Despite high spending, investment on public works has slowed

[naaman fletcher]

Construction dropped 7.7 percent in the first quarter of 2011. This was not only due to by a decline in private sector's activity, but also because of a decrease in public sector's construction for lack of resources.

In the first quarter of the year, government's spending surged by 10.4 percent, according to data from the Central Bank of Venezuela (BCV). However, those funds were mainly allocated to current spending instead of infrastructure investments.

"The construction sector is the second driving engine of the economy," Minister of Planning and Finance Jorge Giordani said two months ago. However, the engine would start.

The construction sector's decline was not higher because the public sector's activity grew by 5 percent, due to the works carried out by the oil industry and power utilities, according to reports from the BCV. However, those data also show that construction works by the central government fell 5.3 percent.

http://english.eluniversal.com/2011/05/23/despite-high-spending-investment-on-public-works-has-slowed.shtml