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  HOME | Opinion (Click here for more)

VenEconomy: The Other Side of the Coin in Venezuela

From the Editors of VenEconomy

It’s been a week since President Nicolás Maduro has been turning Venezuela’s commercial sector into an escape goat in his “fight against the economic war” as he has made use of any existing governmental body to “inspect,” intimidate and sanction businesses nationwide, all of this with a well-oiled propagandistic machinery.

Business owners are being accused of “usury,” a term that defines with a lot of precision the charging of interests above the maximum permitted by law, but for everything else is an inexistent crime for the Venezuelan Constitution and the nation’s laws. These business owners are facing public scorn, are being thrown into jail without right to defense or getting back their looted goods, just like happened recently with farmers, manufacturers and constructors, among other many sectors.

In the face of these events, the Caracas Commerce Chamber (CCC) issued a statement in which it fixes a clear position before the “unacceptable political use of economic problems” Venezuela is facing thanks to the National Executive.

The CCC shows the other side of the coin of such “economic war” going on in Venezuela with seven very precise points.

This industry association has rejected the arguments from the National Executive, which rather than taking responsibility for its actions “has opted to blame business owners for the soaring inflation and intends to manipulate the public opinion through an alleged ‘economic war’ as responsible for its decisions”…”not only because of its falsehood, but because this subject is tactically being used as electoral arguments.”

It stresses that private initiatives “take part of the country’s social assets as a whole, and as such must be safeguarded because they comprise the productive patrimonial assets that we will pass to future generations in the form of welfare and job opportunities.”

It warns that “no society survives before systematic and continues violations to its legal framework by violating fundamental principles such as the due process of law and the constitutional right to property. As a matter of fact, no economy is capable of enduring without paying the consequences in terms of chaos, disinvestment, inflation and scarcity.”

It disapproves “the model being promoted at present by some sectors of the Government: The ethics of easiness, unfair advantages and a mob logic that is not convenient for anyone.”

It is being accurate when it points out that “he who intends to get a product below its real cost and the reasonable benefit to whom provides it and even for free, must be aware that that ‘gift’ is being paid by the workers from those companies with their unemployment, the rest of the country with shortages and the society as a whole with less income due to taxes.” “There is no long term possible for demagogy and populism, most of all when the focus is on considerably destroying businesses and employment.”

It explains that “the decapitalization of businesses and their eventual disappearance does not resolve the inflation issue,” it makes it worse. It also indicates that “the level of shortages will increase when seasonal conditions are added to a demand caused by uncertainty and high expectations to get prices far below company costs. Businesses are being forced, in the face of possible riots, to get rid of inventories quickly, which under such conditions will not be replenished.”

It claims that “handling the economy under a populist-electoral focus does not build a nation. This kind of decisions place the economic activity in a ‘lose-lose’ situation: The country loses, business owners lose, workers lose and consumers lose, as a whole.”

It concludes with accuracy when saying that “uncertainty and a crisis of governance are not convenient for anyone. Venezuelans of good will, who are the majority of us all, deserve and need an environment of peace and progress. We deserve solutions and not the demonization of alleged escape goats, which are being lynched and looted. The law is for all of us and abide by it is mandatory, no exceptions at all.”

VenEconomy has been a leading provider of consultancy on financial, political and economic data in Venezuela since 1982.

Click here to read this in Spanish

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