Saturday, July 30, 2005

Venezuela notes 

The Venezuelan middle class keeps cruising along. A little while back I mentioned how automobile sales have increased dramatically over the past couple of years in a clear indication of how well the middle class is doing. Today we got another indicator. Venezuela’s shopping centers, frequented by the middle and upper classes, have seen their sales go up by 25% to 30% percent during the first half of this year. This statistic comes from Arnold Moreno, president of the Venezuelan Chamber of Shopping Centers (Cavececo), who added “we have seen an increase of 20% in the number of visitors to these establishments”. Also according to Moreno “we estimate that sales could come to 6.5 billion dollars this year or a little more which would put them at levels above those of 2001, and in that way we would have had not only a recovery but a sustained increase”

Moreno further added “if the situation of the country continues to be peaceful, its possible we could close the year with an increase of sales of 35% compared to 2004”

Indeed, it is nice to see how well Venezuela does with a little calm. With the middle class enjoying the benefits of an economy that is clearly doing quite well maybe they will continue to behave and allow the government to do what governments are supposed to do – run the country.


One bogus accusation often leveled against the government is that they don’t prosecute cases of corruption. Not only is it said they don’t prosecute any cases of corruption under this government it is claimed don’t prosecute any from the notoriously corrupt Fourth Republic. This is completely false. For example, just this week and ex-banker involved in the early 90s banking scandal (for those needing a brush up on the Venezuelan banking scandal see here) was sentenced to jail for defrauding deposit holders. Here is the article from Ultimas Noticias:

By decision of the Supreme Court, Rafael, Martin Guedez, ex-president of Banco Amazonas, is sentenced to 11 years in prison for having used funds given by Fogade [Venezuela's deposit insurance entity like the FDIC in the U.S.] for purposes other than helping depositors.

The now defunct Banco Amazonas was loaned by Fogade almost 8 billion bolivares between March 29 and June 10 of 1994, money which was used in high risk financial transactions for the benefit of companies related to the bank. This was strictly prohibited by Fogade and this use of the money prevented many depositors from ever being paid their money.

In addition to the crime of diverting money given by a public entity the banker was sentenced for publishing financial statements that didn’t reflect the true financial situation of the entity.

So here we see that the Chavez government is dealing with corruption, enforcing the law, and giving jail sentences when called for. Of course, there are other big fish out there that they could go after – some who made immense fortunes off their political connections through corruption and many of whom are closely tied to the anti-Chavez opposition. I just hope that when the Chavez administration does go after them the opposition is supportive of these criminals being brought to justice and doesn’t scream about political persecutions.


Lastly, there is yet more positive news on the poll front for Chavez. Previous polls recently mentioned on this blog have put Chavez’s level of support anywhere between 60% and 80%. The other day Datanalisis came out with another poll that put his support at 71.8%. Maybe Datanalisis does what I do when confronted with this type of contradictory information – it just splits the difference. In any event, Datanilisis, which is strongly anti-Chavez, did give one ray of hope to the opposition – the Presidential elections are still more than a year away and Chavez’s popularity could fall by then. True, but it ins't much for them to hang their hats on.


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