economic crisis faced by Venezuela
The content highlights the economic crisis faced by Venezuela. The crisis sparked by years of poor leadership has caused hyperinflation of its currency, food and supply shortages, corruption, high crime rates, and huge public debt. Interestingly, Venezuela was once one of the most prosperous nations in the world due to its large oil deposits; however, years of mismanagement has caused a political and economic crisis in the South American country with no end in sight. The solutions offered are to have different leadership in Venezuela that would create sound political and economic policies.
I agree with the solution offered in the content. The biggest problem with Venezuela is political, which has a domino effect on all sectors of the economy. Under President Maduro, there has been a crisis after crisis that has put Venezuela in a negative light. His policies do not seem to work, and he should look beyond personal greed and do what is best for the country. I think after a change of leadership, Venezuela should seek the help of economic experts and internal monetary bodies such as the International Monetary Fund to find the best way possible to improve the status of the Venezuelan economy.
Venezuelan economic crisis is a threat to the economic and security prosperity of Latin America. Venezuela has added to the debt crisis facing Latin America. As the oil prices tanked, Venezuela borrowed heavily to finance development projects. Now lenders do not feel safe to give the country loans. The effects have been catastrophic to the country; lack of basic amenities has forced millions of people to migrate to other Latin American countries, which puts economic stress on them.
The similarity between Venezuela and other Latin American countries is the debt crisis these countries face. Latin American countries have fallen into a debt trap that threatens their economic prosperity. The differences include the leadership style of the different nations and different monetary policies of each country.
From a political standpoint, the major problem causing turmoil and the debt crisis in Venezuela and Latin America as a whole is corruption and mismanagement of resources. Many countries such as Venezuela and Honduras have Totalitarian regimes that cannot be held into account in case of corruption issues. From an economic standpoint, hyperinflation in Venezuela is caused by deficit spending and heavy money-printing.
Venezuela’s economic crisis relates to the structuralist school of thought. Venezuela has a socialist government that advocates for social ownership of the means of production and income redistribution. However, these policies’ structuralist policies have failed Venezuela and its people.
The opposing views are capitalistic vs. socialist views. I agree with the capitalistic system since it is evident that the socialist views have completely failed Venezuela. With capitalism, they can encourage the free market, which would improve economic growth and increase the living standard for local populations.
The Venezuelan economic crisis is a wake-up call to Latin America. Venezuela used to be one of the biggest economic powerhouses not only in Latin America but in the whole world. However, now despite being an oil producer and having vast oil reserves, its population lacks the most basic of amenities. Latin America should learn from Venezuela and advocate for effective leadership and sound economic policies to prevent other devastating economic crises.