Venezuela has been battling inflation and increasing economic turmoil for quite some time now, especially thanks to the ongoing oil drop. Venezuela has the world's biggest known oil reserves and the majority of their revenue comes from oil exports, but the ongoing drop in oil has slashed the country's revenues by around 60 per cent. This is one of the major factors contributing to their ongoing economic problems. In the last 15 years alone over 1 million citizens have decided to emigrate elsewhere. Those citizens who remain in the nation continue to face shortages of basic goods and many are forced to ration, crime has drastically increased.
Inflation in Venezuela has been rising at a rate of roughly 20.2 per cent every month. The last official report on the inflation rate for the country indicated that in September of 2015, inflation had reached 141.5 per cent. This report for the fall of 2015 marks the first official data that has been released on the worsening crisis there in more than a year. However, some do suggest that the actual inflation rate could be much worse.
As the country continues to scramble for new possible political representatives and seeks alternative leadership, the current President Nicolas Maduro has recently announced a two-month emergency decree in order. The new decree will include tax increases. The new decree also seeks to establish funding for emergency welfare services and food imports. There will also be new controls placed on businesses, industrial productivity, and on electronic transactions.
“A state of economic emergency is declared across the whole territory of the nation.. for 60 days,” read a summary of the decree published by the official state gazette. Authorities are going to be given new powers that will ideally allow them to boost production and ensure access to key goods. Their plan to make the situation better, is to take more control of companies' resources and to impose currency controls.
Nationalization of food distribution hasnt proved to work well in the past and it isn't proving to be a coherent solution now for Venezuela, as things continue to get worse in the country. Interfering with markets has proven to be an avenue that only breeds disaster and destruction and the one thing that the Venezuelan government hasn't tried to consider yet is the option of lessening their grip on the market, and exchanges that occur between their citizens. In fact it's quite the opposite, they want even more control and force to be involved now. Along with their economic battle, the country could also be looking at some major political changes taking place soon.
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