It is hard to believe that the cost of a coffee cup is much greater than their weekly paychecks. Have you ever imagined the daily life with this annual inflation rate of 1,000,000%? Let’s see the reason behind this Venezuela hyperinflation. Before we know the reason behind hyperinflation, let’s know the history of Venezuela.
History of Venezuela Hyperinflation
Venezuela is a big country in South America known for its largest Crude Oil Reserves in the world even greater than Saudi Arabia. Venezuela is bigger than the Indian States of UP, Bihar, Punjab, Haryana, Bengal, and Orissa Combined.
If you think about the population, which is only 35million less than the population of Delhi.Though Venezuela blessed with fertile land, abundant rain, hundreds of small rivers, and thousands of miles long beach. In spite of having such a fertile land still, the people are still begging for food.
You cant imagined in Venezuela there is nothing like Farming of Crops, Fruits & Vegetables, Dairy, Poultry, Fishing, etc. Though the millions of acres are available still they are not growing crops and vegetables. Yet Venezuela is still Starving.
The inflation of Venezuela is that much high if you take the bag of Bolivar (Venezuela Currency)still you cant purchase the food from the store. Where one Indian rs is equal to 3607 Venezuela Bolivars.
Before20 years ago it is one of the most developed & prosperous nations in the world.
But due to the wrong policies of national politicians the developed country turned into a beggar in just 20 years. Today people are not able to buy food for them. this is a reason migration in Venezuela is on a hike. For the piece of Bread, many Venezuela women are doing prostitution.
Now we will discuss the reason behind the Venezuela hyperinflation one by one
What are the mistakes of Venezuela’s Leaders?
Singapore is one of the most developed countries in just 20 years. And the reason behind this a good leader. A bad leader can turn a developed country into a beggar just like a Venezuela.let’s see the import and export condition of Venezuela.
Import and Export Market in Venezuela
After World War 2, when there was a huge demand for oil in the world the prices of oil were skyrocketing. In1945 country made 1 million barrels per day. so the government starts distributing the free services to the citizens. Every service is free, in exchange for oil other goods such as ration, cereals, fruits, vegetables, medicines were imported.
In the 50’s and ’60s century was busy in the development and manufacturing of the new product, Venezuela did not develop even a needle. They imported even a cabbage from another country.
Tourism in Venezuela
Venezuela is blessed with such a beautiful nature. still, they don’t have the tourism industry. And the reason behind this they are not allowing foreigners to take advantage of their free services. with this thought, they didn’t do anything for their living, neither farming nor a tourism industry.
Fall in oil prices
Suddenly one day the oil prices were falling. the government-owned company PDVSA told the company to give the jobs to everyone. Though there is no need for employees to the company. Meanwhile, the government insisted to give jobs at least one man of the family, where he did not work but will get a fat salary and free home.
Slowly the prices of oil start decreasing day by day. The company was facing a huge loss. As the whole economy was depending on oil production. So it is impossible to provide free stuff to the citizen. So the government stops providing free stuff.
Because of that looting, prostitution started in the country for the single bread of food. Caracas is the capital of Venezuela which is one of the most unsafe cities in the world. Where one plate of food equals to 1.5 million bolivares.
Now let’s see the inflation rate of Venezuela in all consecutive years from 2000-2018
Now it is difficult to arrest the Venezuela hyperinflation. Even the average person cant afford his living. the only solution for this to print extra money. Because of the mismanagement of the government and corruption due to this Venezuela is facing such an economic issue.
The citizens are also not ready to do the hard work they are relying on the free services provided by the government. This will encourage the Younger Generation to look for free without out hardworking which may lead our country to disastrous situations.
So Venezuela must stop this freeloading policy and encourage citizens to produce some goods for the betterment of their living.