Venezuela cash crisis sparks looting, protests

A woman counts 100-bolivar-bills at an office in Caracas on December 12, 2016. (AFP)
Updated 17 December 2016

Venezuela cash crisis sparks looting, protests

CARACAS: Desperate Venezuelans looted delivery trucks and clashed with police as a botched plan to introduce new banknotes left people without cash — the latest shortage in a spiraling economic crisis.
Late Friday President Nicolas Maduro blamed opposition politicians for the unrest, claiming that there were pictures and videos of some opposition members of the National Assembly involved in “attempts of vandalism and some acts of violence.”
He warned that “parliamentary immunity does not reach that far,” but did not give any names.
Maduro mentioned that rioters had torched two state banks in the town of Guasdalito, near the border with Colombia.
He blamed unnamed opposition leaders who were also part of a “contraband mafia” for the incident, and warned that they “will be captured and put behind bars in the next hours.”
Faced with world-high inflation that has made its money increasingly worthless, the government is trying to introduce new bills in denominations up to 200 times higher than the old ones.
But the plan went off the rails when Maduro ordered the 100-bolivar note removed from circulation before the new bills arrived.
Formerly the highest denomination bill, the 100-bolivar note was worth about three US cents, and accounted for 77 percent of the cash in circulation in Venezuela.
Angry protests erupted around the country as the chaotic reform left people without money to buy food or Christmas presents.
In the second city of Maracaibo in the west, groups of protesters hurled stones at police, reports said.
In the eastern city of Maturin, dozens of people blocked off a major avenue and looting broke out.
“I went by the market and it was being guarded by the military. A chicken truck was looted,” Juan Carlos Leal, a farmer in Maturin, told AFP.
In the eastern city of Puerto la Cruz, “people rioted because they wanted to take out money and they weren’t allowed to,” said Genesis, a local baker.
“The police fired in the air to calm the riot. Everyone dispersed and the police ordered all shops to be closed,” said Genesis, who asked not to be identified by her surname for fear of reprisals.
Protests were reported by users on Twitter in several Venezuelan states.
Local media in the western city of Santa Barbara said four people were injured when the drivers of a security truck transporting money opened fire on people trying to break into it.
In the capital Caracas, thousands of Venezuelans from around the country queued to rid themselves of 100-bolivar notes at the only place still accepting them: the central bank.
Many were angry to learn they would only be allowed to deposit the old bills or obtain “special vouchers” for new ones.
“The world has turned upside down. Normally, there’s no food. Now there are no bills to buy it,” said Jesus Garcia, a 21-year-old food vendor who had been in line since 4:00 am.
Maduro has presided over an unraveling of Venezuela’s oil-rich economy as crude prices have plunged.
The import-dependent country is desperately short of food, medicine and basic household goods.
Venezuela currently has the world’s highest inflation rate, set to hit 475 percent this year, according to an IMF forecast.
Maduro, whose popularity has plummeted, said the 100-bolivar note had to be killed because “mafias” were hoarding it abroad in what he called a US-backed plot to destabilize Venezuela.
In response, the leftist leader has sealed the borders with Colombia and Brazil until Sunday, exacerbating the chaos.
Angry crowds massed in the town of San Antonio at a bridge crossing on the Colombian border, yelling “We want to cross!“
“We are suffering. We are hungry, we have no medicine, we have nothing. Nothing!” said one of the people in the crowd, Carmen Rodriguez.
“And now with this money problem, we can’t even buy food.”
The 100-bolivar note ceased to be legal tender on Thursday.
Initially, Venezuelans were to have 10 days after that to exchange them at the central bank.
Maduro subsequently slashed the grace period to five days.
Venezuelans had grown used to carrying around huge stacks of 100-bolivar bills for even the smallest purchases.
Now they are stuck trying to amass even bigger piles of 10-, 20- and 50-bolivar notes.
Some companies have stopped dealing in cash altogether.
The new banknotes were initially to be launched Thursday, starting with a 500-bolivar bill and eventually reaching denominations up to 20,000.
But the bills, which are being printed abroad, have yet to arrive.
“By removing the 100-bolivar bills, they are jamming up the economy,” said economist Alberto Martinez.
“Cash registers have no money. The system is under stress.”

US not renewing sanctions waivers for importing Iranian oil, working with Saudi Arabia and UAE

Updated 45 min 1 sec ago

US not renewing sanctions waivers for importing Iranian oil, working with Saudi Arabia and UAE

WASHINGTON: President Donald Trump said the US would be ending sanction waivers for countries importing Iranian oil, increasing economic pressure on the regime, according to a White House Statement.

Secretary of State Mike Pompeo was to discuss the move at the State Department Monday morning. The decision means sanctions waivers for five nations, including China and India and U.S. treaty allies Japan, South Korea and Turkey, will not be renewed when they expire on May 2.

The statement said that the US, Saudi Arabia and the UAE had "agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market."

White House economic adviser Kevin Hassett said on Monday that he believed global oil markets would be able to handle the US decision to force buyers of Iranian oil to either end imports or face sanctions, despite Monday's surge in oil prices.

"I think that the global oil markets are poised to be able to deal with this," Kevin Hassett said in an interview with CNBC. 

The move comes as the administration toughens its already strict penalties on Iran by trying to choke off all the revenue the country makes from oil sales.

The waivers had been in place since November, when the administration re-imposed sanctions on Iran after President Donald Trump withdrew the US from the 2015 nuclear deal with Iran.

They were granted in part to give those countries time to eliminate their purchases of Iranian oil but also to ease any impact on global energy markets with the abrupt removal of Iran's production.

Pompeo says now that production increases elsewhere will make up for the loss of Iranian oil on the market.

(With Agencies)