Venezuela at a crossroads

[Bacchus4.0]

http://www.aljazeera.com/programmes/countingthecost/2014/04/venezuela-at-crossroads-20144415633412368.html

Venezuela's economy is in decline, its population is angry, and its president is under pressure.

Two months ago, people started protesting about soaring inflation and shortages of basic goods. They say they will stay on the streets until socialist President Nicolas Maduro resigns. But problems in Venezuela began long before Maduro came to power.

Late leader Hugo Chavez first had the idea of providing support to Venezuela's poorest - which was laudable - but the plan relied on oil money and actually resulted in less money being invested in the oil sector - which then led to less oil production and less returns.

A decade of currency control pushed inflation up as high as 56 percent in 2013. In January, the central bank's Scarcity stood at 28 percent, meaning that around one in four products tracked by that index were not available for people to buy. Venezuela also devalued its currency, the Bolivar, by almost 90 percent, and despite having $120bn in oil revenue a year, the country is expecting another year of recession.