A Budget Full of Silences

Finance Minister Rodolfo Marco Torres announced the 2016 Budget in a short speech more notable for what he didn't say than what he did.

The Minister for the People’s Power Over the Economy, Finance and Public Banking (yeap, his title really is that long), Rodolfo Marco Torres, showed up at the National Assembly to present the National Budget for 2016.

In a short speech, he said the Government will spend BsF 1.548.574 million – a whopping 49.3% of the current Venezuelan money supply – surpassing the 2015 Budget by 108.8%.

But in Venezuela, the official budget is never the whole story – or anything near it. if we consider the actual amount spent by the government in 2015 the 2016 Budget comes short by 4.9%. Why? Because the actual spending tally includes 395 – 1.4 per day! – additional credits approved by the National Assembly up to October 6. ¡Como se goza!

But to be honest, I was really expecting – or hoping, once again – key economic data: estimated inflation, GDP and oil prices for 2016 and the exchange rate. I got 1 out of 4.

The estimated inflation and GDP were a no show and no adjustments to any of the three official exchange rates was announced.

All we got was the estimated oil price for 2016: 40 US$/barrel, which comes 30 short of the  70 US$/barrel oil price floor promoted by Venezuela just a few days ago.

We also got a rather repetitive promise: the government will pay all of its internal and external debt and all the social programs – Misiones – will stay afloat. Well, Venezuela has a pretty high probability of defaulting in 2016 and I’m not sure if the government will be able to keep such a high -but inefficient- social expenditure. Let’s just forget this promise ever happened.