Venezuelans scramble to survive as merchants demand dollars

Though used to expensive repairs, this one was too much and put him out of business. “Repairs cost an arm and a leg in Venezuela,” said the now-unemployed 42-year-old Garcia, who has a wife and two children to support in the South city of Guayana. “There’s no point keeping bolivars.” For a decade and a half, strict exchange controls have severely limited access to dollars. A black market in hard currency has spread in response, and as once-sky-high oil revenue runs dry, Venezuela’s economy is in free-fall. 

The practice adopted by gourmet and design stores in Caracas over the last couple of years to charge in dollars to a select group of expatriates or Venezuelans with access to greenbacks is fast spreading. Food sellers, dental and medical clinics, and others are starting to charge in dollars or their black market equivalent - putting many basic goods and services out of reach for many Venezuelans. 

According to the opposition-led National Assembly, November’s rise in prices topped academics’ traditional benchmark for hyperinflation of more than 50 pc a month - and could end the year at 2,000 per cent.

“I can’t think in bolivars anymore, because you have to give a different price every hour,” said Yoselin Aguirre, 27, who makes and sells jewellery in the Paraguana peninsula and has recently pegged prices to the dollar. “To survive, you have to dollarize.”

The spread between the strongest official rate, of some 10 bolivars per dollar, and the black market rate, of around 110,000 per dollar, is now huge. 

Rafael Vetencourt, 55, a steel worker here, needed a prostate operation priced at $250. “We don’t earn in dollars. It’s abusive to charge in dollars!” said Vetencourt, who had to decimate his savings to pay for the surgery. In just a year, Venezuela’s currency has weakened 97.5 pc against the greenback, meaning $1,000 of local currency purchased then would be worth just $25 now. In one grim festive joke, a Christmas tree in Maracaibo, the country’s oil capital and second city, was decorated with virtually worthless low-denomination bolivar bills.