CARACAS, Venezuela — An immediate $600-million increase in farm exports from Colombia to Venezuela announced this week could help bail out two presidents who are mired in political problems tied to food and farming.
Venezuelan President Nicolas Maduro said Thursday that the initial shipments of Colombian beef, powdered milk, cooking oil, margarine and eggs — all scarce items in supermarkets here in recent months — will begin arriving next week to help create a three-month reserve of foodstuffs.
Venezuela will hold elections Dec. 8 for all mayors and city councils in which scarcities as well as recent electricity blackouts and the high crime rate are certain to be issues. The government is under pressure to improve living conditions for Venezuelans, who have been hit by a 30% annual inflation rate and food prices soaring even more.
In Bogota, Colombian President Juan Manuel Santos also announced the deal Thursday, saying it was just the start of a program that would raise annual shipments of his nation’s farm products to Venezuela by 20%.
“I have talked to President Maduro and both of us have given instructions to our respective ministers to energize our trade in an important way,” Santos said.
Santos has seen his approval ratings plummet in recent months, partly because of a crippling nationwide strike by farmers that paralyzed parts of the country. Growers and the government made an agreement last weekend that ended the strike, and observers said expanded sales to Venezuela may have been a carrot.
To settle the strike, Santos promised an agriculture pact between farmers and the government to ensure more stable markets. As in much of Latin America, Colombia’s farm sector has seen a slide in prices in the last year after a decade of growth driven by the global commodities boom.
Colombian farmers have complained that Venezuelan buyers were deadbeats, a problem Santos seemingly addressed in saying that the “payment system will offer the appropriate security to producers.” The Colombian export agency Proexport will arrange purchasing and transport of the goods, Santos said.
In Venezuela, socialist policies that have taken root since the late President Hugo Chavez assumed power in 1999, such as price controls and government takeovers, have resulted in the sharp decline of farm production and forced the country to import as much as 70% of its basic foods.
Maduro, who took power in January shortly before Chavez’s death and has struggled to impose order since he was elected president in April, said he was creating a special bureau to ensure food supplies, although he did not make clear how the entity would work.
Meanwhile, measures taken by the Venezuelan government to control inflation — including tight limits on imported consumer goods and on dollars that Venezuelans might take out of the country to spend on tourism — have produced a sharp increase in the black market value of greenbacks, going as high as 42 bolivares to the dollar Friday. The official rate is 6.3 bolivares per dollar.
Economists have said other causes of the spike are the central bank’s declining reserves, plus the rising debt and declining profits at PDVSA, the state-owned oil company that is the source of most of the government’s budget and foreign exchange currency.
Venezuela continues to be plagued by power outages. They have become more frequent since a system collapse Sept. 3 that left the capital and many other cities dark for several hours. Cities in six states reported blackouts or power rationing Thursday.
Maduro continues to blame unnamed right-wing opponents for the electrical system’s problems and says he has created a toll-free telephone number — 0-800-sabotaje, or sabotage — that citizens can use to denounce attackers.
Special correspondents Mogollon reported from Caracas and Kraul from Bogota, Colombia
Article by Los Angeles Times