CARACAS, (Reuters) – Venezuelan President Nicolas Maduro yesterday said his government would extend the use of 100-bolivar notes to Jan. 20, after a plan to withdraw those bills from the economy sparked nationwide protests and widespread looting.
Maduro in December said the notes, the highest denomination in the inflation-plagued country, would be withdrawn to prevent smugglers and “mafias” from trafficking the bills across the border to neighboring Colombia.
He had already postponed the measure to Jan 2. from mid-December after angry citizens, unable to make purchases and worried they would lose their cash holdings, staged protests that led to hundreds of arrests.
Venezuela suffers from triple-digit inflation as a result of low oil prices and an unraveling socialist economy, which has left basic purchases, such as a few days’ worth of groceries, requiring sacks of cash. Many Venezuelans shop with debit cards to avoid the hassle of bills, but point-of-sale networks have been increasingly strained and such services are often unavailable in the provinces and poor neighborhoods of the capital.
The 100-bolivar note is worth 3 U.S. cents on the black market for dollars.
The government has promised to bring in new denominations ranging from 500 bolivars to 20,000 bolivars, but merchants and shoppers say they have yet to see them.
A Reuters reporter yesterday saw new 50-bolivar coins being used at a several newspaper kiosks in downtown Caracas, though circulation appeared to remain limited. Some informal vendors in the area said they still had not seen any.
Maduro yesterday said a cargo of the new bills had reached Venezuela’s main airport, and he repeated accusations that a campaign of sabotage by adversaries had delayed their delivery.
Opposition leaders slammed the measure as a sign of Maduro’s economic incompetence and demanded his resignation.
