From the economic point of view, 1996 will be remembered as the most learning-yielding year. Practically the entire country got a free master's degree in economic policy and in all that should not be done in exchange policy matters..

I shall begin to discuss the issue and then the Venezuelan Agenda.
The year 1996 started with the currency exchange and price control system's final stage; these controls had been justified by the current administration at the beginning of its term. In spite of all the warnings and advise from numerous domestic and foreign specialists, we followed a practice that not only brought additional problems but also a delay in applying guidelines towards competitiveness and efficiency.

The difficulties encountered at the end of the exchange control system (OTAC) when applying for foreign currency and the monetary unbalances, scared away any investment intention in Venezuela. The lack of economic security and the interventionist quest shooed away capitals and acted as a brake applied to modernization and opening.

Faced with the serious problems resulting from barriers set against free play of the demand, the government, in April 1996 was forced to think it all over: it yielded and by means of the so called "Venezuelan Agenda" it decided to let the currency float and to eliminate the exchange control system..

It had to recognize also the need to readapt fiscal expenditures. It did it by means of higher consumption taxes, going from 12.5% to 16.5%, it increased the price of gasoline and starts the flotation following a strong devaluation moving the official rate of exchange from Bs. 290 to Bs. 480 per dollar. Assuredly, the easy way out.

Additionally and as a heavenly blessing, the price of oil was subject to a strong positive adjustment and enabled us to balance the current account with the possibility of closing the year with no fiscal deficit.

Perhaps this government's most significant action was to finally have initiated the oil policy opening. On a very short term these foreign and domestic investments will provide us with the operational capacity to practically double domestic oil production.

The results of CANTV's and other companies' privatization operations constitute an additional positive fact.

Summing up, the most striking feature of 1996 as to the government's role in economic issues, was to have acknowledged that the first road was the wrong one and that Venezuela had to accept the fact that globalization is an opportunity, not a threat.

This new orientation, however, requires a strong competitive vision being able to break away from populism and with the old paradigms still surviving under the shadow of protectionism and easy-way-out solutions.

The unions' radical positions, the protectionist pressures by some industrial and producing sectors are a live demonstration of the hurdles that must be overcome.

We still see those who talk of food provision security based on domestic supply at any cost instead of the modern concept of considering it rather under the capacity of a country's individuals to satisfy their needs at the best available price.

The fact that a strongly negative interest rate has been maintained has punished domestic savings and that is, undoubtedly, one of the bad things of 1996. An inflation rate close to 100% is certainly another of this government's negative variables.

Political tranquillity is an undeniable success of our president. But the fact that it has not been possible to transform the current severance payment system in order to make of it a tool for development is one of the Venezuelan Agenda's weaknesses.

Other spot weaknesses of 1996 may be seen in the maintenance of inconstancies in matters of public education and in holding to free high level education; the same may be said of inefficiency in public health and social security.

The year 1996 was negative also when there was no significant reduction in the number of public employees, in spite of the fact that there are more than a million employees in excess. Government must set the example in matters of efficiency. This is more so when we consider that there re more than 2,000,000 foreign immigrants doing the work that local citizens are not willing to do.

All this proves that there have not been any structural changes as contemplated by the very same "Venezuelan Agenda" and that these are as important as the conjuncture changes in macroeconomic policy.

The improvements in international reserves due mainly to higher oil prices and to privatizations should have provided the golden opportunity to implement a conversion box in the country if a real will to change had been present. It is the only way to guarantee, on a medium term basis, that we will not fall once more into a monetary crisis.

Our current national leadership has proved that it is ready to subject itself to a fiscal discipline warranting that what we have is efficiently used. Only the pressure produced by the rigidity of a monetary board or of a conversion box is going to change things. Those having benefited until now from the government's squandering and disorder in matters of expenditure allocation are obviously entirely opposed to such rigidity.

To conclude, the year's most positive thing has been the change of orientation as to economic matters and the most negative one has been the lack of implementation of structural changes.