Venezuela's Economy: Industrialization, Trade, and Location Factors
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Location Factors
Market Access: Locations near consumer and foreign markets are decisive.
Communication Options: Easy market access and modern telecommunications are favored.
Labor Quality and Quantity: A well-prepared population offers advantages in technology and resource management.
Physical-Geographical Factors: Industrial centers locate near raw materials and advantageous geographical features like navigation channels.
Historical Factors: Early settlements and major population centers attract industrial locations.
Reserves
Currency deposits held by the Central Bank of Venezuela.
Trade
The result of population agglomeration and economic surplus.
Industrialization Stages
Import Substitution: Tax exemptions for domestic industries to supply growing cities.
Basic Industrialization: Using oil revenues to boost industrialization, mainly in Guyana.
Industrial Opening: Requires competitive advantages, improved production methods, and a skilled workforce.
Exchange Rates
- Gold Standard: Money backed by gold.
- Floating: Determined by currency supply and demand.
- Leader: Fixed exchange rates or exchange control.
Trade Balance
An indicator of international trade and domestic production, reflecting the relationship between import and export values.