Venezuela's imports may lead to consumption record year
Commerce has finally recovered losses reported during recession, yet manufacturing remains low. According to the Central Bank's data, manufacturing is 4.6% below with respect to 2008, whereas imports have swelled 13.5% as against the first three quarters of 2008, a record year for imports
Venezuela's economy has shown steady growth over the last eight quarters, just as much as private final consumption. In fact, the latter has not only grown, but skyrocketed over the last five quarters. Nonetheless, domestic demand has not been met by domestic production. It has been satisfied by imports, instead.
After six quarters of consecutive shrinkage (2009-2010), private consumption gradually increased from 2.7% in the second quarter of 2010 to 7.8% by the end of the third quarter of 2012.
As a matter of fact, from July-September, consumption reported its highest volume in history, the Central Bank of Venezuela (BCV) reveals. Furthermore, it all seems Venezuela will record the highest consumption ever in 2012.
This upward trend has allowed commerce to recover losses reported during recession. Until recently, the best performance for the sector had been that from 2008, yet by September 2012 the BCV reported a 1.4% hike with respect to that year.
Commerce jumped 9.7% in the third quarter this year as against that from 2011. The figure recorded this year is in connection with the presidential election held on October 7, 2012, which led to substantial growth in public expenditure.
The advance of the sector was due to growth in global supply, which reported the highest volume in history during the first three quarters of a year. It actually surpassed by 6.8% the index recorded in 2008, when oil prices peaked and exports led to a rise in supply.
While commerce recovered losses suffered during recession, manufacturing has not. In the third quarter of this year, manufacturing spiked 3% with respect to 2011, yet it is 3.8% below the level registered during the same period in 2008.
According to the BCV, manufacturing was 4.6% below the figures recorded in 2008. In other words, although the economy has recovered from the six-month stagnation period, manufacturing, which accounts for 14.4% of the GDP, has not.
Meanwhile, imports seem to smash a historical record; inter-annual growth stood at 17% in the third quarter of this year mainly due to imports from the public sector (41.7%).
Last quarter, imports amounted to USD 13.9 billion, 7.14% above the ones recorded during the same period in 2008, a record year for imports (USD 50.9 billion).
In depth, so far this year, imports have leaped 13.5% with respect to 2008. From January-September 2008, they stood at USD 35.8 billion whereas this year they were reported at USD 40.7 billion through September.
Translated by Jhean Cabrera
Cristian Fonseca, a businessman in La Candelaria district downtown Caracas, was doing the accounts in his small shop office on Sunday December 21, 2008. The Christmas shopping season kept him working late hours into the night. It was around 11 p.m. and his phone rang. A friend broke the bad news to him over the telephone.