VENEZUELA LOWERS EXCHANGE RATE FOR OIL EARNINGS
Venezuela's cabinet approved a new
exchange rate for oil and mining export earnings, setting it at
14.50 bolivars to the dollar from 7.50 bolivars previously,
Minister Manuel Azpur UA said.
    Azpur told reporters after a cabinet meeting that the
measure is "fundamental to conserving the economic and financial
strength of the petroleum industry."
     He said the new exchange rate, which goes before the
central bank for final approval tommorrow, will allow the state
oil company Petroleos De Venezuela, S.A.(PDVSA) to solve its
problem of working capital and implement investment plans,
estimated at 20 billion bolivars for 1987. He did not say when
the measure would become effective.
   Venezuela's oil industry previously sold its dollar earnings
to the government at 7.50 to the dollar but bought foreign
exchange from its imports at 14.50 bolivars.
   The new exchange rate will promote purchases of domestic
goods and services by the industry, Azpur said. He added that
it would also put PDVSA in a position to purchase more
government debt bonds.                        
    PDVSA had available liquid assets of 20 billion bolivars at
the start of this year, of which nine billion were in a trust
fund in the Central Bank of Venezuela (BCV) and placed in
government bonds.
  According to a contract between PDVSA and the central bank,
the BCV must provide cash as the oil industry requries by
repurchasing the bonds.
    PDVSA's contribution to the treasury last year was 44.480
billion bolivars. It foreign earnings for oil and petrochemcial
sales were 8.023 billion dlrs.
 Reuter
