By Daniel Cancel

Feb. 11 (Bloomberg) -- Venezuela will probably lower its growth forecast for this year as the global economic crisis continues to suppress oil prices, Planning and Development Minister Haiman El-Troudi said.

“The budget for this year was drafted last August and foresaw economic growth of 6 percent, but that can be revised,” El-Troudi said today during a news conference at his Caracas office. “There will be growth this year, without a doubt, just with the muscle of the state and public sector.”

El-Troudi also said the government, which has used reserves to support spending, has determined Venezuela’s “adequate” level for international reserves this year is $30 billion. Reserves could fall to $20 billion if Venezuelan oil prices average $35 a barrel, he said. The country’s oil basket sold for $37.37 a barrel as of Feb. 6, according to government data.

Venezuela, which relies on oil exports for more than half of government revenue, may have to devalue its currency to finance spending and ease a current account deficit should the growth forecasts of outside economists pan out.

Boris Segura, an economist at Morgan Stanley in New York, estimates the economy will contract 1 percent this year.

Devaluation, Reserves

Morgan Stanley expects Venezuela to devalue its fixed currency 33 percent to 2.85 bolivars per dollar by year’s end and foreign reserves will close the year at $24.6 billion. The country may post a 2.5 percent current account deficit in 2009, after posting a 15.2 percent surplus last year, according to Segura.

“He’s slowly acknowledging that the economy will grow less than what was in the budget,” Segura said in a phone interview. “We expect a further collapse in private investment and lower exports due to oil production cuts mandated under OPEC.”

Venezuela is seeking to maintain spending on social programs and infrastructure projects amid the plunge in oil prices. The government is tapping development funds and a bi-national fund with China to fund projects as dollar sales are reduced for travelers and certain “unnecessary” imports, El-Troudi said.

Venezuela’s gross domestic product probably expanded about 5 percent last year, the planning minister said. The South American country’s annual inflation rate, the highest of 78 economies tracked by Bloomberg, will likely slow this year from 31.9 percent in 2008.

Falling Imports

Imports to the OPEC member nation will be about $40 billion in 2009, 17 percent less than in 2008, as the government gives priority to imports of food, medicine and machinery, said El- Troudi, who is also a member of the board of directors of the Venezuelan Central Bank.

The government plans to invest $225 billion through 2013 on development projects in the oil and non-oil industries by using money from the annual budget, savings funds, and leaning on allies like Iran and China for financing, the minister said.

Petroleos de Venezuela SA, the state oil company, will fund projects in the oil industry through international financing, the minister said, without elaborating.

The calculations for the five-year investment plan were made with an average oil price of $50 per barrel, according to El- Troudi.

Fonden, as the national development fund is known, has received $58 billion since its creation in 2005. The fund probably won’t grow much this year or next as oil prices hover between $35 a barrel and $45 a barrel, El-Troudi said.

“The fund won’t give much money this year due to the fall in oil prices, and possibly in 2010,” El-Troudi said. “But we guarantee that this crisis is unsustainable beyond three years at these prices and there’s simply a need for oil whether you like it or not.”

To contact the reporter on this story: Daniel Cancel in Caracas at dcancel@bloomberg.net.