Venezuelan President Nicolas Maduro has extended indefinitely the closure of a popular border crossing with Colombia and declared a 60-day state of emergency in several western cities as authorities attempt to reassert control in a notoriously lawless area where three army officers were shot.
Venezuela has the world’s highest inflation rate, a collapsing currency and every prospect of defaulting on its debts next year.
Spreads on Venezuelan five-year credit default swaps (CDS)—derivatives that can be used to hedge against the risk of a country or corporate defaulting—are at their highest since the global financial crisis of 2007/08, indicating heightened expectations of the government failing to repay its debts.
There are shortages of consumer goods (everything from milk and bread to beer and condoms ), and the effort required to obtain hard currency (kidnapping purebred dogs to sell in Brazil is one way).
“We have reached the limit of the aggression by armed groups, of the speculators and smugglers,” Maduro said, referring to people who buy scarce, essential goods that are heavily subsidized by the government and then sell them for inflated prices across the border.
He also complained of a mass migration of more than 120,000 of Colombians into Venezuela this year and said he would seek international aid for a humanitarian plan to cope with them.
As part of a government crackdown against contraband, the government already this year has closed the border in Tachira at night, deployed more troops and toughened jail sentences for smuggling. It also rolled out a fingerprint-scanning system to restrict the amount of any single product shoppers can buy.
In total, the government says more than 6,000 people have been arrested for smuggling in the past year and it says more than 28,000 tons of food were seized last year in anti-smuggling operations