Paid to Wait: Effects of the Venezuelan Economic Crisis

October 11, 2016

While much of the United States has been figuratively dancing in the streets about the incredibly low gas prices as of late, others have not been so fortunate to enjoy the plummet. Rather, their economies have been suffering because of it. One such nation is Venezuela, which has recently entered into a recession due to the global lack of demand for oil. Oil has been Venezuela’s primary export for years, which accounts for 96 percent of its foreign currency reception.1 The central Venezuelan bank also noted 63.6 percent inflation between November 2013 and November 2014. Venezuelan President Nicolás Maduro believes the economic instability and decline is a result of an economic war between the United States and Russia in which the United States is oversupplying the market with crude oil.2 However, Daniel Leon, a PhD candidate at the University of Leipzig, Germany, believes that Venezuela’s economic woes are for reasons other than the United States oil market.

Daniel Leon cites two criticisms of Maduro’s claims; the first that the United States is not solely to blame, but rather Russia and other OPEC members, and second, that “the price of crude oil plummeted in the fourth quarter of 2014.” 3 Leon links to an article by The Economist that claims Venezuela is one of the, if not the, worst managed economies in the world, especially for a large oil-producing nation, that has resorted to printing more bolívares in an attempt to pay of its debts.4 It also does not help that Venezuela’s black market oil “program” sells oil to neighboring countries, primarily Colombia, for cents on the gallon, which turns around and sells the smuggled oil at international prices.3 As the Venezuelan economy suffers, its effects can be seen and felt by the lower classes. In order to pay their bills, many Venezuelan citizens have had to do “freelance” work, such as waiting in lines for those whose bank accounts are not nearly as effected by the recession.

Jesús Olarte of the Agence France-Presse (AFP) reports that the crisis in Venezuela has “spawned a new profession: waiting in line to buy things for other people.” Olarte includes an interview with a Venezuelan woman, 22 year-old Krisbell Villaroel, who describes her new profession. Villaroel explains that each morning at 2 a.m., she calls her friends to ask what to buy and where to buy it. Perhaps by 10 a.m. that same morning she will buy what she can from that line, then leave and go to another where she can buy another portion of someone else’s shopping list. She makes between 600 and 1,200 bolívares per day ($94-$189), and up to 13,200 bolívares ($2,086) each month.5 Venezuelan restaurants have even hired people to wait in line to buy food and ingredients to put on their menus. However, some supermarkets are imposing rations on some of their supplies, meaning some “employees” cannot meet the goals of their “employers.” Villaroel claims that in order to make sure she has the best chance, she negotiates with some vendors to ensure she has one of the first places in line.1

The story of Krisbell Villaroel is not atypical, as Venezuelans line up for hours so that they can shop for others and support themselves. Unfortunately, as long as the nation’s economy suffers, so will its people.

References:

1. Olarte, Jesús. “Waiting in line to shop – a profession in Venezuela.” Agence France-Presse. Jan. 15, 2015. Web. Jan. 20, 2015.

2. “Venezuela recession confirmed as Maduro attacks US ‘oil war’.” BBC. Dec. 31, 2014. Web. Jan. 20, 2015.

3. Leon, Daniel S. “The Venezuelan Economic Crisis and Oil.” Sharnoff’s Global Views. Jan. 9, 2015. Web. Jan. 20, 2015.

4. “Of oil and coconut water.” The Economist. Sep. 20, 2014. Web. Jan. 20, 2015.

5. “Currency Calculator.” X-Rates. 2015. Web. Jan. 25, 2015.

About Author(s)

Asa Equels
Asa Equels is a junior undergraduate at the University of Pittsburgh studying Hispanic Languages and Literatures, as well as pursuing a Certificate in Latin American Studies. He is a member of the university's Cross Country and Track and Field teams. After graduation, Asa plans on continuing his education in graduate school, and hopes to become a teacher/professor and cross country/track coach.