Venezuela Economic Forecast

Venezuela Economic Outlook

September 15, 2020

The economic panorama remained bleak as the coronavirus pandemic and dwindling oil production hammered domestic activity in the first half of the year and into Q3. Oil production in July remained close to the lowest level in nearly 80 years amid U.S. sanctions against PDVSA, the state oil company. Moreover, the last working oil rig was closed down in August as production in the Orinoco belt and the Maracaibo basin dried up. Furthermore, gasoline shortages led to rationing of supplies due to multiple shutdowns at PDVSA’s Paraguaná refining center in early September. In the political scene, upcoming elections are resulting in a fracturing of opposition parties—to the benefit of incumbent President Maduro—as opposition leaders disagree over whether to contest December’s congressional elections or abstain from a vote they consider fraudulent and rigged.

Venezuela Economic Growth

This year, the economy is projected to contract for a seventh consecutive year, amid ongoing U.S. sanctions and slack global oil demand. Oil output is set to fall in kind, limiting access to crucial sources of foreign currency. A steadily increasing rate of new Covid-19 cases, paired with the state’s limited capacity to deal with the fallout, is a key risk to the outlook. The LatinFocus Consensus Forecast panel projects the economy to contract 23.7% in 2020, which is down 1.8 percentage points from last month’s forecast. In 2021, the panel sees GDP shrinking 2.1%.

Venezuela Economy Data

2015 2016 2017 2018 2019
Population (million)30.630.730.328.927.5
GDP per capita (USD)10,5689,0924,7553,411-  
GDP (USD bn)32427914498.4-  
Economic Growth (GDP, annual variation in %)-6.2-17.0-15.7-19.6-  
Domestic Demand (annual variation in %)-11.8-26.3-21.1-18.2-  
Consumption (annual variation in %)-8.9-19.4-16.2-20.1-  
Investment (annual variation in %)-20.4-45.1-45.3-37.5-  
Manufacturing (annual variation in %)-5.4-  -  -  -  
Retail Sales (annual variation in %)-  -  -  -  -  
Unemployment Rate6.87.37.26.9-  
Fiscal Balance (% of GDP)-15.6-16.8-18.2-  -  
Public Debt (% of GDP)74.792.3120-  -  
Money (annual variation in %)1011591,12163,2574,946
Inflation Rate (CPI, annual variation in %, eop)181274863130,0609,585
Inflation Rate (CPI, annual variation in %)12225543865,37419,906
Inflation (PPI, annual variation in %)-  -  -  -  -  
Benchmark Interest Rate (%)14.5914.6214.7715.0024.00
Stock Market (annual variation in %)2781173,884126,9855,521
Exchange Rate (vs USD)6.3010.0010.00638.246,621
Exchange Rate (vs USD, aop)6.309.2910.0081.9415,910
Current Account (% of GDP)-5.6-0.46.18.7-  
Current Account Balance (USD bn)-16.1-3.98.78.6-  
Trade Balance (USD billion)3.911.022.020.9-  
Exports (USD billion)37.227.434.033.7-  
Imports (USD billion)33.316.412.012.8-  
Exports (annual variation in %)-50.1-26.424.2-1.0-  
Imports (annual variation in %)-29.5-50.9-26.66.5-  
International Reserves (USD)16.411.09.78.87.5
External Debt (% of GDP)38.645.778.7110-  

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Venezuela Facts

Value Change Date
Bond Yield5.500.0 %Aug 19
Exchange Rate248,8320.0 %Aug 17

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