Tuesday, June 06, 2006

The more you dig, the better it gets 

Last week I posted some numbers on U.S. investment in Venezuela that showed that Venezuela outperforming such opposition darlings as Colombia, Brazil, and, gasp, Chile. For some reason that post seemed to strike a nerve as a number of opposition supporters showed up to cast aspertions upon the numbers. Among the complaints were the numbers weren't over long enough period of time to be meaningful, its all just oil industry investment, and surely the numbers were better when the opposition was running the country.

Of course, the numbers I had available weren't detailed enough to be able to dispute any of those assertions. But with a little digging I was able to find more detailed numbers. I got them from the Venezuelan-American Chamber of Commerce, which is about as pro-Chavez as the Wall Street Journal, which is to say, not at all. So lets look at what information they have:

This slide gives no numbers but it makes a very important point about the subsequent slides and their numbers. They DO NOT include investments in the oil, petrochemical, or mining industries. So when looking at the numbers we can immediately discount the opposition complaints of "its all just investment in the oil sector". Now that that is clear lets get to some numbers.

This chart shows investment by the United States in Venezuela by semester from 2000 to the first half of 2005. As you can see after a flat or even downward trend during the turmoil of 2002/2003 investment has risen sharply. In the first half of 2005 it was up a staggering 724% compared to the first semester of 2004. I'm sure some opposition supporters will show up and complain that it should have been up 1,000%. But I think 724% is pretty darn good!

To get some longer term persective and see how current levels of investment compare to the previous government lets look at the next slide:

Note that this slide only goes up to 2004 so the year with the 724% increase, 2005, is not included. But it does have the advantage of going back to 1996, 1997 and 1998 which were years before Chavez came to power (and opposition presidential candidate Petkoff was in charge of the economy). While the performamce in 1997 and 1998 wasn't bad as Vencham itself notes there has been an overall increase in investment (tendencia creciente) which is shown by the red line which averages out the numbers. In 2004 investment from the U.S. was higher than in any of the years Petkoff was running things. Yet he has the audacity to constantly complain about the lack of investment now! And lest we forget, investment skyrocketed in 2005 as the economic boom continued so that MUCH more investment in pouring into Venezuela from the U.S. now than under the previous government.

To summarize, when it comes to investment from the U.S. in Venezuela:

1) The trend under Chavez has been for INCREASING investment.

2) The amount of investment under Chavez exceeds the amount under the previous government.

3) The above trends are EXCLUSIVE of investment in the oil sector.

So now that the facts have spoken I hope our opposition visitors have had their fears assuaged and can clearly see that Chavez has improved the investment climate in Venezuela, at least as it relates to investment from the United States.


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