VENEZUELA’S CURRENCY CRISIS: SALT IN THE WOUNDS
Crisis-ridden Venezuela is experiencing a fresh wave of protests and looting, this time over the government’s decision to withdraw, and then delay the withdrawal, of the country’s largest banknote. At least 3 people died in the past week, and more than 400 have been arrested as a result of violent demonstrations and looting across the country.
President Maduro announced the decision to withdraw the 100 bolivar note last week, initially giving Venezuelans 72 hours to exchange the bill for new ones. But on Saturday he backtracked on this promise, saying people would have until Jan. 2 to make the switch after new, larger bills were not delivered to banks. The ensuing chaos is familiar to many Venezuelans, who have been dealing with mass protests, food shortages and rolling blackouts for months.
Maduro maintains the move is needed to combat “mafias” along the Colombian border who hoard cash. However, rampant inflation has rendered Venezuela’s currency virtually worthless; the soon-to-be-defunct 100 bolivar note is worth just 2 cents. In fact, it is the rampant inflation that has caused this devaluation that has forced the government to swap out the old currency.
The opposition has seized on the fiasco to again call for Maduro’s resignation. Last week, Vatican-sponsored talks aimed at finding a solution to the ongoing political crisis faltered, with the opposition saying it would not attend until the government meets its demands. These include the release of political prisoners and a date for fresh presidential elections. The almost three-year crisis shows no signs of abating.