Maduro Picks Surprising Tool To Level Out Venezuela's Tailspin: Capitalism

https://www.npr.org/2020/02/09/804232516/maduro-picks-surprising-tool-to-level-out-venezuelas-tailspin-capitalism

GARCIA-NAVARRO: I mean, this is an extraordinary change because it wasn't so long ago that Caracas was paralyzed economically. Why is this happening?

REEVES: Well, people had to use before the national currency, the Bolivar, and it's completely collapsed. It's destroyed by hyperinflation that at some points went into the millions. The Maduro government, some months back, began allowing people, therefore, to use dollars. At least 4 million people left the country to work elsewhere in the region. They send 3.5- to $4 billion back every year to the families here to help them get by. Those families can now spend those remittances as dollars here.

And there's one other important thing, Lulu, which is that - and it's not exactly in line with the ideology of the socialist revolution of Hugo Chavez. Maduro has kind of formed a partnership with the private sector, and he's greatly relaxed important export controls. Big question is, how long will it last? Maduro's government's planning to tax dollar transactions soon by up to 25%, so that may collapse this minibubble.

GARCIA-NAVARRO: What about the Venezuelans who don't have access to dollars?

REEVES: Well, that's a very important question because conditions for them are still terrible. They're feeling the effect of the worst economic collapse in this part of the world in modern history. Health services pretty much nonexistent. There is a dire shortage of medicine. There is shortage of drinking water. Power outages happen all the time. And many of them are just focused on the struggle to survive. And now they're at the wrong end of a growing wealth gap.