Economy

May
28
2010
Posted by
admin
Comments

Report: over 760 expropriations in Venezuela despite public repudiation for Chávez’s measures

A report released this week by a Venezuelan civil leadership group shows the Chávez government has expropriated 762 companies between 2005 and 2009. Last year alone, 374 expropriation cases were documented. The report confirms a disturbing trend of increased government hostility towards the private sector in Venezuela.

President Chávez’s war against private property intensifies the pressure on an already ailing Venezuelan economy. Also this week, Venezuela’s Central Bank announced a 5.8% decline in the country’s GDP during the first quarter of 2010. President Chávez’s anti-private property measures are “seriously affecting the production capacity and the ability to meet consumers’ needs,” according to Venezuela’s Confederation of Industries President Carlos Larrazábal.

The release of the expropriation data coincided with the release of a new poll showing widespread repudiation by Venezuelans for Mr. Chávez’s measures. The survey, conducted by Alfredo Keller & Associates, reveals that 80% of Venezuelans reject Mr. Chávez’s expropriation measures. The poll also shows that 61% of Venezuelans believe there should be a change in government in their country.

While the majority of Mr. Chávez’s expropriations have been suffered by Venezuelan companies and private property owners, foreign companies also have been impacted by his arbitrary actions. Some of the U.S. companies affected include Cargill, Hilton Hotels, Verizon, AES, Wendy’s and McDonald’s.

 
May
28
2010
Posted by
admin
Comments

Hugo Chávez’s implosion continues in Venezuela

The Washington Posts’s Jackson Diehl just published a must-read column in which he proves with numbers and bullet-proof arguments that the “the implosion of Chavez’s self-styled “Bolivarian socialism” is accelerating”.

In his piece, “Hugo Chavez’s implosion continues in Venezuela”, Diehl writes:

“Figures reported Tuesday by the Chavez-controlled central bank portrayed an economy that is completely out of sync with the rest of the region — and perhaps unique in the world in the degree of its current distress. Gross national product fell by 5.8 percent in the first quarter, while inflation remained at 30 percent. Private investment plummeted by 27.9 percent as capital continued to flee the country.

Private economists suspect the economic contraction is even worse than what the official figures concede. But let’s assume they are correct. Venezuela’s crash compares with quarterly growth rates of 8 percent in Brazil, Argentina and Mexico. It comfortably exceeds the collapse of Greece, which contracted by 3 percent in the first quarter.

Inflation in Caracas is triple the next highest rate in Latin America (Argentina) and is more than double that of the next worst economy (Pakistan) among the 56 tracked by the Economist’s website. Even Zimbabwe, which used to be considered the world’s economic basket case, looks good compared to Venezuela: it is expecting 6 percent growth this year, while inflation is under 5 percent.

In short, economic recovery is taking hold across the world — except in Chavez’s Venezuela.

When I pointed out back in January that Chavez’s revolution was collapsing, a chorus of left-wing bloggers rose up in protest.

The extremists among them claim that Venezuela is actually doing better than the rest of the world, because (loony version) Chavez is destroying evil capitalism or because (slightly less loony version) Venezuela’s implosion is irrelevant to the rest of the region.”

You can read here the entire piece.

Related columns:

Peter M. Burelli on Jackson’s Diehl column (PMBComments, May 27, 2010)

Hugo Chávez’s revolution crumbled (Jackson Diehl, Washington Post, January 25, 2010)