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Venezuela Export Partners
Positive for Investment Growth (SWOT)
Negative for Investment Growth (SWOT)
Industry & Commodity Exports
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When local governments provide a favorable economic environment, the demand and value of their currencies will also increase. WikiWealth's Fundamental Currency Analysis is a combination of four different valuation methods: investment flows, purchase price parity, interest rate parity, and inflation rate parity (see Fundamental Currency Analysis). WikiWealth, and website visitors, examine the conditions for companies to prosper through the "Investor Survey." Countries with strong fundamental freedom, transparency, stability, strengths & opportunities (see Main Street Analysis), will aid the long term potential of companies. A "Buy" rating from both approaches mean a country's currency has high potential to increase in value.
Venezuela Summary
Venezuela Country Analysis ► (edit / improve) Venezuela (VEF) has a mixed economy dominated by the petroleum sector, but with a moderate service and industrial base to slightly diversify economic growth. Currency: Venezuela’s currency is correctly valued on a global basis. Investor Survey: the economic environment is very unfavorable for long term economic growth due to low scores on economic freedom, diversity, and the SWOT analysis. Trade: China, Netherlands, and the US are the top trading partners, while the leading export is petroleum and coca. Coca is especially damaging, because it leads to crime and corruption. Commodity: Venezuela produces a significant amount of crude oil and coca mostly as an export. SWOT Analysis: The leading strength is Venezuela’s participation in OPEC, the international oil cartel. Government nationalizations, crime and corruption are major SWOT weaknesses. Trading Strategy: A correctly valued currency, low investment flow potential and very unfavorable business environment lead to a strongly negative outlook for Venezuela.
Investment Impacts (help)
Crude Oil Commodity Analysis ► (edit / improve) Crude oil is used to produce fuel oil and gasoline. Gasoline is the largest supplier of fuel for internal combustion engines. Commodity: Crude oil is rated a Sell. Crude oil demanders have a moderate potential to increase in value and crude oil suppliers have a very high potential to increase in value. Investor Survey: Crude oil’s long term growth potential is very favorable due to high scores on sensitivity to price changes, demand not sensitive to price changes, and the SWOT analysis. SWOT Analysis: Strength: Limited natural resource / supply; Weakness: Emits carbon dioxide. Opportunity to grow: the overall growth of vehicles will increase demand for crude oil; Threats to growth: environmental concerns could slow growth potential in the near term. Trading Strategy: The commodity analysis sell rating indicates that crude oil prices should decrease over the short term, whereas a very favorable investor survey means crude oil prices increase over the long term.
- Petroleum dominates the economy and exports for Venezuela.
Coca Commodity Analysis ► (edit / improve) Coca is a stimulant with many medical uses. It helps with altitude sickness, fatigue, hunger, and thirst. Commodity: Coca is rated a Buy, because demanders of the plant have a high potential to increase in value. Unfortunately from an analytical standpoint, there are no publicly traded suppliers of coca; therefore, this analysis is incomplete. Investor Survey: Coca’s long term growth potential is moderately favorable due to high scores on sensitivity to price changes. SWOT Analysis: Strength: Coca has a number of medical uses and it is drought and disease resistant; Weakness: The sale of coca produces considerable corruption and violence. Threat to grow: coca, in a concentrated form, is illegal throughout the world. Trading Strategy: The commodity analysis buy rating indicates that coca should increase in price over the short term, whereas a moderately favorable investor survey means coca may increase in price over the long term.
Coca production leads to crime and corruption. It also gives a country a bad international reputation.
Major Venezuela Trade Partners ► Press "Edit / Improve"
USA Country Analysis ► (edit / improve) The United States (US) has a highly productive, capitalist economy and is the largest and most diverse market in the world. Currency: the US dollar (USD) has the potential to increase in value especially versus the Australian and Canadian dollar because of the significant potential of undervalued companies. Investor Survey: the economic environment is very favorable for long term economic growth due to high scores on economic freedom and economic diversity. Trade: China, Japan, Mexico, and Canada are the top US trading partners, while the leading export and import are electrical machinery and vehicles, respectively. Commodity: The US produces a significant amount of coal and wheat for use at home and as an export. However, the US consumes a larger amount of oil, which contributes to their trade deficit. SWOT Analysis: The leading US strength is its entrepreneurial culture, while the main weakness is high health care cost. Energy independence has the opportunity to propel growth, while the major threat is the housing crisis, which will lower growth. Trading Strategy: An undervalued currency, high investment flow potential and favorable business environment lead to a positive outlook for US investments, which will also benefit from positive international actions.
Netherlands Country Analysis ► (edit / improve) The Netherlands (EUR) has an open, capitalist economy with a flexible labor market. Currency: The Netherlands is part of the Euro economic zone, whose currency has the potential to decrease in value on a global scale per the purchase price parity analysis. Investor Survey: The Netherlands’ economic environment is very favorable for long term economic growth due to high scores on government transparency, economic diversity, and the SWOT analysis. Trade: Finland, Belgium, France, Germany and USA are the Netherlands' top export partners, while the leading industry is financial services. SWOT Analysis: The leading Dutch strength is their flexible labor market, while a potential weakness is judicial corruption. A major threat to long-term economic growth is global warming, which could trigger rising sea levels that could flood much of the country. Trading Strategy: An overvalued currency, low investment flow potential, but very favorable business environment leads to a neutral outlook for Dutch investments.
China Country Analysis ► (edit / improve) China (CNY) is a fast growing communist country with the largest population in the world. Currency: China’s currency is moderately undervalued. Purchase price parity shows that China’s currency is approximately 40% undervalued, however, the other three valuation approaches show that China is fairly valued. Investor Survey: China’s economic environment is very unfavorable for long term economic growth due to the lack of economic freedom, government transparency, and the SWOT analysis. Trade: Indonesia, Pakistan, Norway, Singapore, Europe, the US are the top export partners, while the leading industry is industrial goods, usually for export. Commodity: China produces a significant amount of coal for use at home. The use of coal to provide energy leads to other health related problems. SWOT Analysis: The leading Chinese strength is their cheap labor, while the main weaknesses are political risk and corruption. Renewable energy has the opportunity to propel growth, while general pollution and an aging population could slow growth rates. Trading Strategy: An undervalued currency, average investment flow potential and an unfavorable business environment leads to a neutral outlook for Chinese investments.
Major Venezuela Production ► Press "Edit / Improve"
Crude Oil Commodity Analysis ► (edit / improve) Crude oil is used to produce fuel oil and gasoline. Gasoline is the largest supplier of fuel for internal combustion engines. Commodity: Crude oil is rated a Sell. Crude oil demanders have a moderate potential to increase in value and crude oil suppliers have a very high potential to increase in value. Investor Survey: Crude oil’s long term growth potential is very favorable due to high scores on sensitivity to price changes, demand not sensitive to price changes, and the SWOT analysis. SWOT Analysis: Strength: Limited natural resource / supply; Weakness: Emits carbon dioxide. Opportunity to grow: the overall growth of vehicles will increase demand for crude oil; Threats to growth: environmental concerns could slow growth potential in the near term. Trading Strategy: The commodity analysis sell rating indicates that crude oil prices should decrease over the short term, whereas a very favorable investor survey means crude oil prices increase over the long term.
Aluminum Commodity Analysis ► (edit / improve) Aluminum is one of the most widely used metals and global production is second only to iron. Commodity: Aluminum is rated a Hold. Aluminum demanders and suppliers have potential to increase in value. Investor Survey: Aluminum’s long term growth potential is moderately favorable due to high scores on the SWOT analysis. SWOT Analysis: Strength: Aluminum has a vast number of uses, which help it to maintain long term demand. Opportunity to grow: Aluminum is completely recyclable, which will help as consumers become more environmentally active; Threats to growth: Other materials with similar properties like carbon fiber could be a significant threat to aluminum. Trading Strategy: The commodity analysis hold rating indicates that aluminum should stay about the same over the short term, whereas a moderately favorable investor survey means aluminum may increase in price over the long term.
Steel Commodity Analysis ► (edit / improve) Steel is a mass produced material consisting mostly of iron. Steel is used in buildings, infrastructure, automobiles and other diverse applications. Commodity Analysis: Steel is rated a Hold. Steel demanders are fairly valued, so they may not increase in price, while steel suppliers have a higher potential to increase in value. Investor Survey: Steel’s long term growth potential is moderately favorable due to high scores on lack of good substitutes and SWOT strengths. SWOT Analysis: Strength: Steel is recyclable, which greatly enhances its environmental appeal and durability as a material. Opportunity to grow: steel’s widespread use could aid growth as the world economy grows; Threats to growth: plastic is becoming a greater threat to steel as plastics become cheaper and more durable. Trading Strategy: The commodity analysis hold rating indicates that steel should stay the same price over the short term, whereas a moderately favorable investor survey means steel may increase in price over the long term.
Coca Commodity Analysis ► (edit / improve) Coca is a stimulant with many medical uses. It helps with altitude sickness, fatigue, hunger, and thirst. Commodity: Coca is rated a Buy, because demanders of the plant have a high potential to increase in value. Unfortunately from an analytical standpoint, there are no publicly traded suppliers of coca; therefore, this analysis is incomplete. Investor Survey: Coca’s long term growth potential is moderately favorable due to high scores on sensitivity to price changes. SWOT Analysis: Strength: Coca has a number of medical uses and it is drought and disease resistant; Weakness: The sale of coca produces considerable corruption and violence. Threat to grow: coca, in a concentrated form, is illegal throughout the world. Trading Strategy: The commodity analysis buy rating indicates that coca should increase in price over the short term, whereas a moderately favorable investor survey means coca may increase in price over the long term.
Major Venezuela Consumption ► Press "Edit / Improve"
Important Venezuela Industries ► Press "Edit / Improve"
Industrial Industry Analysis ► (edit / improve) The industrial industry includes companies whose sales originate from the manufacturing of materials into finished goods and services. Valuation: Based on WikiWealth's Wall Street analysis, this industry is a Hold, with slightly positive potential. The Main Street analysis says a Hold with SWOT strengths much great than weaknesses and SWOT opportunities less than threats. Trade: The following countries derive much of their income from the industrial sector of the economy: Brazil, Venezuela, USA, Belgium, the EU, Germany, France, China, Hong Kong and Japan. Main industrial commodities include the following: aluminum, copper, lead, nickel, palladium, silicon, steel, tin, and zinc. Trading Strategy: The industrial industry tends to be sensitive to economic cycles. Look for undervalued industrial investments during economic recessions when stock prices are low and sell industrial investments during the late stages of a bull markets when stock prices are high. The global economy is currently in a recession, therefore, it is the perfect time to purchase industrial investments. Upward sloping stock charts and financial news may indicate a selling opportunity while the opposite means that stocks are becoming undervalued.
Source: http://en.wikipedia.org/wiki/Economy_of_Venezuela
