How Reuters Converts the Largest Economic Growth of Latin America into Bad News

The IMF's good news about an economic growth of 8.8% Reuters turns into the bad news of how this is "just" a rebound.

This past April 22 the economic news about Venezuela was the International Monetary Fund’s revelation that the country was heading for an economic growth rate of between 9 and 10% for 2004, which would situate Venezuela as the country with the largest economic growth of Latin America.

In order to say this, Reuters puts its headline like this: “IMF Says Venezuela Will Not be Able to Maintain Current Economic Growth in 2005”

Without a doubt, this figure is explained with the recuperation from the oil industry strike of last year. Nonetheless, the Reuters teletypists did not remember this when they intensely distributed the bad economic figures of 2003.

Now they argue continuously that this only has to do with a rebound from that crisis. Not content with merely this, the Reuters teletype, which is reproduced in its entirety below, reports the largest economic productivity increase in Latin America with the following commentaries, some coming from Anne Krueger, the interim IMF director, and others from the news agency itself:

  • There has been a bounce from a very bad period last year, which is why we do not expect much economic growth for the following year.
  • The severe oil industry strike was the result of serious political tensions around the controversial government of President Chavez.
  • These economic consequences are the result of the uncertainty of investors and of people who “do not know where the government is heading in terms of regulations, which acts as a dissuasive force for economic activity”.
  • The country urgently needs measures to reestablish fiscal sustainability.
  • Venezuela is going through a profound confrontation between its government and the opposition.
  • The signature verification in the coming month will be the last opportunity for the Venezuelan opposition to have a recall referendum against the nationalist president of the fifth largest exporter of crude oil in the world.

Without a doubt, these are surprising commentaries to accompany the news of an economic growth of 8.8%. Imagine what they would say if the Chavez government had suffered bad economic news.

Surly Reuters would have more amicable words for El Salvador’s economy, for example, even though it is bankrupt. Indeed, the “good news” of this country are written by northern news agencies with Salvadoran blood spilled in Iraq.

Below, the teletype in its entirety:

WASHINGTON Apr 22 (Reuters) – Venezuela won’t be able to keep the strong economic growth expected this year, the interim director of the International Monetary Fund (IMF), Anne Krueger, said this Thursday.

“This year, the very high growth rate, has been a bounce from a very bad period last year” in Venezuela, said Krueger.

“Last year, during the period of disturbances, there was a period when the oil production fell sharply,” she added. The IMF, in its semestral report World Economic Outlook, published this Wednesday, said that during 2004, the economy with fastest expansion in Latin America would be the Venezuelan, with a forecast of 8.8%. Venezuela faced during 2003 a serious oil strike due to the strong political tensions around the controversial government of President Hugo Chavez.

Its economy suffered a 9.2% contraction during 2003.

Krueger, at a press conference at the beginning of the credit institution’s spring meetings, pointed out regarding Venezuela and other Latin American countries that she did not identify, that “political disturbances have political consequences, but also economic consequences.”

According to the current principal IMF authority, these economic consequences occur due to the uncertainty of the investors and people who “don’t know where the government is heading to in terms of regulations, which acts a dissuasive force against economic activity.”

In the semestral report, the IMF had said that the take off of Venezuela’s economic activity has a “critical dependence” on the solution to the political crisis and said that the country needs urgent measures to restore the fiscal sustainability.

Venezuela going through a deep conflict between its government and its opposition, which is looking to shorten the Chavez government’s term through a recall referendum.

The National Electoral Council (NEC) of Venezuela announced that the referendum against Chavez will be on August 8, if more than half a million signatures are confirmed through a validation process.

The signature verification next month will be the last opportunity for the Venezuelan opposition to have a referendum against the nationalist president of the fifth world oil exporter.

The opposition accuses Chavez of having authoritarian tendencies and of trying to implant a communist government like the one of the Cuban president Fidel Castro.