What is the economy in Venezuela?

Answer 1

http://en.wikipedia.org/wiki/Venezuela#Economy

Main article: Economy of Venezuela

The 20 Venezuelan bolívar fuerte banknote featuring a portrait of Luisa Cáceres de Arismendi.

The petroleum sector dominates Venezuela's mixed economy, accounting for roughly a third of GDP, around 80% of exports, and more than half of government revenues.They also have gold, diamonds, and iron ore but they do not have as great of an impact on the economey. Venezuela contains some of the largest oil and natural gas reserves in the world. It consistently ranks among the top ten crude oil producers in the world.[18] The country's main petroleum deposits are located around and beneath Lake Maracaibo, the Gulf of Venezuela (both in Zulia), and in the Orinoco River basin (eastern Venezuela), where the country's largest reserve is located. Venezuela has the least expensive petrol in the world because of its high government subsidies. See also: Energy policy of Venezuela

When oil was discovered at the Maracaibo strike in 1922, Venezuela's dictator Juan Vicente Gómez allowed Americans to write Venezuela's petroleum law.[19] But oil history was made[peacock term] in 1943 when Standard Oil of New Jersey accepted a new agreement in Venezuela based on the 50-50 principle, "a landmark event."[20] Terms even more favorable to Venezuela were negotiated in 1945, after a coup brought to power a left-leaning government that included Juan Pablo Pérez Alfonso. In 1958 a new government again included Pérez Alfonso, who devised a plan for the international oil cartel that would become OPEC.[21] In 1973 Venezuela voted to nationalize its oil industry outright, effective January 1, 1976, with Petróleos de Venezuela (PDVSA) taking over and presiding over a number of holding companies; in subsequent years, Venezuela built a vast refining and marketing system in the U.S. and Europe.[22] Economic prospects remain highly dependent on oil prices and the export of petroleum. A founding member of the Organization of Petroleum Exporting Countries (OPEC), Venezuela reasserted its leadership within the organization during its year as OPEC's president, hosting the organization's Second Leadership Conference in 40 years, as well as having its former Minister of Energy, Alvaro Silva Calderon, appointed as Secretary General. The collapse of oil prices in 1997-98 prompted the Rodriguez administration to expand OPEC-inspired production cuts in an effort to raise world oil prices. In 2002, this sector accounted for roughly a quarter of GDP, 73% of export earnings, and about half of central government's operating revenues. Venezuela is the fourth-leading supplier of imported crude and refined petroleum products to the United States. The Government of Venezuela has opened up much of the hydrocarbon sector to foreign investment, promoting multi-billion dollar investment in heavy oil production, reactivation of old fields, and investment in several petrochemical joint ventures. Almost 60 foreign companies representing 14 different countries participate in one or more aspects of Venezuela's oil sector. The Venezuelan national oil company Petroleos de Venezuela, S.A. (PDVSA) and foreign oil companies have signed 33 operating contracts for marginal fields in three bidding rounds. New legislation dealing with natural gas and petrochemicals is further opening the sector. A new domestic retail competition law, however, disappointed investors who had been promised market-determined prices. On November 13, 2001, under the enabling law authorized by the National Assembly, President Chávez enacted the new Hydrocarbons Law, which came into effect in January 2002. This law replaced the Hydrocarbons Law of 1943 and the Nationalization Law of 1975. Among other things, the new law provided that all oil production and distribution activities were to be the domain of the Venezuelan state, with the exception of joint ventures targeting extra-heavy crude oil production. Under the new Hydrocarbons Law, private investors can own up to 49% of the capital stock in joint ventures involved in upstream activities. The new law also provides that private investors may own up to 100% of the capital stock in ventures concerning downstream activities, in addition to the 100% already allowed for private investors with respect to gas production ventures, as previously promulgated by the National Assembly. During the December 2002-February 2003 lock-out where managers and skilled highly-paid technicians of PDVSA locked out PDVSA and sabotaged the industry, petroleum production and refining by PDVSA almost ceased. At the same time, many business owners across Venezuela closed down their stores, both actions being an attempt to destabilize the Chavez government. Despite the lock-out, these activities eventually were substantially restarted when the rank-and-file oil workers restarted PDVSA without the managers. Out of a total of 45,000 PDVSA management and workers, 19,000 were subsequently dismissed; many of which were managers and highly paid technicians. Manufacturing contributed 17% of GDP in 2006. The manufacturing sector continues to increase dramatically at a rate of 26.93% annually. Venezuela manufactures and exports steel, aluminum, transport equipment, textiles, apparel, beverages, and foodstuffs. It produces cement, tires, paper, fertilizer, and assembles cars both for domestic and export markets.[citation needed] Agriculture accounts for approximately 3% of GDP, 10% of the labor force, and at least one-fourth of Venezuela's land area. Venezuela exports rice, corn, fish, tropical fruit, coffee, beef, and pork. The country is not self-sufficient in most areas of agriculture; Venezuela imports about two-thirds of its food needs. In 2002, U.S. firms exported $347 million worth of agricultural products, including wheat, corn, soybeans, soybean meal, cotton, animal fats, vegetable oils, and other items to make Venezuela one of the top two U.S. markets in South America. The United States supplies more than one-third of Venezuela's food imports.[citation needed] Thanks to petroleum exports, Venezuela usually posts a trade surplus. In recent years, nonpetroleum exports have been growing rapidly but still constitute only about one-fourth of total exports. The United States is Venezuela's leading trade partner although Brazil is expected to surpass the U.S. by 2011. During 2002, the United States exported $4.4 billion in goods to Venezuela, making it the 25th-largest market for the U.S. Including petroleum products, Venezuela exported $15.1 billion in goods to the U.S., making it its 14th-largest source of goods.

Answer 2

Venezuela's economy is okay cuz they import and export things that are important like gas, oil, fuel,....