Venezuela central government spending loses momentum in July

The central government spending slowed down, falling at 20% in July in real terms, three months before the presidential elections.

According to data released by Venezuela's Ministry of Finance, last month USD 7.2 billion were spent in public expenditure, lower than last year during the same period.

Asdrúbal Oliveros, an economist and Director of think tank Econalítica, pointed out that this behavior reveals that the Executive Office began to spend the annual budget early. However, due to the quantity of additional credits recently approved to cover the deficit budget in public agencies, he foresees a new acceleration of expenses in August.

In seven months

Despite the fact that, in July expenses were lower than in previous months, the central government accumulated expenditure records a real growth of 6.8%.

These expenses are the result of the State economic size. Since 2007, the government took control of different enterprises. At the same time,  it boosts a model based on public investment.

"Now the State is bigger and more inefficient, consequently it has to spend more," Oliveros said.

Budget spending

Data released by the Ministry of Finance shows that the annual budget through July was estimated at USD 84.5 billion. From that amount, USD 47 billion were spent, which represents 55% of the annual budget.

Translated by Karina Salas