. No country in the Americas is as bad as this. If the monthly trend of inflation escalates back to 20%-25% per month as it was in 2015, then annualized inflation could crack 1,000% this year, a record high, says Morden.
The secretary general of the Democratic Unity Roundtable (MUD), Jesus ‘Chuo’ Torrealba (L), and the president of the Venezuelan National Assembly, Henry Ramos Allup , offer a press conference in Caracas on March 8, 2016.
Market Calls For 'Regime Change' In Venezuela
Under Venezuela’s constitution, the president can be ousted by means of a referendum. In order to trigger a referendum, at least 20% of voters would have to sign a petition asking for a referendum. That would be 3.9 million voters, the BBC reported today. Such a referendum can only be called once the president has served half of this term, which would give Maduro until mid-April before calls for his ouster become even louder.