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In 2014, they exported $63B and imported $36.6B which meant a positive profit of $26.3B. Venezuelas
oil production is very big, but has fallen since 1998. Now they are producing 2,300,000 barrels of oil
daily when 3.5 million barrels where produced in the year of 1998. This is an example of Venezuela
taking advantage of the opportunity they have with a command economy whereas if they had a free
economy, they will be making a lot less as they will be selling their goods at the price of what the
consumers and open market determine.
Singapore is a country which is located in South-East Asia, right next to Malaysia. Modern Singapore
was founded in the 19th century but lived under the British Crown Colony. In 1959, Singapore had their
first general election and The Peoples Action Party won with 43 seats. This resulted in Lee Kuan Yew
becoming the first prime minister of Singapore.
When Malaysia was formed in 1964, the Federation of Malaya, Singapore, North Borneo and Sarawak
wsa compromised. This was done to create closer ties between the countries but Singapores merger was
unsuccessful. Two years later on the 9th of August 1965, Singapore left Malaysia and became an
independent sovereign democratic nation. Singapore now has a free market.
Singapore has what we call a free market economy. A free market economy is an economy where the
government does not interfere with any business activity, which results in the individuals controlling the
market and making economic decisions themselves.
Economic overview of Venezuela
GDP: 438.3 billion USD of 2015
GDP per Capita: 14,414.75 of 2015
GNI per Capita: 17,900
Adult literacy rate: 90% of 2015
Life expectancy(years): 2014 is 74.236
HDI: 0.764 as of 2013 and the ranking is 67
GDP per capita growth rate using years 2012 and 2013
is 13%
Unemployment rate of 2015: 6.7%
Employment rate of 2015: 93.3%
Population of Venezuela: 31.41 million
Poverty headcount ratio: 33.1%
Just from these statistics, we can already tell that Venezuela
is not a very rich and well developed country. However, we
can also tell that they are not extremely poor and most of
the people are not in poverty, taking in consideration that
this is a very large country and has to take care a lot more
people, comparing countries like Singapore.
Gini Coefficient
As we can tell from the Gini coefficient for Venezuela, over the past
few years, the Gini coefficient reduced and still is. This is good for the
country and as the reading goes closer to 0, the more equal the
income distribution between citizens of Venezuela.
Trade agreements
What they mainly produce at mass production:
Venezuela was a member of the Mercosur which has 4 other
Crude Petroleum
members which are Argentina, Brazil, Paraguay and Uruguay.
Refined Petroleum
Venezuela joined the Mercosur in 2012 but are not able to
Acyclic Alcohols
negotiate by trade as a party and can only observe the
Packaged medicaments
negotiations. Unfortunately, Venezuela has now been suspended
from the Mercosur trade agreement as they were not able to Frozen Bovine Meat
comply with the organizations democratic principles. Gold
Petroleum coke
Concentrated milk
Corn
Top 5 countries(main) which Venezuela is exporting to: Top 5 products(main) which is exported from
Venezuela:
1. USA ($27.5B)
2. India ($11.7B) 1. Refined Petroleum ($10.9B)
3. China ($10.1B) 2. Petroleum coke ($425M)
4. Singapore ($3.86B) 3. Acyclic alcohols ($607M)
5. Spain ($1.55B) 4. Gold ($581M)
6. Other countries ($8.29) 5. Crude Petroleum ($47.8B)
Top 5 countries(main) which import to Venezuela: Top 5 products(main) which import to Venezuela:
Health and education of Venezuela:
http://data.worldbank.org/indicator/SH.XPD.TOTL.Z
For educational purposes, the adult literacy rat is 90% of S?page=3
2015, this is above average in the world. In 2010,
Venezuela ranked 59th of 128 countries on UNESCO's
Education for all Development Index which is not too
bad as this shows that Venezuela has an average or
above average education system and not a poor system.
Taxation in Venezuela. Tax percentage rate over the past 10 years have been the same which is 34%. This
will apply to everyone even including people who are very poor. This is very bad as there will be a lot of
people who will not be able to pay their tax, therefore making many debts if all the poor people who
cannot pay their tax is accumulated. Therefore, they should have a progressive income tax rate. This is the
taxation system used in different countries like Singapore and the US. The first time that a citizen is
payed in Venezuela, the amount of tax that they should pay should either be 0% or a smaller percent. The
next time that they will be payed, they should pay with an increase of tax, but not too much. From this,
Venezuelas government should be able to tell how many people are not able to pay tax and if they should
reduce or increase the tax rate progression.
Industry
The main segment is the petroleum and manufacturing sector. This is because of the amount of oil
reserves that Venezuela has which helps them with manufacturing oil products. 36.1% of the GDP in
Venezuela is made off the industry, making this one of the key elements to how Venezuela makes their
money. A list of products like agricultural products, livestock, raw materials, machinery and equipment,
transport equipment, construction materials, medical equipment, pharmaceuticals, chemicals, iron and
steel products, crude oil and petroleum products are made from industries.
Services
Services mainly include labour force. 13.3 million people make up this these labour force which is around
59.9% of the GDP made in Venezuela. This is why employment rate and unemployment rate is very
important and will greatly affect Venezuela as labour force is one of their key segments of making their
GDP.
Statistics of Singapore
GDP: $487 billion
GDP per Capita: $87,100
GNI per Capita: 76,860
Adult literacy rate: 96.8%
Life expectancy(years): 82.1 years old
HDI: 0.912
GDP per capita growth rate:
Unemployment rate: 2.1%
Employment rate: - Population of Singapore: 5.7 million
Poverty headcount ratio: N/A
Gini Coefficient:
Income distribution:
Trade agreements:
Singapores economy heavily relies on trading. Singapore has several trade agreements with both
countries, developed and developing, and group trade agreements. Their FTAs include, but are not
limited to; China, India, Japan, Korea, New Zealand, Panama, Peru, Australia, Costa Rica, Jordan and the
US.
Singapore relies mostly on their trade with China since they are their top importer, and second largest
exporter. Singapore is still making connections with other countries. They currently have 15 free trade
agreements under negotiation with single countries. According to the Singapore ministry of foreign affairs
Singapore has an extensive network of trade agreements of 20 agreements currently in place with 31
different trading partners (MFA Singapore, 2017)
Singapore currently is undergoing negotiation about trade agreements with several countries
including but not limited to; Ukraine, Pakistan, Mexico and Canada.
Singapore FTAs - Trade from Singapore - International Enterprise Singa. IE Singapore Driving
Singapore's External Economy, www.iesingapore.gov.sg/Trade-From-Singapore/International-
Agreements/free-trade-agreements/Singapore-FTA. Accessed 23 Mar. 2017.
2. Describe the economic system in place in your chosen countries and how they deal
with answering the key economic question of meeting needs with limited supplies.
Education:
Education is very important to the Singaporean government, since having intellectual people in their
population is obvious benefit. The education system in Singapore is a bit complex but very good because
there is a school for almost everyone.
Primary school is the first part of every
Singaporeans education. The primary
education is over 6 years which usually is
enough prepare some of the less mature
students. After the 6 years, they have a
huge test, called the PSLE, which
determines what type of secondary
school they will join based on their test
score. When they receive their test
scores, they will be placed in one of the 6
secondary schools based on your level of
intellectuality. After the 4-5 years of
secondary school, you go to post-
secondary where you chose what type of
education you want.
(Education System. Education System, www.moe.gov.sg/education/education-system. Accessed 23 Mar.
2017.)
Health:
The healthcare system in Singapore applies different compulsory savings from payroll deductions. They
do this to to get subsidies within a health insurance called Medisave. There are one of three levels of
subsidy which is chosen by the patient at the given time
(Healthcare in Singapore. Wikipedia, Wikimedia Foundation, 23 Mar. 2017,
en.wikipedia.org/wiki/Healthcare_in_Singapore. Accessed 23 Mar. 2017.)
Taxation:
The taxation method they use in Singapore is a tiered taxation system. This means that the tax
percentage slowly increases for every x amount of money you make. This shows that the
government in Singapore notices the low income earners. This means that for the first $20,000
you make; you get for free. After this, the tax percentage slowly increases depending on how
much money you earn.
(Income Tax Rates. Income Tax Rates - IRAS, www.iras.gov.sg/irashome/Individuals/Locals/Working-Out-
Your-Taxes/Income-Tax-Rates/. Accessed 23 Mar. 2017.)
Industry:
The industry in Singapore covers about 24% of their total GDP ($116.8 billion). Singapore takes
advantage of having a big harbour and being Asia's main trade hub. Because of their lack on natural
resources, Singapore purchases what they are missing of raw material and uses it to produce other
products such as electronic equipment, machines, engines, pumps etc.
Services:
The Singaporean economy is highly dependent on import and export via shipping. Their dependency on
trade is caused by Singapore's small amount of natural resources
Singapore's domestic market is very small which limits their opportunity of capital growth and therefore
they depend a lot on services. 75% of Singapores GDP comes from services. This is because of
Singapore having the main trading doc in Asia. The import and export are the services and this is what
makes up 75% of Singapores yearly $487 billion GDP.
This also means that if drastic changes happen in the shipping industry like companies discovering a more
practical trading doc, Singapore's economy would be in huge danger since more than $365 billion comes
from this industry.
If this shipping doc loses its priority, Singapores industry would also be in danger since they purchase all
the raw material they use to produce from their trading partners. That means that if they lose their trading
partners, they lose their service. If they lose their service, they will also end up losing their industry. If all
this is last the last industry Singapore has left is agriculture which only covers 0.5% of the total GDP
($24.4 billion). This means that if Singapore loses it trade, it loses everything, which would result in
bankruptcy and losing their independency
(Contact CIA. Central Intelligence Agency, Central Intelligence Agency,
www.cia.gov/library/publications/the-world-factbook/fields/2012.html. Accessed 23 Mar. 2017.)
As Nicols Maduro became president of Venezuela, he found that there were a lot of large shortages of
food and a high inflation rate due to the policies of the previous president, Hugo Chvez. However, from
the leadership of Hugo Chves, development activities have initiated which has helped develop
Venezuela even more and has prospered them in every sense of the term. From the shortages that have
occurred, Venezuela now have regulated many products like milk, various types of meat, chicken, coffee,
rice, oil, precooked flour, butter prices; and also basic necessities like toilet paper, personal hygiene
products and medicine. As a consequence of this, the prices of these products have either risen or became
out of stock. People who do not have the luxury of buying these products have to resort to queuing up for
lines taking hours, hunt for food, eat wild fruit or garbage or as a last resort, not purchase the product.
Luckily, organizations like Amnesty International, United Nations and others have come to Venezuela's
aid. However, the Venezuelan government has declined all the offers given to them.
Most economists say that Venezuela started rationing their food in 2014 due to multiple issues.
"According to Venezuelan residents, the government also rations public water to those who use water
over 108 hours a week due to the nation's poor water delivery systems." (research.omicsgroup.org). This
is showing how desperate the Venezuelan government was to rationing their residents. Other products
like Gasoline, electricity and water but was mainly implemented in 2016. This would then lead to bigger
problems like an increase of cases of diseases. Venezuela should be a very rich country because it has the
largest oil reserves in the world. This is because of how the economy is run in Venezuela.
Bibliography
"Venezuela should be rich, but socialism has destroyed its economy." stuff,
www.stuff.co.nz/world/americas/65323158/
Venezuela-should-be-rich-but-socialism-has-destroyed-its-econom. Accessed
23 Mar. 2017.