Unexpectedly Intriguing!
May 9, 2005

This week's edition of the Carnival of the Uncapitalists (hosted by The All Spin Zone is highly abbreviated as the Carnival focuses upon Latin America as a theme. Being uncapitalists, the most interesting posts of the week focus on Venezuela's president:

  • The Green Lantern's Gretchen Ross' uncritical look at Venezuelan President Hugo Chavez' increasing use of paranoid anti-U.S. rhetoric.
  • A post at Fruits of Our Labour claims Hugo Chavez' socialist policies have led to economic growth of 17% in 2004 and drastic reductions in unemployment.

Quick Snapshot of Venezuela's Economy

After reading the latter post, I thought it might be interesting to take a closer look at Venezuela. The World Factbook notes in its overview of Venezuela's economy:

Venezuela continues to be highly dependent on the petroleum sector, accounting for roughly one-third of GDP, around 80% of export earnings, and over half of government operating revenues. A disastrous two-month national oil strike from December 2002 to February 2003, temporarily halted economic activity. The economy remained in depression in 2003, declining by 9.2% after an 8.9% fall in 2002. Despite continued domestic instability, output recovered strongly in 2004, aided by high oil prices. Both inflation and unemployment remain fundamental problems.

This information suggests that Venezuela's 16.8% GDP growth in 2004 is largely a recovery to pre-national oil strike levels, which given the increased price of oil, indicates that Venezuela's real economic output has not yet reached pre-strike levels.

Looking at unemployment levels, the World Factbook estimates Venezuela's 2004 average level of unemployment to be 17.1%. Other reports of unemployment statistics from the Central Bank of Venezuela (BCV) indicate that registered unemployment has declined from January 2004 to January 2005, moving from 19.1% down to 15.5%. This latter unemployment figure marks a return to pre-national oil strike levels. Venezuela's rate of unemployment peaked at 20.7% in January 2003.

The BCV forecasts Venezuelan GDP growth of 5% this year, with a continuing decline in unemployment levels.

More informtion about Venezuela's economy is available at Wikipedia.

Update: Broken link for Gretchen Ross' "The Green Lantern" repaired.

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