Tag: Chavez

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How one of the richest countries in the world can be poor - Part 1

Yesterday in Venezuela, following an investigation into "illegal exchange rates," 86 people were arrested, 112 arrest warrants issued, 596 raids conducted and 1133 bank accounts frozen. Maduro calls it the outcome of one of the largest criminal investigations in history. But really, it is nothing more than a distraction from the real problem.

No exchange offices

Unlike many other countries, there are no official exchange offices for foreign currency in Venezuela. Exchange can only be done at the government, but they no longer have money. Exchanging foreign currency such as Dollars is therefore prohibited. However, the black market trade is gróót, and the price has skyrocketed. In 2014, it was 80 bolivars per dollar. Today more than 550,000 bolivars.

The food trade

In contrast, the government kept the rate of the Dollar artificially low for decades. 1 Dollar was 10 bolivars, but only obtainable by companies that were friends of the government. Since 85% of products are imported into Venezuela -and there was almost no production in its own country- the government managed to keep power over the food trade this way. In recent years, the government did move somewhat away from the one rate policy. Now they operate several. All still far from the black market rate.

Don't unhook yet. If you want to understand how one of the richest countries in the world can be poor, let's go through this. Foreign reserves, 9.8 billion left. To paint a picture. The budget of the Netherlands (2018) is 277 billion. Back to Venezuela. 95% of Venezuela's income comes from oil exports. The country's oil production has halved in recent years (refinery failures, etc). The price of oil has seen better times, but is still higher than when Chavez came to power.

The debts

come from the country comes from oil. Production has been cut in half. Now a word about the debts. To keep paying for everything, the regime has borrowed a lot of money (from China). Their weapons they buy with loans (from Russia). Those loans they pay back with oil. In total, more than 2/3 of oil exports go to paying back loans.

So oil production goes down, what does come out of the refineries goes into debt and the import-dependent country runs out of foreign currency. Airlines can no longer be paid and stop flying into the country. Food can no longer be imported; a scarcity occurs. Medicines can no longer be imported; people die.

The food shortages
Food shortages combined with government-regulated prices on some products stopped the last bit of food production in the country. Queues grew in front of state supermarkets. A black market for food emerged with rapidly rising prices.
People still need to eat, medicines are desperately needed. The government says there is no humanitarian crisis in the country, so international aid is not allowed either. People have to get their food and medicine from neighboring countries. No one accepts their currency, the Bolivar. The government has no Dollars, a black market in Dollars is developing.

Wage of 2 Dollars per month
Meanwhile, the minimum wage is falling rapidly. With today's average black market rate less than $2 a month. People are selling their possessions, getting into crime or whoring themselves out. Corruption was on the rise. Hundreds of thousands of people fled the country in recent months.

Back to where I started. The government is calling yesterday's arrests an outcome of one of the largest criminal investigations in Venezuela's history. And as Bart Schut also points out, the country has bigger problems. And this example is just the tip of the iceberg. Meanwhile, Brazil is considering closing its border, it is harder to flee to Colombia, Chile is making stricter visa requirements, and we are sending Venezuelan refugees back.

Distraction

Maduro will continue to do everything but distract from the real problems (including corruption). Meanwhile, hundreds of thousands will die from shortages of medicine, food and from rising crime.

We will not see much of this. Many journalists are stuck, have fled the country, and communication to the outside world will become increasingly difficult. People will give up hope for international help. That's about it for today. Had to get out. Thank you for your time. Don't forget this country, you are hereby warned.

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From unemployed hipster to UN Security Council member

Maria Gabriela Chavéz, the daughter of Hugo Chavéz, was recently appointed to the 15-member UN Security Council. This is the first job in Maria's life. How did Maria go from party girl, to member of the UN?

Maria Gabriela Chavéz (34), born March 12, 1980, is one of the five children of former President of Venezuela Hugo Chavéz. In the years before Chavéz's death from cancer, Maria was considered a "First Lady. She had a leading role in Chavéz's life. Maria, who dropped out of her first degree program for unknown reasons, then finished studying journalism. She spent the rest of her 34-year existence living her Paris Hilton-like hipster lifestyle with world travel and partying. As of Jan. 1, she is part of the UN Security Council -as one of 15 members- and will spend the next two years co-deciding on issues such as Ukraine, ISIS and terrorism.

The rice queen

Uncontroversial Maria is not. Most recently, she was linked to import corruption from Argentina, earning her the nickname "the rice queen. By keeping the price of imported rice artificially extremely high, she is said to have made millions while Venezuela's food shortages mount. There are voices saying that one of the reasons for her appointment to UN is the additional diplomatic immunity she gains from her position.

Her home, the palace

Image: Instagram

Unlike Jacqueline Kennedy (wife of assassinated President J.F. Kennedy), who left the White House within two weeks of the assassination (without having an alternate home address), Maria has continued to live in the presidential palace "La Carsona. As a result, current President Maduro lives in the vice president's house on an army base.

While Venezuela is burdened by huge deficits, hyperinflation and growing crime, the palace where Maria is staying has a swimming pool, cinema, gym, dance hall and bowling alley. Maintenance costs are around $300,000 a month. She has been living there for more than 15 months. Several complaints have already been filed by neighbors due to noise pollution from parties held at the palace. In addition, a number of delivery services no longer want to deliver food due to unpaid bills.

Maria's sister, Rosa Chavéz, coincidentally the wife of the current vice president of Venezuela, also lives in the palace "La Carsona.

Jetset

In addition to using the palace, Maria still uses the president's private plane and the presidential security force, which numbers 5,000.

The UN Security Council consists of 15 members. 5 permanent members and 10 non-permanent members appointed for 2 years. To get on the Security Council, Venezuela has needed the support of many of the South American countries. Her seat on the Security Council will most likely be next to that of Venezuela 's arch-rival America. As recently as 2006, Chavéz made then-President Bush out to be the devil. When it became known that Chavéz was suffering from cancer, it was alleged that America gave it to him.

The power of Cuba

With close ties to Cuba, much of Maria's input is expected to come directly from the Castro family. The international studies department at the University of Venezuela recently publicly rejected Maria's appointment. In addition, many critics question whether she is the right person in the right place.

Other rumors circulating are that Maria's appointment may be a promotional ladder, as Maduro's popularity is declining considerably, to around 30 percent. Once Hugo Chavéz expressed in an interview on national television that someone from his bloodline will become the new leader of Venezuela.

Social media rock star

Maria is a rock star on Twitter and Instagram. With nearly one million followers on Twitter and large numbers of followers on Instagram, she played a big role when her father was president. Many of her tweets include selfies with celebrities, parties, pets and, of course, those with her father Hugo Chavéz. Time will tell if she is cut from the right cloth for her first job.