Articles

EL UNIVERSAL: “Venezuelan economy down 3.3 percent in 2009 amidst world oil crisis”

In Uncategorized on March 3, 2010 by German Rivero-Zerpa

Venezuela’s economy fell by 3.3 percent in 2009, swept away by the global crisis and falling oil prices, the main export of the country, informed the Central Bank of Venezuela (BCV).

In the fourth quarter 2009, Gross Domestic Product (GDP) fell by 5.8 percent over the same period of 2008. This, together with the decline of 2.3 percent in the first nine months, resulted in a contraction of 3.3 percent in the year, the BCV said in a statement, Efe reported.

Last December, the president of the BCV, Nelson Merentes, in his traditional year-end speech and based on preliminary data, said that the economy had shrunk by 2.9 percent in 2009, noting it was the first fall that Venezuelan GDP suffered in the past five years.

The BCV said in the report released on Tuesday that the oil business declined by 7.2 percent in 2009 over the previous year, due to the “lower level of production” of the country, the fifth largest exporter of crude.

The drop in production was due to compliance with the cuts adopted by the Organization of Petroleum Exporting Countries (OPEC), of which Venezuela is a founding member, said the BCV.

According to official figures, Venezuela agreed to reduce oil production by 364,000 bpd in 2009, leaving production at some 3 million barrels a day.

Meanwhile, non-oil activity contracted by 4 percent in the fourth quarter of 2009, said the official report without specifying a global figure of the year on the conduct of that business.

During the fourth quarter, the largest declines in non-oil activity occurred in the areas of transport services (-16.9 percent), commerce (-13.9 percent ) manufacturing (-6.9 percent), mining ( -4.8 percent), construction (-3.5 percent), and real estate services (-2.8 percent), said the BCV.

By contrast, growth was recorded in the sectors of communications (10.5 percent ), electricity and water (5.5 percent), producers of general government services (2.8 percent) and community, social and personal services (0.6 percent), the BCV added.

In 2009, the so-called aggregate supply shrank by 17.1 percent, hit both by declining imports (-39.8 percent), and by the aforementioned decline in GDP, the report of the BCV said.

The government said that in 2010 the economy would record a “modest” growth of 0.5 percent.

The Venezuelan economy grew by 4.8 percent in 2008, 8.4 percent in 2007, 10.3 percent in 2006, up 9.4 percent in 2005 and 17.9 percent in 2004.

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