Venezuela Undergoes an Economic Crisis

As the end of May approaches, some economists describe Venezuela’s economy in grim terms. The news agency Al Jazeera referred to the nation’s economy as “crumbling” in a facebook online article about the worsening crisis. Reportedly, inflation has risen so significantly that the government of Venezuela cannot even afford to print more currency.
Many Venezuelans likeĀ Adrian Jose Velasquez Figueroa, 54, have tried to deal with the worsening economic situation by using stronger foreign currency, such as the dollar. Within Venezuela, the U. S. dollar has gained strength, causing a significant shortage of dollars. At the same time, the crisis has caused legal exchanges to operate very slowly. Many people have begun using black market currency exchanges, where dollars command an even higher rate. Participants report trading as many as 1,000 bolivars per dollar using black market venues, according to a New Zealand newspaper.

The legal exchange for trading bolivars for dollars has contributed to the problem by performing very slowly. In order to conduct a currency exchange, participants must first register with the legal exchange. Then they undergo an extended waiting period. Since the exchange bureau possesses the authority to furnish a maximum of $300 per day, the process of waiting to enter into a legal currency trade in some cases requires up to a year to complete.