Venezuelan currency collapse makes bad worse for citizens

CARACAS, Venezuela — Food shortages were already common in Venezuela, so Tabata Soler knew painfully well how to navigate the country’s black market stalls to get basics such as eggs and sugar.

But then came a shortage she couldn’t fix: Suddenly, there was no propane gas for sale to do the cooking.

And so for several nights this summer, Soler prepared dinner above a makeshift fire of broken wooden crates set ablaze with kerosene to feed her extended family of 12.

“There was no other option,” Soler, a 37-yearold nurse, said while scouting again for gas for her stove. “We went back to the past where we cooked soup with firewood.”

Five months of political turmoil in Venezuela have brought waves of protesters into the streets, left more than 120 people dead and a set off a wide crackdown against dissent by the government, which many nations now consider a dictatorship.

An all-powerful assembly of loyalists of President Nicolás Maduro rules the country with few limits on its authority, vowing to pursue political opponents as traitors while it rewrites the constitution in the government’s favor.

But as the government tries to stifle the opposition and regain a firm grip on the nation, the country’s economic collapse, nearing its fourth year, continues to gain steam, leaving the president, his loyalists and the country in an increasingly precarious position.

Petróleos de Venezuela, the state oil company that is the government’s main source of income, reported in August its revenue fell more than a third last year amid production declines — part of a long collapse that chokes the country’s supply of dollars needed for imports of food and other goods.

The falling production mirrors trends in nearly every product the nation depends on, from potatoes and corn to automotive manufacturing, with fewer than 1,100 cars made in the country through July this year.

And while production falls, prices continue to rise with inflation. The price of food in Venezuela increased more than 17 percent in July alone, according to the main nongovernmental group that tracks inflation, aggravating a food crisis that had already shattered the image of Venezuela, an oil-rich nation that, until recent years, was the economic envy of many countries in the region.

“This is unprecedented,” said Ricardo Hausmann, an economist at Harvard University and former Venezuelan planning minister, contending that the economic declines are worse than those in Mexico during its economic collapse in the 1990s, Argentina in the 2000s and Cuba after the fall of the Soviet Union.

In one nine-day stretch in late July and early August, the price of the bolívar, the national currency, fell by half against the dollar on the black market, cutting earnings for people who make the minimum wage to the equivalent of just $5 per month.

Even though the government has been raising the minimum wage relentlessly, it has not nearly kept up with inflation, leading to an 88 percent drop in earnings over the past five years for the workers who rely on it, Hausmann said.