May 12

International Monetary Fund

Only the situation faced by economies affects the behavior of Governments. Following this thought, we would not have have astonished several situations that have occurred in the world developed during this crisis and which are typical of developing economies: the financial corralitos to the Argentina, the cuasimonedas in California, the nationalization of private liabilities. The developed world is close to leave behind the painful subprime crisis, but not to leave behind the problems, since it should be prepared for a new challenge: rebuild the fiscal situation of the economies and face the heavy burden imposed them the increase in public debt. While the International Monetary Fund (IMF), is still stubborn to suggest implementation of fiscal stimulus policies to speed up output of developed countries of the situation of recession in which are found, the stock of public debt of these countries continues to continuous climb that has begun to awaken voices of warning about what might happen. In my articles is very common that you criticize the economic policies of Venezuela, and reasons I don’t think missing me to do so.

But there is something which I must admit is that despite the waste of oil resources that Chavez has made in the country, their indiscipline to spending public has not led him to an irrational increase of public debt that would represent for the country a direct passage to a crisis (which I understand that anyway will take place in Venezuela by the high inconsistency of economic policy). The public debt of Venezuela barely exceeds 20% in terms of its gross domestic product (GDP) and expected to reach 21.2% towards the end of 2010. Latin American countries show in General, levels of public debt sustainable in terms of GDP, variable used to determine a country’s wealth generating capacity (Brazil and Colombia, for example, seen a debt of 42.5% and 47.8% in terms of GDP, respectively).