Asia-Pacific
Venezuela shutters stores amid price hike
(Agencies)
Updated: 2010-01-12 11:30
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 Members of the Venezuelan National Guard stand guard in one of the aisles at a supermarket in Caracas. [Agencies] |
CARACAS, Venezuela: Soldiers accompanied government inspectors as they temporarily shut down dozens of retail stores in Venezuela on Monday, aiming to prevent hefty price hikes after the country devalued its currency.
Inspectors from the consumer protection agency closed 70 stored saying they had improperly raised prices, the national Bolivarian News Agency reported. Three large stores of the Exito hypermarket chain, majority owned by France-based Casino Guichard Perrachon SA, where shut down for 24 hours.
Venezuelans crowded into stores selling electronics and appliances for a third straight day, trying to buy items before retailers begin markups. Lines formed outside some stores in Caracas.
One shopper, 26-year-old Jonathan Heybert, walked out with a flat-screen TV, saying: "Just imagine how much this television is going to cost later."
The government had held Venezuela's currency, the bolivar, at an official rate of 2.15 to the dollar since a devaluation in March 2005. Chavez set a new two-tiered exchange rate Friday, pegging the bolivar at 2.6 to the dollar for priority goods such as food and medicine and 4.3 per dollar for imports of nonessential products such as air conditioners and electronics.
The president argues the change will discourage imports of nonessential goods and encourage domestic production of items such as food and clothing.
Oil-rich Venezuela imports most of the products it uses, and most consumers are expecting prices to soar.
Critics have called Chavez's threats against businesses a futile attempt to prevent the devaluation from pushing up inflation, which at 25 percent is already the highest in Latin America.
Domingo Maza, a former director of the central bank, predicted the devaluation could push inflation as high as 50 percent this year. He told Union Radio he doesn't expect the measure to boost exports as the government hopes.
The cost of US dollars on Venezuela's black market increased 18 percent from Friday to Monday, reaching 6.5 bolivars to the dollar.
