C&B Notes

Colombia To The Rescue

As reflected in the series of Notes that we have shared about Venezuela over the past year, we find the burgeoning crisis in the country to be instructive on a variety of economic and political levels, especially given our ongoing investments in South America. The latest absurdity from bad policies: Venezuelans streaming just a few miles across the Colombian border to buy food to avoid starvation.

Omar Torres felt a rush of emotion as he crossed the Simón Bolívar bridge between Colombia and Venezuela with his wife and daughters.  “We almost cried when we entered Colombia, and we realized we were going to be able to, at last, buy the food we lack in Venezuela,” he said.  The Torres family were among an estimated 35,000 Venezuelans who poured into Colombia on Sunday after the embattled socialist government of Nicolás Maduro allowed crossings for 14 hours to let people buy basic goods amid chronic shortages in Venezuela.  Mr Maduro closed the border last August, allegedly to crack down on crime and contraband.

Observers see this as a foretaste of what a humanitarian crisis would look like if nothing is done to end Venezuela’s downward spiral.  Senior Colombian officials say “there is already a plan” to welcome refugees if there is a social implosion next door, where an estimated 3m Colombians live. Sunday’s exodus followed an incident last week in which at least 500 Venezuelan women — dressed in white as a “symbol of peace” in homage to the Cuban dissident movement — defied the border closure and pushed past Venezuelan guards to find basic goods for their families.  José Vielma Mora, the socialist governor of the Venezuelan frontier state of Táchira, said that action was orchestrated by the opposition to generate “chaos”.

But in the Colombian city of Cúcuta on Sunday, Venezuelans from all over the country crowded supermarkets and calmly gathered as much rice, cooking oil and maize flour as they could carry. These items are either in short supply at home or sold at exorbitant prices by buy-and-flip hustlers who resell subsidized products.  “There are a number of indications that the food supply situation is becoming critical and that a large part of the population is simply not finding enough to eat,” said Phil Gunson, a Caracas-based senior analyst with the International Crisis Group.  “It is also apparent that the security forces are finding it increasingly difficult to deal with unrest arising from the lack of food and other basic goods.  Although Venezuela is not yet facing famine, there are some indicators that are typical of countries entering a period of food crisis.”

More than 80 per cent of staple goods are missing from supermarket shelves in Caracas, according to Datanálisis, a pollster.  Food production has plummeted, say industry insiders, because of price and currency controls and the impact of nationalizations in the food industry.  The government owes $30bn to private suppliers and importers, according to Ecoanalítica, a Caracas-based consultancy.