CARACAS, July 17 (Reuters) – A slight recovery in
Venezuela’s economic activity in January evaporated in February
and March due to the fall in global oil prices and the
coronavirus pandemic, according to a document released on Friday
by the opposition-controlled congress.
Economic activity had increased 8% in January 2020 compared
to December 2019, according to the body, which has monitored
economic activity independently for three years due to gaps in
official figures on economic performance.
But the small advance the country achieved with increased
oil sales abroad and relaxed government currency controls has
dissipated since February, hurt by the impact of the fall in
world oil prices, U.S. sanctions, and the departure of Russia’s
largest oil producer, Rosneft, from Venezuela. The Russian
company was a key partner to Venezuelan state oil firm Petroleos
de Venezuela (PDVSA).
At the end of the first quarter, economic activity was down
25% compared to the same period in 2019, the report said.
Venezuela’s central bank has not released economic figures
for a year.
“The opportunity for relief was lost,” said lawmaker Angel
Alvarado when presenting the findings. “We believe the fall will
continue due to PDVSA’s destruction and the inability to sell
Data provided by Venezuela to OPEC earlier this week showed
crude output in June had fallen to a 77-year low, as escalating
U.S. sanctions designed to oust President Nicolas Maduro choked
Production has been falling sharply since 2016 – before
Washington imposed sanctions on PDVSA in January 2019 – due to
underinvestment and mismanagement.
Crude exports have historically provided more than 90% of
Venezuela’s hard currency, though official data has not been
The current size of the Venezuelan economy, which the
congress estimates at about 65 billion dollars, is similar to
that of nations such as Paraguay and Uruguay, with a quarter of
(Reporting by Corina Pons and Mayela Armas; Writing by Sarah
Kinosian; Editing by Rosalba O’Brien)