Venezuela: Making change
Despite devaluing the bolívar in February, Venezuela’s chronic dollar shortage continues. Another devaluation may well be on the cards
By Girish Gupta
Venezuela's financial woes are plain to see on arrival at
Caracas' Maiquetía international airport. Hawkers vie
for hard currency, offering more than three times the official
exchange rate of 6.3 bolívares fuertes (VEF)
per US dollar.
But it's not only the hawkers who are after foreign
currency. Venezuela's government faces a severe shortage of
In February, Venezuelan authorities devalued the
bolívar fuerte by 31.7% to bring down a budget
deficit that had been forecast by analysts at more than 9% of
GDP this year. But the concern is that the action will do
little to meet growing demand for hard currency to pay for
imported goods - and could stoke yet more inflation, already at
rates of over 20%.
"It's very worrying that with oil at over $100, the country
hasn't managed to put in order its fiscal situation in a
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