Tuesday, October 07, 2003

NOT BUILDING A FUTURE (literally)
Tuesday 7, October 2003

Sometimes simple numbers can tell more about the sad state of the Venezuelan economy than whole treatises on it. Tal Cual publishes today the kilogram consumption per capita of cement. Cement in Venezuela is particularly important as it is used much more in construction than in the US. For example all walls in apartment buildings are in hollow bricks cemented together, and not in plywood.

The numbers

 COUNTRY Kg per capita
 Venezuela in the late 70ies 380
 Venezuela today 110
 Dominican Republic 700
 Spain  680

Yet, the shanties keep multiplying in large cities and the government keeps bragging of all the social housing it is building. Clearly something is not right.

It is interesting to note that the Dominican Republic is using 6 times more cement than Venezuela. The big tourist development? New roads? Or just that it is an economy growing normally and slowly but surely satisfying the needs of its people? I do not have the answer but now I understand much better why the Dominican Republic did not seem particularly worried about Venezuela cutting its oil exports there two weeks ago. This cement consumption would suggest that the Dominican Republic can afford to buy oil somewhere else.

These numbers are really worrisome. Clearly it reflects that the construction sector is at a standstill with all the implications that this carries on jobless rate and the dynamism of the economy. It seems that construction today relies on the few drops of oil that the administration is releasing to build a bridge here and some social housing there, not on private investments, confidence in the future. But maybe this is what the current administration really wants, a country totally depending on it, even to fix the holes in the walls of our houses.

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Note: Tal Cual is a pay site and the article cites its source for these numbers from the Association of Constructors in Venezuela. I am thus taking these numbers at face value. But from what I can see in the streets, construction is definitely not doing very well in the country. Well, solid construction that is because shacks are sprouting right and left.

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