Venezuela flag Venezuela: Contexto político-econômico

Contexto econômico da Venezuela

Economic Indicators

Endowed with the largest oil reserves in the world, Venezuela is largely dependent on fluctuations in oil prices. The country experienced a 6% GDP growth in 2022 due to the increase in oil prices and the recovery in remittances sent to the country by Venezuelans abroad, followed by an estimated growth of 4% in 2023. Despite the recent recovery, GDP remains only one-fourth of the pre-crisis level in 2013. Venezuela has been in a deep recession since 2013, and according to the IMF, its GDP contracted more between 2013 and 2018 than the United States did during the Great Depression of 1929-1933. For 2024, the IMF forecasts growth at 4.5%.

The country's industrial activity continues to suffer from insufficient diversification and difficulties in importing intermediate products. The policy of redistributing petroleum through social measures was hindered by the weakness of oil prices, which have been in sharp decline since 2012, only recently recovering. This has reinforced the macro-economic imbalances that Venezuela suffers from. The consumer price index in Venezuela settled at 193% during 2023, slightly lower than expected, according to figures provided by the Venezuelan Observatory of Finance. Although this is the highest rate in the world, it is much lower than the level recorded the previous year when inflation stood at 305%. The hyperinflationary climate was created by several years of monetizing the public deficit, a free-falling currency that makes imports more expensive, a strong depreciation of the currency in both the official and black markets, and dramatic shortages of basic goods. The central bank’s policy of reducing the money supply is not expected to help reduce hyperinflation sustainably, as it does not address the economy’s key imbalances.Despite multiple minimum wage hikes decided by the government, real wages have continuously decreased, and household consumption is highly dependent on remittances from expatriates. Venezuela's government anticipates a 27% rise in revenue from the state-operated oil company PDVSA in 2024, following a loosening of U.S. sanctions amidst planned presidential elections and stagnant production. President Nicolas Maduro's administration projects total expenditure for the year to reach USD 20.5 billion, representing a 39% increase on 2023 spending. The temporary easing of sanctions, scheduled to remain in effect until April 2024 unless reversed by the U.S., has caused a surge in prices for Venezuelan crude. Analysts anticipate that this increase in revenue will prompt additional social spending by the government, aiming to secure support in the upcoming presidential election, in which Maduro is likely to seek reelection. According to the latest available data from the IMF, public debt stood at 159.5% of GDP in 2022 (down from 248.4% one year earlier).

In Venezuela, even though the minimum wage has been increased numerous times over the past few years, wage increases have not kept up with inflation. Therefore, purchasing power is weak and has greatly decreased in recent years; poverty has increased, and the health system is in a critical state. The unemployment rate has been rising for years, and the IMF estimated that this rate has surpassed half of the Venezuelan workforce. Nevertheless, the state has not released an official unemployment figure since 2021, when it claimed it was 7.9%. Furthermore, the country also faces a rise in insecurity, with the highest homicide rate in South America. Because of the country's current economic situation, there are severe shortages of basic goods, such as food and medicine - with Venezuela being among the countries with the highest rates of food insecurity in the world. As such, neighboring countries have been receiving a large number of Venezuelan migrants and refugees in recent years, with estimates suggesting that over 6 million people have left the country so far.

 
Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 92.1092.2197.680.000.00
GDP (Constant Prices, Annual % Change) 8.04.04.50.00.0
GDP per Capita (USD) 3,4223,4743,69200
General Government Gross Debt (in % of GDP) 159.50.00.00.00.0
Inflation Rate (%) n/a360.0200.00.00.0
Unemployment Rate (% of the Labour Force) 0.00.00.00.00.0
Current Account (billions USD) 3.312.023.320.000.00
Current Account (in % of GDP) 3.62.23.40.00.0

Source: IMF – World Economic Outlook Database, October 2021

Main Sectors of Industry

Compared to other Latin nations, agriculture has a smaller contribution to Venezuela's economy. The agricultural sector represents 5% of the Venezuelan GDP and employs 12% of the active population (World Bank, latest data available). The main agricultural products of the country are corn, soy, sugar cane, rice, cotton, bananas, vegetables, coffee, cocoa, beef, and pork meat, milk, eggs, and fish. However, Venezuela enjoys important natural resources, such as petroleum (their main natural resource), gas, gold, and silver mines, bauxite, and diamonds.

The industrial sector represents 37.2% of the GDP and employs 18% of the active population. The main industrial activities revolve around the petroleum sector - which is controlled by a State company and represents the first natural wealth of the country. According to OPEC, the country’s proved resources in petroleum stood at 303.22 billion barrels as of end-2022, which puts it in first place in the world ahead of Saudi Arabia. Actually, despite a continuous decline in petroleum production for the past few years, Venezuela remains largely dependent on revenue from petroleum, which accounts for nearly all of its earnings from exportation and for almost half of the government’s revenue. Additionally, other important industries are construction equipment, food, textile, iron, steel, aluminum, and engine parts assembly. However, due to the State control over the country's currency and prices, local industries have encountered difficulties acquiring the necessary goods to maintain operations or selling goods with profit on the local market. Overall, the manufacturing sector is estimated to account for 12% of GDP (World Bank). The private industrial production of Venezuela decreased by 4.3% in 2023 compared to the previous year, according to preliminary figures from the Confederation of Industrialists (Conindustria).

The service sector represents 51.7% of the GDP and employs 71% of the active population, making it a major source of revenue and jobs. The sector includes banking and finance, real estate, education, medicine, governmental agencies, hotels and restaurants, as well as entertainment. Together, these activities represent more than two-thirds of the total employment in Venezuela.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 13.1 17.5 69.4
Value Added (in % of GDP) 5.0 37.2 51.7
Value Added (Annual % Change) -4.6 -5.8 -0.4

Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}

Score:
24,7/100
World Rank:
177
Regional Rank:
32

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
3.09/10
World Rank:
82/82

Source: The Economist Intelligence Unit - Business Environment Rankings 2021-2025

 

Country Risk

See the country risk analysis provided by Coface.
 

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Sources of General Economic Information

Ministries
Ministry of Economy, Finance and Foreign Trade
Ministry of Foreign Affairs
Ministry of Industries and National Production
Statistical Office
National Institute of Statistics (in Spanish)
Central Bank
Central Bank of Venezuela (in Spanish)
Stock Exchange
Caracas Stock Exchange (in Spanish)
Economic Portals
Business News Americas
 

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