Amid the global financial turmoil, the Venezuelan economy is sending warning signals: the price of Venezuelan bonds has fallen to historic lows raising the cost of financing whereas the foreign exchange parallel market is heating up.

The USD Global 27 bond, the most traded bond in the basket of Venezuelan papers, was traded at 80.7 percent of its value on September 26, 2008. At the end of Thursday's session, it dropped to 59.7 percent, a level that shows its high risk perception, according to investors.

Orlando Ochoa, an economist and professor at the Andrés Bello Catholic University, stresses that on December 31, 1998, when the Asian crisis led to a collapse of oil prices to less than USD 8 dollars, the Global 27 traded at 60.1 percent of its value, whereas the current value is 59.7 percent, even though oil prices average USD 100 in the year.

The country risk premium, an indicator that measures the spread between the yield an investor demands in order not to buy US Treasury bonds and purchase instead Venezuelan bonds, closed on October 8 at 12.89 percent, a figure that surpasses Mexico's 3.17 percent; Peru's 4.33 percent; Colombia's 4.44 percent; Brazil, 4.21 percent and is just similar to Argentina's 12.50 percent.

The collapse in the price of the bonds of Venezuela and of Argentina also affects the ability of the Ministry of Finance to act in order to contain the rise of the parallel US dollar.