The economic impact of Venezuela’s twin earthquakes
The impact of the earthquakes could have caused between $7 billion to $10 billion in damages.
Operations in the export bases, including the oil-rich regions and terminals, remain mostly intact.
While reconstruction requirements could stand around $15 billion, the country was hit largely uninsured and without access to multiple financing mechanisms.
On June 24, Venezuela was hit by two almost consecutive earthquakes of magnitudes 7.2 and 7.5, devastating the state of La Guaira and causing great harm across the north of the country. The latest government figures say that at least 3,535 people have been confirmed dead, 16,740 injured, and 17,854 displaced. Based on independent platforms, there could be as many as 30,000 still missing.
The seismic event also hit Venezuela at a time of economic weakness: its GDP is still just 34% of its 2012 levels, according to the UNDP. While growth was initially projected to reach as much as 10% this 2026, the country will now face, as well as a heavy cost to human life, between $7 billion to $10 billion in damages, which could result in a requirement of $15 billion for its reconstruction.
The task ahead will not be simple. The country is largely uninsured, considering both households and commercial property. On top of political turmoil and uncertainty, the state does not have access to much of its overseas reserves, nor can it raise funds through issuing external debt, while it is still subject to a regime of U.S. sanctions and licenses. What can work in Venezuela’s favour is that most of its export bases are intact, including the Lake Maracaibo basin, the Orinoco Oil Belt, and the Mining Arc.
Fabbiana Lamboglia, Advisory Associate.
Elías Ferrer, Director.
