Venezuela’s state oil company is behind on billions in payments to private oil contractors from Oklahoma to Belarus, some of which have now stopped work, even as President Hugo Chavez funnels more oil revenue to social programs.Chavez doesn't have the money to pay for his military expansion, the oil industry, and the folks he needs to buy the votes of in the elections scheduled for later this year. Without the pork projects he hopes will bide him more time among the poor who rely upon such things, Chavez wont have anything to offer Venezuelans other than the usual amount of socialist claptrap and blaming everyone but himself for Venezuela's problems.
Petroleos de Venezuela SA, or PDVSA, says unpaid invoices jumped 39 percent in the first nine months of last year — reaching $7.86 billion in September. And that was when world oil was selling for $100 a barrel.
With prices plummeting by more than half, PDVSA is trying to renegotiate some contracts. But analysts say hardball tactics to reduce charges from crucial service providers could backfire by lowering Venezuela’s oil output. And foreign debt markets are reflecting jitters about Venezuela’s finances.
Meanwhile, the situation in Zimbabwe isn't improving either. The cholera epidemic shows no signs of letting up as 69,000 cases are now reported.
The opposition Movement for Democratic Change's decision to create a unity government with President Robert Mugabe could give authorities a better chance of tackling the disease that has deepened Zimbabwe's hardships.That's a far too optimistic picture of the situation in Zimbabwe given that Mugabe has refused to give up power and the opposition led by Morgan Tsvangirai isn't going to have the power to actually alter the economic policies that led Zimbabwe to ruin. Tsvangirai's deal with Mugabe only allows some foreign assistance to flow, but doesn't address the underlying fundamental problems with the economy, which are due entirely to Mugabe's socialist redistribution policies that have led the country to ruin.
Zimbabwe's health system has collapsed under an economic crisis that has left eight in 10 people out of employment in the once prosperous country. Poor medical facilities and sanitation have helped spread the cholera.
More than half of Zimbabwe is surviving on food aid and the population is also struggling with the world's highest inflation rate of over 231 million percent as of July last year.
Zimbabwe's parliament passed a constitutional bill last week to allow a coalition government of Mugabe and opposition rivals to be set up under a deal to end the political and economic crisis.