Thursday April 18, 2019

Amid terrible economic crisis, Venezuela is also running short of Beer

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Beer, Wikimedia
  • Venezuela is home to the largest oil reserves in the world
  • The government is causing the country to self implode
  • Shortages have led people to turn to rioting and looting

Meat, milk, bread and beer; staple items on a diet plan. These items are now hardly available to the citizens of Venezuela. Empresas Polar is upon tough times. It was founded in 1941 and has been the food giant in the socialist country. Factories now work at half speed with thousands of employees having been laid off since April.

Even though Venezuela is home to the largest oil reserves in the world, the prices of petroleum are down and government policies are making matters worse.

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The country’s food production has also plummeted leading to food shortages. These shortages have led people to turn to rioting and looting. The disheartening part of this situation is that the government refuses to change its ways.

crisis in Venezuela. Image source: Wikipedia
crisis in Venezuela. Image source: Wikipedia

In fact, the government has turned to place blame on the largest private company in Venezuela, Empresas Polar. President Nicolás Maduro has gone so far to label the chief executive of the company as,  “a thief and a traitor.” The president also claims that Polar is purposefully refraining from full food production in attempts to ruin the Venezuelan economy. These claims come with no evidence that any of it is true, and has left the Lorenzo Mendoza with a saddened heart.

Lorenzo Mendoza, the chief executive of Empresas Polar, has been appalled at the attacks on him and his private company. He is frustrated because he has seen other governments such as those in, Nicaragua, Bolivia and Ecuador embrace the private companies within their country.

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There is a barley shortage. The government controls foreign currency and refuses to import the barley that Polar needs. Venezuela is unable to grow its own barley in its tropical climate. That creates frustration among the workers; demanding the materials they need to be able to work. So many hard emotions are being felt everyday and many of the Venezuelans may just want to sit down and have a beer in attempts to relax. Unfortunately for them, Polar is responsible for 80 percent of the countries beer. Vendors now have to ration off the remaining beer cases they have, and they limit the amount that each customer can purchase.

The government is causing the country to self implode. Without the approval from the government to import goods into the country, the largest food distributor has no means to put anything on their shelves to sell. It is hard for a company to convince the government to go out and purchase foreign goods when the government hardly has any money to sustain its own Maduro regime.

The Venezuelan economy is crumbling. The government has decided to pit the blame on the largest food distributor in the country. With shortages in meat, milk, bread, and beer things do not look as though they will get better under the socialist rule.

-by Abigail Andrea. She is an intern at NewsGram. Twitter @abby_kono

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Despite Tariff War With U.S, China’s Economic Growth is Steady

The fight between the two biggest global economies has disrupted trade in goods from soybeans medical equipment, battering exporters on both sides and rattling financial markets.

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China
An employee working on the production line of an electronics factory is seen reflected on an equipment, in Jiaxing, Zhejiang province, China, April 2, 2019. VOA

China’s economic growth held steady in the latest quarter despite a tariff war with Washington, in a reassuring sign that Beijing’s efforts to reverse a slowdown might be gaining traction.

The world’s second-largest economy expanded by 6.4% over a year earlier in the three months ending in March, the government reported Wednesday. That matched the previous quarter for the weakest growth since 2009.

“This confirms that China’s economic growth is bottoming out and this momentum is likely to continue,” said Tai Hui of JP Morgan Asset Management in a report.

Government intervention

Communist leaders stepped up government spending last year and told banks to lend more after economic activity weakened, raising the risk of politically dangerous job losses.

Beijing’s decision to ease credit controls aimed at reining in rising debt “is starting to yield results,” Hui said.

Consumer spending, factory activity and investment all accelerated in March from the month before, the National Bureau of Statistics reported.

The economy showed “growing positive factors,” a bureau statement said.

A delivery worker pushes boxes of goods at the capital city's popular shopping mall in Beijing, April 4, 2019. The U.S. and China opened a ninth round of talks Wednesday, aiming to further narrow differences in an ongoing trade war.
A delivery worker pushes boxes of goods at the capital city’s popular shopping mall in Beijing, April 4, 2019. The U.S. and China opened a ninth round of talks Wednesday, aiming to further narrow differences in an ongoing trade war. VOA

Recovery later this year

Forecasters expect Chinese growth to bottom out and start to recover later this year. They expected a recovery last year but pushed back that time line after President Donald Trump hiked tariffs on Chinese imports over complaints about Beijing’s technology ambitions.

The fight between the two biggest global economies has disrupted trade in goods from soybeans medical equipment, battering exporters on both sides and rattling financial markets.

The two governments say settlement talks are making progress, but penalties on billions of dollars of each other’s goods are still in place.

China’s top economic official, Premier Li Keqiang, announced an annual official growth target of 6% to 6.5% in March, down from last year’s 6.6% rate.

Li warned of “rising difficulties” in the global economy and said the ruling Communist Party plans to step up deficit spending this year to shore up growth.

Beijing’s stimulus measures have temporarily set back official plans to reduce reliance on debt and investment to support growth.

Also in March, exports rebounded from a contraction the previous month, rising 14.2% over a year earlier. Still, exports are up only 1.4% so far this year, while imports shrank 4.8% in a sign of weak Chinese domestic demand.

China
Chinese leaders warned previously any economic recovery will be “L-shaped,” meaning once the downturn bottomed out, growth would stay low. VOA

Auto sales fell 6.9% in March from a year ago, declining for a ninth month. But that was an improvement over the 17.5% contraction in January and February.

Tariffs’ effect long-lasting

Economists warn that even if Washington and Beijing announce a trade settlement in the next few weeks or months, it is unlikely to resolve all the irritants that have bedeviled relations for decades.

The two governments agreed Dec. 1 to postpone further penalties while they negotiate, but punitive charges already imposed on billions of dollars of goods stayed in place.

Even if they make peace, the experience of other countries suggests it can take four to five years for punitive duties to “dissipate fully,” said Jamie Thompson of Capital Economics in a report last week.

Chinese leaders warned previously any economic recovery will be “L-shaped,” meaning once the downturn bottomed out, growth would stay low.

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Credit growth accelerated in March, suggesting companies are stepping up investment and production.

Total profit for China’s national-level state-owned banks, oil producers, phone carriers and other companies rose 13.1% over a year ago in the first quarter, the government reported Tuesday. Revenue rose 6.3% and investment rose 9.7%. (VOA)