Venezuela’s Economic Activity Falls 8.3% in Q1 2023

Economic activity in Venezuela fell 8.3% in the first quarter of 2023 compared to the same period the previous year, according to the Monthly Economic Activity Indicator prepared by the Venezuelan Finance Observatory (OVF).

This is the first time in two years that this data has been negative and puts the country on the path of a new recessionary cycle. The slowdown in economic activity had been evident since the fourth quarter of 2021, but it was accentuated in the second half of 2022.

“The main driver of the economy is oil production and during the first quarter of 2023 it suffered a decline when compared to the first quarter of 2022, despite the significant increase in crude extraction by Chevron,” the OVF said in a press release.

The Observatory cited other data to warn of the possibility of a new recession, such as the fall in sales volume, which declined by 13.3%, according to Ecoanalítica, and the stagnation of salaries for workers in the commerce and services sector.

Venezuela’s economic activity has registered 26 consecutive quarters of decline, the longest and deepest streak in its history.