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The Medical Device Market: Venezuela
Espicom Business Intelligence Ltd, Oct 2011, Pages: 66
The volatile Venezuelan market for medical equipment & supplies is almost entirely supplied by imported products, principally from the USA. The level of per capita spending is comparable to that in Colombia or much of Central America, but is below that found in the richer Latin American markets of Mexico and Brazil. Expenditure is heavily concentrated in Caracas and other major urban areas. The best opportunities are in the advanced private sector and the Barrio Adentro-related public sector, which was re-launched in October 2009.
The economic outlook is difficult in the short term, the country relies on petroleum prices, which can be unpredictable, and this is compounded with the effects of the global recession. Real GDP is expected to have fallen by 6.7% in 2010, but to move back to growth of 2.3% in 2011. Inflation is among the highest in the world. From 29.6% in 2010, it is expected to hit a record of 40.3% in 2011.
Venezuela joined the South American trading block MERCOSUR in 2006, however its full ratification is being blocked by Paraguay which sees the country as undemocratic. In August 2010, despite pressure from Brazil, Paraguay voted again to stop Venezuela’s full membership which had been due to take place in March 2011.
In January 2010, the bolivar was devalued for the first time since 2005, with a two-tier exchange system for priority imports which included medical devices and the remainder of goods, at 2.6 and 4.3 bolivars to US$ respectively. The President said that the two official rates would limit imports that are not strictly necessary and stimulate export policy. The lower exchange rate was abolished in January 2011, leaving all goods at the rate of 4.3 bolivars.
Venezuela is the third leading importer of medical equipment & supplies within Latin America, behind Mexico and Brazil. Hospital modernisation in the public and private sectors has brought imports to record levels, particularly via the implementation of Barrio Adentro in the public sector. Imports rose by a 2005-2009 CAGR of 39.8%. Imports of dental products experienced the highest rise, with a 2005-2009 CAGR of 57.2%, followed by patient aids (40.7%).
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