A SWOT analysis of Venezuela

A SWOT analysis of Venezuela

Strengths: A natural gift of the world’s most demanded resource, viz.oil. Huge militias of rough oil in the state. A roar in the oil monetary value in the international market causes a flourishing of the Venezuelan economic system ; a rise in the employment rate and the GDP of the state. It besides runsa current history excessowing to the excess grosss earned from oil. Thenon-oil sector has besides been turningat a steady and fast gait.

Finance and insurance has grown 258.4 per centum during the current enlargement, an norm of 26.1 per centum yearly ; building, which has grown 159.4 per centum, or 18.9 per centum yearly ; trade and fix services ( 152.8 per centum, or 18.4 per centum yearly ) ; conveyance and storage ( 104.9 per centum, or 13.9 per centum yearly ) ; and communications ( 151.4 per centum, or 18.3 per centum yearly ) . Manufacturing grew 98.1 per centum during the enlargement, or 13.2 per centum per twelvemonth.

Failing:An overdependence on the oil industryfrequently leads the economic system to come crashing down in the instance of bead in oil monetary values.

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The changelesspolitical instabilityin the part leads to rapid policy alterations and an overarching control of the military forces in private and public domains.

Opportunities:Foreign public debt is low, at about 9.8 per centum of GDP. Principal payments for the following four old ages are about $ 1.5 billion a twelvemonth, which is really modest. Therefore Venezuela could besides increase its borrowing internationally if necessary, but it is highly improbable to meet any balance of payments jobs. In the face of strong deflationary force per unit areas,Venezuela’s rising prices is likely to go on fallingin the close hereafter.

Challenges: The chief challenge for Venezuela in the following twosome of old ages is to implement aneffectual stimulation bundlethat can maintain the economic system on a steady growing way. Venezuela could do substructure and other public investings that will increase productiveness in the old ages that follow.

Menaces:Current concerns are a weakening of democratic establishments, political polarisation, a politicized military, drug-related force along the Colombian boundary line, increasing internal drug ingestion, overdependence on the crude oil industry with its monetary value fluctuations, and irresponsible excavation operations that are jeopardizing the rain wood and autochthonal peoples.

Theoretical Lessons learnt from Venezuela:

• Venezuelan authorities gross and oil gross into the state are indivisible as it constitutes a major ball of its GDP.
• A more balanced version of the Big Push theoretical account could ease other sectors to travel frontward like agribusiness and industries, and this would take to merchandise variegation.
• Equitable distribution and efficiency are positive maps of a balance between private and public projects. Merely public ownership and care fuels corruptness and inefficiencies.

Kerala

Kerala is located at the southern tip of India and was formed in 1956. In footings of country, it constitutes merely 1.275 % of India ; it accounts for 33.3 million of the entire Indian population.i.e. 2.76 % of the sum. It is the 3rd densest province in India but this camouflaged by plush green biodiversity.

Like Venezuela, Kerala excessively is a resource-driven state, exporting its ecology.This is in the signifier of touristry and besides the export of primary merchandises like java, coconuts and spices. Ecology plays an of import function in the Kerala economic system by supplying a diversified natural resource base, enabling a big grade of occupational variegation.

A comparing between Venezuela and Kerala.

Variables	Venezuela	Kerala
Longevity	Entire population:74.39 old ages male:71.26 old ages female:77.67 old ages ( 2014 est. )	Entire population: 74 old ages. Male: 71.67 year Female:77.2 year
Adult Literacy	( 2013 ) Total-84.1 Female- 83.9 % Male- 84.2 %	( 2011 ) Total- 94 % Female-100.76 % Male-96.11 %
Gross Enrolment Ratio ( chiefly primary school )	It was 103 % in 2009-10, and dropped to 102 % in 2011-12. This per centum exceeds 100 due to the inclusion of over-aged and under-aged pupils because of early or late school entryway and grade repeat.	100 % Gross Enrolment Ratio.
GDP per capita	12,729	Sodium
Baby and kid mortality	2009 The kid ( below 5 year ) mortality rate was 17.5 ( a bead in rate as compared to old old ages above 18 ratios ) , per 1000 unrecorded births. The infant mortality rate was 15 per 1000 unrecorded births	2005-06 Child mortality rate is 16.3, and infant mortality rate is 15.3 per 1000 unrecorded births.
Secondary school registration	Secondary school registration ( % gross ) was 83.48 as of 2011. Over the past 40 old ages this index reached a maximal value of 83.48 in 2011 and a minimal value of 35.15 in 1971.	45 % of the entire population enters into higher secondary instruction.
Incidence on poorness	The policies of the Bolivarian Government has caused poorness to fall to 23 % in 2009 from 70.3 % in the 2nd half of 1996 accompanied by 40 % of utmost poorness and a record rising prices rate of 103 % .	The incidence of rural poorness has declined in the 1980s in malice of the slow rate of growing of the economic system
Maternal mortality	92 deaths/100,000 unrecorded births ( 2010 )	Lowest maternal mortality rate in India. 66 deaths/100,000 unrecorded births ( 2010-12 )
Third Registration	78 % of the entire population of the five-year age group following on from secondary school go forthing.	Disregard on higher instruction. For illustration, in 1998-99, such a ratio is estimated to be 5.6 per cent in Kerala, compared to 5.9 per cent in the state as a whole on norm
Gini-coefficient for income distribution	0.482	0.40

• HDI 0.748 0.625

Kerala and Venezuela are similar on evidences of following a way towards really high GDP. However, every bit much as they have been demoing rapid development, an of import issue which poses a immense job for both economic systems is that of societal security threatened byCrime, and the widespread corruptness.

Soon, in 2013, after the decease of President Chavez, President Maduro took over, the Venezuelan economic system has been sing acute deficits due to turmoil. Marginal Propensity to devour is really high presently in Venezuela due to high rising prices and deficits. In Venezuela, growing in the money supply leads to rising prices. This growing in money supply is caused by an about near full employment degree in the economy.There is high ingestion in basic trade goods such as milk, butter, java, Indian meal and lavatory paper. This deficit has been caused due to theState-controlled monetary values – monetary values that are set below market-clearing price.Many mills operate at half capacity because the currency controls make it difficult for them to pay for imported parts and stuffs. Business leaders say some companies verge on bankruptcy because they can non widen lines of recognition with foreign providers. In April 2013, Venezuela 's scarceness index reached its highest degree since 2009, while the 12-month rising prices rate has risen to about 30 % . Shoppers frequently spend several yearss looking for basic points, and stock up when they find them. Therefore, their Fringy leaning to salvage is highly low.

The protests have hit the streets, but are controlled in a really ghastly affair by the authorities and military stalwarts of the authorities. There is a batch of offense even among the constabulary force. The basic freedom of address is curtailed as the media is controlled by the President. ‘Colectivos’ is the name given to packs of hoods sponsored by the province to hush the resistance. Venezuela is declared to be the 2nd most corrupt state, and is besides the most offense ridden state in Latin America.

In Kerala, Crime rate statistics in footings of offenses coming under the scope of the Indian Penal Code during 2012 have put Kerala on top with 455.8 instances for every 1,00,000 individuals. There is besides corruptness which permeates all subdivisions of society.

Policy Deductions

The first measure toward diminishing the income distribution spread is to increase transparence of public financess. When there is high corruptness at the federal and province degree, authorities grosss and outgos may be miscalculated or misguided in order to victimize financess. Making certain that financess are suitably allocated and that federal assets and liabilities are decently recorded will guarantee soundness of the economic system.

Kerala is one of India’s most unequal provinces in footings of income inequalities, as 10 % of India’s richest lives at that place. Therefore, Kerala can follow from Venezuela the policies of societal inclusion in order to achieve a more just society. Other ways the authorities can diminish the figure of people below the poorness is to cut down or extinguish the value-added revenue enhancement ( VAT ) . The VAT is a regressive revenue enhancement on consumable goods and services at all phases of production. The VAT takes a larger proportion of a hapless person’s income than the affluent person’s income. Decreasing the VAT will increase disposable income and may excite ingestion.

There should be a changeless cheque on poorness, as that can drag the economic system down. In Venezuela, go oning to do certain that the Misiones are effectual at increasing life criterions will increase is of import. The Misiones can non be a promotion stunt ; in order for there to be a lessening in poorness, there must be an addition in the criterion of life. Access to low-cost nutrient, high-quality instruction, and health care should non be a privilege of the wealthy, but instead a criterion for all.

Higher ( third ) instruction is developing in Venezuela, and is about wholly neglected in Kerala. Therefore there needs to be policies in topographic point to guarantee the sweetening of this instruction. Increasing scholarships to travel to a university will besides excite growing. Education will increase human capital and will take to an enlargement of the production possibility frontier. In order for instruction to be most effectual for economic growing, course of study should be up to international criterions. In order for there to be an addition in human capital, which will increase the production possibility frontier, cosmopolitan quality instruction should be provided.

Food deficits and rising prices on nutrient are besides of international concern. In order to protect the citizens from malnutrition and famishment, the authorities must go on to supply entree to low-priced indispensable agricultural merchandises. In order to protect the citizens from dropping below the poorness line, the authorities must increase domestic production of agricultural goods.

Since offense and corruptness appears to be a common job faced by both these economic infinites, it is of import that a stricter, stiff penal codification be in topographic point with its appropriate executing. When the jurisprudence is strong, the rates of offenses bead.

Decision

Venezuela, a alleged prima Latin-american state, has still a long manner to travel in order to transform wholly into a ‘developed’ state. It needs a more deeply-entrenched structural and authorities alteration, most sooner a democracy. The current bossy authorities is making an aura of fright for the people to populate in, and the utmost socialism is destructing industry and trade. People’s basic and cardinal rights are being compromised upon. Kerala, although one of the most developed provinces in India, still lacks in a few parametric quantities. Higher instruction is wholly neglected ; high rates of offense and slayings ; widespread corruptness, etc. Therefore, policy demands to provide to these demands of the hr.