Bad government, low oil prices and a tale of woe:
“Venezuela has become a failed state.
According to the International Monetary Fund’s latest projections, it has the world’s worst economic growth, worst inflation and ninth-worst unemployment rate right now. It also has the second-worst murder rate, and an infant mortality rate at public hospitals that’s gotten 100 times worse itself the past four years. And in case all that wasn’t bad enough, its currency, going by black market rates, has lost 99 percent of its value since the start of 2012. It’s what you call a complete social and economic collapse. And it has happened despite the fact that Venezuela has the world’s largest oil reserves.”
The regime’s cronies were happy to take money out of the company, but not so much about putting what they needed back in so that they’d continue to be able to turn their extra-heavy crude into refined oil. As a result, production fell 25 percent between 1999 and 2013. And the second reason has just been that oil prices have fallen in half the past two years. Add those two together — selling less oil for less than before — and you have an economic death sentence for a country that doesn’t have an economy so much as an oil-exporting business that subsidizes everything else.
Here is the EIA’s analysis of Venezuela:
http://www.eia.gov/beta/international/analysis.cfm?iso=VEN
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