Venezuela Business Forecast Report Q4 2012


October 24, 2012
51 Pages - SKU: BMI4899044
License type:
Table of Contents Related Reports
Executive Summary
Core Views
Major Forecast Changes
Key Risks To Outlook
Chapter 1: Political Outlook
SWOT Analysis
BMI Political Risk Ratings
Domestic Politics
Imagining Life Without Chávez
Even if Henrique Capriles Radonski wins Venezuela's October 7 presidential election (not our core scenario), we believe he would
struggle to exert any significant influence over many of the country's political institutions, which are loyal to President Hugo Chávez.
TABLE: POLITICAL OVERVIEW
TABLE: VENEZUELAN STATE GOVERNMENTS
Long-Term Political Outlook
Massive Challenges To Overcome
The Venezuelan political landscape will very likely remain polarised over the next 10 years, with potential for pent-up tensions to lead to
unrest.
Chapter 2: Economic Outlook
SWOT Analysis
BMI Economic Risk Ratings
Economic Activity
Strong Growth, But Massive Risks Remain
We have revised up our 2012 real GDP forecast for Venezuela from 2.5% to 3.5% on the back of a very strong Q112 real GDP reading
of 5.9%. Despite this revision, we maintain our view that Venezuela's current economic trajectory will not be sustained beyond the
October presidential election.
TABLE: ECONOMIC ACTIVITY
Balance Of Payments
External Accounts Adding Pressure To Currency
We expect Venezuela to continue recording sizeable current account surpluses in 2012 and 2013. However, ongoing capital flight will
result in financial account deficits that are larger than the current account surpluses, draining the country's foreign reserves,
TABLE: CURRENT ACCOUNT
Fiscal Policy
Fiscal Challenges Beyond The Election
The ramping up of social spending in Venezuela ahead of the October elections will see the fiscal deficit widen from 8.8% of GDP in
2011 to 11.6% in 2012, before narrowing slightly to 8.3% in 2013 as the levels of pre-electoral spending fade.
TABLE: FISCAL POLICY
Monetary Policy
Currency Devaluation: When, Not If
We believe a devaluation of the Venezuelan currency is forthcoming at some point beyond the October presidential elections. With
foreign reserves declining and external debt issuance at unsustainable levels, the Venezuelan government is running out of options to
maintain an overvalued fixed exchange rate.
TABLE: INFLATION
Regional: Sovereign Risk Ratings
More Relative Value Ahead
The gap between our proprietary sovereign risk ratings and investors' perceptions of regional sovereign risk has increased since our last
update. This implies significant potential for relative value plays over the coming quarters.
TABLE: LATIN AMERICA SOVEREIGN RISK RATINGS – EVOLUTION OF ABILITY TO PAY
TABLE: LATIN AMERICA SOVEREIGN RISK RATINGS – EVOLUTION OF WILLINGNESS TO PAY
Chapter 3: 10-Year Forecast
The Venezuelan Economy To 2021
Growth Outlook Beyond Chávez
Although the Venezuelan economy is likely to experience a tough time over the next few years, we believe there is significant economic
growth potential over the long term. In our view, a more moderate and market-friendly government that is willing to make the necessary
structural reforms is needed to unlock this potential.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 4: Business Environment
SWOT Analysis
BMI Business Environment Risk Ratings
Regional Business Environment
Business Environment Update: Could Do Better
Our recently revised business environment ratings show the Latin American and Caribbean region has made some substantial
improvements since our last update.
Business Environment Outlook
Institutions
TABLE: BMI BUSINESS AND OPERATION RISK RATINGS
TABLE: BMI LEGAL FRAMEWORK RATING
Infrastructure
TABLE: LABOUR FORCE QUALITY
Market Orientation
TABLE: LATIN AMERICA, ANNUAL FDI INFLOWS
TABLE: TRADE AND INVESTMENT RATINGS
TABLE: TOP EXPORT DESTINATIONS
Operational Risk
Chapter 5: Key Sectors
Pharmaceuticals
TABLE: PHARMACEUTICAL SALES
TABLE: PRESCRIPTION DRUG SALES
TABLE: PATENTED DRUG SALES
TABLE: OTC MEDICINE SALES
TABLE: MEDICAL DEVICES SALES
TABLE: GENERIC DRUG SALES
Telecommunications
TABLE: FIXED LINE
TABLE: INTERNET
TABLE: MOBILE
TABLE: MOBILE ARPU
Other Key Sectors
TABLE: AUTOS SECTOR KEY INDICATORS
TABLE: FOOD & DRINK SECTOR KEY INDICATORS
TABLE: INFRASTRUCTURE SECTOR KEY INDICATORS
TABLE: DEFENCE & SECURITY SECTOR KEY INDICATORS
TABLE: OIL & GAS SECTOR KEY INDICATORS
TABLE: FREIGHT KEY INDICATORS
Chapter 6: BMI Global Assumptions
Global Outlook
The Cycle Has Turned
TABLE: GLOBAL ASSUMPTIONS
TABLE: DEVELOPED STATES REAL GDP GROWTH FORECAST
TABLE: REAL GDP GROWTH CONSENSUS FORECASTS
TABLE: EMERGING MARKETS REAL GDP GROWTH FORECAST
 
Research assistance
We can help you find what you need. Call us or write us:
US: 800.298.5699
Int'l: +1.240.747.3093
Need help in your search?
 
Related Markets

International Trade Reports
 
 

Share this report


Other tasks

 
 
Join Alert Me now!
Receive bi-weekly email alerts on new market research

Sign up today!