October 9 2013 image description
by: jmhumire 0 Comments

Good Money After Bad

Venezuela’s President Nicolás Maduro recently returned from Beijing with a $5 billion line of credit from the China Development Bank (CDB).  This comes at a very difficult time for Maduro, whose regime’s support is at an all time low since his predecessor, Hugo Chávez, first came to power 15 years ago.  For Maduro things abroad look better than things at home. 

A former bus driver, named as successor to the late, charismatic Chávez, Maduro is driving his country’s economy into a ditch.  Instead of correcting his path, he has been shifting blame for his mismanagement on to others. 

The Broken Record 

Despite one of the largest oil booms in history, yielding over $90 billion a year to the Venezuelan government, Maduro runs one of the worst performing economies in the Americas. 

Since coming to power in April, after a hotly contested election in which he claimed to receive just over fifty percent of the vote, Maduro has presided over recurrent national electricity blackouts, one of the highest murder rates in the world, shortages of basic goods such as rice, oil, butter, flour, and even toilet paper. 


September 7 2013 image description
by: jmhumire 0 Comments

Is the China-Latin American Fiesta Over?

The recent deceleration in China’s economic growth rate has sent waves of speculation among many commentators.  Most recently, concern is being voiced that China’s slowdown will have a negative impact on Latin America’s emerging markets. The Miami Herald’s Andres Oppenheimer, for example, declared that the “China-Latin American fiesta is over.”  None other than Nobel Laureate Paul Krugman has argued “China is in big trouble.” 

For Oppenheimer signs of the fiesta’s end are China’s lowered growth rates, its decreasing raw material purchases in the region, as well as a lack of diversification in exports and infrastructure spending by Latin American countries. 

There are two things to examine here.  One is China’s shifting economic priorities.  The other concerns trade policies in different Latin American countries.