Venezuela's increasing inflation, shortages leave poor doubting Maduro

[Bacchus4.0]

http://www.helsinkitimes.fi/world-int/world-news/international-news/11425-venezuela-s-increasing-inflation-shortages-leave-poor-doubting-maduro.html
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A government spending boom in the two years to April 2013 provided Geraldine with her new home and secured election victories for then-President Hugo Chavez and, after his death last year, for President Nicolas Maduro. Since then, government spending has stalled, inflation has tripled to more than 60 per cent and a lack of dollars has led to shortages of everything from toilet paper to drinking water. As poverty levels rise, people like Geraldine say they are losing faith in Maduro.

Venezuela's poverty rate rose to 32 per cent at the end of last year from a record low 25 per cent in 2012, according to the National Statistics Institute, or INE. That represents an additional 1.8 million people who live in families with less in income than 6,648 bolivars (65 euros at the black market rate) a month.

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Central to rising poverty is inflation. After the fiscal deficit widened to 11 per cent of gross domestic product in 2012 on a surge in spending, Maduro has seen annual inflation accelerate to 61 per cent from 29 per cent.

Poverty is set to increase further as Maduro reduces the supply of dollars and in March devalued the currency by 88 per cent with the introduction of a secondary exchange system, said Ronald Balza, an economist and professor at the Catholic University in Caracas. Imports tumbled 23 per cent in the first quarter of this year.

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"It's been 12 months since I've been able to buy anything else for the family," she said. "Not even a piece of clothing for my kids or myself."