Venezuela is launching a new currency with the new year, lopping off three zeros from denominations in a bid to simplify finances and boost confidence in cash that has been losing value due to high inflation.
President Hugo Chavez's government says the new currency -- dubbed the "strong bolivar" -- will make daily transactions easier and cure some accounting headaches. Officials also say it is part of a broader effort to contain rising prices and strengthen the economy.
"We're ending a historical cycle of ... instability in prices," Finance Minister Rodrigo Cabezas said on Monday. He also said that the change aims to "recover a bolivar that has significant buying capacity."
Prices have risen as Chavez has pumped increased amounts of the country's oil income into social programs, reinforcing his support among the poor and helping to drive 8.4 percent economic growth last year.
The Central Bank is promoting the new monetary unit with an ad campaign and the slogan: "A strong economy, a strong bolivar, a strong country." Officials, however, have yet to clearly spell out their anti-inflationary measures.
Some Venezuelan critics, meanwhile, have dubbed the new currency the "weak bolivar," noting its predecessor, the bolivar, has seen its purchasing power suffer in an economy where inflation ran roughly 20 percent last year -- the highest in Latin America.
Venezuelan economist and pollster Luis Vicente Leon said that while the new currency may provide "the perception of stability" for some, it is largely a "cosmetic change."
Government officials say the change is overdue to bring Venezuelan denominations into line with those of other countries in the region. Instead of denominations in the thousands, the largest new Venezuelan note will be 100 strong bolivars.
"It was necessary to leave behind the consequences of a history of high inflation," Central Bank president Gaston Parra said in a televised year-end speech. He said officials aim "to reinforce confidence in the monetary symbol."
The new money was distributed to banks and automated teller machines ahead of yesterday's launch and will be phased in during the next six months. Venezuelans will be able to use both old and new bolivars during the transition.
Venezuela has had a fixed exchange rate since February 2003, when Chavez imposed currency and price controls. The government has said it is not considering a devaluation any time soon.
But while the strong bolivar's official exchange rate will be fixed as 2.15 to US$1, the black market rate has hovered around the equivalent of 5.60 to US$1.
Venezuela's currency has long been named after independence hero Simon Bolivar, pictured on the new 100 "strong bolivar" bill.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS