Venezuela's economy grew 5.6% in the first quarter of 2012, confirmed planning and finance minister Jorge Giordani and Venezuelan Central Bank (BCV) president Nelson Merentes on Thursday.
With these figures Venezuela has enjoyed six consecutive quarters of a sustained growth. The first quarter GDP increase is ahead of the Venezuelan government’s own national budget estimation of 5% GDP growth in 2012.
"Venezuela's economy has experienced a new boost," declared Giordani in a press conference on the GDP results.
The minister argued that Venezuela’s current period of economic growth is a result of President Hugo Chavez’s social spending policies. “Social policies, including those implemented in a determined manner by President [Chavez], today allows us to have a solid base of growth that translates into human happiness,” he said.
Comparing the figures with the current economic situation in the United States and Europe, BCV president Merentes stated that “while the [economic] crisis sharpens in the US and Europe, the Venezuelan economy is rising”.
GDP, which measures a country's production of goods and services, rose by 4.9% in the fourth quarter of 2011, the highest since mid-2008. Together with the 3.9% growth observed during the first nine months of 2011 it defined a growth of 4.2% by the end of that year.
In the first quarter of 2012 the construction sector grew 29.6%, financial institutions 27.7% and the electricity and water sector 6.7%. Meanwhile communications grew 7% and products and services 4.6%.
Oil related activities grew 2.2%, against an increase the non-oil related sectors of 5.6%.
The communications sector “is very stable. It's growing and we hope it will continue so. Almost all sectors have been growing significantly," Merentes highlighted.
Both Merentes and Giordani highlighted the importance of the Venezuelan government’s Great Housing Mission program for stimulating construction, with Giordani terming the construction sector “the second motor of the economy” after oil.
"Venezuela will continue its path of growth," said BCV president Merentes. "We will continue growing and we will work hard so that inflation keeps dropping. We hope that by the end of the year we continue talking about growth with single digit inflation," he said.
Inflation in Venezuela has been falling for five months in a row, since December 2011. Inflation in April was 0.8%, with cumulative inflation of 4.4% so far in 2012.
Written with information from Agencia Venezolana de Noticias. Additional comments by Ewan Robertson for Venezuelanalysis.com.