Economy
On Wednesday, the Executive branch of government forwarded to the Finance Committee, National Assembly, a new message about borrowing in 2009.

The need for additional funds to address fiscal management now stands at VEB 25 billion (USD 11.63 billion), up from VEB 22 billion (USD 10.23 billion), which was the amount originally announced by President Hugo Chávez last Saturday, said Ricardo Sanguino, chair of the Finance Committee, National Assembly.

Thus, Venezuela's government has a free way to borrow up to VEB 37.32 billion (USD 17.36 billion), out of which VEB 12.32 billion (USD 5.73 billion) will be borrowed under the Special Law on Borrowing, and additional VEB 25 billion (USD 11.63 billion) will be borrowed under the Law on Supplementary Borrowing.

The final amount established in the reform of the Budget Law will remain unchanged at VEB 156.38 billion (USD 72.72 billion), as announced by Chávez.

Sanguino would not elaborate on the ordinary income items that were revised downward –a move that resulted in additional borrowing exceeding the amount the Venezuelan ruler disclosed last week.

The lawmaker said that the new amount was estimated based on the need for resources to address social projects and the injection of funds for social programs, also known as missions.

Another change the Finance Committee introduced to the Special Law on Supplementary Borrowing was the inclusion of some regulations under which the Executive branch of government has no obligation to seek authorization from the National Assembly for borrowing and debt repayment transactions.

The chair of the Finance Committee, National Assembly, added that the domestic banking system has enough resources to lend VEB 37.32 billion (USD 17.36 billion) to the Venezuelan government.

"There is an internal reserve in the financial system that not only will provide resources to the government but will also serve to finance the private sector," Sanguino said.

The public purse
On Wednesday, President Chávez also referred to the financial resources of Venezuela's banking system. He mentioned the legal reserve requirements (the share of clients' deposits that the Central Bank of Venezuela holds as collateral for specified deposit liabilities) as a way to obtain more resources.

"I told (Minister of Economy and Finance) Alí Rodríguez Araque in a meeting that instead of talking exclusively of the international reserves, we could also talk of domestic reserves. All the funds deposited in the domestic public and private banking system, all the funds that the Central Bank has in its monetary reserves in bolivars (...) They (the governments before Chávez administration) would have never touched the monetary reserves," he said.

The burden of the new public borrowing in 2009 will be huge, to the extent that the issue of bonds will virtually equal the oil sector's contributions to the Treasury.

Under the draft reform to the 2009 Budget Law, which will be discussed Friday in the National Assembly, financial authorities have estimated revenues at VEB 37.32 billion (USD 17.36 billion). Meanwhile, oil revenues will amount to VEB 37.82 billion (USD 17.59 billion) this year, according to the first report that President Chávez submitted to the National Assembly.

Translated by Gerardo Cárdenas

Suhelis Tejero Puntes
EL UNIVERSAL