The Chávez Administration at 10 Years: The Economy and Social Indicators

[This paper looks at some of the most important economic and social indicators during the 10 years of the Chávez administration in Venezuela, as well as the current economic expansion. It also looks at the current situation and challenges.]

The Chávez Administration at 10 Years: The Economy and Social Indicators

February 5th 2009, by Mark Weisbrot, Rebecca Ray and Luis Sandoval - CEPR

For the full report in its original PDF format, click here (255kb).

Executive Summary
This paper looks at some of the most important economic and social indicators during the 10 years of the Chávez administration in Venezuela, as well as the current economic expansion. It also looks at the current situation and challenges.

Among the highlights:
The current economic expansion began when the government got control over the national oil company in the first quarter of 2003. Since then, real (inflationadjusted) GDP has nearly doubled, growing by 94.7 percent in 5.25 years, or 13.5 percent annually.

Most of this growth has been in the nonoil sector of the economy, and the private sector has grown faster than the public sector.

During the current economic expansion, the poverty rate has been cut by more than half, from 54 percent of households in the first half of 2003 to 26 percent at the end of 2008. Extreme poverty has fallen even more, by 72 percent. These poverty rates measure only cash income, and does take into account increased access to health care or education.

Over the entire decade, the percentage of households in poverty has been reduced by 39 percent, and extreme poverty by more than half.

Inequality, as measured by the Gini index, has also fallen substantially. The index has fallen to 41 in 2008, from 48.1 in 2003 and 47 in 1999. This represents a large reduction in inequality.

Real (inflationadjusted) social spending per person more than tripled from 1998-2006.

From 1998-2006, infant mortality has fallen by more than onethird. The number of primary care physicians in the public sector increased 12fold from 1999-2007, providing health care to millions of Venezuelans who previously did not have access.

There have been substantial gains in education, especially higher education, where gross enrollment rates more than doubled from 1999/2000 to 2007/2008.

The labor market also improved substantially over the last decade, with unemployment dropping from 11.3 percent to 7.8 percent. During the current expansion it has fallen by more than half. Other labor market indicators also show substantial gains.

Over the past decade, the number of social security beneficiaries has more than doubled.

Over the decade, the government's total public debt has fallen from 30.7 to 14.3 percent of GDP. The foreign public debt has fallen even more, from 25.6 to 9.8 percent of GDP.

Inflation is about where it was 10 years ago, ending the year at 31.4 percent. However it has been falling over the last half year (as measured by threemonth averages) and is likely to continue declining this year in the face of strong deflationary pressures worldwide.

The current situation and challenges:

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