Venezuela Remains Firmly on the Wrong Path

According to a Conindustria business survey, the manufacturing sector was working at 48.85% of its installed capacity during the third quarter of 2014, down 3.52 percentage points from the same quarterly period in 2013 (52.37%). A situation that, far from improving in 2015, is expected to worsen further. First of all, as explained by Eduardo Garmendia, the head of Conindustria, it is forecast that allocations of foreign currency for the acquisition of raw materials will continue to decline next year, and with this the negative impact on the volume of industrial production that uses imported raw materials (that is to say, nearly all of it) will grow. This is something particularly serious for industrial activity due to the fact that companies have been experiencing a significant decline in their inventories since November 2013. According to the survey, 67% of respondents reported a production drop and up to 79% of them said that their inventories have experienced a decline. More…