Archive for November 16th, 2005

Factoids on Free Trade

November 16, 2005

-In 1980 Venezuela and Mexico had export levels that were similar,
roughly US$ 20 billion in exports, mostly oil. Twenty five years later
Mexico exports are expected to be between US$ 222 to 240 billion a year+, of which barely 11% is oil,
Venezuela on the other hand will export around US$ 45 billion, still
mostly oil.

-In 1980, Mexico’s GDP was US$ 4130, Venezuela’s was US$3580. In 2004 Venezuela’s was US$ 5800, Mexico’s US$ 9600.

-In 1987, the market capitalization (Worth of all stocks that trade in
it) of the Mexican Bolsa and the Venezuelan Stock Market were roughly
the same: US$ 10 billion. Today, the Mexican market is close to US$ 164
billion, while the Venzuelan Stock Market capitalization is less than
US$ 5 billion.

–Despite not believing in free trade, the Chavez Admisnitration will
send a delegation of 130 people to the WTO meeting in Hong Kong.
Curiously, the only expert in the Foreign Minsitry on the subject is
not going.

–Lost in the shuffle on Sunday, Chavez said that Venezuela had no use
for the Andean Pact of which Venezuela is an integral part. The Andean
Pact has been very good for trade, increasing it by a factor of three
in the last 15 years between all the countries. However, Venezuela has
had trouble competing with manufactured products versus Colombia and
Peru. Can Venezuela compete better with Argentina and Brazil?

+I had earlier used the number quoted by Fox on CNN yesterday, I have
corrected it to reflect the Mexican Government’s projection (US$ 222
billion) and a Wall Street Broker (US$ 240 billion) that I have a paper
report for.

Supreme Court stops expropriation, for now

November 16, 2005

Slowing down the Law of the Jungle, The Venezuelan Supreme Court ruled yesterday that the Government had to suspend the exprpriation of the Polar silos in Barinas state. As described here
in late September the Governor of Barinas State who happens to be
Chavez’ father, expropriated the plant without following any of the
legal procedures established in the law. Of course, they can now go
back and do things right to satisfy the Court, but at least they will
have to follow the procedures established in the Constitution for
expropriating something, which includes the National Assembly
declaring it a public utility and paying compensation.