Page 88 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.71, # 1, 2014, pp. 80-98

6) Growth of real wage rate – this factor was not explained before, but it is assumed to

play a significant role in the loosing of concurrent advantage of domestic manufacturing.

Venezuelan economics will be subjected to the analysis on the presence of these symptoms.

Example of Dutch Disease country

In present work, Venezuela is taken as an example for further analysis of Dutch Disease

symptoms.

Venezuela is a country situated in the North of South America continent. Climate is equatorial.

Significant part of the countries territory consists of mountain regions. Capital is Caracas (roughly 2.1

mln citizens). The population is around 29 millions of citizens. National currency is Bolivar fuerte.

Country is exceptionally endowed with natural resources. Venezuela has significant amounts of

petroleum, natural gas, iron ore, gold, bauxite, other minerals, hydropower, and diamonds. (CIA, 2013)

Venezuela has the second-largest proven natural gas reserves in the Western Hemisphere -

195.100 trillion cubic feet (5,52 trillion m³) (EIA, 2013) In comparison, these reserves are bigger

than total ones of European continent. In 2012 country produced 893 billion cubic feet (25,29

billion m3). Consumption was estimated at 980 billion cubic feet.

Venezuela has the biggest proven reserves of oil in Western Hemisphere. Venezuela crude oil

production in 2012 was estimated at 146 Mt (Enerdata, 2012) or 2,489.2 thousand barrels per day (EIA,

2013) what equals to 908.558 mln barrels per year and proven reserves are 297.570 billion barrels

(EIA, 2013) exports was 479.994 thousand barrels per day in 2010 (175.198 mln barrels per year).

For the analysis of the economic development in Venezuela the mainly the World Bank

statistics data (World Bank, 2013) is used. If we look at the history of country’s GDP, it is possible to

notice significant fluctuations of Venezuelan GDP during the 1980-2012 year period (Fig.5). There

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