Venezuela Legalizes Money Exchanges

Venezuela’s Constituent Assembly voted on Thursday (Aug. 2) to legalize money exchange operations in an effort to relax the government’s strict currency controls. According to Reuters, economists say it’s unlikely that President Nicolás Maduro’s government would do away completely with the controls. The country is in its fifth year of recession, with inflation expected to hit 1 million percent this year. It is currently at 14,000 percent.

In March, Socialist President Maduro announced that the bolivar currency would be redenominated in an attempt “to remove three zeros from the hyperinflated economy’s prices.”

However, critics warned that the plan is being implemented so quickly that “Maduro is at risk of repeating the chaos of late 2016, when the government withdrew the largest bill from circulation, sparking long lines, looting and protests that led to at least three deaths.”

In the meantime, the Constituent Assembly, which was created last year to override the opposition-controlled congress, agreed to end the law that criminalizes money exchange, as well as eliminate an article from the law governing the Venezuelan Central Bank to allow the sale and purchase of foreign currency.

The vice president for the economy, Tareck El Aissami, said Venezuelans would be able to go to state-authorized exchange houses to change out money in a “transparent, legal and safe manner.”

“This is a big opportunity. It is a fresh start,” said El Aissami in a speech.

However, the political opposition said the move is nothing more than an attempt by the government to take control of the remittances that many Venezuelans depend upon, especially since the minimum wage is now worth only $1.50 a month.

“They have said many times they will relax currency controls, which will solve all the chaos they have caused, but they have never managed to do it,” said opposition lawmaker and economist Angel Alvarado.