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Maduro backtracks on elimination of 100-bolivar bill as looting erupts

Monday, December 19th 2016 - 09:55 UTC
Full article 3 comments
Violence erupts in Venezuela, forcing Nicolas Maduro to reconsider his ban on the 100-bolivar bill Violence erupts in Venezuela, forcing Nicolas Maduro to reconsider his ban on the 100-bolivar bill

Venezuela's President Nicolas Maduro reversed his decision to ban from circulation the 100-bolivar bill and gave the notes, which are worth between US$ 0.02 and 0.04 according to varying quotations, a two-week grace. The bills can now be used until January 2, Maduro said.

 The surprise pulling of the 100 bolivar note from circulation on Thursday - before new larger bills were available - led to vast lines at banks, looting at scores of shops, anti-government protests and at least one death. Many Venezuelans had found themselves without the means to pay for food, gasoline or Christmas preparations in a country already reeling from a profound economic crisis.

Maduro, speaking from the presidential palace, blamed a “sabotage” campaign by enemies abroad for the delayed arrival of three planes carrying the new 500, 2,000 and 20,000 bolivar notes. He had justified the 100 bolivar note's elimination as a way of strangling mafia and smugglers on the frontier with Colombia. He has also closed border crossings with Colombia and Brazil until January 2.

About 40 percent of Venezuelans do not have bank accounts, and so cannot use electronic transactions as an alternative to cash. Adding to the chaos, Venezuela has the world's highest rate of inflation, meaning large bags of cash must be humped around to pay for basic items.

On the other hand, those Venezuelans who can are turning to digital currency bitcoin to mitigate the effects of rampant inflation, which is expected to rise to 1600 percent in 2017, according to the International Monetary Fund. A website where bitcoin exchange operations can be handled has risen from 450 users in Venezuela in August to over 85,000 in November.

In the southern mining town of El Callao, a 14-year-old boy was shot dead during looting on Friday, authorities confirmed. An opposition legislator reported three fatalities.

Earlier on Saturday, about 400 people in western Tachira state jumped fences and defied security personnel to surge into Colombia in search of food and medicines, which are scarce in Venezuela, witnesses said.

In southern Bolivar state, people broke into dozens of shops and warehouses in various towns, witnesses and business leaders said. Authorities declared a curfew in Ciudad Bolivar and the state governor said 135 people had been arrested.

Security forces fired tear gas in Venezuela's largest second city, Maracaibo, to stop looters, witnesses said. Some protesters burned 100 bolivar bills.

 

Categories: Economy, Politics, Venezuela.

Top Comments

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  • Kanye

    A human tragedy of epic proportions.

    Victims of human greed, in the name of ideology.

    The Bolivarian Socialist utopia.

    Under Evita Kirchner, Argentina would have been next. Might be too late now, anyway.

    Dec 19th, 2016 - 03:07 pm +2
  • Idlehands

    The obvious temporary solution is to adopt the USD. I'd love to see Maduro announce that. He'd be whispering it under his breath while trying not to have a heart attack.

    Dec 19th, 2016 - 03:18 pm +2
  • ChrisR

    I take it the toilet paper shortages are a thing of the past then?

    Dec 19th, 2016 - 01:44 pm +1
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