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  HOME | Venezuela (Click here for more Venezuela news)

TalCual: Hyperinflation, Political Change in Venezuela
Venezuela is together with Zimbabwe the only two nations with hyperinflation in this century. And the country can set new records despite a forecast by the IMF of hyperinflation exceeding 1 million percent. Specialists have pointed out that according to experience abating hyperinflation represents a change in policies from those who rule the country, or a change in governments

By TalCual

All forecasts for 2019 are truly alarming. Hyperinflation already completed its first year. According to International Monetary Fund (IMF) forecasts, annual inflation may exceed 1 million percent. In this way, Venezuela would easily exceed the highest inflation known so far in Latin America (Bolivia) in the last century. It would be placed in the rankings of a few countries with hyperinflation throughout the year.

We are, together with Zimbabwe, the only nations that have got to know these processes in this century. The country can set new records. We heard local economist Asdrúbal Oliveros pointing out two original features of hyperinflation in Venezuela: it is the only oil-producing country where this situation has been produced and also the only where it has coexisted with cash shortages.

Local economist, university professor and former Minister Rodrigo Cabezas has stressed in several forums and interviews that the policy of the government lacks a coherent plan to combat inflation. While it is true that initially with the announcements of President Nicolás Maduro had emerged favorable expectations in some sectors, as reflected in a survey conducted by the Catholic University Andrés Bello, those expectations were dashed a few days later when the increase of the minimum salary became nothing with the massive increase in prices on a daily basis.

Jesus Faría, and economist and member of the Constituent Assembly, recognizes that the Government has not been able to cope with the "hyperinflationary scourge" and that it will be able to do so thanks to an increase in oil production when it is widely known that the very serious situation in the oil industry is the result of the ongoing mismanagement and corruption there.

The United Nations Food and Agriculture Organization (FAO) said in a recent report that our country has registered the largest increase in hunger and malnutrition between 2016 and 2018. That report draws particular attention because, a few years ago, that organization had praised Venezuela for its alleged performance in that area.

Specialists have pointed out that according to experience abating hyperinflation represents a change in policies from those who rule the country, or a change in governments, with the rare exception of Zimbabwe which attempted to overcome it by allowing the use of various foreign currencies.

Despite rumors circulating on the Government's intention to bring forward a comprehensive economic plan whose priority objective would be to tackle the main problem of the economy, we have serious doubts about that purpose because of the dogmas and concepts that members of Venezuela's ruling elite are prisoners of.

Various spokespersons of the democratic opposition have announced a few days ago that they would be holding a series of meetings in order to move in the right direction, however it is required to have a sense of urgency in line with the needs. For its part, Frente Amplio (Broad Front), a coalition of opposition political parties and civil society, has been developing a series of extremely important initiatives, among them the holding of regional congresses which will culminate with the celebration of the national event later this month.

All these activities are necessary and important, but the reconstitution of a political leadership to assume the leadership of the democratic opposition makes an urgent priority. This seems so simple to achieve, but it has been impossible until now. Inexplicably.

 

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