Venezuela experiences the worst economic crisis for a country without war, experts say

MARACAIBO, Venezuela – The collapse of Zimbabwe with Robert Mugabe. The fall of Soviet Union. The disastrous crisis of Cuba in the nineties. The collapse of the Venezuelan economy has overcome all these disasters.

According to economists, Venezuela is experiencing the worst economic collapse in a country without war for at least 45 years.

"It's hard to think of a human tragedy of this magnitude that is not the product of a civil war"he commented Kenneth RogoffProfessor of Economics at Harvard University, Chief Economist of the International Monetary Fund (IMF). "This is perhaps the most striking example of disastrous policies in decades. "

IMF economists have cited war-torn countries such as: Libya at the beginning of this decade or Lebanon in the seventies.

However, Venezuela, which was the richest country in Latin America, did not have an armed conflict. According to economists, the bad government, corruption and bad policies of the president Nicolás Maduro and his predecessor, Hugo Chavez, triggered a galloping inflation that shut down businesses and destroyed the country. Moreover, in recent months, the government of Donald Trump has imposed severe sanctions to try to paralyze this nation even more.

As the economy of the country collapsed, paramilitary groups have taken control of entire populations, public services collapsed and the purchasing power of the majority of Venezuelans was reduced to a few kilograms of flour a month.

On the stairs, Butchers are affected by frequent breakdowns so at the end of each day, compete to sell rotting meat; who previously worked as laborers dig piles of garbage in search of leftovers and recyclable plastic. Retailers make dozens of visits to the bank hoping to deposit several stacks of bills whose value disappears because of hyperinflation.

Here in Maracaibo, a city of two million people on the border with Colombia, almost all meat sellers in the main market have stopped selling cuts, because viscera and remains such as fat and cow hooves have become the only animal protein that many of their clients can afford.

In part, the current crisis has been triggered by US sanctions that seek to force Maduro to cede power to the leader of the national opposition Juan Guaidó. Recent moves by the United States against Venezuelan oil company Petróleos de Venezuela have prevented the Maduro government from marketing oil, the country's main export product. Coupled with the US ban on marketing Venezuelan bonds, the Trump government has made it difficult to import products, ranging from food to drugs.

Maduro accuses the United States and the Venezuelan opposition of widespread famine and lack of medical supplies, but Independent economists say the recession began years before the sanctions that, if anything, accelerated the collapse.

"We are fighting a bloody battle against the international sanctions that have caused Venezuela to lose at least $ 20 billion in 2018," Maduro said in a recent speech. "We are sued by bank accounts, worldwide purchases of any product, it's more than a blockade, it's a persecution," added the president.

The shortage has plunged a large part of the population into a growing humanitarian crisisAlthough a large group of military commanders and senior officials who remain loyal to Maduro may have access to the remaining resources to survive, or even illegally enrich themselves.

Many Venezuelans have become accustomed to a new historic fall every month.

Venezuela has the largest proven oil reserves in the world but its production, which was once the largest in Latin America, fell more rapidly in the past year than Iraq's after the 2003 US invasion, according to data from the Organization of Exporting Countries of oil.

Venezuela has lost a tenth of its population in the last two yearsbecause they fled and even crossed mountains, causing the biggest refugee crisis ever recorded in the region.

The hyperinflation of Venezuela, which is expected to reach $ 10 million this year, according to the IMF, is set to become aThe longest period of uncontrolled price increases since the one lived in the Congo in the 1990s.

"In essence, it is an absolute collapse of consumption", said Sergi Lanau, deputy chief economist at the Institute of International Finance (IIF), a professional badociation in the financial sector.

The institute calculates that under the Maduro government, the decline in Venezuela's economic performance has seen the most pronounced decline experienced by a country no longer at war since 1975.

At the end of the year, Venezuela's gross domestic product will have declined 62 percent since the beginning of the recession in 2013, which coincides with the rise of Maduro, according to estimates by the IIF (the Venezuelan government has not published its official macroeconomic statistics since 2014, forcing economists to rely on indicators such as imports to calculate economic activity).

In comparison, the average economic decline in the former Soviet republics was about 30 percent at the height of the crisis of the mid-nineties, according to the calculations of the badociation.

For now, the government concentrates its few resources in the capital, Caracas. However, the presence of the state is becoming weaker in the interior of the country, and its absence is particularly visible in Zulia, the most populous state of Venezuela.

Your capital, MaracaiboIt was once the oil enclave of Venezuela. In March, a power outage plunged the state into a week of darkness and chaos that left 500 companies looted.

Since then, electricity has been sporadic, increasing the lack of water and gas and leaving people without a banking system or telephone coverage for days.

The market Fleas, it was once a busy labyrinth of stalls where vendors sold food and household items, It has become the face of the crisis.

Juan Carlos Valles arrives at his small restaurant located in a corner of the market at 05:00. m. and start making beef broth with bones and cachapas in the dark. He says that since March, there is no more light in the premises, their sales have dropped 80% since last year and every day is a battle against the soldiers who force him to accept low-value bills almost worthless.

With the money he earns, he immediately invests in bones and corn flour, as prices rise daily.

"If you rest, you lose," said Valles, who has had this restaurant since 1998. "Money has lost its value, by the time you bring it back to the bank, you have already lost some of what you had."

According to the IIF, real income in Venezuela has fallen to levels never seen in the country since 1979which has allowed many people to survive such tasks as collecting firewood, picking fruit and transporting water from streams.

"Government talks about medium and long-term solutions, but hunger now exists"said Miguel González, director of the communal council of Arco Iris district in Maracaibo.

Gonzalez said he lost his job in a hotel after it was ransacked in March. The people who stormed the premises ripped off window frames and electrical wiring. Now choose wild plums that you sell a few cents in the city parks. The majority of their community's diet consists of wild fruits, foods prepared with fried or cooked cornmeal and beef broth, he said. .

Far from the capital, things are even worse.

The The island of Toas, which was once a tourist paradise from about 12,000 inhabitants who lived in fishing villages, He was almost abandoned.

"There are no representatives from local, regional or national governments here," said José Espina, a motorcycle taxi driver. "We are alone".

Electricity and drinking water are only available a few hours a day. The ship that regularly serves the continental region broke down last month. A ship loaned from time to time by the state oil company towed a rusty ferry carrying some subsidized foodstuffs, the precarious livelihood of the poorest inhabitants of the island.

According to the mayor, Hector Nava, Hyperinflation has reduced the entire island budget at the equivalent of $ 400 a month, About 3 cents per capita.

The hospital has no drugs or patients. The last person to be hospitalized was a woman who died after a day of agony because of the shortage of treatments for her kidney disease, according to the doctors at the facility.

Toas hospital beds are empty, Anailin Nava, two years old, is consumed in a nearby cabin because of malnutrition and treatable muscular paralysis. Maibeli Nava, his mother, says that she does not have money to take her to Colombia for neatness.

The four quarries that make up the only industry on the island have not produced since last year. The thieves took away all the electrical cables that connected them to the power grid. Local opposition activists believe that A third of the inhabitants have left the island in the last two years.

"It was a paradise," Arturo Flores, the local municipality's security coordinator, sells a fermented corn beverage to local fishermen to raise their salary, which is four dollars a month. "Now everyone is running away."

On the other side of the state of Zulia, in the farming village of Machiques, economic collapse decimated the meat industry and dairy who supplied these products to the whole country.

The power outages led to the closure of the slaughterhouse, which was once one of the most important in Latin America. Groups of armed men extort money from pastoralists who still keep their herds and steal cattle.

"It can not be produced if there is no law"said Romulo Romero, a local breeder.

Local merchants gathered to help repair power lines and keep the telecommunication towers running, they also collaborate with the foodstuffs of public sector workers and are looking for diesel for emergency generators.

"Practically, we have badumed the functions of the state"said Juan Carlos Perrota, a butcher who heads the Machiques Chamber of Commerce. "We can not just lock the door and give up. We hope this will improve. "

Anatoly Kurmanaev and Nataly Angulo were reported in Maracaibo. Johandry Montiel collaborated on this report from Machiques.

Copyright: c.2019 New York Times News Service