Venezuela Economy 1997

Economy - overview The petroleum sector dominates the economy, accounting for roughly 25%of GDP, 70% of export earnings, and 50% of central government revenues. Itis likely to become even more important as the state petroleum company plansto double its production over the next ten years. The non-petroleum sectorshave been contracting, however, with GDP shrinking by 1.6% during 1996. Realizingthe failure of interventionist policies, the CALDERA administration embarkedon a comprehensive reform program and successfully negotiated a $1.4 billionstand-by agreement with the IMF. The state eliminated price and exchange controls,reduced the long-standing subsidy on gasoline, and revitalized its stalledprivatization program. Foreign investors reacted positively and the Caracasstock exchange ended 1996 as the world's best performing stock market. Theinflux of foreign investment and a windfall of oil revenues resulting fromhigher-than-expected international oil prices raised Venezuela's reservesto over $15 billion. As a result, Venezuela used only the first tranche ofthe IMF credit - $400 million. The currency depreciated sharply followingthe exchange liberalization, and caused an inflationary burst that led toa 103% yearly rate of inflation, the highest in Venezuelan history. The bolivarhas since strengthened and inflation fell near the end of the year. The macroeconomicadjustments should take hold in 1997, and the economy is expected to growby 4% or more. Increased salary demands by public and private sector workers,however, threaten a renewal of inflationary pressures.

GDP purchasing power parity - $197 billion (1996 est.)

GDP - real growth rate -1.6% (1996)

GDP - per capita purchasing power parity - $9,000 (1996 est.)

GDP - composition by sector
agriculture: 5%
industry: 41%
services: 54% (1993)

Inflation rate - consumer price index 103% (1996)

Labor force
total: 8.8 million
by occupation : services 64%, industry 23%, agriculture 13% (1993)

Unemployment rate 13% (1996 est.)

Budget
revenues: $11.99 billion
expenditures : $11.48 billion, including capital expenditures of $2.3 billion (1996est.)

Industries petroleum, iron ore mining, construction materials, food processing,textiles, steel, aluminum, motor vehicle assembly

Industrial production growth rate 0.5% (1995 est.)

Electricity - capacity 18.966 million kW (1995)

Electricity - production 74.886 billion kWh (1995)

Electricity - consumption per capita 2,887 kWh (1995 est.)

Agriculture - products corn, sorghum, sugarcane, rice, bananas, vegetables, coffee; beef, pork,milk, eggs; fish

Exports
total value : $22.8 billion (f.o.b., 1996 est.)
commodities: petroleum 72%, bauxite and aluminum, steel, chemicals, agriculturalproducts, basic manufactures
partners: US and Puerto Rico 55%, Japan, Netherlands, Italy

Imports
total value : $10.2 billion (f.o.b., 1996 est.)
commodities: raw materials, machinery and equipment, transport equipment, constructionmaterials
partners: US 40%, Germany, Japan, Netherlands, Canada

Debt - external $26.5 billion (1996)

Economic aid
recipient: ODA, $46 million (1993)

Currency 1 bolivar (Bs) = 100 centimos

Exchange rates bolivares (Bs) per US$1 - 476.840 (January 1997), 417.333 (1996), 176.843(1995), 148.503 (1994), 90.826 (1993), 68.376 (1992)

Fiscal year calendar year

NOTE: The information regarding Venezuela on this page is re-published from the 1997 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Venezuela Economy 1997 information contained here. All suggestions for corrections of any errors about Venezuela Economy 1997 should be addressed to the CIA.