Venezuelan President Hugo Chavez has presented this Saturday, March 21 a series of economic measures against the global crisis. While the neoliberal governments intend to charge the debacle capitalist workers, Caracas paves the way for a progressive response. These include, among others, to release 100 billion of public investment over the next four years, an increase of 20% minimum wage in 2009 and limit the income of senior officials.
These 100 billion of public investment will result, inter alia, construction infrastructure and new housing . ( Photo: Seb )
The announcement was expected by many, including the opposition hoped unpopular measures such as higher gasoline prices and a devaluation of the Bolivar (money local). None of this will ultimately appear on the agenda. (1)
Against the current standard recommendations of the IMF or World Bank, Caracas presented on Saturday a plan for public investment to the tune of $ 100 billion (2) over the next four years. "The revolutionary government will invest a total mass of 100 billion dollars. And this does not include investments in oil that they will reach $ 125 billion. This is one of the strongest anti-crisis measures and counter-cyclical," said President Chávez.
Moreover, the 2009 budget of the state will be lowered (- 6.7%) and recalculated on a price per barrel of oil at $ 40 instead of $ 60 as a current basis. To to cope with this reduction, the State will nearly double its domestic debt and will save on salaries of top officials.
According to figures presented by President Chávez in the Council of Ministers, the external debt of Venezuela accounted for 64.1% of Gross Domestic Product (GDP) 20 years ago and now stands at 9.3% (end 2008 ). The internal debt is about it to 4.3% of GDP. "This low percentage today we can take steps to increase (domestic debt), computed accurately to protect us and strengthen us," he said.
also the agent called the National Assembly (Parliament) to legislate to limit the salaries of senior officials. Regarding the executables, a decree should be published in the coming days to revise and reduce the highest incomes. The lavish expenditure are also concerned. "We are eliminating the expense of luxury vehicles, gifts, construction of new offices, missions abroad, unnecessary advertising, etc..."
Minimum Wage Increase
The measures also include a minimum wage increase of 20% in two steps: 10% from 1 May and 10% in September. It will therefore, this year, the equivalent of 274 euros to 331 euros per month, is now among the highest in Latin America.
The only decision that will be directly reflected in the portfolio of the population, partly to balance the state budget is an increase of 3% of VAT. It rises from 9 to 12%, far behind the 16% of the late 90s. "In the same way as we reduced the VAT from 14 to 9% where we enjoyed the high oil revenues, now we make a conservative increase," noted Chavez.
Finally, the government confirmed the nationalization (announced several months ago) of the bank subsidiary of English group Santander, Banco de Venezuela . If this decision goes ahead, the Venezuelan State will control 25% of the banking sector and will be the largest player. These actions, accompanied by a strong desire to maintain social spending in education, health and infrastructure, show that there is no inevitable due to the capitalist crisis and a sovereign government, not subject to the dictates of international financial institutions and businesses can act the interests of workers ... the intention is there.
Notes:
(1) The private channel Globovision was even gone so far as to invent the imminent announcement of a decrease in the amount of foreign currency granted to every Venezuelan. The information, which proved totally false, was backed by several opposition media before being contradicted by a statement from the Ministry of Economy and Finance.
(2) On March 23, one dollar was equal to 0.73 euro.
Article published on the site The Left March 23, 2009
