BRIEF HISTORY OF DR MIGUEL RODRIGUEZ
Dr Miguel Rodríguez studied Economics and Engineering simultaneously at Central University of Venezuela, graduating in Economics in 1977, and studying Engineering until the eighth semester. Before concluding the latter, after having applied to the Gran Mariscal de Ayacucho Scholarship Programme created under the first government of Carlos Andrés Pérez, he was awarded the scholarship to study in the United States.
He spent 1 year at Harvard University and 4 years at Yale University, obtaining from them 2 Master’s degrees and a PhD in Economics at Yale University. He had the great privilege, as a scholarship holder of the Gran Mariscal de Ayacucho Scholarship Plan, of being able to study at these two extraordinary universities.
He was a student of eight Nobel Laureates in Economic Sciences in memory of Alfred Nobel, and an assistant to two of them.
His specialty is made up of Macroeconomics, International Economy and Finance, Currency and Banking, and Development Planning.
After completing his PhD at Yale University, Dr Miguel Rodríguez returned to Venezuela in December 1983, and in January 1984, he joined directly to teach as a full professor at the Institute of Higher Administration Studies, IESA, until the year 2005.
He inaugurated the IESA Debates Magazine with a special article on Domingo Cavallo’s Currency Board in Argentina, where he made the exact prediction of the evil that was going to affect our Argentine brothers with that straitjacket. Magazine Number 1, IESA Debates.
In 1984, he published an article in El Diario de Caracas entitled «Myths and realities of Venezuela’s external indebtedness», which caught the attention of former President Carlos Andrés Pérez, who contacted him, this being the first time they met.
In 1987 he returns to Washington as one of the two candidates selected by the Peterson Institute where 300 PhD from the best universities in the world participated: * Dr Soon Cho, the Dean of the Faculty of Economics at the University of Seoul, and Dr Miguel Rodríguez, Professor at the Institute of Advanced Studies in Administration, IESA.
The Peterson Institute for International Economics (PIIE) is an independent, nonprofit, nonpartisan research organization dedicated to strengthening prosperity and human well-being in the global economy through expert analysis and practical policy solutions.
Both remain and share experiences for a year and a half in said institution, which allowed Dr Miguel Rodríguez to assimilate the experiences in the matter of South Korea’s Export Policy: how South Korea grows and focuses on export growth. In the same way, what was happening in terms of Development Planning for the Asian Tigers, in Taiwan, in Singapore, what was already taking shape in China, an important and fundamental aspect for the process that China was beginning to convert an economy governed by a communist party, in name only, in a market economy.
During his stay in the United States, Dr Miguel Rodríguez frequently meets with Carlos Andrés Pérez, who offers him the position of Minister of State, Head of CORDIPLAN, after reaching the presidency for the second time by winning the presidential elections in 1988.
Dr Miguel Rodríguez had already been in contact and held meetings with the highest representatives of the Financial Institutions: World Bank, Inter-American Development Bank, International Monetary Fund, managing to bring Carlos Andrés Pérez together with these high representatives, emerging the idea of converting Venezuela in a diversified country.
The programme of economic adjustments proposed and undertaken that sought to refinance the external debt and prevent the country from going bankrupt had great success in the economic field, by managing to lower inflation and promote growth that reached 9% year-on-year of GDP in just three years.
Venezuela missed the great opportunity to modernize its economy with the reforms proposed in the second government of Carlos Andrés Pérez by the team led by Dr Miguel Rodríguez.
The Venezuelan political sector blocked these reforms and conspired to overthrow the government that advanced them.
In 1991, Dr Miguel Rodríguez introduced the Project for the Creation of the Macroeconomic Stabilization Fund, the Sovereign Fund of Venezuela, to the National Congress, being the first, during the government of Carlos Andrés Pérez, to propose that Systematic Sovereign Stabilization Fund, in the world, even before Norway.
Norway introduced the project to create this fund in Congress and approved it in 1991, and today it has a trillion dollars. Venezuela would have hundreds of billions of dollars in its fund. Venezuela would be a fully developed country today if this Sovereign Fund had been approved. We would have had the most extraordinary, developed, thriving, totally democratic country in Latin America in the last twenty years.
Venezuela plunged into a ravine in 1992-93, from which it has not recovered to this day. Most of those responsible who destroyed the great Development programme designed and implemented by Dr Miguel Rodríguez, today propose themselves as its saviors.
The following are some of the most outstanding aspects of the management of Dr Miguel Rodríguez as Minister of Planning:
The oil programme was accelerated, which was the only one since the time of Pérez Jiménez that in two years increased oil production by 700,000 barrels.
The actions that were implemented from 1989 tending to increase production, generated the inertia of increase that was experienced until 1997, trend that is observed in box.
Dr Miguel Rodríguez introduced the creation of the Macroeconomic Stabilization Fund, the Venezuelan Sovereign Fund, to Congress in 1991, before Norway introduced in Congress, and approved the resources for his fund. “The life of oil is the volatility of prices, that is why we should have a macroeconomic stabilization fund that would become a sovereign fund, not discretionary like the Investment Fund of Venezuela, but a parametric fund that would sterilize price increases at starting from a reasonable price of oil that would inject into the economy the profits derived solely from the increase in oil production”.
The programme of economic adjustments proposed and undertaken, which sought to refinance the external debt and prevent the country from going bankrupt, was highly successful economically, by managing to lower inflation and promote growth that reached 9% year-on-year of GDP in just three years, projecting values above 10% for subsequent years.
In this way, the phenomenal crisis of the average debt received from Jaime Lusinchi in his 5 years of government, which was 4,500 million dollars per year, was addressed. The commitment to service the debt was fulfilled with the payment of 6,500 million dollars in letters of credit, in order to restructure the economy for stabilization, and the next step, to immediately carry out the economic development programme that had to be undertaken.
RECADI CEASED FUNCTIONS AND WAS DISSOLVED IN 1989, WHEN THE DIFFERENTIAL EXCHANGE RATE SYSTEM WAS ABOLISHED.
That was the Great Turn, the development planning to turn Venezuela into a producer of 10 million barrels of oil and derivatives per day, and into a great exporter of industrial, mining, tourism, high-tech, and agricultural products. which is what corresponds to an economically and socially developed country.
A solid democracy can be built, consolidated, and sustained on the basis of an assertive long-term development plan. The Venezuelan political sector blocked these reforms and destroyed in 1993 the great development programme designed and initiated by Dr Miguel Rodríguez, after Venezuela achieved the highest level of economic growth in the world, as recognized by the prestigious magazine Fortune.
Headline of El Nacional on the economic growth of Venezuela. Source: Fortune Magazine, November-December 1991
In light of
our present circumstances, it is imperative to recognize the significant
achievement of the economic adjustment program initiated by Dr. Miguel
Rodríguez in 1989. This program aimed to refinance Venezuela's external debt
and prevent it from facing bankruptcy. It proved highly successful in reducing
inflation and fostering economic growth, with GDP reaching an impressive 9%
year-on-year increase within just three years.
Given that this represents the sole instance of such success in the history of the Venezuelan economy, we believe that Dr Miguel Rodríguez's guidance and leadership are indispensable for crafting the Economic Recovery and Transition Plan.
The economist Dr Miguel Rodríguez's vision of transforming Venezuela into a prominent exporter of diverse products across various productive and service sectors should serve as a guiding principle for the sustainable development planning process. This vision can be realized through the implementation of policies aimed at bringing about essential structural changes not only within the oil sector but also within other sectors of the economy that have the potential to become export-oriented.
Significant efforts in this direction, which should have continued, were made in Guayana in order to produce that great structural change that would definitively turn Venezuela into a country with high economic growth, since it had the resources to do what Japan, South Korea, and China had been doing.
The entire Bajo Caroní development programme was accelerated. All resources were injected into Macagua II. Dr Miguel Rodríguez fully assembled the investment programme for the Caruachi Hydroelectric Power Plant. With the Tocoma Hydroelectric Plant, we would already have at least two reduction plants of more than half a million tons per year of aluminium each, accompanying Venalum and Alcasa in full production, as well as the entire aluminium chain that Venezuela installed.
This was the great opportunity to shield once and for all the Sustainable Development of Venezuela, with these two successful and emblematic figures: Dr Miguel Rodríguez, and Eng Leopoldo Sucre Figarella, forming a team to reaffirm and guarantee the validity and continuity of the Guayana Programme, which gave the country great strength on the threshold of the 21st century.
DR MIGUEL RODRIGUEZ, 36 MIN. AUDIO ON ECONOMY, DEVELOPMENT, POLITICS AND HISTORY OF VENEZUELA.
*Dr Soon Cho
Dean of the Faculty of Economics at the University of Seoul
Later in 1988 he was appointed Minister of Planning of South Korea
By Law, the Minister of Planning simultaneously holds the position of Vice Minister of South Korea
Dynamics of Korean Economic Development, The
https://econpapers.repec.org/bookchap/iieppress/25.htm
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