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Venezuela breaks monthly inflation record, opposition says
CARACAS, Sept 6, 2018 (BSS/AFP) – Inflation in Venezuela broke the 200
percent barrier for a single month in August, bringing it to 200,000 percent
over the last year, the sidelined opposition-controlled parliament said on
Wednesday.
Only two months ago, inflation over a single month had passed 100 percent
for the first time, opposition deputy Jose Guerra, a former central bank
executive, said on Twitter.
It means prices have increased by almost 35,000 percent since the start of
the year and 200,000 percent since August 31, 2017.
The International Monetary Fund has predicted inflation will reach one
million percent in 2018.
The news comes after President Nicolas Maduro launched a series of
economic reforms last month to try to arrest four years of recession and a
crippling economic crisis that has led to hundreds of thousands of people
fleeing the country.
Reforms included increasing the minimum wage by 3,400 percent,
redenominating the currency — removing five zeros — that was also devalued
by 96 percent and fixed to the value of Venezuela’s largely discredited
cryptocurrency, the petro.
Maduro also bumped up value added tax (VAT), reduced fuel subsidies and
created a new levy on remittances sent from outside the country.
Those measures came as August’s daily inflation rate of 4.0 percent
surpassed neighboring Colombia’s over the last 12 months (3.12 percent).
The opposition-dominated National Assembly holds no real power in
Venezuela, although it continues to sit despite its members going unpaid.
It was sidelined by Maduro’s political maneuverings last year that
culminated in him creating a parallel parliament, the Constituent Assembly,
filled with regime loyalists and backed by the Supreme Court, also comprised
of pro-government figures.
MORE/HR/0932
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The central bank stopped publishing macroeconomic indexes in February
2016, with the National Assembly starting to do so in its place last year.
Experts say the crisis was caused by the government’s reckless printing of
money to try to offset the problems created in 2014 by the plummeting price
of crude oil, on which the country is almost entirely reliant.
That sparked hyperinflation that the government has been unable to control
while industry has tumbled to just 30 percent, with the population facing
shortages of basic necessities such as food and medicine.
Public services such as water, electricity and transport have been
paralyzed.
Supermarket shelves have been left empty with long queues forming at cash
dispensers as people wait to withdraw scarce banknotes.
The United Nations says 1.6 million Venezuelans have left the country
since 2015, but that has left other South American countries, such as
Colombia, Ecuador, Peru and Brazil, struggling to cope with the influx of
migrants.
BSS/AFP/HR/0935