Sun, Dec 01, 2013 - Page 7 News List

Maduro threatens retailer arrests over inflated prices

‘GOING ALL OUT’:In an address on national TV, the Venezuelan president laid the foundation for tougher enforcement of a three-week crackdown

AFP, CARACAS

Venezuelan President Nicolas Maduro, second right, accompanied by his ministers, speaks on Venezuela’s national television network from the Miraflores presidential palace in Caracas, Venezuela, on Friday to announce his new pack of economic measures.

Photo: AFP

Venezuelan President Nicolas Maduro vowed on Friday to arrest shopkeepers who defy government price controls, the latest salvo in a populist “economic war” ahead of key municipal elections.

Maduro delivered the warning in a nationally televised address that laid the ground for tougher enforcement of a three-week crackdown on actions seen as fueling Venezuela’s soaring inflation.

He urged authorities who find retail prices that have been raised “to act with all the severity of the law and, because they are crimes in flagrante, to proceed immediately to detain those responsible.”

Using new powers to rule by decree, the socialist leader also ordered lower rents for commercial spaces and barred property owners from asking for payments in foreign currency.

“We are going all out. We are taking measures with even more authority,” he said.

The latest declarations came with Maduro facing a key test of political strength on Sunday next week, when municipal elections will take place in the midst of a burgeoning economic crisis.

It will be the first elections since Maduro succeeded his political mentor, late president Hugo Chavez, in April elections whose tight results the opposition has refused to recognize.

Inflation is running at 54 percent a year, shortages of basic goods are widespread despite the country’s oil wealth and a hard currency crunch wreaking havoc on the import-dependent domestic economy.

Earlier this month, Maduro fired what he called his first salvo in an “economic war against the bourgeoisie and imperialism,” the latter a reference to the US or US interests.

He ordered home appliance stores to slash prices and deployed Venezuelan National Guard troops to enforce the measure.

This unleashed a tumultuous early start to the Christmas shopping season, with Venezuelans mobbing consumer electronic stores for windfall bargains.

The Venezuelan National Assembly then Maduro special decree-making powers, which he immediately used to impose price controls and cap profit margins at 30 percent.

“For a while, these measures will benefit citizens or shopkeepers, but it is all done to reap political and electoral rewards. These are not economic solutions,” Universidad Central de Venezuela economics professor Maxim Ross said.

“What you would expect is for someone to address the underlying problems like shortages or inflation,” Ecoanalitica consultancy head Asdrubal Oliveros said.

Maduro was scheduled to hold a working meeting later on Friday at the presidential Miraflores Palace that was expected to produce his next set of economic initiatives.

The Venezuelan Federation of Chambers of Commerce, Fedecamaras, which represents private business and is frequently at odds with Maduro, urged him to stimulate production by guaranteeing respect for private property and access to hard currency.

Critics have blamed the government’s strict currency controls for exacerbating Venezuela’s price distortion and fueling a black market for dollars.

Fedecamaras president Jorge Roig said more than 200,000 businesses have had to shut their doors in the past decade.

He complained that only 2 percent of companies have been receiving dollars at a preferential official rate of 6.3 bolivars to the US currency, though the government insists that greenbacks are being distributed to retail businesses.

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