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Venezuela Construction
The construction industry followed a pattern similar to
that
of other Venezuelan industries, flourishing during the
1970s as
the result of huge government expenditure on physical
infrastructure, but contracting severely during the 1980s
as the
economy waned. Construction employed about 8 percent of
the labor
force in 1988 and contributed about 5 percent of GDP.
After
reaching a low in both output and employment by 1985, the
construction industry rebounded somewhat by 1987 as a
result of
new government investments, increased foreign investment,
and
liberalization of some rent-control policies. The country
produced a wide range of inputs--such as wood, cement,
basic
metals, and industrial minerals--for construction
activity.
Venezuelan construction firms displayed high levels of
technical
capability and erected many of the nation's complex, heavy
industry structures.
Although many private construction firms ranked among
the
country's largest companies, the government played an
increasingly more prominent role in the sector by the
1980s. The
public sector accounted for 77 percent of construction in
1988,
compared with 32 percent in 1978. State-owned enterprises
fulfilled a substantial portion of the government's
construction
activity. Most public-sector construction responded to the
needs
of PDVSA, various power companies, and the corporations
providing
sanitation services.
After a frenzy of building in the 1970s, the country
still
faced an enormous deficit in urban housing in the 1980s.
Accelerated urban migration forced millions of Caracas
residents
to live in
ranchos (see Glossary), or squatter
settlements, made from scrap materials, largely because of
the
lack of formal housing. As new home starts fell from
35,000 to
15,000 between 1982 and 1983, the Ministry of Urban
Development
(Ministerio de Desarrollo Urbano--Mindur) and the National
Housing Institute (Instituto Nacional de la
Vivienda--Inavi)
became increasingly involved in residential construction.
In 1985
public-sector housing construction exceeded that of the
private
sector for the first time; private firms, however,
produced five
times as many single-family homes. One obstacle to more
rapid
growth in housing was restrictive interest rate policies,
which
threatened to dry up future mortgage financing.
Data as of December 1990
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