June 29, 2007
Venezuelan Finance Minister promises no short term devaluation and no flights of capital

(VHeadline.com) - "Speaking on José Vicente Rangel's TV talk show, Finance Minister Rodrigo Cabezas denies any devaluation in the short term.

The Minister says no more bolivares are required in the short term either and there will not be any flight of capitals forcing the government to introduce an exchange hike.

The government is not expected to apply recommendations from the International Monetary Fund that interest rates be raised to 40% and public spending reduced to 20%.

The Minister has announced an Agricultural & Lands (MAT) Ministry plan to increase domestic production by granting subsidies.

The Central Bank of Venezuela (BCV) is expected to announce some time this week a policy aimed at a reeling in liquidity and other decisions to boost savings.

This year 2 million new savings accounts have been opened.

Cabezas maintains that the GDP will be around 8% and unemployment around 7% at the close of the year.

The government is determined to reinforce its anti-inflation plan in Q2 to avoid any knock-on effect on growth.

The Minister points out that imports this year could reach around $28 billion due to purchases undertaken by the private sector of the economy".