Cedice: Venezuela needs $17.67 billion to improve its public services

In order to optimize the electricity sector in Venezuela, $15,000 million are required, of which 30% should be oriented to improve generation, 20% to transmission, 50% to distribution and commercialization. Cedice Libertad indicated in a report that this investment for the electricity industry should be executed in a period of 5 to 10 years.

In order to improve and optimize basic services such as electricity, water, transportation and telecommunications in Venezuela, an investment of US$ 17,670 million is required in the short and medium term. This was determined by the most recent report of Cedice Libertad's Public Services Monitor, prepared by economist Raúl Córdoba Arneaud.

This research is the result of information gathered from 12 monitors distributed throughout the country, surveys to 1,275 citizens and the review of information in 25 digital media and three social networks.

The 2022 summary of the Monitor, belonging to Cedice's Public Expenditure Observatory, points out that in the electricity sector there were three states in the country: Zulia, Merida and Nueva Esparta where the daily average without electricity supply was 16, 14 and 12 hours.

"78% of the citizens perceive that the current management is inefficient and there are no signs of improvement. 66% of the citizens claim to have lost an electrical appliance as a consequence of a power cut. None of them obtained a governmental response", the report indicated.

The summary pointed out that 83% of the citizens assured that they can pay higher rates if this contributes to improve the electric service.

In order to optimize the electricity sector, $15,000 million are required. The investment is oriented to 30% in generation, 20% transmission, 50% distribution and commercialization, in a period of 5 to 10 years.

Regarding water and sanitation, the Cedice report informed that only 1% of the population receives water continuously through a piped system seven days a week, while 61% has the service every three or four days.

The most affected states are Carabobo, Falcón, Miranda and Nueva Esparta "where there are localities that can be a week without water supply (...) In Venezuela there are 91 reservoirs for the collection of water and 86 of them are out of service", expressed the document.

The recovery of the water sector requires $1.4 billion, distributed in 30% of the resources for sanitation, 50% for treatment, transport and coverage, 20% for preventive monitoring, in a period of between 3 and 5 years.

520 million for telecommunications

In the 2022 summary of Cedice's Public Services Monitor report, it is stated that "in Latin America we are the third country with the lowest competitiveness ranking of the public telecommunications network".

Regarding the provision of Internet services, "80% of Venezuelans state that every day there are between five and eight failures of Cantv's ABA system, making the normal development of work, classes or other activities impossible (...) The perceived speed of the network is increasingly deficient; 76% of the citizens state that they have more time to solve simple tasks".

Fixed telephony, which is Cantv's responsibility, is questioned by the recipients of the service. "Four out of 10 Venezuelans present failures in the fixed telephony service and the solutions almost always arrive six months after the complaints have been made".

Telecommunications needs an injection of capital in the order of $520 million, of which 50% should be allocated for the reestablishment of the network, 40% fiber optics, 10% innovation, in a period of between 1 and 2 years.

On the subject of public transportation, 58% of those surveyed by the Cedice team indicated that they have to spend 1 or 2 hours per trip. 30% consider that this is due to the inefficient management of the institutions and the non-existent application of the norms established in the laws.

In the road segment, the report detected that 81% of the avenues, streets and transversal roads present fissures, potholes or cracks every 100 meters.

The service provided by the Caracas Metro is not well weighted either. "76% of Caracas residents pointed out that there are still failures in the frequency of train car circulation".

To fill up with gasoline, it takes between three and eight hours to refill a tank of subsidized fuel, at least in Caracas. And between four and 12 hours for the rest of the country.

Cedice estimates that the failures in the supply of gasoline persist, even though "during 2022 a slight improvement was observed, but the fuel supply schedules were not always complied with".

The transportation segment requires an injection of $750 million. 40% for road refurbishment and 30% for innovation over 2 to 3 years of work.

To start improving this lack of public services, Cedice proposes three ideas to be developed in 2023:

Talent: re-skilling platform for the profiles and knowledge necessary for the efficient management of public services. Partnerships with universities.

Technical: Redesign of service delivery models, progressive and banded tariff schemes. Alliances of public-private institutions. Privatization in some cases.

Deployment of prioritized investments: Plan for attention, monitoring and solution of failures. Alliances with trade associations and research institutions.