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Venezuela Foreign Assistance
As the wealthiest country in Latin America and an OPEC
member, Venezuela was more frequently a donor than a
recipient of
foreign assistance. The United States stopped providing
aid to
Venezuela in the mid-1960s; nor did any bilateral
development
agency give Venezuela assistance. Instead, Venezuela's
bilateral
economic relations were characterized by technical
cooperation
agreements, student exchanges, or commercial accords
similar to
those signed by the major industrial nations. Its oil
wealth in
the 1970s, however, did allow the country to become a
major
provider of bilateral and multilateral financing. From
1974 to
1981, the nation contributed US$7.3 billion to
international
development, 64 percent of which went to multilateral
sources,
such as the United Nations Special Fund, the Andean
Reserve Fund,
the OPEC Fund, the Coffee Stabilization Fund, the
Caribbean
Development Bank, and the Central American Bank for
Integration,
among others. In addition, Caracas was the headquarters of
the
affiliates or institutes of many regional and
international
organizations. Total annual contributions in the late
1970s
averaged 1.88 percent of GDP, above the 1 percent level
suggested
by the United Nations for developed countries. Most
bilateral
assistance, funneled through the FIV, went to Andean
nations,
Central America, and the Caribbean. Venezuela used this
oil
wealth to enlarge its profile in regional and
international
affairs, a prestige it aggressively sought.
As its prosperity eroded in the 1980s, Venezuela saw
its role
as a donor, particularly as a bilateral one, wane. The
country's
most prominent economic assistance during the decade was
dispensed through the joint San José Accord that it
administered
along with Mexico in order to provide subsidized oil to
the
Caribbean Basin region. Throughout the decade, Venezuela
remained
disposed to intervene in Central America. After supporting
the
Sandinista National Liberation Front (Frente Sandinista de
Liberación Nacional--FSLN) against the Somoza dictatorship
in
Nicaragua in 1979, the Venezuelan government also provided
financial assistance to the Sandinistas' opposition, the
National
Opposition Union (Unión Nacional Opositora--UNO), in its
successful bid for power in 1990. Some minimal bilateral
funding
through the FIV continued in the early 1990s, mainly to
promote
the country's commercial interests.
In the 1980s, however, Venezuela sought funds from the
major
multilaterals, such as the World Bank and the IMF, after
more
than a decade of detachment. The World Bank was active in
Venezuela from 1961 to 1974, disbursing thirteen loans
worth
US$340 million. Because of its high per capita income,
however,
Venezuela did not become eligible for World Bank financing
until
1986. In 1989 it received over US$700 million in the form
of a
structural adjustment loan and a trade reform loan.
Venezuela
also used its large and previously untapped reserves at
the IMF
in 1989, when the IMF disbursed the first installment of a
threeyear Extended Fund Facility in the amount of US$4.8
billion.
These new funds helped ease the country's painful
transition to a
more open economy, a transition undertaken largely on the
advice
of the IMF and the World Bank. Another multilateral
agency, the
Inter-American Development Bank (IDB), also continued to
fund
Venezuela's development in highway construction, forestry
programs, water and sanitation projects, mining, and other
infrastructure projects. In cumulative terms, the IDB
provided
approximately US$1.3 billion from 1961 to 1990.
The economic reforms begun by the Pérez administration
in
1989 tracked with the prevailing liberal orthodoxy of
international economics, but flew in the face of
traditional
Venezuelan state intervention. It remained to be seen
whether
Pérez would be able to weather the political storm created
by his
restructuring, and whether his program would show enough
tangible
benefits to warrant its retention and expansion under his
successor.
* * *
As of 1990, there was no economic study available in
English
that examined in depth Venezuela's transition toward a
more
private-sector and market-oriented economy. Nonetheless,
several
valuable studies throughout the 1980s provided insight
into the
nation's evolving political economy. An excellent
collection of
essays appears in John D. Martz and David J. Meyers's
Venezuela: The Democratic Experience. Laura
Randall's
The Political Economy of Venezuelan Oil and David
Eugene
Blank's Venezuela: Politics in a Petroleum Republic
provide informative analysis on the country's pivotal oil
industry. Some outstanding journal articles include
Vladimir
Chelminski's "The Venezuelan Experience: How Misguided
Policies
Paralyzed a Prosperous Economy," Rene Salgado's "Economic
Pressure Groups and Policy Making in Venezuela: The Case
of
FEDECAMARAS Reconsidered," and a series of articles by
South magazine in August 1989. The best source of
economic
statistics includes the publication of the Oficina Central
de
Estadística e Informática, Anuario Estadístico de
Venezuela, as well as numerous publications from the
International Monetary Fund, the World Bank, the Economist
Intelligence Unit, the United Nations Economic Commission
for
Latin America and the Caribbean, the Inter-American
Development
Bank, and the United States Department of Agriculture.
(For
further information and complete citations,
see
Bibliography.)
Data as of December 1990
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