SkipCaptcha, Administrators
3,055
edits
Changes
→Economy
==Economy==
==Economy==
[[File:Cathedral of Puerto Ayacucho, Amazonas, Venezuela.jpg|thumb|300px|Puerto Ayacucho, Amazonas.]]
Real GDP increased by 10.3% in 2006. The economy recovered strongly in 2004 (17.9%) and 2005 (9.3%) after two consecutive years of deep economic recession (in 2003, Venezuelan GDP contracted 7.7%, after contracting 8.9% in 2002). The economic recovery has been driven by a large increase in government expenditures, based on an oil windfall, which in turn generated higher consumption levels.
Real GDP increased by 10.3% in 2006. The economy recovered strongly in 2004 (17.9%) and 2005 (9.3%) after two consecutive years of deep economic recession (in 2003, Venezuelan GDP contracted 7.7%, after contracting 8.9% in 2002). The economic recovery has been driven by a large increase in government expenditures, based on an oil windfall, which in turn generated higher consumption levels.
As of January 23, 2003, all foreign exchange requests must be approved by the National Exchange Control Administration (CADIVI) and the Central Bank (BCV) completes all legal purchase and sale of foreign currency. The current exchange control regime rates for U.S. dollar exchange rate are: Bs. 2,144.60=U.S. $1.00 for purchase operations, and Bs. 2,150=U.S. $1.00 for sale operations. The national budget for 2007 assumes that the government will not devalue this year. Nontheless, some local economists expect devaluation in late 2007 due to the increasing disparity between official and parallel market rates.
As of January 23, 2003, all foreign exchange requests must be approved by the National Exchange Control Administration (CADIVI) and the Central Bank (BCV) completes all legal purchase and sale of foreign currency. The current exchange control regime rates for U.S. dollar exchange rate are: Bs. 2,144.60=U.S. $1.00 for purchase operations, and Bs. 2,150=U.S. $1.00 for sale operations. The national budget for 2007 assumes that the government will not devalue this year. Nontheless, some local economists expect devaluation in late 2007 due to the increasing disparity between official and parallel market rates.
Central Bank-held international reserves increased to over U.S. $36 billion at the end of 2006. The reserves would have been higher, but the BCV transferred $6 billion to the National Development Fund (FONDEN) during the last quarter 2005, as directed by the Central Bank Law (July 2005) and an additional $4.3 billion in 2006. The level of international reserves is expected to decrease during 2007 after additional transfers of foreign reserves to FONDEN and because the Central Bank Law established that state-owned oil company PDVSA will only transfer the foreign exchange earnings needed for its domestic expenses, taxes, royalties, and dividends to the BCV, and would transfer the rest to FONDEN.
[[Image:Canaima Venezuela.jpg|thumb|250px|Canaima]]
[[Image:Canaima Venezuela.jpg|thumb|250px|Canaima]]
Venezuelan sovereign debt, both domestic and foreign, has decreased in recent years in both absolute terms and as a percentage of GDP. Venezuela's external debt/GDP ratio of approximately 16% is low by Latin American standards. Venezuela's Emerging Markets Bond Index investment risk rating, at 202 basis points, dropped somewhat over 2005, but remained higher than many in the region.
Venezuelan sovereign debt, both domestic and foreign, has decreased in recent years in both absolute terms and as a percentage of GDP. Venezuela's external debt/GDP ratio of approximately 16% is low by Latin American standards. Venezuela's Emerging Markets Bond Index investment risk rating, at 202 basis points, dropped somewhat over 2005, but remained higher than many in the region.
Thanks to petroleum exports, Venezuela usually posts a trade surplus. The United States is Venezuela's leading trade partner. In 2006, the United States exported over $9 billion in goods to Venezuela, making it the 22nd largest market for the U.S. Including petroleum products, Venezuela exported about $36 billion in goods to the U.S., over the same period, making it our 9th largest source of goods.
Thanks to petroleum exports, Venezuela usually posts a trade surplus. The United States is Venezuela's leading trade partner. In 2006, the United States exported over $9 billion in goods to Venezuela, making it the 22nd largest market for the U.S. Including petroleum products, Venezuela exported about $36 billion in goods to the U.S., over the same period, making it our 9th largest source of goods.
The government of Venezuela has taken a vocal role against the proposed Free Trade Agreement of the Americas (FTAA). Its stated goal is to expand its Bolivarian Alternative for the Americas (ALBA) project and develop a South American bloc (see Foreign Relations).
The government of Venezuela has taken a vocal role against the proposed Free Trade Agreement of the Americas (FTAA). Its stated goal is to expand its Bolivarian Alternative for the Americas (ALBA) project and develop a South American bloc (See Foreign Relations).
Manufacturing contributed an estimated 17% of GDP in 2006. The manufacturing sector continued its recovery started in 2004, but remained hindered by a marked lack of private investment. Venezuela manufactures and exports steel, aluminum, textiles, apparel, beverages, and foodstuffs. It produces cement, tires, paper, fertilizer, and assembles cars both for domestic and export markets.
Manufacturing contributed an estimated 17% of GDP in 2006. The manufacturing sector continued its recovery started in 2004, but remained hindered by a marked lack of private investment. Venezuela manufactures and exports steel, aluminum, textiles, apparel, beverages, and foodstuffs. It produces cement, tires, paper, fertilizer, and assembles cars both for domestic and export markets.