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  HOME | Opinion (Click here for more)

VenEconomy: The Results Are There for All to See!

From the Editors of VenEconomy

It’s so hard to make the people ruling Venezuela for the past fifteen years understand that the way of Castro-communism leads only to the ruin of the nation and the impoverishment of its people.

Understanding that, for instance, by violating property rights the only thing they could get is destroying the efficient order of the country’s economic and productive activity as well as contract the economic growth, and with that deteriorating the quality of life of Venezuelans. Understanding that is essential to respect property rights, one of the most basic social institutions, one that buoys individual initiatives, entrepreneurship and the personal and collective progress.

Also understanding that, for example, it has been widely demonstrated there is an unbreakable link between economic freedom and prosperity, and as Rafael Alonzo from Cedice, a local nonprofit organization, puts it, “the highest-rated countries as to economic freedom offer their citizens a better quality of life and prosperity, in comparison to lowest-rated countries, where oppressive regimes deny their citizens opportunities for economic growth and personal freedom.”

It is so impossible to reason with them that the feverish minds from those encouraging a dictatorial regime in the country keep insisting on controlling the economy, on destroying productivity, on seizing means of production, distribution and commercialization, on preventing the market forces from flowing, and on taking over all institutions from the State.

The consequences of this regrettable persistence on sinking the country into the “sea of happiness” are there for all to see. An economic crisis, a cash crisis in the public treasury, a high public indebtedness, a high dependence on imports in order to meet the demand of basic goods, shortages, inflation, and so on and so forth.

The negative results of this are reflected in just about every world or regional index measuring the performance as to competitiveness, economic freedom, country risk, climate to lure investment and property rights, and many others of social nature as poverty, transparency and freedom of speech.

For instance, Venezuela ranked No. 1 on the list of countries with the highest risk for investment on the planet in October, surpassing Argentina for the first time in almost a year, according to figures from the Emerging Market Bond Index (EMBI) compiled by JP Morgan Chase.

And talking about competitiveness, Venezuela ranked 134, out of 148 countries, according to the 2013 Global Competitiveness Report from the World Economic Forum, thus sharing the same poor performance with Chad, Equatorial Guinea, Burundi, Yemen and Sierra Leone. And as for economic freedom, Venezuela came in last out of 144 countries according to a report released by The Fraser Institute, a Canadian think tank.

Or the International Property Rights Index 2013, a study carried out by the International Property Rights Alliance that analyzes the “legal and political environment,” the “physical property rights” and “intellectual property rights,” where Venezuela has not made any progress since 2011 by keeping a score of 3.4 points out of 10, thus remaining on par with Haiti, Burundi and Libya.

With this outcome, it goes without saying the direction the Government is taking Venezuela.

VenEconomy has been a leading provider of consultancy on financial, political and economic data in Venezuela since 1982.

Click here to read this in Spanish


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