BY: CLAUDIA A. GONZALEZ
For the past years two years, Venezuela has been in the headlines as domestic turmoil increases and quality of life decreases. It is estimated that 2.5 million Venezuelans have left the country between 2015-2017, and this number is expected to continue to increase to 4 million in 2018. As Nicolas Maduro, the current president of the country, continues to deny the existence of a crisis and continues to blame any grievance of the Venezuelan people on an alleged economic war staged by the international community, the country continues to fall deeper into an unprecedented humanitarian crisis.
On February 14th, 2018, Bloomberg released its annual miserable economies index, and for the fourth year in a row, Venezuela came in first with a score 50 times larger than Egypt, the country that came in second. This number is nothing more than a reflection of how atrocious the Venezuelan reality is. In February alone, inflation rose 80%, according to the opposition-led National Assembly (the government stopped releasing inflation figures in 2015), compounded annually this inflation goes up to 6,000%.
Source: Bloomberg Misery Index 2018 https://www.bloomberg.com/news/articles/2018-02-14/most-miserable-economies-of-2018-stay-haunted-by-inflation-beast
Usually hyperinflation is the immediate cause of income insufficiency to purchase goods, but in Venezuela, besides hyperinflation, people have to endure a second foe- food scarcity.
Due to a foreign currency exchange control imposed by Hugo Chavez in 2003, any Venezuelan looking to purchase foreign currency or import anything into the country, needed to undergo a bureaucratic process by seeking government permission to buy currency, be it for personal use or even to import goods. As time went on, this process became increasingly corrupt and limited to those close to the chavista regime; leaving all those deemed as opposition with no other option but to trade in the black market. As the differential between the official and black market grew, both chavista and the opposition seized the opportunistic trade and profited from the exchange differential.
Today, Venezuela produces nothing but oil, due to a continued policy of socializing means of production, through which most companies were taken away from private entities and given to the people to lead production. This left the state as the sole importer of goods. As the oil price plummeted, the access to foreign currency, which was already limited due to the exchange control, became even more limited, restraining both the capacity of the few surviving national producers to import finished goods or import raw materials to produce goods and restraining, as well, the willingness of the government to use their currently limited resources for the purpose of importing goods.
The latter was accompanied, of course, by further measures that de-incentivize national production and incentivize perverse market behavior. One of these outstanding policies has been fixing prices for nationally produced goods, and further imposing regulatory measures on how many articles an individual can buy, as well as how many times a week.
As a Venezuelan, if I wanted to go to a supermarket to buy cooking oil, flour, eggs, rice, I would have to wait until Thursdays, since it is the specific day when I am allowed to purchase certain goods, as it is designated according to each person’s identity number.
The latter constitutes the infrastructure of the economic disaster and social misfortune that the chavista regime has created for the Venezuelan people through the years, translating into the dramatic reality we are seeing today.
To put the crisis into numbers- since the government stopped publishing economic figures, the three largest Universities in Venezuela united to track social and economic figures during the crisis through a yearly research project. As 2018 kicked-off, the 2017 National Survey of Life Conditions in Venezuela (ENCOVI) was released, which revealed the depth of the crisis; the report explores and analyzes topics such as, food scarcity, inflation, poverty, insecurity, housing and more recently migration.
ENCOVI surveyed around 6,000 people, and the picture that their data paints of the country is horrifying to say the least. When asked if income was sufficient to feed their household, 89.4% answered negatively. Furthermore, when asked if any member of the household had to reduce their meals because income was insufficient, 63% answered positively. This means 9 out of 10 Venezuelans feel their income is not sufficient to feed their households; based on this insufficiency, 6 out of 10 need to reduce the amount of meals they have per day, in order to feed their families. When asked if in the past three months they had eaten less due to insufficient income, 80% answered affirmatively, and when asked, if in the past three months they had gone to bed hungry because income was insufficient to buy food, 61.2% answered positively.
As a consequence, this survey documents, in 2017, 64.3% of Venezuelans have lost 11.4 kgs, in contrast to a weight loss of 8.9 kgs for 74% in 2016, meaning that those who are losing weight are doing it in a more extreme way, although the amount of people losing weight has decreased.
A further element complicating reality is the lack of security. In 2017, 26,616 violent deaths were documented, 16,000 of those were homicides and 5,500 were resistance to authority, with 5,035 still under investigation.
These elements compound the present day situation, under which at least 2.5 million Venezuelans decided to leave the country between 2015-2017; 2016 and 2017 saw the highest increase in migration. Chile alone received 165,000 Venezuelans in 2017, becoming the third most important recipient of migrants from Venezuela, after Colombia and Peru.
In a recent special report, Reuters detailed the hardships Venezuelans go through as they make the decision of leaving the country by bus. For a trip to Chile, it costs around 300-400 USD and takes approximately 9 days. For those of us used to a privileged life, 9 days on a bus sounds like torture, but for those who have barely eaten in months, or are in dire need of healthcare, 9 days is just a small wait.
This week the United Nations High Commissioner for Refugees issued a Guidance Note on the Outflow of Venezuelans. Under this note, UNHCR petitioned that member states of the region consider protection-oriented arrangements to enable Venezuelans to legally stay within their territories.
Such a consideration is unprecedented for migrants coming from Venezuela, which underscores the urgency of the situation in which Venezuelans find themselves. As time goes by, and Venezuelans are unable to find a way out the grim situation, it becomes urgent that the regional international community agrees upon new ways to address this migration, enabling the protection of these migrants.
Claudia A. Gonzalez is a Political Analyst with a background in economics. She is currently an Associate at Atheneum and holds a Master’s degree in Political Science. She has attended Pontificia Universidad Catolica de Chile, Universidad Catolica Andres Bello and the London School of Economics and Political Science.
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