Unless he isn’t…
This Bloomberg piece describing changes in chavista financial management sort of raises more questions than answers, if you ask me. According to Joshua Goodman and Charlie Devereux, this…
Last week the government cut by $2.9 billion Petroleos de Venezuela SA’s share of oil revenue it contributes to an off- budget fund that’s the second-biggest source of public spending.
…is a sign that the chavista paquetazo is already in progress. And while the paquetazo is as dear a theme to my heart as any, how this move counts as an instance of it somewhat eludes me: surely, by cutting your contribution to a mechanism that acts as a savings fund, you’re signalling that you want to spend more now and less later, no?
i.e., the Fonden shenanigan looks to me more like a patada de ahogado trying to postpone a paquetazo for just a little bit longer than a part of the aforementioned. Or am I missing something?
Caracas Chronicles 
At least one difference lies in that he sees is as a spending fund, while you see it as a saving fund.
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Right!
Fonden surely isn’t a “savings fund” – but it has effects similar to a savings fund, in that it allows you to accumulate dollar assets for spending later – whether one week or one month or one year later we can’t tell, of course, due to all the opacity, but at any rate later.
Not depositing money in Fonden looks to me like a decision to spend it now, not later.
But like I said, I’m mostly confused about this.
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I agree, I’m just trying to imagine the other perspective and I’m guessing that he interprets that not depositing in Fonden to mean that the spending will simply not be on public stuff, rather than anything to do with time lags of the spending.
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The fund doesnt make disbursements until the value of accumulated oil purchases from Venezuela reach a certain level that cushions the chinese from risk of not being paid back . At least I understood something like this was involved when Ramirez announced a couple of weeks ago that of the total Venezuelan oil sales to China deposited in China or used to pay disbursed loans, Venezuela was ahead by 23 billion USD , implying that Venezuela had money tied up in the Chinese banks which it could credit to its accounts although it could not avail itself of it under the fund arrangement . If the money being used to cushion the fund from risks is reduced then more money is available for Pdvsa and the Regime to use in other ways . Maybe I got it wrong , anyone understand this better??
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