Relive the ghost of scarcity in Venezuela with a government list

CARACAS —

The National Superintendence for the Defense of Socioeconomic Rights (Sundde) published a list with the maximum consumer sales prices of 40 products in Venezuela, but the document was later removed from its social networks.

“As a result of the dialogue tables with the agri-food productive sector, we were able to agree on maximum prices for the final consumer in some prioritized items. From the Sundde we will ensure that the prices of these items are met for the benefit of our people,” the tweet said.

Consulted by the voice of americathe economist and member of the Venezuelan Finance Observatory (OVF) José Guerra considers that the possible implementation of the controls translates into a “regression” and considers it probable that a situation of scarcity could be repeated again.

“If the currency is devaluing as it has happened and these costs begin to remain in the accounting of the companies and are not reflected in the prices, surely there will be a shortage. It is a setback with the situation we had starting in 2019, when price controls were de facto eliminated,” he said.

Between 2015 and 2017, price controls caused a critical situation of shortages and rationing. In the immediate vicinity of the markets, long lines of people formed waiting to buy basic products that, in many cases, were resold at excessive prices on the black market by the so-called “bachaqueros”.

According to the experts, the “incipient” recovery of the “fragile” Venezuelan economy and the dynamism it has shown in recent months is due to de facto dollarization and the “relaxation” of price controls and inspections by the government since 2018.

Despite the fact that the bolivar is the legal currency in Venezuela, the Sundde published the prices in dollars and clarified that the calculation is carried out at the official rate of the Central Bank of Venezuela (BCV).

In Guerra’s opinion, prices are established in dollars because in fact and “de facto” the dollar is the currency in Venezuela.

“That tells you that what is actually rising is inflation in dollars, also because if not, they would not regulate them in dollars but in bolivars,” explains Guerra.

“This is an apparent contradiction, that a government that does everything possible to defend the national currency and because the bolivar is used forcibly as it did with the Tax on Large Financial Transactions, now sets prices in dollars,” he added.

Prices in dollars in Venezuela have increased between 47% and 50% compared to last year, according to economic consulting firm Ecoanalítica.

For Luis Palacios, youth leader of the Primero Justicia party, price control means remembering the “queues, scarcity and a limitation of products.”

“This shows that the complex humanitarian emergency is not over. This is going to limit businessmen and the Venezuelan population,” he said on Friday during a street activity.

Until now, the Sundde has not given details or informed the reasons why it suppressed the publication with the maximum prices for some products in the food basket which, according to the OVF, was $383 in October and registered an increase of $11, 35% compared to the previous year.

Here are some of the products on the list with their maximum prices:

• 1 kg of corn flour 1.20 dollars
• 1 kg wheat flour 1.30 dollars
• 1 kg of pasta 1.50 dollars
• 1 kg of white rice 1.20 dollars
• 1 kg of sugar 1.25 dollars
• 445 grams of mayonnaise $3.50
• 397 grams of tomato sauce 1.65 dollars
• 140 grams of canned tuna 1.20 dollars
• 500 grams of beans 1.30 dollars
• 1 kg of pork rib 7.50 dollars

[El periodista de VOA en Caracas Álvaro Algarra colaboró con este reporte]

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