Report Examines Economy and Social Indicators During the Chavez Decade in Venezuela

The Center for Economic and Policy Research (CEPR) released a report today on the Venezuelan economy on the tenth anniversary of President Hugo Chavez's tenure, which began in February 1999.

"Looking at the economic data and social indicators, it's not difficult
to see why Chavez 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 Chavez Administration at 10 Years: The Economy and Social Indicators."

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.