[rockwool]

Can this be a typical reason to why some in this forum have come got a negative view of Chavez's government? A bit of the good ol' discreditation, miss and dissinformation (in this case) from the IMF.

I'm thinking of another time when I had brought Venezuela up, then the Chavez government was critisized for not taking care of their people and instead a massive interest was expressed on that Venezuela is building up its defensive forces.

I was a bit amazed by how people had gotten that impression, and I hope with this article that I can put some light on this subject.

Cut from here: http://www.venezuelanalysis.com/news.php?newsno=2269

Venezuela and Its Neighbors Reject IMF ReportSaturday, Apr 14, 2007

By: Chris Carlson - Venezuelanalysis.com



Mérida, April 13, 2007 (venezuelanalysis.com)— Venezuela, along with other countries of the region, rejected the latest report by the International Monetary Fund on the economic growth of the region. The recent report released by the fund predicts that Latin America will not grow as much in 2007 as it did in 2006. Leaders of the region assured that the international organization keeps getting it wrong on Latin America.

"For three consecutive years now they've gotten it wrong with Venezuela," said Venezuela's Minister of Finance, Rodrigo Cabezas, yesterday, in response to the IMF report. "It seems like their prognoses have a kind of political commitment in order to discredit the success of the Venezuelan economy in the last few years," he said.

On Wednesday the international organization released their annual report entitled World Economic Outlook. The report forecast that the world economy will continue to grow, but that Latin America's growth will slow down.

The report projected that economic growth in the region will drop to 4.9 percent this year from 5.5 percent in 2006. Venezuela's growth, which was 10.3 percent last year, is projected to drop to 6.2 percent in 2007, and inflation was predicted to be 21.6 percent.

But Cabezas questioned the motives of the International Monetary Fund, saying that they continuously register low growth rates for Venezuela. In 2005, the IMF predicted a 1.1 percent growth rate for Venezuela, when the real actual growth rate ended at 10.3 percent. In 2006 the IMF said 3.8 percent, when Venezuela actually grew 10.2 percent.

"The IMF hasn't realized that we have 14 quarters, almost 4 years, of sustained growth," said Cabezas, "something that hasn't been achieved in Venezuela since 26 years ago." Cabezas assured that the growth rate for 2007 would be above 7 percent, and could pass 8 percent. The government's goal for inflation is 12 percent.

President of Argentina Nestor Kirchner also responded to the IMF report, rejecting their recommendations. Although the report indicated that Argentina would have the highest growth in the region, Kirchner rejected the suggestions given by IMF director Rodrigo Rato. "He can no longer tell us what we have to do," he said. "We already saw what happened to us when he told us what we had to do."

The President of Ecuador, Rafael Correa, also spoke out against the IMF this week. On Wednesday, he stated that the new Bank of the South, a regional fund being created with the joint efforts of Venezuela, Ecuador and Argentina, would end the region’s subjection to the control of the IMF and World Bank.

"They want to put us on our knees so that the IMF and the World Bank will give us funding," said Correa. "That is the new way of subduing countries. Now they don't need aircraft carriers or bombers, only dollars."

The IMF also recommended that Latin America further open their economies, and create a better environment for investment. According to IMF director Rodrigo Rato, Latin America's growth is behind that of other regions "because their markets are not open or competitive enough."

In what appears to be a veiled call for privatizations, the fund says that the nations of the region should also reduce the role of state-owned companies in the economy. This goes directly against the politics of the Chávez government, which has drastically increased state participation in the economy. Also, Venezuela should control their public spending which has grown "exceptionally fast," they said.

Venezuelan Finance Minister Cabezas responded by saying "the experience of the last three years should demonstrate to the IMF that the problem is not the amount of spending, but the quality of spending."

Cabezas also pointed out that the IMF "ignores" that the percent of homes in Venezuela in conditions of poverty has dropped from 25 percent in 2003 to 9.1 percent in 2006. They also "ignore" that the minimum wage in Venezuela is US$ 238 per month, the highest in Latin America after Chile, and even higher than Chile if food supplements are included, he said.

According to Cabezas, the IMF's calculations are "not technical, nor economic, but political, and they have the intention of discrediting our model."

I find it obvious that the IMF and the World Bank are fighting all countries which choose another model than their neo-liberal one, and by that way putting asside the democratic votes of the people of those countries who have voted for an alternative economic policy.

 

[rockwool]

Here's a report from the Center for Economic and Policy Research that takes a look at these IMF reports of recent years.

http://www.venezuelanalysis.com/news.php?newsno=2263

New Report Raises Doubts about IMF Growth Projections on Venezuela and Argentina, Friday, Apr 06, 2007


By: Center for Economic and Policy Research


Washington, DC: On the eve of the IMF/World Bank Spring Meetings, a new paper from the Center for Economic and Policy Research raises serious concerns about IMF projections for Argentina's GDP growth since 1999 and Venezuela's since 2003.

"It's hard to look at the pattern of these large, repeated errors — especially for Argentina — and not wonder what went wrong," said economist Mark Weisbrot, CEPR co-director and co-author of the paper with David Rosnick.

Weisbrot recommended that the IMF address this problem at their Spring Meetings this month. "It raises questions regarding the reliability and objectivity of the IMF's growth projections," he said.

The report, Political Forecasting? The IMF's Flawed Growth Projections For Argentina and Venezuela, shows that the IMF consistently made large errors in overestimating Argentina's GDP growth for the years 2000, 2001 and 2002. This was during the country's 1998-2002 depression, when the IMF was lending billions of dollars to support policies that ultimately ended in an economic collapse.

These overestimates then changed to large underestimates for the four years 2003-2006, as Argentina's economy grew rapidly. During this time, the IMF had an increasingly antagonistic relationship with the Argentine government and opposed a number of its economic policies. In April 2003, the IMF's Director of Research called Argentina's growth "a hiatus at the moment from its long economic fall."

Argentina has now completed a five-year economic expansion with the fastest growth in the Western Hemisphere, with real GDP growth of 47 percent.

The paper looks at the record of IMF public documents and finds evidence that faulty economic analysis and political considerations may have contributed to these errors. Similarly, the authors suggest that the IMF's repeated large errors in underestimating Venezuela's GDP growth for the years since 2004 may be related to its apparent dislike for that government.

According to the report, with regard to Venezuela, "IMF projections for the years 2004, 2005, and 2006 underestimated GDP growth by 10.6, 6.8, and 5.8 percentage points respectively."

I find the turnaround Argentina has done very remarkable, and it's joyful to see what profits from state owned companies can do to the growth of a country and all of its people instead of just e few shareholders.

 

[rockwool]

Damn, this is of no interest to nobody? It's your own front yard ffs.. I on the other hand found this interesting about what John Pilger had to say about Venezuela.

Noam Chomsky recently said that after five centuries of European conquests, Latin America was reasserting its independence. Do you agree with this?

Yes, I agree. It’s humbling for someone coming from prosperous Europe to witness the poorest taking charge of their lives, with people rarely asking, as we in the West often ask, “What can I do?” They know what to do. In Cochabamba, Bolivia, the population barricaded their city until they began to take control of their water. In El Alto, perhaps the poorest city on the continent, people stood against a repressive regime until it fell. This is not to suggest that complete independence has been won. Venezuela’s economy, for example, is still very much a “neo-liberal” economy that continues to reward those with capital. The changes made under Chavez are extraordinary – in grassroots democracy, health care, education and the sheer uplifting of people’s lives – but true equity and social justice and freedom from corruption remain distant goals. Venezuela’s well-off complain endlessly that their economic power has been diminished; it hasn’t; economic growth has never been higher, business has never been better. What the rich no longer own is the government. And when the majority own the economy, true independence will be in sight. That’s true everywhere.

http://www.venezuelanalysis.com/articles.php?artno=2028

Not owning the government anymore is understandably a whole lot to complain about. I mean, they've been masters of this world for centuries and millenias, they must really feel like everything belongs to them as they've controlled it for so long.

Pilger is BTW comming out with a film this summer that is called "The War on Democracy".