Macroeconomic Forecast Venezuela

September 2006 | Macroeconomic Forecasts

Foreign exchange reserves, which have been increasing rapidly since 2002, stood at a record high of US$23.9bn in 2005 (after the Chavez government moved US$5bn into the FONDEN social expenses fund). Venezuela's large accumulation of reserves has been underpinned by strong international demand for oil, coupled with high prices. As such, we project reserves (ex-gold) to register US$28.5bn by the end of this year, reaching US$32.8bn by 2007 (upwardly revised from US$26.0bn in both years). Although Venezuela has indicated that it intends to double its oil exports to China, we are somewhat sceptical about its ability to do so. Nevertheless,

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