CARACAS (Dow Jones)--Venezuelan President Hugo Chavez said Wednesday he plans to come up with a new, socialist-friendly way of measuring economic growth, one day after gross domestic product data indicated his country is in recession.

Oil-rich Venezuela's economy shrank 4.5% in the third quarter, the country's central bank reported Tuesday. This comes after the economy shrank 2.4% in the second quarter.

"We simply can't permit that they continue calculating GDP with the old capitalist method," President Chavez said in a televised speech before members of his socialist party. "It's harmful."

Analysts say Venezuela's contracting GDP numbers reflect dwindling oil revenue, as global crude prices are well off their July 2008 record highs. Many analysts also attribute blame for the weak growth numbers to the Chavez government's push toward socialism, saying local and foreign businesses are pulling back on investment plans amid fears their company or entire industry may be nationalized.

Private-sector economic activity dropped 5.8% last quarter, the data indicated, while manufacturing activity slid 9.2% from the year-earlier period.

But Chavez, in his speech Wednesday, said the weak economic growth numbers are mostly the result of "capitalist calculations" that don't give proper credit to economic activity in a socialist setting.

In Venezuela, he said, a citizen who goes to a medical center for a visit can get free service that never shows up as economic activity because money doesn't change hands.

Chavez also attributed the weak economic data to Venezuela's decision to voluntarily cut oil production as a way to reduce supply amid slackening demand and thus avoid a sharper drop in prices. Venezuela's oil gross domestic product was down 9.5% in the third quarter, the central bank data indicated, but Chavez said that contraction would have been mostly avoided if the country didn't cut production.

Venezuela took the decision to reduce production in solidarity with other members of the Organization of Petroleum Exporting Countries after the global economy began to weaken in 2008 and prices began to fall.

Venezuela's oil minister, Rafael Ramirez, said recently that the country has the capacity to produce 3.2 million barrels a day of crude, but said it is only producing 3.0 million to meet the OPEC reduction calls.

Amid Venezuela's weak GDP numbers and as global oil prices rise above $80 a barrel, Venezuelan officials have suggested they will consider reversing the production cuts and start ramping up output to churn the local economy.

Chavez said he's aware the media will say it's sour grapes that he is criticizing how GDP data is gathered one day after the weak numbers were released. But he said he's always spoken out against the way the growth data was collected.

-By Dan Molinski, Dow Jones Newswires; 58-212-284-5651; dan.molinski@dowjones.com