Why is Venezuela hiding its official statistics?

News

  • Author: Carlos Alberto Gómez Grajales
  • Date: 19 August 2015
  • Copyright: Image appears courtesy of Getty Images

About six months ago, Venezuela published for the last time its consumer price index, in which the government stated that annual inflation had reached 68.5% in December [1]. After that, only silence. Since February, the Venezuelan Central Bank has not published any pricing data.

This fact became news again a few days back, when the justice system in the country supported the classification of the information. A civil organization, Transparencia Venezolana, demanded the publication of the index through a lawsuit presented to the Supreme Court, which was against the President of the country's Central Bank, Nelson Merentes. The lawsuit claimed that Central Bank had unfulfilled its obligations to the country by not publishing main economic indicators. Just a few days back, a verdict from the court dropped the petition, based on the argumentation that Transparencia Venezolana failed to comply with the proceedings required to ask for the information.

thumbnail image: Why is Venezuela hiding its official statistics?

This is not the first time the regime in Venezuela has decided to stop publishing official statistics. The homicide reports were classified back in 2005, including epidemiological reports regarding outbreaks of dengue or chikunguña [2]. The difference is that, right now, the economic situation in the country is so complicated that hiding the numbers cannot hide the reality that Venezuelans are living.

Analysts believe that the country is home to the world's highest inflation rate [1]. “Prices are going up practically every day,” a Venezuelan merchant told a news agency. “People get upset. They just don’t understand. But after they go out and hunt for goods themselves and realize they can’t find what they want, they end up back here and paying the price” [1]. Statistics allow us to understand the reality. But hiding or twisting statistics do not change the reality itself.

Rating agencies and international organizations all have their own estimates of the current inflation numbers in Venezuela, reflecting the outstanding situation in the country. The Bank of America estimates an increase in prices of 142% for the year and JP Morgan projects a rise of 140%. Some academics even claim the annual inflation rate is at hyperinflation levels of over 500%, which is higher than the second-highest inflation rate on the world - Syria at 84% [3].

It is not then surprising that the government tries to hide official statistics, even more so considering that the falling oil prices mean the authorities have limited maneuverability in the current situation. Yet the power of statistics lies in the fact that they bring knowledge. Hiding estimations do not in any way provide an answer to the issue: it might worsen it, in fact. The political debate that the government is so badly trying to avoid, could in fact contribute to a solution. Statistics isn't a political tool; it is a scientific method to understand the world, to identify problems. The government's misunderstanding of statistics is not only harming its image, but the lives of all citizens who can only witness the crisis upon them.

[1] Venezuela’s Inflation Nightmare Signals Default May Come Sooner.
– Bloomberg Business (July, 2015)
http://www.bloomberg.com/news/articles/2015-07-15/venezuela-s-772-inflation-means-default-may-come-a-lot-sooner

[2] La justicia impide informar de la inflación en Venezuela. – El País (August, 2015)
http://internacional.elpais.com/internacional/2015/08/12/actualidad/1439341940_083307.html

[3] Venezuela: World's highest inflation rate – CATO Institute (May, 2015)
http://www.cato.org/blog/venezuela-worlds-highest-inflation-rate

Related Topics

Related Publications

Related Content

Site Footer

Address:

This website is provided by John Wiley & Sons Limited, The Atrium, Southern Gate, Chichester, West Sussex PO19 8SQ (Company No: 00641132, VAT No: 376766987)

Published features on StatisticsViews.com are checked for statistical accuracy by a panel from the European Network for Business and Industrial Statistics (ENBIS)   to whom Wiley and StatisticsViews.com express their gratitude. This panel are: Ron Kenett, David Steinberg, Shirley Coleman, Irena Ograjenšek, Fabrizio Ruggeri, Rainer Göb, Philippe Castagliola, Xavier Tort-Martorell, Bart De Ketelaere, Antonio Pievatolo, Martina Vandebroek, Lance Mitchell, Gilbert Saporta, Helmut Waldl and Stelios Psarakis.