World Bank, International Monetary Fund Agree: Venezuela’s Economy to Decline While Most Others Grow in South America

April 22, 2010

With the worst of the worldwide economic recession having passed, most would assume that national economies have nowhere to go but up. And they would be right – unless they are talking about Hugo Chávez’s Venezuela.

Economic forecast reports released this week by both the World Bank and the International Monetary Fund conclude that while almost every country in the Western Hemisphere will see modest to substantial economic growth in 2010, Venezuela’s economy will continue to deteriorate.

The World Bank’s Chief Economist for Latin America blamed the plummeting Venezuelan economy on President Chávez’s anti-private property policies: “In Venezuela we are seeing a phenomenon in which private activity, productivity, business and private production is falling.”

Both reports project that the Venezuelan GDP will dip 2.6 percent in 2010, making it the only South American nation projected to have a negative GDP. Only one country is expected to have worse economic progress: earthquake ravaged Haiti. All other South American countries will see their GDPs improve by two to six percent.

The IMF report compared Venezuela’s economy to that of its neighbors. It states that “the [economic] rebound is projected to be relatively strong in Bolivia and Paraguay, whereas the recovery is expected to be delayed and weak in Venezuela, given ongoing power shortages. “

The IMF report further projects that by 2015 only three countries in the Western Hemisphere will have worse economies than that of Venezuela.