Reasons that explain the Deep Economic Crisis in Venezuela

 1.- Increase in the Monetary Mass:

This is one of the main reasons why there is huge inflation and it is the government that does not stop printing and printing inorganic money without any support and which does not obey any economic or growth factor or even any productive activity, this makes The bolivar loses value faster and faster. Between 12/28/2018 and March 2019, the money supply increased by 391% and if considered from 2013 to March 2019 there is an increase of 36,000,000%.

 2.- Gift of Resources to Other Countries:

If there is something that Venezuela has been worried about, it is to give and give things to other countries regardless of whether that will be necessary for their own population. To talk about a few facts we have:



* In 2008 Nicaragua obtains free $ 457 million in terms of oil

* Chavez gives $ 3 million for the construction of a hospital in the West Bank (Palestine)

* Hugo Chávez gives Bolivia a thermoelectric generator (10MW).

* Hugo Chávez begins by his own effort the construction of an underwater cable to Cuba.

* Hugo Chavez gives several luxury planes to Cuba for free.

* Puerto Rico receives free gasoline (2017).

* A total of 29 tons of food are sent to Mexico and Dominica

* Cuba receives in 2017 600 tons of food for free.


If I started saying them all, it would never end.

 3.- Destruction of Private Property:

This began in the Chavez government by arbitrarily and illegally expropriating private establishments without giving any type of reimbursements to their owner and in the mature government forcing them to sell their products at a loss, that is, the businessman bought a certain Product X at 100 Bs and the government forced him to sell it for 5 Bs, having a loss of 95 Bs, this ended up taking away the investment of individuals and businessmen in Venezuela.

  
4.- Subsidies: 

This is one of the biggest bleeding of the Venezuelan budget and the biggest economic losses. Venezuela is known to have the cheapest gasoline in the world but to achieve this Venezuela must invest $ 15 billion a year, money that can be used in other things, this without considering the subsidies of water, gas, electricity, medicines because it would reach 25 billion dollars. This factor was a cause of the destruction of private property because by subsidizing food, for example, a private sells hamburgers at 10 Bs but the government imports the same hamburger and sells it at a loss of 2 Bs, the private cannot compete and must decline , by destroying private property and falling the government there is no one left who sells hamburgers.

 5.- Decrease in Oil Production:

This is the main factor of the crisis and that Venezuela lived and was supported by oil (even today it depends 100%), with the decision not to invest in maintenance of the facilities, little by little many stations were stopped and wells and caused the production of 3 million barrels per day to be reduced to just 680 thousand barrels per day. This is noted by not receiving the same amount of money.

6.- Destruction of the Economic Sectors:

In addition to oil, manufacturing and agriculture were destroyed due to lack of investment, the establishment of guerrillas and inflation. And it is that about 20,000 companies have closed since socialism arrived and by June 2019 the industry works at 11% of its capacity, this due to a shortage of raw materials, investment, maintenance, skilled workers, among others. the steelmaker of the Orinoco, an iron and steel producer has the capacity to produce 5.1 million tons per year, for 2017 it only produced 47546 tons (99% decrease). agricultural production has a 75% deficit and pharmaceutical production has a 70% deficit