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7 March, 2019 00:00 00 AM
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In impoverished Venezuela, the dollar is king

AFP, Caracas
In impoverished Venezuela, the dollar is king
Venezuelan opposition leader and self-proclaimed acting president Juan Guaido (C) gestures as he speaks during a press conference after a meeting with union leaders in Caracas on Tuesday. AFP photo

Whether paying for a manicure, an evening gown or a liter of milk, in Venezuela the dollar can buy anything, so long as you're discreet.

"Of course we take dollars, we can even try your credit card, if it works there's no problem," said a restaurant owner in Caracas, keen to be both welcoming and pragmatic, and to remain anonymous.

Given the South American country's economic crisis there's no question about turning away a customer.

Venezuela's own currency, the bolivar, has been crippled by hyperinflation.

Back in August, President Nicolas Maduro devalued the bolivar by 96 per cent as one of a raft of economic reforms he hoped would boost an economy in meltdown.

But the bolivar has lost 98 per cent of its value since. A dollar is now worth around 3,000 bolivars and the rate is changing every day.

It has left the salaries and savings of millions practically worthless.

The International Monetary Fund says inflation will hit a mind-boggling 10 million per cent this year -- it ended 2018 at 1.3 million per cent.

Since 2003, the government has tried to enforce a monopoly on foreign currency reserves.

Its detractors have accused top officials of exploiting the misery of the wider population by acquiring foreign currencies at official rates and then selling them for a huge profit on the black market at a wildly inflated exchange.

"We started doing it under the table," said the restaurant owner.

"We started taking dollars two or three months ago, but if it was known it could hurt our business because we're supposed to declare everything in bolivars."

Asked if it was illegal, he added with a smile: "I don't know, but it's not authorized."

Madeleine runs a small clothing shop with shiny dresses and sparkling shoes aimed at the middle classes that have some money to burn.

All prices are listed in dollars.

"Of course! And if anyone asks, I calculate (the price) in bolivars at the day's rate," she said.

"Otherwise I lose too much money. I import everything from Los Angeles. I've got to keep the business going."

She knows it's illegal but says she has little choice. With the bolivar losing value every day, it's not possible to set prices in the local currency.

"To buy a liter of milk you need this," she laughed, imitating an eight-inch high stack with her hands.

Like the restaurant owner, Madeleine doesn't want to give her true name, nor that of her shop, nor be pictured or filmed.

"I could have done like countless others and left the country, but I prefered to stay and work here," she said.

"But at any moment, the government could come and close my business," which only opened in mid-December.

It's not even a luxury store but the dresses she sells cost around $50, eight times the minimum monthly wage of 18,000 bolivars -- around $6.

Those who earn that much can just about buy two kilograms of rice and as much flour.

 

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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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