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Venezuela announces economic growth of 18 points of GDP for 2022


Analysts and ECLAC calculate the increase in half, but the economy takes its first leap after having suffered the most serious production contraction in its history for seven years

Calixto Ortega, president of the Central Bank of Venezuela, in Caracas in 2020. DIOGENES PRIMERA (Reuters)

After six years of spectacular contraction, and a 2021 stabilization in the moat, the Venezuelan economy has grown during 2022. The Central Bank of Venezuela announced that the Gross Domestic Product (GDP) in 2022 will register a growth of 18.70% and He added that this is "the largest in Latin America for four consecutive semesters."

It is the first time that official figures have been published after the Chavista government had refused to give them in recent years.

President Nicolás Maduro congratulated himself on the circumstance and affirmed that this result "is the product of the effort of national work, of union and articulation."

Although no one denies the recovery, independent analysts and firms, and international institutions, such as the Economic Commission for Latin America (Cepal), place the growth rate of the national economy in a much lower range.

Most Venezuelan economists calculate it at 9%, while Cepal places it at 10.

The experts explain that the recovery of the Venezuelan economy is showing the effects of a productive rebound after several years of a free fall that seemed indefinite over time and is, to a large extent, a consequence of the strategic reorientation of the Bolivarian Government towards the fundamentals of the market economy and the desperate search for capital, in force since 2019.

Asdrúbal Oliveros, economist and managing partner of the firm Ecoanalítica, affirms that the recovery of 2022, although evident, "is quite weak, uneven and insufficient."

He maintains that it is well established in the area of ​​the capital, and is based on the recovery of trade, partly thanks to the measure to dollarize part of the economy.

“It is a growth focused on a few sectors, about nine in total, mainly food, health, personal care, technology, packaging, media, commerce, transportation.

The increase in productive activity has been concentrated in Caracas, the Lara-Portuguesa axis, or Dairy, with enormous differences in income, ”he adds.

Oliveros considers that the circumstance is the product of the increase in government revenue, which according to Ecoanalítica has recovered by 90%, "and of the activity of the private sector and the stimulus for imports."

Remittances from the diaspora are also protagonists of the increase in national income.

“There is a fiscal boost as a result of the increase in oil revenues, the price of which has risen because of the war in Ukraine,” says José Manuel Puente, an economist at the University of Oxford and the Institute for Higher Administration Studies, IESA.

"The question is how sustainable, and of what quality is that growth."

“The truth is that in Venezuela, the national accounts, the balance of payments, and the international investment position have not been published since 2019,” observes Roland Balza, an academic at the Andrés Bello Catholic University, who affirms that he is not unaware of the recovery, but he is doubtful about the magnitude of the figures.

“There is no complete or transparent information.

Since 2016 the National Budget has not been published.

Without detailed information it is difficult to have estimates on GDP,

Although the figures offered have the Government enthusiastic, the experts consulted comment that a lot of work will have to be done, and for several years, so that the national productive apparatus resumes its old physiognomy after the economic collapse in force in Venezuela since 2014, when Maduro took office, and that materialized a crack of 80% of local GDP in 2019.

The structural difficulties of the electrical service place a ceiling on industrial activity;

there are still many areas with enormous disinvestment, and oil activity, which in its good times could produce up to 3,500,000 barrels of crude oil per day, today barely reaches 700,000.

The shortage of bank credit continues to be a bottleneck to be resolved.

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Source: elparis

All news articles on 2022-11-29

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