Caracas Chronicles

A few days ago, Spanish daily ABC published an article about Venezuela’s weak position on external assets, basically arguing that the country does not have enough currency to pay for the imports it seriously needs. ABC somehow got access to a weekly report from the Ministerio del Poder Popular para la Planficación (where Jorge Giordani remains as titular head) that tracks a relatively wide selection of economic indicators.

Beside the information about falling foreign-exchange reserves, and the fact that currency allocations from Cadivi do not cover imports, it’s interesting to check the original document where the information came from.

From all the information available, our personal favorites are (in order of appearance):

• The fall in annualized production of state-owned cement and steel industries. This explains, at least partially, the results recently published by BCV, showing the growth rate in the construction industry falling from 16.6% in 2012, to -2.3% in 2013.
• Venezuela’s country risk is steadily above Argentina’s since September, 2013. So, huge oil reserves are not enough to make markets trust you more than they trust a country that defaulted in 2001.
• The minimum wage measured in real terms in 2014 is pretty much the same as it was in 1991. In constant BsF from 2007, the minimum wage is now BsF 628, and it was BsF 632 in 1991. The top real minimum wage was BsF 955, way back in 1987.
• Imports fell 11% from US$ 59.3 billion in 2012 to US$ 53.0 billion in 2013. This is interesting to note, just because BCV has not yet published the Balance of Payments’ results for the last trimester of the 2013.
• Alleged Cadivi allocations fell from US$ 56.2 billion in 2012 to US$ 51.3 billion in 2013. We say “alleged”, because that amount actually corresponds to total currency expenses from the BCV. It’s not just Cadivi, but also Aladi, Sucre, Sicad, external debt payments, Fonden payments and everything else (you can check it).
• Oil production in 2013 was 2.8 million barrels per day, below the 2.9 million barrels reported for 2012, and well below the 3.5 million barrels we were supposed to reach. It’s curious that since September 2013, the oil ministry apparently stopped sending first-hand data for the report, and now the source indicated for Venezuela’s oil production data is OPEC’s Oil Market Report.
• Car sales are LOW. Annualized car sales fell 86% in March of2014. In the 1^st trimester 2014, sales reached 1,213 units, one fourth of the 12,876 units sold in the 1^st trimester of 2003, when a general strike had all but halted the Venezuelan economy.

There’s more to see. Check it out here.