VenEconomy: Venezuela is Following Cuba’s Example!

VenEconomy: Venezuela is Following Cuba's Example!
From the Editors of VenEconomy

Fifty years ago, Fidel Castro imposed Cubans a rationing system through
a supplies booklet so they could buy foodstuff at subsidized prices. The
goal was to face food scarcity, avoid speculation in prices and hoarding
for profit with "egalitarian goals."

Today, every Cuban citizen gets "five eggs, one pound of beans, four
pounds of sugar, one-half pound of cooking oil, one pound of chicken,
seven pounds of rice, four ounces of coffee, one packet of pasta. It
also includes another 11 pounds of 'chicken for fish' and one-half pound
of minced soybean" a month.

At present day, Venezuelans are walking hand in hand with Nicolás Maduro
towards what Hugo Chávez used to call a "sea of happiness."

Three examples speak for themselves, and the three of them were
published in the national press on Thursday:

The first of them is the immediate effect of Providence 294 from the
National Superintendence of Costs and Prices over the regulation of
prices of all services from privately-run healthcare institutions and
medical fees. This is an outdated regulation when compared with today's
economic reality and prices of medical services, analyses, exams and
fees were arbitrarily fixed below real costs. This is jeopardizing the
survival of private healthcare services at a time that the State has
proven totally inefficient in the management of public healthcare
services. Today, the appeals made by the Venezuelan Medical Federation
for the providence to be reviewed now join the alert from the Venezuelan
Society of Pathological Anatomy on an "impending shutdown of 200
privately-run laboratories in the country" since regulated prices cannot
cover the costs of that specialty.

The second is a looming threat over buy and sell operations of vehicles
with a criminal law that will regulate such activity. Once passed during
a second discussion in the Congress, this bill will force the sale of
new and used national or imported vehicles below their real costs.

And third, also developing, the Government is forcing the sale of red
meats at Bs.28 ($4.44) per kilogram, when real prices stand above Bs.50
($8) per kilogram, thus leading to mass protests of meat retailers from
Táchira and Lara states, including the shutdowns of shops for a second
day in a row by more than 70 butchers in Táchira.

All this adds up to scarcity and generalized food shortages, thanks to
the drought of dollars, the destruction of the productive apparatus and
agribusiness among other measures emulated by communist nations, which
have led consumers to endless queues (and even violent quarrels) to get
the products.

We do not exaggerate when we say that existing fears over tests
conducted in border states with chips inside vehicles gas tanks to
ration the fuel might be the first step towards Cuban-style rationing.

VenEconomy has been a leading provider of consultancy on financial,
political and economic data in Venezuela since 1982.

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