On July 25, Wednesday Nicolas Maduro Venezuelan President announced the removal of five zeros from its country’s currency. However, the news comes after IMF (International Monetary Fund) warned that the inflation of the country could reach upto 1 million percent this year.
The Maduro said the Venezuela demands the ‘great revolutionary changes in the economy’ that is due to monetary conversion.
Moreover, the country has already proven as world’s largest oil reserves, although it economic crisis over shortages of food and medicines resulting in huge migration. Eventually, Organization of the Petroleum Exporting Countries (OPEC) have been collapsing since 2014. Due to fluctuation in oil price which was unable to manage its economic system for several years.
However, Maduro declared on Wednesday, the new bills will begin circulating from August 20. Infact, in Venezuela it seems to be difficult to get paper money wherein at present 100,000-bolivar note is meant to be a largest bill. Since, it is equally less than 1 cent on the basically used black market exchange rate.
The statements reads;
“The new paper bills will have denominations ranging from 2 up to 500. The lowest represents the buying power of 200,000 current bolivars, the highest stands in for 50 million”.
Considerably, the print of new money approach was to overcome increasing inflation. Later on in 2008, the President Hugo Chavez declared the new currency that eliminated three zeros. In same context, Maduro stated the country would print paper money with three fewer zeros. Although it was never into an action and resulted in increasing inflation.
Nicolas Maduro said on national TV to his economic team about renewing on the country’s failing oil sector but there were no such details for improving crude oil production.
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Image Source: Nicolas Maduro