|Center for Economic and Policy Research
Report Examines Economy and Social Indicators During the Chávez Decade in Venezuela
WASHINGTON, D.C. - The Center for Economic and Policy Research (CEPR)
released a report today on the Venezuelan economy on the tenth
anniversary of President Hugo Chávez's tenure, which began in February
"Looking at the economic data and social indicators, it's not
difficult to see why Chávez remains popular and has won so many
elections, despite overwhelmingly hostile media coverage," said Mark
Weisbrot, Co-Director of CEPR and lead author of the report, "The
Chávez Administration at 10 Years: The Economy and Social
Among the highlights:
* The current economic expansion began when the government got control
over the national oil company in the first quarter of 2003. Since
then, real (inflation-adjusted) GDP has nearly doubled, growing by
94.7 percent in 5.25 years, or 13.5 percent annually.
* Most of this growth has been in the non-oil sector of the economy,
and the private sector has grown faster than the public sector.
* During the current economic expansion, the poverty rate has been cut
by more than half, from 54 percent of households in the first half of
2003 to 26 percent at the end of 2008. Extreme poverty has fallen even
more, by 72 percent. These poverty rates measure only cash income, and
do not take into account increased access to health care or education.
* Over the entire decade, the percentage of households in poverty has
been reduced by 39 percent, and extreme poverty by more than half.
* There have been substantial gains in education, especially higher
education, where gross enrollment rates more than doubled from
1999-2000 to 2007-2008.
* Over the past decade, the number of social security beneficiaries
has more than doubled.
* Real (inflation-adjusted) social spending per person more than
tripled from 1998-2006.
The report also examines the current economic situation and how the
country will be affected by lower oil prices. It concludes that
because of Venezuela's large accumulation of foreign exchange
reserves, it is unlikely to run into balance of payments problems even
if oil prices remain depressed for much longer than analysts and oil
futures markets are anticipating. The most important and immediate
challenge for Venezuela, according to the analysis in this report,
will be to implement a timely and adequate fiscal stimulus package to
counteract the effects of the global recession. Over the long run, the
analysis also sees a need for a more competitive exchange rate in
order to diversify away from oil.