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Non-oil exports decline to their lowest point since 1997

Data released by the Central Bank of Venezuela (BCV) show that Venezuela non-oil exports in the third quarter of the year amounted to USD 919 million, the worst result for a third quarter of the year since 1997.

In fact, non-oil exports are 40.5 percent below the level achieved in the third quarter of 2003, the year when employers went on a work stoppage. It represents 40.5 percent less than in 2002, when the coup d'état destabilized the Venezuelan economy.

The collapse of non-oil exports amounts to 47 percent compared to the third quarter of 2007.

During five years, the government of Hugo Chávez has kept the price of the dollar at VEB 2.15 even though the price of the rest of the products has increased more than 70 percent.

As a result the Venezuelan bolivar is overvalued and there is an imbalance between what can be bought with VEB 2.15 in Venezuela and the items that can be purchased with one dollar abroad.

Analysts say that this gap creates a strong incentive to import and problems for the domestic industry which has to compete with cheaper foreign products, to grow properly, create jobs and diversify exports.

Oil exports amounted to USD 15.45 billion in the third quarter due to OPEC's quota cuts and the decline in oil prices.

Meanwhile, imports in the third quarter totaled USD 8.82 billion, a 29 percent decline.

The BCV said that cuts in imports have mainly affected the private sector, where foreign purchases declined 35.5 percent compared to imports in the third quarter of 2008.

Translated by Gerardo Cárdenas

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