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COUNTRY INSIGHTS

Preparing for talks
VENEZUELA · Report · 28 Jun 2021

Groundwork is being laid for talks sponsored by Norway to take place between the government and the opposition. They might begin in August. Both sides seem motivated, given that the Maduro government needs sanctions lifted so it can govern, and the opposition needs to re-engage its base. At th...

Inflationary crosscurrents
VENEZUELA · Report · 14 Jun 2021

Consumer prices rose by 27 percent month on month in May, an increase close to the 25 percent seen in April and steeper than our forecast lift of 11 percent. While factors we had anticipated worked to tame inflation, others we’d not foreseen kept it strong. As we had anticipated, money supply ...

Oil exports set to fall regardless of Chinese tax
VENEZUELA · Report · 26 May 2021

China has announced a substantial levy on oil-related items that include Venezuela’s main oil export, the Merey 16 blend. Pdvsa sends just over 400,000 barrels per day of Merey 16 to China—60 percent of its total exports. If implemented as written, China’s planned tax would grind those exports to...

A negotiations bazaar
VENEZUELA · Report · 19 May 2021

Maduro’s government is negotiating with multiple parties. The signals sent by his important recent concessions, an outcome of ongoing negotiations, were listened to attentively by the international community, governments and think-tanks, forcing the interim government and the G4 to stop ignoring ...

Strategic regime moderation
VENEZUELA · Report · 12 May 2021

Maduro’s government has signaled a major shift in stance and strategy in the last several weeks. Most importantly, it agreed to a legal process for renewing the five-member board of the National Electoral Council that resulted in the designation of two opposition-aligned members. Maduro has al...

Erratic control
VENEZUELA · Report · 11 May 2021

Inflation sped up sharply in April, to 27 percent month-on-month from 11 percent in March. It was driven up primarily by sharp dollar strengthening in bolivar terms (+36 percent) despite slow public spending and money supply. We think that dollar prices were responding to the March surge in publi...

2021–2022 Outlook: Pandemic Pains
VENEZUELA · Forecast · 12 Apr 2021

Our 2021–2022 outlook depends heavily on the evolution of the Covid-19 pandemic. Things are bleak right now: Venezuela is suffering its worst wave of infections so far, its hospital system has collapsed, the regime is dragging its feet, and there’s no vaccination plan. One consequence of the p...

Atypical disinflation in March
VENEZUELA · Report · 09 Apr 2021

March inflation slowed to 7 percent month-on-month, from 16 percent in February. That extraordinarily low reading owes partly to a fiscal policy-driven cash crunch as demand for bolivars to pay annual taxes collided with unusually low government spending, causing dollar prices to fall against the...

Quiet deals may lead to broader negotiations
VENEZUELA · Report · 31 Mar 2021

A sharp spike in Covid-19 infections has forced Nicolás Maduro’s government to order a strict two-week lockdown for a period including Holy Week. The national hospital system has run out of Covid-19 beds and faces severe shortages of oxygen, medicine, and equipment. Yet the Maduro government, ...

Inflation continues to slow
VENEZUELA · Report · 12 Mar 2021

Inflation slowed to 16 percent month on month in February, down from 50 percent in January and below our forecast of 34 percent. Driving the slowdown were government austerity and exchange rate stability. In our central forecast scenario, we assume that the government will continue to dampen i...

Government and opposition continue to circle each other
VENEZUELA · Report · 04 Mar 2021

Three months into 2021, the government and opposition are continuing to circle each other, each attempting to strengthen its position, neither willing to make the first move toward negotiations, and both afraid of appearing weak and incurring the wrath of their radical factions. The Maduro go...

We extend our inflation outlook to 2022 (1,600%)
VENEZUELA · Report · 12 Feb 2021

We have extended our outlook for inflation, exchange rates, and dollar purchasing power to 2022. In our central scenario, inflation slows to 2,200 percent this year and 1,600 percent next year from 2,500 percent in 2020. We continue to forecast under one central and two alternative scenarios. ...

2021–2022 Outlook: Crony Capitalism
VENEZUELA · Forecast · 05 Feb 2021

This report lays out our central scenario outlook for 2021–2022, which we call Crony Capitalism. It assumes that the regime stays in power and keeps its policy framework essentially unchanged. Economic policy is pragmatic to a degree, but the government is unable to meaningfully improve expectati...

A chance for negotiations in 2021
VENEZUELA · Report · 01 Feb 2021

This year may bring mediated talks between Venezuela’s regime and opposition. The United States and European Union both want to push for a negotiated solution to Venezuela’s crisis that leads to competitive elections, making sure the required institutional changes are implemented. Maduro ha...

The hyperinflation menace remains near
VENEZUELA · Report · 15 Jan 2021

Our central inflation forecast scenario has inflation slowing down a bit in 2021, to 2,200 percent this year from 2,500 percent last year. Black market dollars appreciate against the bolivar by 1,700 percent and sell for 20 million bolivars by year end but lose bolivar purchasing power for the fo...

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