Venezuelan President Hugo Chavez threatened on Sunday to seize businesses that raise prices as a result of last week’s devaluation of the nation’s currency.
Economic analysts called the warning a futile attempt to control 25 percent inflation that is already the highest in Latin America and stands to be worsened by the weakening of the bolivar.
Chavez disputed that his decision to devalue the currency for the first time in nearly five years should spur a sharp rise in consumer prices.
“There is no reason for anybody to be raising prices,” he said on his weekly radio and TV program Alo Presidente.
He urged his supporters to “publicly denounce the speculator” and warned business owners that his government would “take over any business, of any size, that plays the bourgeoisie speculation game.”
The devaluation aims to stretch oil earnings further by increasing their value in the local currency, and thus help the government counter a recession by boosting spending.
But critics said the measure would unavoidably push inflation even higher.
Oscar Meza, director of the local Cendas think tank, which tracks economic data, predicted the devaluation would propel annual inflation above 33 percent this year, with food prices rising as much as 36 percent.
“It’s impossible for prices not to be adjusted,” Meza said. “If they aren’t adjusted, they’ll disappear.”
The currency’s official exchange rate had been 2.15 bolivars to the dollar since a devaluation in March 2005. Chavez set a new two-tiered exchange rate on Friday, pegging the bolivar at 2.6 to the dollar for priority goods such as food and medicine and at 4.3 to the dollar for imports of nonessential products such as air conditioners and radios.
Chavez said he is determined to curb inflation — even if it means deploying the military to prevent price hikes.
“For all the threats and possible takeover of businesses, it’s not going to solve the problem,” Meza said. “If they take control of businesses, the problem will only get worse.”
Chavez also said on Sunday that he has asked film producers to make “socialist soap operas,” with government help if needed, because there’s too much capitalism on TV.
“A while ago, I was in Cuba and they broadcast soap operas there, not capitalist soap operas but with a social content, socialist” soap operas, Chavez said on Alo Presidente. “I’m going to ask that we make socialist soap operas, instead of capitalist ones.”
“We can also make good movies,” he said. “Not capitalist movies that are poison and incite our children to take drugs and even push them into crime.”
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